Tips for a Successful Business Transition to the Next Generation
If you own a family business, part of your estate planning process should focus on how you will pass down your business to the next generation, be it your children or someone else.
There are, of course, some steps you’ll need to take internally within your company as well. But you should consider succession planning to be a form of estate planning.
Here are a few tips to help that planning go as smoothly as possible.
- Get started early: The earlier you start developing succession plans, the more other people working with your business have a chance to get accustomed to those plans and the more comfortable everyone will be with the transition.
- Get the family involved: Keep your family part of the planning process so everyone understands their roles in the succession and can take ownership of the transition. This also helps you to work through people’s personal feelings about your plans.
- Don’t be laser-focused on giving everyone an equal share: You have to consider what’s in the best interest of your business, not what will make your family feel good. Not everyone will be equally interested in owning or managing the business. You should also separate the ideas of ownership and management—you might separate ownership stakes, but choose one child to manage the business moving forward. Whatever decisions you make, equal is not always (or even often) best.
- Seek professional assistance: There are professionals that specialize in succession planning that can help you work through all the issues associated with such a transition. It can be very helpful to lean on them during this process.
- Give plenty of training: When you’ve got a chosen successor, give them every opportunity available for training and education to make the process go as smoothly as possible.
For more information about how estate planning factors into business succession plans, contact an experienced Tampa, FL attorney at BaumannKangas Estate Law.