It can be challenging to leave a business you’ve spent years building. Our approach to succession planning first helps clients identify their readiness. Our advisers also assist in creating exit strategies that align with the business goals and time frames.
Succession planning consists of the logistical and financial decisions business owners must make. Decisions like who will take over when they leave the company and how that transition will go. A succession plan ensures less disruption to business operations, employees, and clients.
Exit Planning Institute (EPI) estimates that some 4.5 million firms representing more than $10 trillion in business value will transition over the next decade. In addition, the challenges of the post-pandemic economy have many business owners taking a hard look at their current financials and operational status and making decisions accordingly.
Transitioning Your Business
The Oregon SBDC assists small business owners with the succession planning process. Our services help guide planning and execution stages, including:
- Creating a documented succession plan
- Working the steps of that plan
- Maintaining and growing valuation through the process
- Keeping the company in a sellable position
- Preparing for the transition of ownership
- Doing post-transition planning
- How a Succession Plan Covers Your Business
How Succession Planning Covers Your Business
Succession planning is most commonly associated with retirement. It can also protect your business in unexpected circumstances and provide peace of mind for the business you’ve worked so hard to build.
Effective succession planning covers how your business would respond to unexpected events, including death, disability, divorce, or the decision to separate from partners; how ownership would be transferred; and how you and your heirs would be financially compensated.
As baby boomers look to retirement and lack potential buyers, building up internal leaders in key positions with high potential plays a critical role in succession planning. It is essential to look at a potential successor as a leader who is not only capable of handling the business’s day-to-day operations but can also successfully move it forward for the long term.