Just about every business owner will at one point have to step away from the daily management nitty-gritty and hand over the reins of his business to a trusted associate.
Remember, although you exit the business, there are other stakeholders like family, employees, vendors and customers who still rely on your business.
A Succession may be brought about by:
- Deceased Estate
Without leaving things to chance, starting early with a gradually managed transition will bring confidence to your employees, vendors and customers in the effectiveness of the new management.
What does the plan involve?
- Timing of transfer of Assets
- Ownership of asset by trust Deed, will, business succession agreement
- Periodic review of the succession plan to account for changing circumstances like tax law or marriage
- Minimising Capital Gains Tax & Maximise small business tax concessions
- Locating potential buyers or external management
- Analysing the potential for a management buy-out, trade sale or public listing
- Ensuring that accumulated wealth is separately and safely protected
- Ensuring that wills are set up to properly deal with the business
- Structuring life insurance policies and dealing with risk management issues
- Communication, addressing stakeholder concerns goal setting, managing obstacles
- The key elements to deliver this successful outcome are a combination of – Succession Planning, Valuation, Employee Share Ownership Plans (ESOP), Strategic Planning and Capital Gains Tax (CGT)