According to PwC's 2017 U.S Family Business Survey, only 23% of business owners have a succession plan in place.
Whether you just launched a new company or you own and run an established firm, it makes sense to spend some time crafting a plan for what will happen to your business if or when you are no longer in the picture.
You will want to make some detailed plans for who will step in if you can no longer run your organization as a result of your passing, injury or illness.
I can understand why most entrepreneurs and small business owners shy way from this particular topic, as it involves confronting some uncomfortable realities. In fact, according to PwC's 2017 U.S Family Business Survey, only 23% of business owners have a succession plan in place.
With that being said, most experts encourage small business owners and entrepreneurs to consider these points when thinking about a succession plan for you business.
What is your company worth?
Accessing a robust business valuation report is a great place to start when looking to put a business succession plan in place. You can seek the help of professionals in this area, to tell you what your business could fetch on the open market.
With this knowledge in hand you can help navigate some of the asset-based challenges that may come up during the transfer of your company to an heir or a business partner.
During the process of valuing your business, you may come across parties to which you can sell your company should you decide to spend some time recovering from a health-related setback, or for any reason.
It helps to have preliminary conversations with these kinds of individuals so you know what your options are.
Identify an Heir
Most small business owners know, from day one, who they want to inherit their companies. For most, the heir apparent is a son or daughter. As a result, small business owners work closely with their children, grooming them for the day they take over the family business.
The son or daughter can step in at anytime to run the business. There have been discussions around their role in the company should something happen to you, the small business owner.
If this is not the case with you, then you will want to find someone who can step in and "Make things happen" if you were out temporarily or permanently. This can be your spouse or a key employee.
I would recommend having these types of discussions with them to see if they have an interest in being the one to take over the firm in your absence.