How to Plan Your Small Business Succession
From the sole proprietor to the corporation, King & King has assisted business clientele since its inception. As business owners ourselves, we understand the amount of time spent in nurturing and growing a business. While many businesses take the time to set up a formal entity such as a LLC or S-corporation, many entrepreneurs do not have any documents in place to provide for a succession of their business in the event of their incapacity or death. And, the bottom line is that transition will eventually be unavoidable as a business owner. Unexpected death of an owner, key person, or employee can be detrimental to a business if no successor or plan is in place. We can tailor your estate plan, in conjunction with your business formation documents, to make sure your business is passed down to the right persons or otherwise disposed of at your death.
Ownership
One of the first things you need to consider when succession planning is who will take over ownership of your business. This is a critical decision, as it will determine the future of your business. You need to choose someone who you trust to run the business in your absence and who has the experience and knowledge to do so.
Governance
Another important aspect of succession planning is governance. This includes things like choosing a successor for your business, setting up an advisory board, and putting together a management team. These are all critical aspects of succession planning that will help ensure the success of your business in your absence.
Financials
Another important consideration when succession planning is your business’ financials. You need to make sure that your business is in good financial shape so that it can continue to run smoothly in your absence. This includes things like having enough cash on hand, having a good business credit score, and having a solid financial plan in place.
Employees
Another important consideration when succession planning is your employees. You need to make sure that your employees are taken care of in your absence and that they have the resources they need to continue running your business. This includes things like having a good employee handbook, having a solid benefits package, and having a plan for employee retention.
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