If you own a small business in New Jersey, you know how difficult it is to start a company from scratch, build a client base and sustain success. You have poured your heart and soul into your business, and it may be difficult to think of a day when you will not be running your small business. However, that day will come, and it is in your interests to plan for it now.
Succession planning is a smart step for all business owners. Even if you believe that it will be years before you step away, you can make plans now that will give you peace of mind for whatever comes down the road. Having certain plans in place means that you get the final say over what happens to your company.
What should be in your succession plan?
Every business is different, and every small business succession plan should be different as well. You can custom-tailor yours to suit your needs and goals for the future of your business. Even if you are young and healthy, having a plan in place can be helpful in case of your unexpected death or incapacitation. The following basic steps can help you understand what to include in your plan:
- Choose who you want to succeed you. Do you want a family member to have your company, or do you want a trusted employee to take over? It is best to decide on a successor years before your retirement date.
- You can start formally training your replacement, outlining this process in your succession plan. Training should be detailed and thorough.
- In your plan, you can outline your preferred timeline for when you want to step away from the business or start your transition out of the company.
- It may also help to include plans for your retirement as well, as this could closely tie into your transition plan and planned retirement date.
If you do not have a succession plan in place, you are leaving the future of your business to chance. Thorough plans significantly reduce the chance of fighting, legal battles and other complications in the future.
You worked hard to build your business, and you can decide what will happen even after your passing. Understanding what should be in your plan or how you can draft enforceable plans for your company is not always straightforward. You may want to talk with an experienced attorney about your goals and hopes for the future.