Planning Key to Business Survival 

By Dennis Goldstrand
Goldstrand Planning Group

June 2007 -- Successful business owners have invested many years in building their companies. In order to build financial security for retirement and ensure business continuation, it is important to plan ahead.

Business succession planning can establish retirement income for the retiring owner, as well as the smooth transfer of operations and/or ownership to family or another entity. In addition, a succession plan can also provide structure for unforeseen events, such as death or disability.

Laying the Groundwork: Plan early so you can develop an appropriate exit strategy and allow time to choose the right person to eventually run your business. It could take many years to identify and groom a successor to manage the intricacies of your company.

Valuate Your Business: A key aspect of planning is calculating the worth of your business. There are a variety of techniques for business valuation that a qualified professional can assist with.

Plan Your Exit Strategy: Retiring business owners should schedule their departure to ensure smooth operations during the transition, as well as facilitate the transfer of ownership.

Meet with Potential Successors If you wish to keep ownership and control within the family, you will need to assess your family members’ interests and qualifications and how well they match the needs of the business. If you expect unrelated parties to be involved, you need to meet with the key people for discussions about the company and future. If succession involves the sale of the business, be prepared to address such issues as what the purchase price will be, how it will be paid, and when the succession plan will be activated.

Other Considerations

 Develop a Business Plan for the Future

 Choose a Transfer Strategy

 Plan for Contingencies

 Funding buy-out