After years of growing their business, one of the biggest challenges for a business owner is to ensure the business moves forward after their exit.
In consulting with owners of small businesses, we have found that many do not have a succession plan and are not prepared for retirement or for their exit from the business.
As a business owner gets closer to retirement, a succession plan is more urgent. Ideally the succession plan should begin at least 5 years before the goal retirement date.
Transferring the business to a family member may require coaching for the family members and leadership development for the next generation of leaders.
Selling to an existing key leader in the business or to a third-party will demand strategies for an optimal sale. These strategies work best with years to allow for preparing for this transition stage and for the most beneficial outcomes for everyone involved.
The goal for succession planning for owners of small businesses and family businesses is usually to transfer ownership upon retirement. Below are the more common ways for transferring ownership:
Transferring ownership to a family member or an existing internal leader is a different approach than selling the business to a third-party.
The current owner has a responsibility to prepare the next generation, to develop the leadership skills they will need to run the business. This will likely take years of coaching and mentoring as the successor learns to navigate and develop an understanding of the intricacies of the business.
There are several key steps necessary to create a comprehensive small business succession plan, such as documenting standard operating procedures, valuing the business, assets, and properties, and understanding options for funding for the successor.
The exiting owner will benefit from the advice of different specialized professionals, such as a CPA, attorney, or commercial lender.
Because we have years of experience working with a myriad of professionals, we have built a broad network of professional service resources, and we are happy to make those connections for our clients.
Excelerant offers executive advising for owners who are ready to create a succession and exit plan, whether the retirement date is next year or 5+ years in the future. We support the owner in achieving his/her goals for the transition of ownership.
This process is designed to strategize and identify all of the options, issues, and conditions of satisfaction for the exiting leader.
Succession planning with Excelerant’s executive advisors is a thoughtful, planned approach for transitioning to the next leader or selling to the next owner.
Excelerant is an award-winning leadership development and human resources consulting company based in Lafayette, Louisiana. Using a unique approach, Excelerant combines expertise in training, coaching, human resources, and facilitation to solve problems with practical, executable solutions that deliver high-impact, sustainable results.