When talking with business owners of 60 plus years I always ask them: what have you done about Succession Planning? The most common reply is “I have a plan!”. After a few more questions it becomes apparent they don’t have a plan at all. What they are describing is the outcome they hope to achieve when the time is right.

The most important recruitment decision you will make since becoming a business owner will be the appointment of your successor. This may be a sibling or another family member who you desperately want to succeed in taking over your business. You could, unwittingly, be setting them up to fail! You will need to be able to share with your successor the key skills and attributes you developed to make your business successful. This can be challenging as many owners have trouble articulating their unique skill set. This will often be facilitated through a third-party Business Advisor.

It is never too early to start positioning your business to pass on to your chosen successor. We often refer to this process as getting your business sale ready. Getting sale ready requires a holistic business approach and can take up to 2-3 years to implement. This process needs to be completed well before you approach a business broker to sell your business. In fact, business brokers are telling us they are often being approached to sell a business that is not sale ready. They are reluctant to take on these commissions because they know they will not achieve the results the vendor is expecting. Many business owners tell us they are too business focused to do this stuff, and therefore put it to the back of their minds. You will need to learn to allocate time to working on your business as opposed to working in your business. Once again, a business advisor can facilitate this process.

Many baby boomer business owners have left it far too late to put a succession plan in place and find themselves feeling like a prisoner in their own business. Not ideal for achieving the optimum value in the sales process. I have seen business owners in tears when they realise they have left it too late.

Where to from here?

  1. Develop a plan to get your business sale ready.
  2. Develop a plan for your succession.

It is very unlikely you have done anything like this in your life. Engaging with a business advisor to support you in this stage of your journey will be invaluable.

Trevor Clark
Business Advisor
Advantage Business Ltd
Ph. 021 445433