Although you run your small business efficiently and successfully, you may never have needed to follow many of the formal management processes that a larger company relies on. Your staff probably consists mostly of members of your family, and your business may be more of an extension of that family dynamic.
Recently, you may be feeling tired, either in body or spirit, and the idea of retiring may be more attractive as the seasons pass. Have you considered what will happen to your business if you walk away? Is there someone in the company who is ready to step into your shoes? On the other hand, are you comfortable with the idea of letting your business die with you?
What’s holding you back?
It isn’t likely that, after spending years building a successful and respected business, you would simply let it end when you retire or pass away. In fact, one of your purposes in striving so hard to make your work profitable was likely to have a legacy to pass along to your children. Still, if you are reluctant to think about a plan of succession, you are not alone. Some common reasons why small business owners hesitate to begin moving toward succession include the following:
- No one in the company shares your business philosophy.
- There is a personality conflict between you and your chosen successor.
- Your children are at odds with each other over who will take over and how they will run the business.
- None of your children wants to run the business.
- You are not ready to let go of control of your company.
Small business advocates encourage entrepreneurs to take at least three years to establish a plan of succession. If you already have someone in mind to take over, you have taken a very big step toward that goal. If not, your first task may be to begin coaching the best-qualified candidate.
Help for planning your future
Making a business succession plan for a Texas family business certainly means spending time discussing the options with your family. Advisors suggest family business owners provide their children with business training outside the home, allowing them to broaden their perspectives and widen their skill sets. Gradually, you can relinquish control over certain tasks while you are still able to assist them.
This process of letting go should not be random, and perhaps in your family meetings, your children can help you devise a methodical plan for reaching your goals. Additionally, the advice of an attorney will prove beneficial, especially when that attorney can assist you with understanding the tax and other financial implications of your decision to relinquish your business to the next generation.