In several prior posts on March 19, 2010, February 23, 2010, November 6, 2009 and July 2, 2009, I emphasized that a business succession plan is critical for most closely held businesses. Yet according to an article last week by Marcia Pledger in the Cleveland Plain Dealer, fewer than 30 percent of small business owners have any kind of succession plan. That is according to Bob Nemeth of the consulting firm of Apple Growth Partners in Independence, Ohio.
There are all kinds of reasons that small business owners never get around to focusing on business succession. One of the principal reasons is that they are simply so busy with day to day business operations; and there is frequently inadequate time for long term planning.
Over the years I have helped many clients with business succession planning, and I have found that there are numerous benefits that clients do not even expect. In addition to getting a solid plan in place, the succession planning process often helps focus the business owner on a variety of other matters that may not have received adequate attention including:
- key person life insurance
- personal estate planning
- updating corporate records
- strategic planning for the business
- a variety of other matters that simply have not been focused on in many years
Perhaps most important of all, getting some sort of business succession plan in place can bring great peace of mind to the business owner. This is one of those “priceless” benefits of the planning process.
This post is just another reminder that the time and effort involved in business succession planning can pay huge dividends for a closely held business owner.