When a business owner in Florida thinks about the future of their company, their mind may turn to succession planning. Making these plans can be critical to keeping a firm profitable and successful for many years. However, many family business owners neglect to put a plan in place to prepare for a generational transition. Some may find it difficult to consider handing over an enterprise to their children or dealing with disinterested or squabbling family members.
According to the 2016 Family Business Survey, 43 percent of family business do not have a succession plan. However, almost 75 percent of respondents said that they planned to pass their businesses to their children. Family businesses may require a great deal of work on the part of the owner while future planning decisions are pushed off down the line. However, while people may avoid succession planning in order to prevent family disputes over the future of the company, failing to do so may lead to more complicated problems.
Public disputes or legal battles after an owner’s death or retirement can lead to a poor reputation and a loss of goodwill in the firm as well as significant expenses that can threaten the business’ future. Therefore, planning early for transition can be critical in order to achieve a successful outcome.
Business owners can carry out long-term succession plans that gradually give children more access to management tasks. By working with an estate planning attorney, a family business owner can develop a comprehensive succession plan that reflects their goals for the future.