BUSINESS SUCCESSION PLAN What is in store for the family business? Nearly three quarters of small business owners in North America will look to exit their businesses in the next 10 years. They will be faced with the emotional challenge of handing the reins over to their kids or finding someone qualified to step into their business as they hand over the reins to someone else. It is a hard decision, it is equally hard to accept that in doing so, they will no longer be making the key decisions for the business’s future as that future is in the hand of someone else to take care of and grow. Which is hard to do as more entrepreneur and business owners have built these companies from the ground up, making it very hard to let go. Finding a successor is one challenge, selling the business is another, according to research by the Canadian Federation of Independent Business these business asset transfers over the next 10 years could be potentially worth more than $1.5 trillion just in Canada alone. by Lee Ann Atwater
Small business entrepreneurs dedicate most of their life to their business and building their brand. They put all their time, savings and energy into their business for many years, so it can thrive and truly succeed, so that they can pass it on to their children to carry on the business and see it continue to grow for many generations to come. But if they want to pass the business to the next generation their children have to be interested and dedicated to running the business, if they are not then it is better to look at handing the reins of the business over to an outside party to run the business. However, finding that person is not an easy process and does require a great deal of effort. Small business drives the economy and is respon- sible for the majority of the job growth in Canada and the United States for that matter, so it is very important that these businesses remain local in order to keep people employed in their commu- nities. The key to a successful transition is for owners to start planning early, even if it’s hard to think about leaving the business now. It may not be a top priority compared with all the small and large emergencies that are a regular part of running a small business, but one of the keys to success is to have a formal written succession plan and a variety of exit strategies in order to prepare for the unexpected. The more carefully the transi- tion is planned, the higher the chances of success. And a successful handover means that jobs will be kept — and more could even be created.
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SPOTLIGHT ON BUSINESS MAGAZINE • JANUARY 2020
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