We all know about our personal succession planning and most of us have a Will to ensure the planning comes to fruition in the way we would have approved.

 

But what about succession planning for our business? Usually that planning has to produce good outcomes while we are still alive and young enough to enjoy it. We want to know that we’ve done the right thing selling off the results of many years’ hard work, often involving the whole family. Or, we’ve decided to sell the business to family or even gift it to one or more family members. The options need to be thought about very carefully and then take those thoughts to your lawyer or accountant or both.

 

Champion Legal recently hosted a seminar which drew on the succession planning expertise of three successful businessmen – Michael Shur, Brian Fine and Gerald Camberg, names associated with the Venture Group, the Athlete’s Foot and Raymond Weil Watches respectively.

 

All sold their primary business developed in Australia and as early “baby-boomers” reaching their fifties each moved into developing new interests.

 

Their styles of planning corporate after-life were quite different but equally effective. Gerald put it all on paper, studied the figures, consulted the family, looked at the options and finally decided to sell. He is our “Blueprint Planner”. Brian was more intuitive and relied on the feeling that he did not want to work in this company anymore. He put out the word that he was ready to sell and took the first good offer to come along. He held the cheque in his hand and thought what he might do with it. He knew himself well enough to know that his life had to be more of the same in Terms of Challenge and hard work, but closer to home to give more time with the family and for a little leisure. Michael was a nice mixture of the other two. All had different approaches and styles. They still do. But there are common elements.

 

All supported the notion of professional assistance. “Listen to what your lawyer and accountant have to say” was the common refrain. And all thought their spouses/partners were important in the decision to sell, not just as partners but also as women with intuitive insight. It was these special women who sounded the alarm bell if their men had not thought enough or honestly enough about what they might do after the cheque had been put in the bank.

 

All of this revealed that the big question in succession planning is “what am I trying to achieve?” Once there is a solid answer to that question, the professionals can help you achieve it.

 

There are many traps unless you have faced the future in a sensible pragmatic way. If you gift your life’s work to a family member but the company’s continued success is in effect your superannuation you will be tempted to hang around and worry or try to run the business by remote control. Either way you will annoy everyone concerned. Or you may decide to sell your business to a family member while continuing to work part-time to ensure yourself an income. It probably won’t work. We had a matter like this recently where the owner of a small business decided not to continue with the sale to a member of the family. “I realised”, he said, “that it would be difficult for us to work together.” At least he was finally clear about what he wished to achieve. 

 

You do the same and then come to see the professionals.