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The idea of handing off your business can be stressful and scary, but with the proper planning, you can set your business up to succeed. Especially in a family business, where you have sat at the helm for the entirety of its existence, a succession plan is not only a good idea; it is crucial to the further success of your business. At Precision Financial Services, we can help you walk through the steps of creating a business succession that will be healthy and comprehensive. Let’s look at some of the steps that are involved in creating a business succession plan.  


Choosing the Successor

Determining the individual who will take over the leadership of your company is an essential step in business succession planning. Making a good choice in this department will help ensure that your business will succeed well into the future. The process of selecting a successor should begin well before your intended retirement. It is important to weigh the candidate’s leadership skills with their potential long-term effects on the business as a whole. For family businesses, it can be a good idea to look at objective third-parties to fill this role as to avoid the emotions and potential favoritism that comes with family members.


Gather the Details

Many small details go into the everyday operation of a business that it is easy to take them for granted. These details could include logins, filing locations, financials, and other company data. It is important that you spend time gathering all of the necessary information into one place for your potential successor. This work on the front-end will help the transition go as smoothly as possible.


Set Time Frames and Training

Some people say the correct amount of time to create a succession plan is three years, and others say fifteen. It is never too soon to start looking at the future of your business. When beginning the process of business succession planning, be sure to set a time frame for your retirement that will help keep you on task and motivated. During this process, you should also set up and begin any potential training sessions with your successor so they will have the skills and information they need to flourish in their new role.


Ensure Your Own Estate Plan is In Order

During the process of preparing your business for its next stage, you should also be preparing yourself for the next stage. A crucial piece of business succession planning is planning your retirement. By putting forethought into your retirement, you will have an easier time letting go of the business and handing over the reins. Don’t forget about your future in the shuffle!