As business owners age and reflect on their lives, they are often most proud of two things: their family and their business. Most successful entrepreneurs achieved their success through hard work, dedication, and sacrifice, and many of them want to ensure that their entrepreneurial legacy will live on after they retire or pass away. Family businesses can easily and securely be transferred to relatives when business owners work with skilled lawyers to develop succession planning.
Without succession planning, family businesses can fail or cause major rifts within the family, disturbing an often otherwise harmonious relationship. Conversations like “Dad said I would take over,” or “Mom always talked about my husband running the business” can become commonplace without thoughtful consideration ahead of time. As such, family business owners should meet with their family to discuss a plan for succession. After meeting with the family, the business owner needs to work closely with a skilled attorney who specializes in business succession planning in order to make their wishes come to fruition.
In meetings about succession planning, a business owner can discuss the terms of the succession, including whether certain people will have to buy into the business, or if the business will be gifted to certain members of the family. Timelines can also be addressed so that a business owner can ensure that grandchildren can have an opportunity to engage in the business when they reach a certain age.
Business owners who fail to create a succession plan are gambling on the future of the business, the livelihoods of family members, and on relationships within the family. These risks have major consequences, but fortunately, they can be avoided through proper succession planning.
At Baxter & Borowicz, our lawyers are highly skilled in estate planning and business law, and we have extensive experience helping family businesses stay within the family long after the original owner has passed away. If you own a family business and want to begin taking the steps to ensure that it remains vital and healthy long after you’re gone, contact us today!