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The Importance of Business Succession Planning

Posted by John Bothof on Thursday, January 24, 2019

Business succession planning is an important part of operating a business, especially for small business owners and owners nearing retirement. Learn the six benefits to going through a business succession plan evaluation.

image of a business plan

Creating a business succession plan is an essential step for business owners to take when they are planning for their future. To provide the most value, business succession planning documents should be reviewed and updated every few years.

Conducting an evaluation of your planning documents confirms you are transitioning your business in the most efficient manner possible. The process begins by reviewing your objectives and results and considering appropriate planning alternatives.

At Northwest Bank, our business succession evaluation provides business owners with a confidential analysis of their current business succession plan by a qualified business planning expert. Additional benefits include:

  1. Provide for family: A business succession evaluation confirms that your business succession plan will provide full and fair value for the business interest. If planning deficiencies are identified, alternatives are suggested.
  2. Retain Control of the Business: Former spouses and children of a deceased owner commonly become unintended business partners of the surviving owner(s). A business succession evaluation can verify the business interest of a deceased owner will remain with the surviving owners.
  3. Assure Employees: A business succession plan addresses your concern for the welfare of your employees and their families. A business succession evaluation confirms that a plan is in place to continue the business and help assure employees of their future employment.
  4. Changing Business Value: The business succession evaluation process includes a detailed analysis of the current and projected business value to make certain your heirs receive fair value for your business interest and they are not left wanting due to inadequate funding.
  5. Changing Objectives: The business succession evaluation process considers current objectives to ensure the plan is designed to transfer the business interest to the appropriate party in the most efficient manner possible.
  6. Changing Economic Conditions: Recent economic changes have created challenges for businesses in virtually all industries. Your timetable for retirement may have changed. A business succession evaluation includes a review of your exit strategies to ensure your plan will allow you to exit the business when you desire.

Business owners should initiate the evaluation process with a trusted wealth management advisor. Northwest Wealth Management Advisors are ready to provide the tools and resources you need help you get started today.

Advisors represent Northwest Wealth Management, a Registered Investment Advisor and affiliate of Northwest Bank.
Not FDIC Insured | Not guaranteed by the bank or any government agency | May Lose Value

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