The most important consideration after building your small business into a success, is making sure that it's preserved. There will come a time when handing over the reins of your business to a trusted peer is inevitable.
Whether you no longer feel that it's right for you to lead the company, or you simply wish to take an early retirement, having a plan in place when you leave is critical.
Here are some considerations when you begin to outline and implement your succession plan:
Treat every option equally
Many succession plans - particularly those that are centred on small businesses - will be focussed on passing the company down to the next generation of the family. Whilst this is certainly a viable option, it should be a considered choice.
You should ensure that you evaluate every possibility when planning for the future in this way. For example, if you have an employee who has been a trusted deputy for many years, they may be best placed to take over the business.
Keep in mind that long-term planning should be centred on what's best for the business and any family loyalty may have to come second in favour of continued success.
Don't leave it to the last minute
According to the Ministry of Business, Innovation and Employment, a successful business should begin planning at least two years before any succession is set to take place.
However, that is considered the bare minimum only if your successor is up to speed and already knows the business. If you're planning on having to teach someone - a family member or otherwise - the inner-workings of your business, it's recommended that any plan is outlined at least three to five years before being put into practice.
Consider your finances
It is very important to get a firm grasp of your available finances long before you actually go ahead with your succession plan. Implementing small business software such as CashManager from Accomplish is the one of the most effective and efficient ways of doing this.
If you can garner a wider outlook of cashflow in your business, chances are you'll be better equipped to deal with any hiccups that any planned succession could bring with it.