It is often difficult to discuss business succession planning, particularly in a family business environment. This is often because:
It is hard to separate family and business because unlike other business, the individuals involved will always remain ‘family’. Where a breakdown occurs due to a failure to plan, not only does it often result in a failure of the business but also a permanent fracture in the family.
Clients are often confused about what is involved as part of a business succession plan. A business succession plan can include any or all of the following:
As lawyers we often find that clients are most concerned about what will happen to their family business in the event of their demise, however very few consider what will happen to the family business in the event of their permanent incapacity. A well-considered and thought out succession plan should cover circumstances of death, retirement, incapacity and possibly even the impact of relationship breakdowns (i.e. divorce and separation).
Succession plans can sometimes take several years to finalise so it is important to begin the process early. At Bailiwick Legal we take a holistic approach to succession planning. We believe it is important to work with your accountants, advisors, financial planners and bankers to ensure a robust and effective transition takes place.
If you are part of a family business and require assistance with business succession planning, please contact Karolina Rzymkowska Karolina@bailiwicklegal.com.au for more information.
Remember, failing to plan more often than not, means planning to fail.