A business succession plan may seem like a lot of work. But among the advantages of succession planning is your peace of mind later.
When you spend time in talent management and succession planning, you can know that you are prepared to deal with sudden resignations or personal problems that may arise. In other words, you will have a long-term strategy that ensures your company survives hard times.
If you plan on retiring, you can help your business transition without you. You can pick a successor and have time to train them effectively for taking on the company. Without a succession plan in place, your business is at risk of disruption and cash flow problems. If you own a company, you may think about creating a business succession plan when you are will writing.
What is business succession planning? A lot of people confuse business succession planning with exit planning. While these terms may sound the same, they are different.
Succession planning is about determining successors for your company when you are gone. It is about doing what is best for the business. Normally, there is time for training and developing relevant skills for the role before internally handing over responsibility.
Exit planning is about leaving your business and doing what you want to do. It is less about the business and more about you. While exit planning can include talent management and succession planning, the factors that are worked out are owner-centric; not business-centric.
Business succession planning can take some time and it is important to start the process early. Indeed, there are a lot of aspects to consider to ensure a comprehensive business succession plan.
In particular, you will have to choose a successor for your company. They will lead your business and should be someone you trust and are able to train. You can spend time with them sharing your expertise before you leave. You can choose more than one successor if this is helpful for your company. You will also have to consider intellectual property, especially during and buy-sell agreements.
This will be applicable if your business has multiple shareholders and it will be necessary to come to an arrangement as the exiting shareholder.
If you are wishing to plan for the future, it is best to seek assistance from an experienced lawyer. They are going to have the expertise to deal with all of the legal documents and make sure they are in line with local law requirements.
Having a comprehensive and well-thought-out succession plan is essential for the longevity of a business. An experienced lawyer is going to be able to guide you through the process to ensure you do not miss any important elements. This includes considering a trainable successor, buy-sell agreements, and intellectual property. In particular, family-owned businesses can ensure all affairs are taken care of so that their loved ones benefit from a good legacy.
Here at Kith & Kin Law we offer transparent fees and our Business Succession Plans starts from S$2500 nett.
Everyone has their own unique legacy they wish to leave behind. Through our purpose-driven ethos, we will help you craft out a personalised plan on how you wish to incorporate your legacy plan with your estate plan.
The process starts with a paid consultation of 60 minutes for S$175.
Meetings can be in-person or over ZOOM.
Based on what has been agreed upon during the meeting, we shall start the process in fulfilling your legal requirements.