CFIB States 2 Million Jobs To Be Impacted Due to Lack of a Succession Planning
According to a study by Canadian Federation of Independent Business, 40% of small business owners plan to leave their companies within five years, and 70% within the next ten years. Three-quarters of those leaving are planning to retire.
The potential impact on the economy is tremendous, with some two million Canadian jobs affected over the next five years. Unfortunately, more than 2/3 of these business owners do not have a succession plan in place, and most of those that do have a succession plan only have informal or unwritten plans.
Without a succession plan your options to retire, liquidate, or sell the business for a fair price drop dramatically. Should you die suddenly you leave the task of disposing of your assets to someone less experienced than you to decide what to do with your business assets.
Think of your succession plan as the 'last will and testament' of your business life. Find a business coach, lawyer, or adviser to help you get your plan down on paper.
July 2nd, 2006 at 5:47 pm
This is what I call thinking outside the box!
Think of your succession plan as the ‘last will and testament’.
In business thinking about what I have to achieve today, fighting the fires which need to be put out now!, with planning for next year, to next 3 years is what I thought was a succession plan.
I have heard the Japanese have 100 year business plans. (maybe there is something in that? How can thinking that far ahead really help my business now?
July 2nd, 2006 at 7:55 pm
By looking ahead to developing a succession plan you have time to train, develop, and grow your own successor. Then when it is time you can sell to the successor.
July 2nd, 2006 at 8:37 pm
I often think that business owners think of a “succession plan” as something that does not apply to them, since they probably will never “promote” someone else into their job as owner.
If we ask those same owners if they have an “exit strategy,” they may be able to see how the exact same process really does apply to them.
If an owner has acqiured an existing business, it is often easier for them to comprhend the need for succession plans and exit strategies, knowing how they got into it in the first place.
July 3rd, 2006 at 6:49 pm
I only smiled when one of my employees said the other day I’m going to own this business. I hadn’t thought of it as a strategy?
“train, develop, and grow your own successor” Interesting!
“If we ask those same owners if they have an “exit strategy,” they may be able to see how the exact same process really does apply to them” mmm I thought this was a for “life commitment”…in business is that where I need to plan and grow with the end in mind…