Business Succession Planning
Your dedicated lawyer will help you through your business succession planning and implementation
Succession Planning Services
Want to retire from your business but ensure that your reputation is protected? Considerable preparation and careful consideration over who will take over control of your business will be required. This will ensure that when you retire or in the event of your death, your wishes for your business are carried out.
The key to a stress free retirement is to plan for the succession of your business early. This gives you plenty of time to adjust the business structure if need be, to recruit others or grow and upskill current staff to eventually take control of your business and to plan for your own exit and retirement.
Why choose Goughs as your succession planning lawyers?
At Goughs, we understand that every business is unique and that entrepreneurs pour their heart and soul into building successful enterprises. Business succession planning is not only about passing on the baton but also about safeguarding your business’s stability and preserving its core values. It provides peace of mind, knowing that your hard work will continue to thrive even after you step down.
By taking proactive measures now, you can minimise potential disruptions and uncertainties that might arise during leadership changes, ensuring that your legacy lives on and your employees, customers, and stakeholders are protected.
Our experienced team of succession planning experts is dedicated to tailoring comprehensive strategies that align with your business’s specific goals and objectives. Our approach involves a systematic and collaborative process to identify, develop, and groom the right candidates for leadership roles, whether they are within your company’s existing talent pool or external candidates.
What is succession planning?
Succession planning is the process of identifying and developing individuals within an organisation who have the potential to take on key leadership positions in the future. It is a proactive approach to ensure that a company has a smooth transition of leadership when current leaders leave their roles.
The primary goal of succession planning is to prepare a talent pipeline that can effectively fill critical roles when they become vacant, reducing disruptions and ensuring the continuity of business operations. It involves a strategic and systematic approach to identify, assess, and develop high-potential employees to take on greater responsibilities.
Succession planning breakdown
Prepare a talent pipeline
Reducing disruptions
Continuity of business operations
The different types of succession planning
There are a number of different routes you can go down when planning who to pass your business on to when you retire. Our friendly team of solicitors will talk you through each option in detail in order to help you decide which works best for you and your business.
Passing your business to an heir
For many small or family-run businesses, a popular option is passing your business onto one of your children or other trusted family members. This can not only preserve your company’s original ideals but also instil a strong sense of confidence in the organisation’s future.
Passing your business to a family member can also be a strategic way to establish generational wealth. If the family business is performing successfully, you can pass it to your child, who can one day pass it onto the next generation (and so on). This cycle ensures that each succeeding generation can reap the financial benefits and opportunities associated with a successful business, creating a legacy that endures through time. Clear communication across the family and proper legal agreements are key to the success of an heir-based plan, in order to avoid potential disputes.
Selling your business to a co-owner or existing employee
Where there are multiple owners of a business, a viable succession planning option is to transfer ownership to one of the co-owners. Where your business doesn’t have shared ownership, you could also sell your business to an existing employee. This means that your business will be left in the hands of a trusted colleague, dismissing any worries about capability and skill.
The initial step in this process involves determining the equitable value of each ownership stake. In cases where a company’s stocks are publicly traded, the share price becomes the basis for valuation. For privately-held businesses, a comprehensive business appraisal is conducted to ascertain the value. Armed with this valuation information, the two co-owners can engage in negotiations to agree on the precise sale price for the ownership transfer.
Selling your business to an outside party
An alternative approach for business succession planning involves selling the company to an external party. This option includes potential buyers such as investors, competitors, management firms, or any interested party. Opting to sell to an outside entity can be an attractive choice for business owners who wish to step away from the company entirely.
The process of selling to an external party begins with conducting a business valuation, which can be accomplished using various methods depending on the ownership structure. Once a suitable value is established, the business owner can proceed with finalising the sale of the company to the interested party. This path offers a viable opportunity for business owners to transition away from their business while ensuring its continued growth and prosperity under new ownership.
Speak to a solicitor
Whether you are looking at retiring or you have some questions that you would like a solictor to answer, we can help. You can call, email or come into one of our seven offices.
Call us
With seven offices around the South West of England, we have multiple offices you can call.
Email us
If you would like to drop us an email you can on info@goughs.co.uk
Visit us
With offices in Calne, Chippenham, Corsham, Devizes, Melksham and Trowbridge, you can pop in and see us. View office locations.
Benefits of Partnering with Goughs
Preserving Your Legacy
Your hard work and dedication deserve to be preserved for the long term. We help you craft a succession plan that protects your legacy and ensures your company’s values continue to be upheld.
Minimising Disruptions
Properly planned and executed succession strategies reduce the risk of disruptions and maintain operational stability during leadership transitions.
Identifying Future Leaders
Our talent assessment and development programs help identify potential leaders, ensuring a skilled workforce ready to take on key roles when the time comes.
Enhancing Business Value
A well-prepared succession plan can enhance the value of your business, making it an attractive proposition for potential investors or buyers.
Compliance & Legal Security
We stay up-to-date with the latest regulatory requirements, ensuring that your succession plan is legally sound and compliant with all relevant laws.
Business succession planning FAQ's
Business succession planning is the process of preparing and transitioning a business to new owners or leadership, typically when the current owner(s) retire, sell the business, or face unexpected circumstances. It involves identifying and grooming successors, defining exit strategies, and ensuring the smooth continuation of the business.
Business succession planning is crucial to ensure the long-term viability and continuity of a business. It helps minimise disruptions during leadership transitions, preserves the company’s value, and protects the interests of stakeholders, employees, and customers.
It is best to start business succession planning as early as possible, preferably years before the intended transition. This allows ample time to identify and develop potential successors, address any challenges, and implement the necessary changes gradually.
Key steps in business succession planning include:
- Identifying potential successors and assessing their readiness
- Developing a comprehensive exit strategy
- Creating a detailed succession plan outlining roles, responsibilities, and timelines
- Evaluating the company’s financial readiness for the transition.
- Obtaining professional advice from lawyers, accountants, and business consultants
Choosing the right successor involves considering factors such as their skills, experience, leadership abilities, alignment with the company’s vision, and commitment to the business’s long-term success. It may also involve training the chosen successor.
Business succession options include:
Family Succession: Passing the business to a family member
Internal Succession: Promoting an existing employee to a leadership position
External Sale: Selling the business to an outside buyer
Employee Stock Ownership Plan (ESOP): Transitioning ownership to employees through a trust
Liquidation: Dissolving the business and selling off its assets
Family dynamics can be complex during business succession. Open communication, setting clear expectations, and involving a neutral third party can help navigate potential conflicts and ensure a smooth transition.
Advisors, such as lawyers, accountants, and business consultants, play a crucial role in guiding business owners through the succession planning process. They offer expertise, help with legal and financial aspects, and provide objective insights to make informed decisions.
Business succession plans should be regularly reviewed and updated, especially during significant changes in the business or family circumstances. It is advisable to review the plan annually and make adjustments as needed.
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L C, Devizes
Our Wills were dealt with efficiently, we have already recommended your firm to our daughter and husband. Absolutely brilliant – thank you.
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Everything was completed professionally and within my tight time scales. I would like to say thank you and would definitely go back to Goughs should I need help in the future.
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Why work with Goughs?
Local since 1882, with an excellent reputation
First-class, effective service
Largest solicitors in Wiltshire
Seven offices throughout the county
Nationally accredited law firm
Recognised by Legal 500 and Chambers & Partners
