Preparing to leave your business

The old adage, “businesses which fail to plan, plan to fail” is also very true in respect of succession planning. Most small businesses don’t give this much thought until it’s too late.

Over 75 percent of Australian businesses can be classified as family or privately owned. Their estimated value represents 5 times the market capitalisation of the Australian Stock Exchange.

Cliff Dawson recently spoke to the Whitehorse Business Group on small business succession planning. He spoke of the following key factors that business owners should consider when planning to pass their business on:

1. Determine why you are in business and identify a succession plan or exit strategy early on and always keep your options open.

2. Operate and run your business each day so it would be attractive to potential equity participants whoever they may be.

3. Make sure you have good systems and procedures in place.

4. Look after your employees, your most valuable asset.

5. Operate your business as if succession or transfer of ownership could happen at any time.

6. Enjoy the financial rewards from your business along the journey and set financial targets and expectations.

7. Consider the impact of taxation and seek good advice in this area.

Cliff also spoke about the key issues for a management buy in and where the business would be passed onto family. There are many issues involved and Saward Dawson has assisted many clients through the complexities. It is never too early to start planning.

Read the entire content of Cliff's speech

Published : 18 November 2007