Surely you have an exit plan for your business, don’t you?
I read recently that 2/3 rds of business owners in the UK will hit retirement age in the next decade.
Of these, only 30% have a robust, documented and communicated succession plan in place.
Are you one of them?
If not, I fear that you may fall into the same trap as my father who owned and ran a small plumbing and decorating business in St Helens for more than 40 years
He worked hard and provided for our family – we never went without. He never ever borrowed any money either personally or in his business life. He most certainly was an “old school” die-hard Lancastrian.
I have fond memories of seeing him in his office working out quotes for customers, looking after the accounting records and making sure his small team of plumbers and decorators were always kept busy.
Unfortunately, he was always his own and had no management structure in place to support him. If my dad didn’t do it, nobody did!
So, when he approached the age of 65 (yes, that used to be the retirement age back in those days) and the time came for him to wind down and enjoy life, what you think he did?
The silly old fool found himself a business partner (or I suspect the partner found him) and I gather the plan was for my dad to retire and the new partner to run the business successfully going forward.
No money changed hands and I guess that no legal documents were involved either. Like I mentioned earlier – my dad was “old school”. He trusted his new partner to keep his word.
But (and it hurts me to repeat this; particularly as my dad passed away some 5 years ago) things did not go exactly to plan.
In fact, they couldn’t really have gone any worse because in only a matter of months after “retiring” my dad became burdened with huge debts that had been run up by his new business partner – who had stripped the business bank account bare without paying key suppliers or HMRC.
By the time my dad eventually discovered what had happened, it was too late and the new partner miraculously disappeared leaving my dad (because he was still a partner and jointly and severally liable for the partnership debts) to pick up the tabs and settle all the outstanding debts from what money he had managed to save over his previous 40 years in business.
Dad did live until the ripe old age of 89 and I’m sure he enjoyed a wonderful 24 years of retirement with mum – but it could have been so much better if only he had taken advice from trusted professionals when it really mattered. They could have helped him safeguard his financial position and enhance his wealth in retirement.
Because of what happened to my dad so many years ago is just one of the reasons why I care so deeply about my clients and am passionate about doing anything I possibly can to secure their financial wellbeing; not only for the here and now but for the future too.
You can perhaps understand now why exit-planning for family businesses is one area I am particularly keen on.
If this touches a nerve with you in any way and you want to discuss the future plans of your family business with me feel free to give me a call on 01925 761600 or email me at firstname.lastname@example.org