Alexandria Business Succession Lawyer
The owners of family businesses face a multitude of legal challenges when passing business assets from one generation to the next. With far too many Alexandria businesses failing to thrive after a change in ownership, it comes as no surprise that sound business succession planning can play an integral role in continued success.
Confident planning can help a new owner avoid future pitfalls that may compromise their business. With the assistance of a skilled Alexandria business succession lawyer, an established legal plan can be drafted to protect one’s unique interests. A practiced trusts and estate attorney can help evaluate your specific circumstances to determine what could work for you.
Important Facts on Business Succession Planning in Alexandria
Business succession planning involves the transition of management and ownership of one’s business and the tax implications that follow. These plans can vary greatly, depending on the objectives of the owners and a variety of other factors including:
- Determining the value of a business
- Establishing sound guidelines for the transfer of assets
- Creating a limited liability company (LLC) or limited liability partnership (LLP)
- Drafting buy-sell business planning agreements
- Minimizing taxes and other liabilities
- Establishing a retirement plan for the business owner
According to a study held by the Family Business Review, statistics confirm that succession remains a problematic issue for today’s family businesses. With 30 percent of family firms surviving the transition to the second generation and only 10 percent making it to the third generation, new multilevel approaches need to be taken to improve this transitionary phase.
There are several points to keep in mind when considering a succession plan. One lies in envisioning whether the business should stay in the family, who likely already understands and knows the brand. This invaluable experience and knowledge may provide continuity despite a change in leadership, but it may be wise for owners to check with family members before a designation is made to ensure the same passion and desire is there.
Common Issues of Not Having a Plan
Companies cannot survive without a competent owner or manager at the helm. In the event of an abrupt retirement, illness, or death, companies are often left scrambling to find a feasible replacement. This tumultuous transition is likely the result of not having a proper succession plan in place.
Moreover, a lack of a succession plan can lead to family disputes between siblings and other relatives due to the owner’s stake being passed on to shareholders, relatives that are part of the estate, or a combination of the two. Members who have been more active in the daily operations of the business may feel like they are entitled to larger shares.
Without prior planning, owners may face the risk of employees leaving due to the fear of instability or misguidance. Additionally, remaining shareholders may not have the resources needed to purchase the shares of the existing shareholder, which can lead to disputes, delays in the process, and even a loss of assets.
Speak with an Alexandria Businesses Succession Attorney
Business succession plans can be tailor-made to fit any type of business model and address a variety of concerns and issues. With so many factors to consider, it is essential to contact an Alexandria business succession lawyer who can help you draft a succession plan that facilitates a smooth and seamless transition. To learn more, call today.