It may be in your best interest to have a succession plan in place even if you don’t plan on stepping down from your Kentucky business anytime soon. This is because a sudden illness or other unexpected event could render you unable to effectively run your company. Take a look at some elements of an adequate succession plan:
Determine early who will lead the company in your absence
Ideally, you will have an idea of who would be most qualified to take over your business if anything happened to you. For instance, you may want your child, your younger sibling or a key employee to become the CEO after you retire. It is important to identify your successor as quickly as possible, as it provides more time to train this person for his or her future role.
Make sure information is readily available
Whoever is tasked with running your company after you are gone should know everything about it. This means that they will need accurate and thorough financial statements and customer lists. Ideally, whoever leads the business will have access to a team of professionals who understand how to run computer or other technical systems.
Having this information will also be critical in the event that you choose to sell the company to an outside party. Generally speaking, an outside person or company will feel better about acquiring your business if your organization has something that it wants or needs.
Think about creating buy/sell agreements
A buy/sell agreement can make selling or transferring your share of the company an easier process whether the sale is planned or occurs unexpectedly. The agreement will stipulate how much your ownership interest is worth and who can purchase it.
Going through the succession planning process today may ensure that your company remains intact for generations to come.