Families that rely on the business for financial support or employment are concerned about its future - obviously.
Succession planning examines this specific situation and concerns itself with planning and action-items that are done “before” the transfer actually takes place. In this way, it is more effective, efficient and less stressful than it often would be otherwise without proper planning.
Sure some families are perfect and could handle an unexpected or even an expected, generational transfer of the family business…but c’mon, really? It is the rare bird indeed that could make this migration without losing any feathers.
Sometimes it is a fairly easy to unwittingly make decisions without fully recognizing that some heirs have sacrificed and contributed mightily to the financial success of the business. Your plans should be certain to not overlook this sometimes major item when making plans for a generational transfer of your business. Treating all of your children or heirs equitably, rather than equally, can be a difficult decision, and frankly, hard to discern.
"Discipline weighs ounces while regret weighs tons."
Poor planning can also create undue conflict, prolonged legal battles and division of business assets to satisfy those that simply want to “cash in” ….or for the tax man. There is a lot to think about. Succession planning is not a one-time transaction, but rather a process that can take years to develop successfully.
I am sure some of this stuff keeps you awake at night. These situations happen all the time and have happened for centuries. Although farmers never plan on fully retiring, let alone passing away, odds are good that someday you may not be around.