Succession planning is all about clarifying the future of your farming business. Learn what you need to begin your succession plan and how we can help!
Succession planning is all about clarifying the future of your farming business. It is vitally important, yet all too often avoided until it is too late and forced to come to the forefront.
In research from Let’s Talk Succession, it was shown that less than half of all those interviewed have a succession plan. Protecting the business, assets and the interests of all individuals involved are key reasons this kind of plan is essential for every farm. With that being said, we understand just how challenging discussions like this are. Particularly with family businesses, it can become very emotionally taxing and there truly is no one-size fits all approach.
Your succession planning should be as unique as your business is. Its not all about retirement either – Sharing knowledge, skills and wisdom with the next generation is vital in case of unforeseen circumstances that may arise, accelerating the succession.
The first step is to start having open conversations with
everyone who is involved and will be affected by the future plans. Partners,
employees, family should all be part of the discussion and listening is essential.
Its much better to have these conversations earlier, as it helps to mitigate
disputes later on. It also means all parties understand the expectations and
goals moving forward. Bringing in external advisors is often beneficial here –
With a wealth of experience around succession planning, an advisor can not only
give expert advice but maintain an objective view throughout. Asking you the
right questions, helping you to implement the processes you need and
establishing the true position of all involved. They will also take particular
considerations to issues around estate planning, taxes and business finances.
A comprehensive plan is undoubtedly the best way to minimise
difficulties and stress, so what should it include?
How the assets of the business are owned
How each individual wish to benefit from the business?
What parties are occupying the land and
buildings on the farm, and what arrangements are in place around this
The long-term plans and goals currently in
place, along with those of the future decision-makers
Requirements or aims to diversify on the farm
Plans for training and mentoring the future
leaders, and how and when you will begin to step back from the business
Possible implications on tax from the future
plans or succession, which have unexpected consequences
As we have laid out above, it’s never too early to start these open and honest discussions, however succession planning is not a simple process. Independent and competent advisors play an essential role in formulating a plan that considers all parties involved and the financial implications faced. Contact us today to start discussing your business’ succession plans and how we can help.