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Owners Need an Exit Plan in Addition to a Business Plan

Posted by Concannon Miller on Thu, Aug 23, 2018

When business owners start their businesses, they often create a written business plan to guide them toward success. However, many successful owners don’t mimic that process when they begin to approach the end of their business ownership.

There are three areas in which forgoing planning for the future can create unintended consequences for business owners: money, time, and successors. Consider how a thoughtful planning process (or lack of one) can affect each area.

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Topics: Succession planning

Family Business Transfers: Balancing Owner’s, Family’s Goals

Posted by Concannon Miller on Thu, Aug 2, 2018

If you’re considering transferring your business ownership to family, you might be tempted to put your family’s wants over your own goals. While this altruism may be admirable, it can also cause more problems than it solves. Consider the case of Darnell Orie.

Darnell Orie was unsure how to approach his business exit. His son, Hannibal, was the main reason why his company had tripled its revenues and profits over the last 15 years. And even though he wanted to begin winding down his own involvement in the business, he knew that he had to keep Hannibal motivated to grow the company: His retirement depended on Hannibal’s continued success growing the company.

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Topics: Succession planning

The Dangers of Transferring Your Business to Children Without Planning

Posted by Concannon Miller on Thu, Jul 5, 2018

After building a successful business, many business owners decide that they want to transfer their ownership to their children.

Too often, those owners assume that a transfer to children will go smoothly and simply, requiring little more than informing their kids of the date they’ll be taking the reins. Owners who make this assumption commonly realize that without planning, they can harm their businesses, their business exits, and their long-term relationships with their families.

Without proper Exit Planning, ownership transfers to children can produce negative consequences in three areas of your life.

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Topics: Succession planning

In Line to Take Over the Family Business? Start Preparing Now to Beat the Odds

Posted by Andrea Brady and Tony Deutsch on Tue, Jun 5, 2018

The odds are pretty staggering – only 30% of family-owned businesses succeed in transitioning their business to the second generation.

For those transitioning to a third generation, the odds are even worse – only 10% succeed.

There’s a way to beat the odds – prepare. The best business transition plans happen over many years, both to allow the next generation to learn the family business and move up the leadership ranks and also to best prepare the business financially. 

“A business needs a team of advisors to help them get through the transition,” says Tony Deutsch, CPA, MT, CGMA, a shareholder at Concannon Miller. “When developing a client exit plan, we partner with a business owner’s existing advisors, and/or bring in experienced advisors, such as Compass Point, a strategic partner of Concannon Miller that focuses on family business."

How the business is transitioned will affect the livelihood of both the current and future owner, as well as the future success of the business as a whole, so it’s important that we start early and get it right.”

Leadership training and developing financial skills are the top two skills you need to succeed in taking over your family business.

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Topics: Succession planning

Business Succession: The Two-Pronged Approach to Exit Planning

Posted by Concannon Miller on Tue, May 1, 2018

When business owners begin to think about their business exits, they tend to focus on one specific goal that they want to achieve. Some owners focus on when they want to exit, some focus on how much money they want when they exit, and others focus on the person or group that will take over once they exit.

But what’s the process that takes owners from thinking about what they want, to acting on what they want?

In the context of Exit Planning, it’s important for business owners to understand the two-pronged approach that Exit Planning Advisors take to Exit Planning. The first prong is the general prong, which focuses on a successful business exit for a business owner. The second prong is the specific prong, which focuses on the business owner’s goals and in turn defines what makes the business exit successful.

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Topics: Succession planning

Family Business Succession Planning: Steps to Starting Transition

Posted by Concannon Miller on Tue, Mar 27, 2018

The majority of North American businesses are family owned and many are facing ownership-transfer issues as more Baby Boomer founders enter retirement.

On the eve of a retirement, or following a death, family-run businesses have four basic choices. The first two involve giving up a family tradition: closing up shop or selling the business to outsiders or non-family employees.

The second two choices involve keeping the business under family control and either hiring outside managers or passing on the business to younger family members.

That final option of family succession can be difficult and not every business that attempts it is successful. Family dynamics often play a major role in the success or failure of a transition. Only a very small number of family businesses succeed in transfers to the second generation and even fewer make it to the third generation.

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Topics: Succession planning

Business Succession Planning: When Key Employees Stall Your Plans

Posted by Concannon Miller on Tue, Mar 13, 2018

An important part of a successful ownership transfer, regardless of Exit Path, is the presence of key employees. Key employees are those who have a direct and significant impact on business value, meaningfully participate in the business’ strategic future, and whose combination of skills and experience would be exceedingly difficult to replace.

Because of their role in the business, key employees can just as easily stall your business exit as facilitate it.

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Topics: Succession planning

Business Owners: How to Best Set Exit Goals for the New Year

Posted by Concannon Miller on Thu, Jan 4, 2018

With the new year upon us, many people have begun their journeys to fulfill their New Year’s resolutions. For business owners, it’s no different. Between creating goals for the business to achieve and assuring that the business keeps growing, owners will have much to consider this year.

One of the goals most commonly shared by owners is to successfully exit their businesses over the next 10 years. Most business owners have a sense of how much longer they want to remain as owners of their businesses, and the new year is a perfect time to take control of the planning that can make the future successful.

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Topics: Succession planning

How Business Owners Can Realize Their Retirement Goals

Posted by Tom Garrity on Tue, Jan 17, 2017

Most business owners dream of a business legacy and financial independence.

Many never reach their goals. But it doesn’t have to be that way.

So what’s the formula? It’s pretty basic: reduce risk, drive profit, and build a team stronger than you are alone.

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Topics: Business consulting, Succession planning

How Succession Planning Can Give Business Owners the Retirement They Want

Posted by Tom Garrity on Tue, Oct 11, 2016

The failure of successful family business owners to reach their personal goals, especially their financial goals, is not because they don’t try or care. In our experience, the main cause of failure is lack of clarity, a plan around the big picture, and a myopic pursuit of the "urgent."

There are 5.5 million family-owned businesses in the United States, comprising nearly 90 percent of all businesses. These companies comprise over half of the nation’s GDP and create three-quarters of all new jobs. Only 33 percent make it to the second generation and less than 12 percent make it to the third.  Many family business experts believe that one common cause of failure in family businesses is a lack of transition planning and preparation.

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Topics: Business consulting, Succession planning

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