Business Succession Planning: Navigating What’s Next for Your Company and Family

Imagining Life After the Business

Whether you’ve owned your business for decades or just a few years, stepping away from something you’ve poured your heart and soul into can feel overwhelming. It’s more than just a company – it’s your legacy, your family’s financial security, and a huge part of your identity. You might find yourself wondering: what comes next? While the idea of creating a succession plan may seem intimidating or even unnecessary right now, it’s one of the best ways to protect what you’ve built and ensure a smooth transition for your business and loved ones. 

Why a Succession Plan Matters

At its core, a business succession plan is about protecting what you’ve built and ensuring its future success – whether it’s transitioning to family, preparing for new ownership, or ensuring continuity in unexpected situations. A strong plan does three essential things: 
 

• Maximizes the business’s value
• Prepares the business for a smooth transition to successors or buyers
• Mitigates risks that could threaten the business’s future

Succession planning is about creating a roadmap for the business’s next chapter while securing your family’s financial well-being.

Building the Right Team

Succession planning isn’t a solo endeavor. Much like hiring key employees to grow your business, assembling a trusted team of advisors is crucial for success. At minimum, you’ll need:
 

• A CPA to manage tax implications and valuation
• An attorney to handle legal documents and ownership transfers
• A wealth manager to ensure your personal financial security post-transition

Equally important is having someone to keep you motivated – whether that’s a mentor, friend, or advisor. With the demands of running a business and maintaining family life, it’s easy to lose focus. Having a reliable team can make the process smoother and more productive.   

Taking the First Step

Starting a succession plan can feel overwhelming, especially without all the answers. But perfection isn’t the goal—progress is. Start by consulting your CPA, attorney, or banker. They’ll help you draft essential legal documents, assess the business’s valuation, and start tax planning. Over time, your plan will evolve into a comprehensive strategy.  

Planning for Multiple Owners

When two or more people own a business, then more variables are at play for its future, making succession planning even more critical. A health event, divorce, or even a conflict between partners can cause one to depart the business. Establishing clear roles and agreements early in the partnership will reduce headaches down the line and ensure a seamless transition in case of ownership changes.

Key Considerations for Every Plan

While no two businesses or owners are alike, there are several factors that can affect almost every succession plan:

Your Personal Finances. Consider your lifestyle, retirement goals, and the expenses tied to your business. Work with your CPA and wealth advisor to determine what’s financially feasible and align your plan with your personal needs.  

Adding Value to The Business. If you plan to sell, maximizing the business’s value is essential. Improvements like upgrading facilities, streamlining operations, or diversifying product lines can make a significant difference. These changes take time, making early planning critical.  

Timing. As with so much of life, timing is crucial. Economic conditions, market demand, and the readiness of your successors all influence the timeline. Preparing early ensures you can act strategically when the time comes.  

The Family Factor

Merging family and work together can get complicated. Balancing familial relationships with professional decisions requires openness and clear communication. Start conversations early and, if needed, enlist advisors who specialize in family business transitions to mediate sensitive discussions.  

Lessons Learned

Kathryn Diminich, a seasoned Wealth Planning Advisor, shares three critical insights for business owners embarking on succession planning.

Start now. You don’t have to have all the tough decisions finalized to get started. Agonizing over whether you’ll sell or who will take over will only cause procrastination and more trouble down the road. Taking the first step is easier than you think; begin with what you know and refine the plan as you go.

Be open to getting help. A good consultant or advisor can give you an honest assessment of your business and provide actionable advice. Their expertise can add value to your business and ease the burden of planning. 

Remove the emotion. Separating personal feelings from the future of something you’ve spent decades building isn’t easy. But if you can keep emotions out of the decision process, your business and your family will have the best chance for long-term success.

How SouthState Can Help

At SouthState, we understand the intricacies of succession planning. Our Wealth Managers collaborate with CPAs, attorneys, and financial planners to help business owners create personalized plans. From your first business account to planning for retirement, we’re here to guide you every step of the way. Together, we’re banking forward.