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3 Factors to Consider When Planning for the Future of Your Business

3 Factors to Consider When Planning for the Future of Your Business

When it comes to ensuring the success and continuation of your business, it's important to consider a variety of factors and plan ahead. In this article, we'll cover 3 key considerations, including succession planning, the involvement of family members, hiring outside experts, improving valuation, and more. Use this guide to help you plan for the future of your business.

When it comes to the future of your business, it's important to consider a variety of factors and plan ahead. One key element to consider is the role that your individual skills, knowledge, and expertise play in the success and continuation of your business. If you or another key person are integral to the functioning of the business, it's important to plan for their succession by training an appropriate successor. Additionally, you should be mindful of any key person risks that could jeopardize your business, such as death, disability, or quitting, and consider strategies for mitigating these risks, such as key person insurance or generous retirement benefits. 

Another factor to consider is the possibility of having your children or other family members take over the business. If this is your goal, it's important to think about how this might impact your legacy goals and the equitability of your estate, especially if certain family members are not interested in continuing the business. It's also important to determine whether you plan to remain involved in the business after you sell or retire, and if so, to consider the extent of your involvement and whether it is appropriate for the continuation of the business. 

If you're planning to sell or appraise your business, you may need to consider hiring outside experts to help with the valuation process. This could include a valuation expert, business appraiser, attorney, or accountant. It's also important to review ways you can potentially improve the valuation or appraisal of your business, such as by cleaning up the balance sheet, paying off debts, or having the appropriate equipment in place. Additionally, you should consider any business assets that you wish to keep and not include in the sale of your business, as this could impact the valuation and prospective buyers. 

There are a number of other factors to consider as well, such as any pending or potential liability issues, business expenses that are significantly above or below market rates, fluctuating or inconsistent income, a small base of clients or customers that generate a large portion of your revenue, the possibility of an installment sale, and any potential disputes between business partners or shareholders. It's important to carefully review all of these factors and plan accordingly in order to ensure the success and continuation of your business.

The commentary on this website reflects the personal opinions, viewpoints and analyses of the Ascend Investment Partners employees providing such comments, and should not be regarded as a description of advisory services provided by Kesler, Norman & Wride, LLC dba Ascend Investment Partners or performance returns of any Ascend Investment Partners Investments client. The views reflected in the commentary are subject to change at any time without notice. Nothing on this website constitutes investment advice, performance data or any recommendation that any particular security, portfolio of securities, transaction or investment strategy is suitable for any specific person. Any mention of a particular security and related performance data is not a recommendation to buy or sell that security. Ascend Investment Partners manages its clients’ accounts using a variety of investment techniques and strategies, which are not necessarily discussed in the commentary. Investments in securities involve the risk of loss. Past performance is no guarantee of future results. 

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