Succession Planning Process – Business Structuring
Business structures and agreements have a direct impact on taxation, ownership control, transfer tax on gifts and estates, and shareholder access to cash flow, They also protect you by helping you achieve desired outcomes with partners, family, and key managers. Understanding how business structure affects the succession planning process is essential to a seamless transition.
Why Is it Important?
- Drives business success and longevity. Outlines details relating to corporate structures and agreements between directors, owners, and key managers.
- Avoids disagreements or differences of opinion. Appropriately designed, communicated, and coordinated stockholder, operating, and partnership agreements protect you from disagreements that can handicap the attitudes and enthusiasm of shareholders.
- Provides greater protection of your goals. Well-thought-out and documented business agreements provide greater certainty your expectations as a business owner will be fulfilled.
- Creates formal compensation and incentives. Employment and golden handcuff agreements create incentive compensation opportunities helping to drive performance and career commitment of key managers.
Download the Business Structuring section of our Succession Matrix® guide.
See how your business compares to best practices in our printable guide complete with worksheets and additional insights.
Symptoms of a Business Structuring Problem
- No deadlock break mechanism in place
- Lack of or unclear employment agreement
- Lack of or unclear non-compete agreements between key leaders in the organization
- Inflexible business structure and or agreements impacting the business’ ability to grow or achieve the owner’s vision
Click the following link to read Dan Iosue’s post on the Multi Unit Franchising’s website titled: Business Structuring – 5 Steps to Help You Protect Profit and Performance
What are the issues impacting the value of your business?
Contact us to schedule a Phase I diagnostic assessment of your business to find out.