Transition Management and Succession Planning
Change is a complex process. We’ll help you create a plan to support a smooth transition and secure the future of both your family and your business.
You’ve invested many years in your business, and now you’re ready to explore what’s next. However, you need a succession plan to mitigate risks and manage the complex process — no matter whether you plan to transfer leadership, sell your business to a third party, or pass ownership to a member of your family.
Our advisors can help you create a comprehensive strategy that ensures you have an exit plan to transition on your terms — whether you intend to move on or move up into a new role as a mentor for the next generation. We can help you define a timeline for the transition process and create a strategy to maximize the value of your business while minimizing your tax burden. Additionally, our advisors can help determine a compensation structure for your family members and develop the decision-making frameworks you need to maintain harmony throughout the process.
Our team provides robust succession planning consulting services to ensure that both you and your family get the most from what you’ve worked so hard to create so that you can move forward together into the future.
-
An all-in-one advisor for your business
How can you make the most of your family business throughout every stage of its lifecycle? Our advisors provide support and advice from the beginning of your business journey to when you are ready to move on to the next chapter.
What's your challenge?
Mitigate risks
It's difficult to predict what the future may hold — and you need to have the right structures in place to protect both your business and your family from unexpected emergencies.
Maximize value
It is important to make the most from what you’ve created, and you need support to determine the value of your business, navigate tax implications, and develop a strategy to enhance its value.
Maintain harmony
Your family dynamics are as complex as your business — and you need support to set up a transparent compensation structure and define a decision-making process to minimize conflict.
How we help
Family transition
You need support to navigate complex family dynamics — both before and during the transition process. Our advisors can help you set up a compensation structure for your family members, create a process to resolve disputes, and identify the education they need to understand the benefits they receive from your business such as shares or dividends.
Management transition
You may be considering transitioning your family members into management positions in your business. Our advisors can help you create a decision-making structure to reduce conflict, identify the competencies your family members need to take on more responsibilities, and develop a timeline to ensure the transition occurs smoothly.
Ownership transition
You’ve worked hard to create a successful business, and now you’re ready to explore the next chapter of your life — either by selling your business to a third party or passing ownership to a family member. Our advisors can help you create financial strategies to enhance the value of your business, minimize the tax burden of a sale, or mitigate risks during the transition process.
Take the ExitSMART™ assessment
You’ve worked hard to create a successful organization. Are you building a plan to get the most out of what you’ve built?
Find out if your succession planning is on the right track with our ExitSMART™ assessment tool.
Succession Fireside Chat Series
Advisors answer your questions and address your succession struggles.
TransitionSMART™
During succession planning, there are many questions that need to be answered. Important questions that ensure you transition your farm on your terms.
Taking the TransitionSMART™ assessment is a fast and easy way to begin answering your questions.
Family Office Playbook
No two families are the same, and money creates additional complexities. MNP’s Family Office playbook provides insights to help you navigate family dynamics, address challenges, and develop a comprehensive strategy to secure the future of both your family and your business.
SMARTPro
Now that you’ve progressed into the mature practice stage of the professional lifecycle, it’s time to check in and determine whether you’re prepared for what comes next.
SMARTPro can help you self-assess the current state of your practice and develop a roadmap for the years ahead.
What’s your challenge?
Who
Three siblings shared joint ownership of a family business. Two were active in the business while one was not involved. Additionally, the siblings employed four next-generation cousins in the business who were compensated equally for their contributions despite their different work experience and educational backgrounds.
Challenge
A lack of communication about the future created uncertainty in the business. The cousins weren’t sure about their place in the future — such as whether they would continue to be compensated equally or how to make decisions together. Additionally, they weren’t sure how to resolve conflict if all four of them did not agree on business decisions.
Solution
Our advisors set up a management transition plan that would enable the cousins to practice making decisions for the business together and support open communication between family members. Additionally, we helped to create a family business constitution to outline how family members could enter or exit ownership of the business.
This constitution also outlined how family members would be compensated for their contributions and defined the decision-making process to reduce conflict. Additionally, the sibling who was not active in the business agreed to be bought out over time through conversations with our advisors.
Frequently asked questions
Business transitions can include selling the business, passing it to a family member, merging with another company, or even liquidating assets. Each type has unique financial and tax implications.
Business valuation involves various methods, such as income-based, market-based, and asset-based approaches. MNP can help you assess your financial statements, market conditions, and other relevant factors to determine a fair value.
Improving financial records, optimizing cash flow, and demonstrating growth potential can make your business more appealing. Our team can help identify areas for improvement and financial strategies to enhance your business's value.
The tax implications of selling a business can vary based on factors like the structure of the sale, the type of assets being sold, and the seller's tax status. Working with us can help you understand potential capital gains taxes and strategies to minimize the tax burden.
Succession planning involves addressing tax issues, setting up appropriate legal structures, and ensuring a seamless transfer of ownership. Our Family Office team works with you to create a comprehensive plan that considers financial stability for both parties.
Due diligence involves a thorough examination of the business's financial, operational, and legal aspects by potential buyers or investors. Having accurate and well-organized financial records is crucial during this phase.
Tax planning strategies may include utilizing available deductions, structuring the sale in a tax-efficient manner, and considering options like installment sales. Working with experienced professionals can help you find the right strategies to minimize your tax liability.
Financial risks can include disruptions in cash flow, changes in customer behavior, and unforeseen legal or regulatory issues. MNP can assist in identifying these risks and developing contingency plans to mitigate them.
While estate planning primarily focuses on the transfer of personal assets after death, business succession planning specifically addresses the transfer of ownership and management of a business while the owner is still alive. Business succession planning involves additional considerations such as continuity of operations, preserving the business's value, and preparing successors for leadership roles.
Effective succession planning is essential for ensuring the continuity and sustainability of a business over the long term. By proactively identifying and developing future leaders, businesses can minimize disruptions during leadership transitions and maintain operational stability.
Additionally, succession planning helps businesses adapt to changing market conditions, attract and retain top talent, and preserve the company's legacy for future generations.
Contact our Family Office team
Starting a succession plan for your business sooner rather than later will help you prepare for anything. Reach out to our team to explore your options further.
