Your business is at the top of its game, and retirement is the furthest thing from your mind. It’s taken you a lifetime to build your practice into what it is, and you couldn’t imagine handing the reins or your book of business over to someone else. It’s the sign of a true entrepreneur.
Trust me, I know exactly how you feel. I identify with and respect your work ethic, and I know you prioritize your clients’ needs above even your own. Ironically, this characteristic is exactly why you know you need to imagine the future of your business.
Here are four reasons why now is the time to create a succession plan.
1. You’ll gain freedom and peace of mind.
Even if you’re not actively thinking about retiring, it’s in the back of your mind, gnawing at your subconscious. If you allow yourself to entertain the idea of life after you, you might find that creating a plan gives you a sense of relief. It doesn’t mean you’re ready to step back from the business. On the contrary: it means you’re all the more dedicated to its success. And adding this layer of stability frees you up to think about the present.
2. You can start to recruit people you trust and develop their skills.
The more time you have with your protégé or leadership team, the better. You want the journey through the ranks of your company to be organic, a learn-by-doing process. Time makes this possible. If you’re thinking 10 years ahead, you have the chance to groom your replacement as well as the team that supports him or her. Your new leader will have time to advance naturally into increasingly challenging roles with an increasingly broader scope, molding him or her into a stronger leader who truly understands the business and how to move it forward.
3. Your practice base may be near its peak earning years.
If you’re considering selling your practice, now might be the ideal time for valuation. You’re established, your client base is strong, and you have proven your growth potential – all factors that lead to a higher bid. Pursuing valuation doesn’t mean that you have to sell right away or retire early. In fact, it gives you more time to find a buyer that’s passionate about your business and values your employees. And not all buyers are operating on the same timetable. Some might want time to becoming familiar with operations and would welcome your desire to remain in charge. For example, you could sell your stake gradually to this potential buyer or even change the financial structure completely. You’ll want to consult your money team [hyperlink to Money Team article] to help guide you, but I’m confident that you have more options than you realize.
4. Planning ahead best serves your staff and clients.
As I mentioned before, you want to consider the welfare of your clients and your employees. These two groups are probably the reason you’ve avoided thinking about retirement. You feel guilty as if you’re abandoning people who have been loyal to you. But if you act now and start working through a succession plan, you’ll have plenty of time to choose the right buyer or build a strong team. Doing that will provide the best future for clients and employees and ensure they’re taken care of.
It’s never going to feel like the right time to start thinking about succession planning. But one thing is for sure: the sooner you start, the smoother the transition will be.