The importance of the family business to the United States economy continues to grow, and in a striking development, family businesses are beginning to reverse the trend of mega-businesses wiping mom-and-pop stores off the map.
The recession of 2008 provided the catalyst for laid-off workers to create home-based businesses using the Internet and a low cost website to create and sell products and services.
A buy-sell agreement is a legally binding agreement between partners or co-owners outlining what will happen if an owner dies, is forced or chooses to leave.
Business succession planning is a series of logistical and financial decisions about who will take over your business upon retirement, death or disability.
A spouse might be interested in keeping their shares, but may not have the time investment or experience to help it blossom.
A buy-sell agreement ensures they’re given fair compensation, and allows the remaining co-owner(s) to maintain control of the business.To write a succession plan, the first step is to identify the ideal successor to take over the business, then determine the best selling arrangement.This usually involves a buy-sell agreement, secured with a life insurance policy or loan.Many partnerships draft a mutual agreement that, in the event of one owner’s untimely death or disability, the remaining owner(s) will agree to purchase their business interest from their next of kin.This type of agreement can help ease the burden of an unexpected transition— for the business and family members alike.Taking these five steps now will save money and time and will help assure the continued success of your business.For more great small business articles such as The Top 25 Home-Based Business Ideas and Keeping Your Business Ideas Confidential, visit All and All Business Experts.A succession plans makes it clear who will take over the business, reducing any potential disputes between parties.If a purchase is involved, the sale price and purchase terms are also clearly outlined, relieving some of the stress for the departing owner’s family.Families today are often more complicated and less traditional than they once were.Family businesses have several other issues that work against the successful continuation of the business.