Planning for the future key for succession

We’ve all seen those headlines — the ones that breathlessly proclaim that a business is being scooped up by an industry giant

We’ve all seen those headlines — the ones that breathlessly proclaim that a business, once a small start-up, is being scooped up by an industry giant for mind-boggling millions.

Granted, many of those are in the tech sector, involving apps and software and such, but it does occasionally happen in other industries as well.

It’s nice to dream that maybe one day that will happen to you. Kind of like when you buy that lottery ticket and indulge in thinking about what you would do and where you would go if you really won all that money.

But like the lottery ticket, don’t count on it. Even if you are in the tech business.

For every headline-maker there are thousands upon thousands of small businesses that are never going to set their owners up for a life of early retirement luxury.

In fact, many owners may find it difficult to sell their businesses assets at all.

It’s a sticky problem that’s facing more and more small business owners in the Cowichan Valley.

And it’s affecting our communities as a whole, as well.

We’ve likely all had the experience of seeing a beloved business that we once patronized close its doors.

It’s a sad occasion.

Part of it is just demographics. Business owners looking to retire now are largely baby boomers, a big bulge in the population graph. There are simply just not as many people coming up behind them to slide into their shoes.

And those in the younger generations are also often plagued with debt and unable to pay outright the lump sum you want, or even need to get, for your business.

As you can see in today’s front page article by Lexi Bainas, getting bank loans to go into business is no simple matter, either.

Traditional and straightforward transactions between owner and new owner face many challenges.

So perhaps it’s time to look at some not-so-traditional arrangements.

And start looking at them years before you’re ready to head into retirement.

Perhaps it means taking on an employee or partner and grooming them to take over.

You may not get a lump sum payment for your business this way, but over time the new owners can pay you back, and your business, which you put so much of your heart and soul into, remains intact.

Whatever you choose, the message is that you need to make a plan for the future. The sooner the better.