360 degrees – Dec/Jan 2013

Martin Checketts
Martin Checketts is a partner at Mills Oakley Lawyers

Martin Checketts
Mills Oakley Lawyers

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In my experience, from an intellectual perspective, most business owners absolutely understand the benefit of exit planning and the need to take steps now to maximise value on sale. The logic behind this is obvious.

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However, the problem with business succession planning is that it is a bit like writing a will. Everyone knows that they need to do it, but it can be difficult and painful to confront what the future may hold. Combine this with the fact that there is always something more immediate and pressing to do, and the path of least resistance is simply to plough on with day-to-day business issues.

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The failure to implement a business succession plan is therefore often emotionally, not logically, driven.

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It requires an upfront investment of time and money for a return that only comes later down the track (and in some cases, many years down the track).

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It is therefore no wonder that many business owners make the right noises about succession planning but then change their mind or procrastinate.

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The challenge to all business owners is to put together a good exit strategy and then make sure they are kept accountable to implement it – an external consultant can often help with the ‘accountability’ factor.

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