Waves of retirements of small business owners is set to expose our economy to yet another risk. Ownership succession planning is apparently sadly lacking. Since this CIBC World Markets report I’ve read others which highlight the same dilemma, and it got me wondering – why is this so sudden an issue? Why is this such a blind spot in entrepreneurial thinking?
Forget retirement. What about the fact that when you run your own business, you could drop dead at any time in your cycle of life? What was the financial advice you sought at the front end? For example, you would think as a self-directed person who chose to incorporate, one of the first questions a darn good lawyer and accountant would advise you was to write your will and P.O.A’ s to consider that “final exit plan”.
OK call me naïve.
But in an interview the other day I heard a small business owner say (paraphrasing) “I hoped by building my business I was creating my own retirement plan.” Say what? He continued, “I planned to keep going for another 10 years but the value of my business is diminishing and I might have to work longer before things improve. This wasn’t the vision I had for being able to retire.” Say what?
If you were really “working on your business” not “in your business” perhaps one of your true business skills would be to have the foresight to strategize on an ongoing basis for succession, sale or surrender.