As we enter what is expected to be the peak decade of baby boomer retirement, the recent 2018 Insights into Family-Owned Business published by the Birmingham Business Journal focused on transitions happening, and expected to happen, in family-owned businesses. The most significant expectation appears to be that many family-owned firms will be sold during this wave of baby boomer retirement. This is not an unreasonable forecast based on the number of family-owned businesses in the U.S. and the troubling reality that many owners have not planned adequately for the succession or transition of their business. Certainly, many family-owned businesses will be sold as part of a well-thought-out plan. I expect more will be sold as a result of inadequate planning.
I had the opportunity to participate in the Table of Experts for the 2018 Insights issue. We focused much of our discussion on the importance of planning for transition in a family-owned business and challenges faced by families seeking to continue ownership through generations. If you want the “CliffsNotes” version of the 2018 Insights, I would summarize the key points as follows: Successful transition, whether that means succession to the next generation, moving to professional management under family ownership or a sale of the business for the maximum return, requires total commitment, continuous planning, unwavering focus and excellent communication. Easy enough, right? We also recommend outside help from knowledgeable, experienced, trusted advisors (which should come as no surprise).
I hope you find the 2018 Insights into Family-Owned Business helpful. Please contact any of the attorneys on our team if you need additional guidance on preparing for the transition of your business.