There are around 563,000 small business enterprises in New Zealand – also known as SMEs. That is a whopping 97 percent of all Kiwi firms. These firms employ around 28 percent of our workforce and contribute to over a quarter of our gross domestic product (GDP).
Pretty important right?
If you’re one of those Kiwi businesses, have you considered what would happen if you lost a key member of your staff who was critical to your business operation? And, as the business owner, do you have a plan in place for yourself to transition out of your business when you want to move on or retire?
Research carried out by Xero found that three out of four Kiwi business owners are counting on the funds they will get from selling their business to set them up for retirement. Yet, a staggering 30 percent of business owners surveyed said they did not believe their business would survive without them, and even more concerningly, 47 percent don’t even have an exit plan.
Businesses that have a robust succession plan are much more likely to survive and much more likely to be purchased when up for sale. An exit plan will also help to ensure your employees are looked after and impacted as little as possible by any transition.
Our business advisory services can help you put together the best plan for your business. Here are the key steps:
- Identify key positions
- Identify potential successors
- Determine the development needs of potential successors
- Consider when the potential successors might be ready to take over
- Obtain an ongoing commitment from the potential successors to the path the business needs
Our own succession plan at Aspiring Law
At Aspiring Law, we’ve got our own succession plan so that when the time comes for team members to move on to new adventures it’s a smooth transition.
Some of you may be aware, in the next few years, our wonderful co-founder Mike Toepfer, is going to be starting a new chapter in his life and new adventures.
To help plan for Mike’s departure, we’ve been busy building a robust team of lawyers and legal executives to support the clients he works with directly. Each client has more than one team member assigned to assist them with their legal work, and Mike’s support crew will be taking on more of a leading role over the coming year.
This way, each client gets to know who else in our amazing wider Aspiring Law team can help them. Taking some simple steps can help ensure the continuity of your business and create some great opportunities for other team members too.
Our team approach is just one of the building blocks in our wider business plan. The key is to get all your building blocks in place with a plan that works for you. Come and have a chat to us if you’d like to put your own business succession plan in place.