A new study shows that 85 % of small business owners, and 40% of larger (more than 50 employees) businesses don't have a succession plan. Almost half of the business owners said they hadn't started succession planning yet because they felt it was too early to do so. These figures don't surprise me, as they are very similar to the figures I found published elsewhere when I was researching my "Succession Planning Kit for Canadian Business" book.
Something I found very interesting in the report of the study was that the number of business owners who have a strategy in place for disasters or unexpected events (such as an outbreak of H1N1) has increased by 10% since 2008. I'm glad that more business owners are becoming aware of the need for planning ahead, even if they haven't quite got as far as full succession planning.
The unfortunate part of putting off your succession planning is that if an unexpected event takes the business owner out of the picture permanently - due to death or disability - the business often suffers. Sometimes it means that a business is sold at a fire sale price, or that it can't be held/run for a child who isn't quite old enough to take it on yet, or that inventory or assets devalue significantly.
Click here to read the article in the Globe and Mail.
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