What Should Small Business Owners Know About Succession Planning?

succession, DuPage County bueiSuccession planning refers to passing on ownership or leadership roles in a business. If you are a small business owner, proper succession planning can help you avoid many of the negative consequences of a sudden change in ownership or management. Even if you do not plan to give up ownership in the immediate future, it is never too soon to get started on a business succession plan. Once you are ready to move on to a new business venture or retire, the plans for selling or passing on the business will already be started. Ideally, succession planning should be an ongoing process that is updated as your business changes and grows.  

Hire Employees Capable of Taking on Leadership Roles

Sometimes, a business owner wants to keep a business in the family. He or she may have an adult child or other relative that he or she hopes will eventually take over the business. However, passing the business to a family member is not always be the best option. It is also possible that the intended recipient of the business decides that he or she does not want to be a business owner. This is why it is crucial that business owners hire employees who are capable of filling leadership roles as they become available.

Choosing an employee as your successor is not the right choice for everyone, but it does come with certain benefits. If your successor is an employee, you will have time to properly train him or her and set the business up for success—even if this success occurs in your absence. Furthermore, if employees know that there are opportunities for advancement and even the chance of being an owner, they will be more inclined to put in the maximum effort at their current jobs.

Be Proactive Instead of Reactive

It is an upsetting possibility to consider, but have you ever considered what would happen to your business if you become seriously ill or passed away? There are some situations in which succession planning is obviously necessary, such as when an owner or manager is planning to retire, but sometimes an unexpected event forces the need for a change in leadership. Proper succession planning will give you the peace of mind that even if something happens to yourself or a valuable member of your team, your business will not be left without a leader.

Contact a Wheaton Business Succession Attorney

Succession planning is not only about choosing a successor but also developing a business that will be able to run smoothly even when major changes take place. For dependable legal guidance regarding succession planning and other business needs, contact a knowledgeable DuPage County business lawyer from Stock, Carlson & Duff LLC. Call our office at 630-665-2500 and schedule a confidential consultation.

 

Sources:

https://www.investopedia.com/terms/s/succession-planning.asp

https://www.sagepeople.com/about-us/news-hub/succession-planning-strategy-effective/

Why Does Wording Matter in Business Contracts?

wording, Wheaton business contract lawyersMost people were taught at a reasonably young age to be sure to read anything they sign, especially documents that create a contractual relationship. If you own a business, you probably realize the importance of doing so now more than ever. The reason is simple: the wording of your contracts matters a great deal. Moreover, the way that a contract is worded is crucial to the enforceability of the agreement. One misunderstood clause or provision could cost your company thousands of dollars, and the contract might not be enforceable in the way that you understood it to be.

How Poor Wording Can Cost Your Business

Nearly all business transactions are guided by some type of contract, including those between you and your suppliers, your clients, and even your employees. The reality is that poor wording or confusing language in a contract can put your company at risk in just about every way you can imagine. You could face legal action for failing to meet your customers’ expectations. You could find yourself on the short end of deals with your suppliers. You could even be facing wrongful termination lawsuits and other litigation related to your employees.

Key Elements of Business Contracts

Each contract is going to be different, as various types of contracts are used to serve specific purposes. For this reason, you should work with a qualified business contact attorney before signing any agreement with a partner, distributor, supplier, employee, customer, or client. This can allow you to be sure that the wording of the contract does not put your company at risk and that you did not overlook any elements that should have been included in the contact. Such elements may include, but are not limited to:

  • Clear verbiage in simple language to reduce misunderstandings;
  • A section that defines the terms as they used in the agreement;
  • Warranties, limitations, and exclusions that are applicable to specific products or services;
  • Limitations on liability or liability exclusions, as appropriate;
  • Provisions on how disputes regarding the contract;
  • A provision that releases both parties from the contract if unforeseen circumstances should occur; and
  • All relevant details about the services and products, such as pricing, payments, interests, and penalties.

Contract Review Is Crucial

Whether you have drafted the contract yourself or the contract was drawn up by the other party, you should always have it reviewed by your lawyer before you sign it. Your attorney can help you identify possible areas of concern and can propose changes that might need to be made to protect your best interests.

Call a Wheaton Contract Lawyer for Help

At Stock, Carlson & Duff LLC, each of our attorneys has over 40 years of legal experience, and we are equipped to help you with all of your business contract concerns. For guidance with drafting a new contract or to have a contract reviewed, contact an experienced DuPage County business lawyer at our firm. Call 630-665-2500 for a confidential consultation

 

Sources:

https://smallbusiness.chron.com/write-contract-verbiage-17516.html

http://www.forbes.com/sites/allbusiness/2013/10/03/big-legal-mistakes-made-by-start-ups/

Common Reasons to Consider Selling Your Business

selling your business, DuPage County business lawyerFor many people, owning and operating a small (or medium-sized) private business is the realization of a lifelong dream. Reaching one’s dreams, of course, does not happen without many years of hard work, focused research, and an attitude of perseverance during the difficult times. When you stop to think about how much time, talent, and treasure that you have invested in your venture, you could be forgiven for being hesitant to realize that your run with the company is nearing its end. There are a few things you should keep in mind that might be indications that you should consider selling your business.

Reason #1: You Are Losing Your Passion

When you first started your business, you probably woke up every morning excited to get to work. Building a successful business and satisfying customers were more than daily operations—they were ideals that drove and motivated you into working as hard as you could.

They say that if you love what you do, you will never work a day in your life. While this may not be exactly true, as many days certainly require hard work, things are certainly easier while your passion for your business is at its peak. As the years have passed, however, you might find that running your business feels more like a chore than ever before. If you notice that you are no longer as excited about your company as you once were, it is probably time to start thinking about how you will get out.

Reason #2: Too Big, Too Soon

Believe it or not, it is possible for a business to grow too much too fast. When your company was small and you had just a few people working for you, you might have been fully capable of running day-to-day operations as well as performing your “owner’s” duties. If the business has exploded, however, and now you are faced with serving more customers that you initially expected to serve, the scale of the business could be beyond your capabilities.

It is important to recognize and acknowledge your own limitations. In a case like this, you could even be looking at a tremendous financial opportunity. A fast-growing company is often extremely attractive to larger companies and investors who might be willing to give you top dollar for the business you have built. If you are interested in doing so, you might even be able to remain a part of the company in some capacity after the sale is completed.

Reason #3: An Economic Downturn

Some industries are built around annual business cycles. Others have cycles that are better measured in decades. Still other sectors explode in popularity all at once and then fade in obscurity—sometimes permanently. Business trends and advances in technology can have a direct impact on your company’s success and long-term profitability, and you may need to adapt or get out of the way. For example, the online shopping boom of the last few years has pushed many “brick-and-mortar” retailers to the brink of collapse. If the evolution of your industry has you seriously questioning your future, now could be the time to consider other options.

Call a Wheaton Business Lawyer

For more information about selling a business or advice about knowing when to sell, contact an experienced business law attorney in DuPage County. Call 630-665-2500 for a confidential consultation at Stock, Carlson & Duff LLC today.

Sources:

https://www.businessinsider.com/millennials-are-killing-list-2017-8

https://www.entrepreneur.com/article/247990