For most business owners, their business is their most significant asset and the success of that business has an immediate impact on the economic security of the family. Proper planning is essential to assure the ability to tap the value of the business to support retirement, proper transition to successive owners and cash flow for estate taxes.
Operation planning focuses on properly managing essential parts of the business throughout its lifecycle. Most of these are under your control and include sales, marketing, internal controls, human resources, tax planning, asset management and product development.
Each business comes with its own set of risks to manage. Choosing the right entity structure can have a significant impact on the safety of your personal assets. Other risk factors include overall management, human resources, taxation and general liability claims. Proper business risk management identifies these risks and decides to either accept, mitigate or transfer the risk.
Executive compensation planning focuses on rewarding those key employees of your business. Developing measurements of success and rewarding on those measurements is an important way to keep these people interested in the success of the business. Executive compensation can include various items including insurance benefits, qualified retirement plans, stock options, stock plans, personal performance initiatives and other non-qualified plans.
Succession planning focuses on planning for the eventual transfer of the company to the next generation of leadership and ownership. Proper planning provides for smooth transitions of both the company to new ownership but also cash flows to the current owner or his estate. Succession plans can include generating formulas and time tables for the transfer to a current purchaser or structuring the company so that it is highly marketable when the owner is ready to exit the business.