The owner must also look after his or her own retirement plans, as well as estate planning considerations. The smart business owner stays intimately involved with the business. Many successful business owners receive daily financial updates and, with a quality accounting and information technology system, can respond personally and immediately to the needs of their clients and business. This is often difficult for the business owner. A decision must be made based on a carefully considered plan.
Several options exist.
Maybe a team of key employees has the ability, interest and resources to purchase the business. Perhaps members of the owner's family will be in a position to take over the operation. Or, it might make sense to sell to a competitor or outside group. Each method of succession has its advantages and disadvantages, including income and tax consequences. The final decision needs to be weighed based on the owner's needs, interests and the soundness of the options.