Farm Table says:
This article from the Ontario Ministry of Agriculture, Food and Rural Affairs outlines a list of Do’s and Don’t’s of Succession Planning.
- Do think of succession planning as a process rather than an event
- Do start planning now.
- Do keep the big picture — the long-term direction of the farm business — in mind.
- Do complete a financial analysis of the past and present farm business along with some financial projections not making money now, what can be done to make it profitable?
- Do become educated on the subject.
- Do consider using a “family business meeting” as a way to open the lines of communication among family members.
- Do determine the most important things (values and their priorities) to each individual family member as a starting point.
- Do figure out each individual’s personal, family and business goals, which should be based on their values and priorities.
- Do ensure good communication among family members about plans, strategies, and issues.
- Do address the issue of fair (equitable) vs. equal division of the farm early in the process — especially if there are off-farm family members involved.
- Do prepare a legal will early.
- Do develop a “successor development plan” for any family member(s) who is (are) planning to take over the business.
- Do generate and discuss various options — be creative.
- Do assemble a “team” of professional advisors.
- Do take responsibility for development and implementation of the plan with help from the advisors.
- Do consider the tax implications, but don’t focus solely on them as the most important thing.
- Do write it down.
- Don’t procrastinate.
- Don’t be afraid to ask questions and listen carefully to the answers, even though you might not like them.
- Don’t assume you know what others are thinking or how they feel about the process or what they want to achieve from
the succession plan.
- Don’t be afraid to share responsibilities
- Don’t define life as the business.
- Don’t put all your eggs in one basket.
- Don’t rely on just one professional advisor.