Do you know where your restaurant is headed? Do you plan to pass the leadership or management to a different person? Is your restaurant establishment prepared for the unexpected? Every business, large or small, needs to have a succession plan.
Building a thriving restaurant takes a lot of hard work and succession planning is vital to ensure the continued evolution, growth and promotion of leaders in any restaurant business.
Here are three succession planning tips to support your restaurant’s continued growth:
- Start Early. Succession planning is not just an issue that exists in the future. It is possible to create a succession plan transferring business ownership to an eventual successor without losing control or income. The earlier a business owner begins planning and transferring ownership to a successor, the likelier it is for a succession plan to be a success, both emotionally and financially.
- Assemble a Team. Choosing a trusted financial advisor, certified public accountant, attorney and business valuation expert will relieve stress throughout the process. A solid succession plan should address the financial, legal and tax implications involved with transferring or selling your restaurant. Your plan may include transfers such as gifting, bequeathing, or selling to a family member, employee or outsider. We can help you address the tax aspects and minimize your tax bill. Considering tax implications early will leave you well suited to support your long-term financial goals.
- Communicate. The dynamics within a restaurant business can be complex. There are several questions that may arise. If you are planning to transition your restaurant to a family member or a non-family member; are they interested? Designating a family member as your successor may raise emotional issues. Does your son or daughter want to run the restaurant? If not a family member, do you want to have an employee or an outsider take over? Honest communication with all parties is critical to achieve success.
We have qualified professionals to assist you in developing a succession plan. We often remind restaurant owners there are unexpected events in life that may necessitate having a succession plan in place at all times. Contact the Smith Schafer Hospitality Team.