Key factors for business succession planning
A good business succession plan is essential to achieving your goals down the road. Whether you want to keep the business in the family or sell to outside buyers, the journey can be long and rewarding.
You’ve worked long and hard to build your business. Building a business succession plan is essential to achieving your goals down the road. Learn more about planning strategies, factors, and considerations.
Succession planning considerations
- Timing: A plan should start taking shape years before your departure or change in role and involves building a transition team. With your eye on maintaining company strength, a good plan will help guide ongoing operations: hiring, employee retention, and more.
- Personal goals: You've worked hard for a payoff that will allow you to finance your next venture, whether it's a new business, charitable foundation, or other goal.
- Family financial security: Some family members may be critical to succession; others will not be involved. Achieving fairness for everyone can be complex. Transition can be controversial, but there are ways to help improve communication and minimize disagreements and power struggles.
- Risk management: Even for companies with substantial assets and loyal customers, lack of liquidity can impair the transition process. A good succession plan accounts for this, allowing wealth extraction while helping to keep the company vital in a competitive market.
Selling vs. keeping your business
A critical succession issue: keep the business or sell? Here are some factors to keep in mind as you look to select trustees and successors.
Keep the business in the family
The hand-off process can be complex. A solid succession plan can help affluent families secure their wealth for successive generations. This may include mutually beneficial, tax-efficient strategies for selling or gifting the business to heirs.
The big question: who gets the job? A critical component of a successful transition is getting successors in place. If several family members are involved, sorting out the reporting structure can be nuanced. Effective communication during the succession planning process will help clarify expectations and responsibilities.
Sell to outside buyers
Sorting your options takes time. You may have many options, including an Employee Stock Ownership Plan (ESOP), an outside sale, or an initial public offering (IPO). A succession plan considers the needs of the business, the dynamics of the market, and your personal goals.
Prepping for sale has many dimensions. Proper valuation of your company is a vital succession planning strategy tool, and a transition team will help make an objective assessment. As transition approaches, the successor must be groomed and your role clarified. During this period, talent retention becomes critical.
After working long and hard to achieve success, a good business succession plan can help you prepare for the next phase of your life. There are many options available and decisions to make, so the sooner you begin, the more likely your plans will come to fruition.
The complexities of a business succession plan require the guidance from a team of experienced professionals, including a Huntington Private Bank® Advisor. To learn more, please contact your Huntington Private Bank team to see how we can help, or find a Huntington Private Bank Office near you.
Looking for more business insights?
2025 Beyond Business Report
Check out our "2025 Beyond Business Report" for more on business owner mindset and macroeconomic trends.
Download Report
The information provided is intended solely for general informational purposes and is provided with the understanding that neither Huntington, its affiliates nor any other party is engaging in rendering tax, financial, legal, technical or other professional advice or services, or endorsing any third-party product or service. Any use of this information should be done only in consultation with a qualified and licensed professional who can take into account all relevant factors and desired outcomes in the context of the facts surrounding your particular circumstances. The information in this document was developed with reasonable care and attention. However, it is possible that some of the information is incomplete, incorrect, or inapplicable to particular circumstances or conditions. NEITHER HUNTINGTON NOR ITS AFFILIATES SHALL HAVE LIABILITY FOR ANY DAMAGES, LOSSES, COSTS OR EXPENSES (DIRECT, CONSEQUENTIAL, SPECIAL, INDIRECT OR OTHERWISE) RESULTING FROM USING, RELYING ON OR ACTING UPON INFORMATION IN THIS DOCUMENT EVEN IF HUNTINGTON AND/OR ITS AFFILIATES HAVE BEEN ADVISED OF OR FORESEEN THE POSSIBILITY OF SUCH DAMAGES, LOSSES, COSTS OR EXPENSES.
Investment, Insurance and Non-deposit Trust products are: NOT A DEPOSIT • NOT FDIC INSURED • NOT GUARANTEED BY THE BANK • NOT INSURED BY ANY FEDERAL GOVERNMENT AGENCY • MAY LOSE VALUE
Huntington offers a full range of wealth management and financial services through dedicated teams of professionals in the Huntington Private Bank® and Huntington Financial Advisors®, as follows:
- Banking solutions, including loans and deposit accounts, are provided by The Huntington National Bank, Equal Housing Lender and Member FDIC.
- Trust and investment management services are provided by The Huntington National Bank, a national bank with fiduciary powers.
- Certain investment advisory solutions, securities, and insurance products are provided by Huntington Financial Advisors®.
- Certain insurance products are offered by Huntington Insurance, Inc. and underwritten by third-party insurance carriers not affiliated with Huntington Insurance, Inc.
Huntington Private Bank® is a federally registered service mark of Huntington Bancshares Incorporated.
Huntington Financial Advisors® is a federally registered service mark and a trade name under which The Huntington Investment Company does business as a registered broker-dealer, member FINRA and SIPC, a registered investment advisor with the U.S. Securities and Exchange Commission (SEC), and a licensed insurance agency.
The Huntington National Bank, The Huntington Investment Company, and Huntington Insurance, Inc., are wholly-owned subsidiaries of Huntington Bancshares Incorporated.
Minimum investment or deposit balance criteria apply with respect to the Huntington Private Bank. Please contact a Huntington Private Bank colleague for more information on eligibility requirements.
Third-party product, service and business names are trademarks/service marks of their respective owners.
