Not long ago, a business brokerage company received a call from the sister of a transportation company owner. The owner had recently passed away unexpectedly. His sister had been designated as the executor of the estate, and had no knowledge of the transportation business. She contacted the business brokers feeling overwhelmed and seeking assistance.
Unfortunately, situations such as this are very common. The value of a transportation business can quickly and dramatically decrease after the unexpected death of the owner. Family members and loved ones are often left in precarious positions, financially and emotionally, if preparation for the unexpected was inadequate. How can transportation business owners protect their loved ones from being put in this type of situation? How can you prepare?
Here are three tips to help you prepare for a situation requiring an expedited business sale:
Speak frankly with your spouse and family members about the possibility of a tragic event and what should be done in the aftermath.
- If your children are involved in running the business, encourage an honest discussion about their capabilities to professionally maintain the company, should they be interested in staying in the same business. Take into account their goals, concerns, and thoughts about debt, risk, and other financial decisions. It would be a mistake to assume your family or spouse would want to inherit your career path. Communication is critical for preparation, and you and your family will likely learn many things about each other in the process.
Make sure you and your family are knowledgeable about the business sale process.
- The importance of having your documentation and financial information in order can’t be overstated; this will greatly reduce the stress and burden that would fall to your family otherwise. Research your options for advisers and industry professionals. The expertise of a professional who is skilled and experienced in the transportation business can be a very valuable asset should your family desire a fast, painless business sale.
Have a specific, written plan of instructions.
- All the preparation in the world is worth little if your plan is not immediately available to mourning, overwhelmed family members. Take steps now to eliminate the need for them to make difficult decisions in the immediate aftermath of a crisis. A formal plan provides comfort and clarity in the present and offers your family a road map after a tragedy.
Don’t hesitate to speak with an specialized industry business broker about your future concerns about a business sale. Doing so can avoid a difficult situation in the future.