When planning to hand your business over to a successor, there are precautions you should take to ensure that the business model is protected in a way that you wish. After establishing your successor has undergone the proper training and education for the position, having a clear guide will help the transition run smoothly.
Have a succession plan:
A succession or exit plan will outline who will take on the business once you leave, and the manner in which the transition will take place. A formal succession plan can help to guide your business through a smooth transfer of ownership. This will allow you to teach your successor the ways of the business and the correct process of doing various tasks. This also helps to teach and maintain the order in which the business has always operated, making the change easier for customers and clients.
Manage legal requirements:
A major part of the succession plan involves managing the financial and legal issues that arise with the changeover of a business. Before handing over the business, you will need to do a number of things including cancelling tax registrations such as GST, lodge any final tax returns, pay any outstanding activity statements or bills, and transfer any other assets such as domain names or web registrations.
Define your role going forward:
Overstepping the boundaries and trying to be over-involved after you no longer own the business can cause conflict between yourself and your successor, negatively impacting the business. You need to respect the new person you have appointed as a business owner and let them run the business on their own. To avoid becoming overbearing, make sure you prepare yourself for what no longer owning the business will mean such as how you are going to fill your time that was previously spent working.