Family-run businesses now have access to a succession planning guide designed to help them formulate a plan for passing their businesses on to the next generation.
Co-released by Family Business Australia (FBA) and the Australian Small Business and Family Enterprise Ombudsman (ABSFEO) on Monday, the guide provides step-by-step instructions on how a family business can plan for the successful transition of ownership and management within the family.
Amanda Greer, business development manager at Melbourne’s family-owned Stainless Steel Wire and Mesh, is currently 12 months into what is commonly a five-year succession process.
The Greer family has been in the wire industry since 1793, first operating in Edinburgh before launching operations in Australian in 1849. In 2002, Amanda’s parents, Leigh and Andrew Greer, established their current entity, Stainless Steel Wire and Mesh.
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“Today, we’re working through transition planning from Leigh and Andrew to the second generation,” Greer tells SmartCompany.
Greer works alongside her siblings Tory Greer and James Greer, who work as the sales manager and international commercial manager, respectively.
“We were very pleased to hear about the launch of this guide by the FBA and support it, as we know it’s a resource that we would have used,” Amanda Greer says.
The new introductory guide offers family businesses a starting point to begin their journey.
Greer encourages any family business embarking on a transfer of ownership to access the guide, and also to become a member of Family Business Australia.
“It’s a great resource, they have great courses, and you can learn from non-competing industries as well,” she says.
Through Family Business Australia, the Greer family found an external consultant who has been advising the family over the course of their succession planning process.
“An external consultant can act as a circuit breaker and assist in communication,” Greer explains.
Succession planning is a demanding process that not only involves planning the transfer of the equity interest in business, but also skills such as leadership and management, she says.
Had the new guide been around when her family began their planning a year ago, they likely would have used it.
“It would have helped us understand and position ourselves probably a little bit faster.”
The guide includes a flow chart and case studies to help businesses understand the strategies family businesses can take, depending on their situation.
It also includes information about transitioning ownership within a family, and exits via either selling or transferring ownership to employees.
Announcing the guide on Monday, Family Business Australia chief executive Greg Griffith said that, with quality information, succession planning can be a rewarding process for small businesses.
“Our guide provides a great starting point for families in business to consider the ‘what, why and how’ of transitioning the business to the next generation,” Griffith said.
Small business ombudsman Kate Carnell said there is a real need for family businesses to create succession plans, given that the majority of business owners are currently aged between 45 and 59 years.
“Australia’s most successful family business stories — and there are many — are a result of well-executed succession planning,” Carnell said.
The free Introductory Guide to Family Business Succession Planning is available on both the Family Business Australia and the Australian Small Business and Family Enterprise Ombudsman’s websites.