{"id":3656,"date":"2016-10-20T15:44:24","date_gmt":"2016-10-20T19:44:24","guid":{"rendered":"https:\/\/www.insureyourcompany.com\/?p=3656"},"modified":"2016-10-20T15:44:24","modified_gmt":"2016-10-20T19:44:24","slug":"overcoming-small-business-founder-dependence-with-estate-planning","status":"publish","type":"post","link":"https:\/\/insureyourcompany.com\/blog\/overcoming-small-business-founder-dependence-with-estate-planning\/","title":{"rendered":"Overcoming Small Business Founder Dependence With Estate Planning"},"content":{"rendered":"

One of the primary reasons many\u00a0consumers prefer to frequent a small business is also one of the greatest challenges of small business:\u00a0founder dependence.<\/p>\n

Customers often remain loyal to a small company because the size of the business enables them to have direct contact with the business owner. This creates a strong sense of trust and belief in consistent quality and performance in whatever product or service the business offers.<\/p>\n

However, nothing is forever. As your business grows and changes over time, there may come a day when you, the business owner, will have to let go of the wheel. Whether it\u2019s by allowing your staff more control over the business or finally reaching your goal of retirement, the business must be prepared to continue\u2014and thrive\u2014without you.<\/p>\n

Preparing Customers For Change<\/h2>\n

As a business grows, there is often difficulty in transitioning clientele to put their trust in the hands of employees. It is not uncommon for customers to continue to expect the business founder to be present and personally managing their transactions and needs.<\/p>\n

Educators from\u00a0Michigan State University Extension<\/a>\u00a0offer guidance to entrepreneurs for this small business dilemma.<\/p>\n

First of all, they advise that from the moment a business founder opens the company’s doors, they should be planning strategically for steady growth. From day one, they should be conditioning\u00a0their clientele for the day when future employees\u00a0will be assisting them in the day to day work of meeting customer demands.<\/p>\n

Preparing Yourself For Change<\/h2>\n

In addition to an adjustment to change that affects clients, it is just as common for founders to struggle with delegating duties they once performed themselves. Perhaps a business owner is hesitant to relinquish control out of fear of a lack of quality. Oftentimes, it may simply seem easier to just do it themselves rather than take the time to train someone in the task.<\/p>\n

However, if a small business is to ever grow, the realities of demands upon time and physical limitations dictate that founders must simply entrust employees with some of their own duties. Even in the early days of business, founders must continue to remind themselves that their role will eventually change as the business grows and demands become too great for one person to bear alone.<\/p>\n

Planning A Legacy<\/h2>\n

Entrepreneurial experts<\/a>\u00a0also advise founders to\u00a0plan for the future when their business may transform into a family business legacy, being handed over to the next generation and\u00a0continue being a community presence for the goods and services offered by a founder’s company. Estate planning is an essential responsibility for any business founder.<\/p>\n

Estate Planning<\/h2>\n

Business founders already have an\u00a0expert estate planning resource<\/a>: the company that is providing for their business insurance needs. Experienced professionals in estate planning can first explore a founder’s business philosophy and management style. Strong founders are what shape the direction of a company and establish its reputation within the local community.<\/p>\n

Loyal customers are expecting a thriving business to remain active even in the event of a founder’s retirement or death. Although a business owner is naturally going to manage company profits to provide an active income as well as prepare for future retirement, financially planning for business as usual for the company after retirement or death must not be overlooked.<\/p>\n

An investment plan that leaves behind sound financial footing for a future management team insures a founder’s legacy. This is how a small, independently owned company grows into a multi-generational family business.<\/p>\n

Fine Tuning The Estate Plan<\/h2>\n

Although the financial aspect of such a plan is crucial to the success of a future transition, there are many other details to work out. Employees and staff will need to be assured of a seamless, stable transfer of power. Proper estate planning can avoid high stakes drama that can be costly in more ways than litigating who takes over the helm of a family business.<\/p>\n

Critical loss of productivity can be devastating. Avoid future catastrophes of founder dependence. Plan properly so that business as usual can continue. Professional services will continue uninterrupted. Marketing can remain consistent as it generates traffic. Customers will remain satisfied.<\/p>\n

Coverage Specifics<\/h2>\n

To get down to the specifics of insurance products to consider, these are the two most popular for\u00a0small business protection:<\/p>\n