If business succession planning is so important, why don't business owners do it?

Minneapolis attorney Sally Grossman explains why business owners typically do not create business succession plans.

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Why don’t business owners do succession planning? I have asked myself that a lot. That is a really good question. I don’t really know. I think part of it is it’s probably not a lot of fun to talk about death and taxes, and pay the lawyer to do it, but it’s more than that. I think it’s because the owner has to deal with really difficult questions.

For example, which of my children can take over this business? Can any of them take over this business? Should any of them take over this business? What happens to this business so I’m no longer there? Will customers and suppliers and bankers still deal with this business? And another question is what happens to me, as the owner, if I’m no longer president of ABC Company. What is my identity?

So I think most entrepreneurs throw up their hands. They say I’m a take charge type person. Most of them are dominant drivers. We like to know what we’re doing. We like to be in our area of expertise. We don’t know if business succession planning as business owners, we don’t know the answers. We don’t even know the right questions to ask. And so, I think people throw up their hands.