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Site Map

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Adviser Updates

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Publications and Documents

 

Business Succession Planning:

Business Succession Planning

Need for Succession Plan

Need for Asset or Buy/Sell Strategy

Need for Liability or Key Person Strategy

Negotiating a Succession Plan

 

Simple Succession Plan:

Simple Succession Plan

 

Complete Succession Plan:

Complete Succession Plan

Strategy

Financial Needs

Insurance Funding

Retirement Funding

 

One Page Strategy:

One Page Strategy

Asset Needs

Liability Needs

Personal Needs

Who Pays the Premiums?

Valuing the Business

Simplifying the Valuation Issue

Equity vs. Loan Capital

 

One Policy Strategy:

One Policy Strategy

Flexibility

Dual Role of Personal Cover

Dual Role of Debt Red'n Cover

Security & Tax-Effectiveness

Cost Savings

Pre-Agreed Purchase Price

Apportionment of Premiums

Methods of Aggregation

 

Multiple Policy Approach:

Multiple Policy Approach

Super Fund Ownership

Tax Disadvantages

Cost Disadvantages

Other Disadvantages

Geared Premium Funding

Super Buy/Sell

 

One Page, Two Policy Strategy:

One Page, Two Policy Strategy

 

Other Issues:

Tax Deductibility

Inadequate Insurance Proceeds

Vendor Finance

Changing Needs

Future Growth of Equity

Trauma Buy/Sell Strategy

 

Sole Proprietors and Families:

Sole Proprietors and Families

Overview

Family Ownership

Sale Strategies

Third Party Buy/Sell Strategies

Estate Equalisation Strategies

Family Buy/Sell Strategies

Second Generation Strategies

Debt Reduction Strategies

 

 

Negotiating a Succession Plan

 

The questions on the page "Why Do You Need a Succession Plan?" highlight the different perspectives people can have on Retirement and Death.

 

First to Die or First to Buy?

Unfortunately, in a business relationship, you never know whether you will be "the first to die or the first to buy".

Similarly, at the risk of perpetrating an even worse rhyme (!), when it comes to Retirement, you never really know whether you will be "gone tomorrow or having to borrow" (to pay out the Vendor).

 

Thinking as Both a Vendor and a Purchaser

Ultimately, it helps to place yourself in the position of both a Vendor and a Purchaser, when you think about a Succession Plan.

When you're the Vendor, you will negotiate diffferently to how you would negotiate if you were a Purchaser.

A Vendor wants to maximise the Sale Price, a Purchaser wants to minimise it.

So your expectations and how you would approach the negotiations depend on which hat you are wearing.

The chances are that your Partners would have the same expectations as you would in the same situation.

 

The Time to Negotiate and Agree

This makes for a problem if we wait for the event to arise.

If we wait, everyone will know which hat they are wearing and they will negotiate from that perspective.

If we negotiate a Succession Plan now, nobody knows whether they will be a Vendor or a Purchaser.

However, if we understand the legitimate expectations of a Vendor and a Purchaser, it makes it a lot easier to design an even-handed Succession Plan.

 

Copyright: Ian Gray Solicitor

 

 

Adviser Tip

A Complete Succession Plan is not just about Death, it's not just about Insurance and it's not just about selling your Equity.

See more Adviser Tips

 

 

 

 

 

Current Marketing Schedule

Current Marketing Schedule

Ian Gray travels to most capital cities regularly throughout the year and is available for Meetings.

Please click here to see his availability in Brisbane, Sydney, Melbourne, Adelaide and Perth.

Please contact us to arrange an appointment or teleconference.