The challenge of planning for your own departure as an SME company director is apparently leaving a growing number of people effectively unable to retire from the position of running their own businesses.
According to recent research, as many as one in eight small or medium-sized business bosses are now remaining in their posts up to and beyond the age of 70.
That figure means that there are an estimated total of more than 73,000 people in the UK who are into their 70s while still being in charge at their own companies.
For many, that situation will be the result of their own choices and preferences but there are also reckoned to be many others who would like to have retired by now but who have effectively found themselves unable to do so due to a lack of a workable exit strategy.
Part of the problem for company directors in these situations is that failing to plan well for your own departure or to time the process well enough can often mean that your business suffers financially.
According to Moore Stephens, the accountancy firm behind some of the latest research on this subject, company values can be hit badly if senior management departures are not handled in the right way.
The firm points out that it can take months or years for a retirement-based exit strategy to be planned and executed in ways that minimise disruption for the companies involved.
Handing over an SME operation to a new management team or to new owners is not always straightforward and the complexities are seemingly leaving more and more UK business managers facing a real challenge as they come to consider the details of their own transition into retirement.
“After spending so many years building up a business, it’s a crying shame if SME owners can’t enjoy all the fruits of their labour when they retire,” says Mark Lamb from Moore Stephens.
“Company directors who are still working hard through their 60s need to make time to plan for what can often be a lengthy succession process, so they can exit in an efficient way that will deliver real value.”
