WHAT IS FARM SUCCESSION PLANNING?

Succession planning is simply planning for the transition when you are no longer running the business.     You will either die, become incapacitated or simply decide to do something else, but regardless at some point you will no longer be at the healm of your business.   Like the ostrich, many of us apparently think that if we stick our head in the sand, and ignore this reality, it will go away.  Thus, in the great majority of cases, the ":succession" occurs without the "planning".

As we all know, the results of almost any endeavor are better if we have planned the endeavor than if we simply leave the results to chance.    In fact, plannning for a business transition is probably more important than most of the other endeavors you have undertaken.    Unfortunately, most people have not planned for the successsion of their business whether it be farming or any other type.   The results of this have frequently been catastrophic, resulting in the failure of the business.  Without proper planning, the new "decision maker" has not been properly trained, the entity has not been structured to allocate decision making authority in the proper way (i.e., "non-farming" siblings may veto the decisions of the "farm operator" or estate tax requirements may cause the liquidation of the business assets).

We will explore the nuances of transition planning in much greater depth as we go along, the starting point is simply that succession planning involves a conscious, problem solving approach to the ineveitable fact that no business is going to continue forever under the present operator.   Therefore, it is wise to plan for this transition rather than simply trusting to luck, or pretending that it will never happen