Business Succession Loans: How to Write a Continuation Plan
Who wants to continue an existing company as a successor, of course, must meet the same conditions, as someone who founds new: A business plan is mandatory, in case of succession he is continuation plan. In our technical article you will find all information about the continuation plan and in which essential points it differs from the business plan as a practical overview.
An idea and a fairly precise plan are the most important prerequisites for a start-up. You do not even have to start a new business: Business succession is a serious alternative to start-ups. There are many good reasons to start the path to self-employment with a company takeover .
Here you will find all the information about company succession as a practical step-by-step guide.
Who wants to continue an existing company as a successor, of course, must meet the same conditions, as someone who founds new: A business plan is mandatory, in case of succession he is continuation plan .
The entrepreneurial planning is similar to that of a new start- up , but there are some significant differences and peculiarities . Because the continuation plan is about describing the business idea in the course of the continuation.
In our technical article you will find all information about the continuation plan as a practical overview.
The continuation plan is built on the already running business, the existing customer potential, on existing suppliers and employees. The market, competitive situation and target group for existing and future intended business areas should be described as precisely as the existing, internal organization and the intended changes.
You must describe the actual situation as accurately as possible so that you can define the desired state of the company after your takeover.
How do you find an entrepreneur who wants to pass on his business? There are so-called successor exchanges, the most important we have put together here for you.
Special information in the continuation plan
Also on the number part you have to use a lot of care. For a continuation plan, even more detailed facts and figures are expected, since it is possible to derive very clear information from an ongoing business. Must be stated:
- a deadline for the company transfer
- The buying price
- the legal form in which the business will continue after the acquisition
- a business continuity plan if it fails in the short term (illness, accident)
Points such as capital requirements planning , liquidity planning and risk planning are just as necessary here as in a business plan.
Remember to make the most accurate estimation of the financial planning, by when the transfer costs from current operations will have amortized.
Business model and products
In the continuation plan you should describe exactly what you intend after the company takeover with the company. To this end, you first analyze the existing business model as well as the products and services offered. Then you write down what is going on and what should be changed.
- Which products / services are already available? vs. Which products / services should be available after the takeover?
- Which target groups are already served? vs. Which target groups will be added after the takeover?
- Will the prices for the products / services change after the takeover?
- Which supplier contracts are there? Should they be adapted?
Market and competition situation
With market and competitor analysis, you can not only see what you can do better than your competitors, but you also see what has worked well in your companies and where there is room for improvement. From these insights you develop your concept for the orientation of your company after the takeover.
- Will the market volume change after the takeover?
- Will the sales area change after the acquisition?
- Which competitors are already available?
- Will there be new competitors after the takeover?
- Is the marketing strategy changing?
How to create a market analysis based on what tools you can use and what is important, you will learn in this article .
Staff, equipment and premises
A look into the inner workings of your company to take over is essential for the continuation plan. Get an accurate picture of premises, location and personnel structure so that you can make a well-founded assessment of future development.
- What is the condition of the premises? Must be renovated?
- How long and on what terms do rental or lease agreements run? Must be renegotiated?
- Are the premises and location sufficient for the future direction of the company?
- Which equipment (machines, devices) is available and in what condition?
- Are repairs necessary?
- Do devices need to be replaced?
- Is the equipment sufficient for the alignment of the company after the acquisition?
- How many employees does the company have?
- How many employees should it have after the takeover?
A carefully prepared continuation plan requires intensive research work and a sober and critical examination of the results. It not only helps to convince potential financiers, but also shows you in detail what to expect when you decide on a corporate succession.