Never too early to start succession convo

Never too early to start succession convo


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ANNA Cochrane of Mike Stephens & Associates explores the importance of starting the succession conversation and how to flag the subject with the family.

ANNA Cochrane of Mike Stephens & Associates explores the importance of starting the succession conversation and how to flag the subject with the family.

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IT'S never too early to start talking about farm succession with family - but it can be too late.

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IT is never too early to start talking about farm succession with family - but it can be too late.

Too often a family crisis is the catalyst to begin the process that transfers the control of management, income and ownership of a farm's operations and assets to the next generation.

Mike Stephens and Associates farm business advisor Anna Cochrane said family relationships and business productivity reap the rewards of starting the conversation early.

While it can be seen as a daunting process that is plagued with destructive stories, Ms Cochrane said the process can be open, transparent and result in a more viable business through good communication.

"Talking about succession planning is all about having courage - it is about having the courage to start the conversation," Ms Cochrane said.

"It is far easier to talk about farm issues than family issues; that includes succession planning."

Succession has become a dirty word within the industry, the negative stigma attached to planning provides enough fuel to discourage families starting to talk about their future.

However, Ms Cochrane said while it can be an emotional journey, it can be positive for relationships and productive for the business and encouraged family members to be empathetic.

"Every family is different, every relationship within the family is different and each family member communicates differently," she said.

"Getting people to talk about succession planning must be the single most important step to making it happen.

"It's not something you can just do on your own, you have to have a conversation, and someone has to start that process - ideally early, without any pressure."

Ms Cochrane answered why most people in the family worry and possibly fear succession, however find it difficult to talk about it, saying farmers were typically passive communicators.

"They have developed a pattern of avoiding expressing their feelings and identifying their needs," she said.

"If you are a mum or dad or son or daughter in a farming family, and you want to start the conversation, you will need to identify your feelings, evaluate the consequences of not talking about your goals and desires and find the courage to talk openly about the future of the farm, the business and the family.

"It needs to realised that equitable is not equal and that succession planning is a transitional process not a transactional process."

Often it helps to think about the farm land as an asset, the farm operation as a business and the family as a model of business operation, she said.

"Look at succession planning as a process rather than an event," Ms Cochrane said.

"My advice to families is to have the initial conversation, engage an advisor or consultant and begin the process.

"The earlier Succession Planning is started the more options families have available to them. A great time to start the conversation is when the next generation comes back to live and work on the farm."

Her advice to people wanting to start the succession conversation was to research different approaches consultants' offer, think about key questions you want answered that are important to you, engage a specialist to help you and suggest having regular family meetings where strategy is discussed.

Questions to consider

  • What have you built the business for?
  • What do you see as the strengths, weaknesses, opportunities and threats of the business?
  • Where do you see yourself in five or 10 years' time?
  • How do I fit into the plan?
  • How does the business fit into my goals?
  • Check out Stock & Land's special succession planning in this week's edition of the Stock & Land September 25 edition

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