How many business owners have worked with an advisor to put a firm succession plan in place?
Not many, but most are still confident their businesses will remain successful after they retire, according to Merrill Lynchs latest Affluent Insights Survey.
The survey, titled Business Owner Spotlight, included 250 U.S. business owners with $10 million to $250 million in revenue. The telephone poll was conducted in October.
Currently, 60% of business owners think that their businesses will prosper after they retire. At the same time, just 35% of business owners said that they are confident that their wealth management strategy would carry them through if their ability to lead their businesses came to a halt now.
And when it comes to a succession plan, 39% of the business owners said they are working with a financial professional to craft a strategy, while 33% have not worked with a financial advisor or commercial banker on what could happen to their personal wealth if they can no longer run their businesses.
Fifty-one percent of those business owners said that they would now mostly likely choose a current employee to run their businesses in place of them. Twenty-four percent said that they would pick a family member and 21% said they would select someone outside of their business.
The survey also revealed the positive impact the business owners surveyed saw their businesses having into the New Year.
More business owners (30%) said that they have hired new staff members as compared to the 22% who have laid off employees. Thirty-eight percent of business owners are targeting new customers, while 37% said they are growing operations and 35% said they are adapting products and services to market needs.
In 2013, 24% of business owners surveyed said that they plan to introduce new products or services, another 24% plans to take advantage of new technologies, 21% plan to market to new customers and 21% plan to expand their U.S. presence.
And while those business owners indicated they have a strong domestic focus, many are also looking to expand globally. Currently, 89% count less than half their revenue from international sales and operations. But that could change, with 17% looking to international growth in the next five years and 32% indicating that they see growing beyond U.S. borders as a positive risk.