Successful business succession planning is a complex interaction of engagement skills, needs, funding and planning. No wonder that financial advisers have taken the lead amongst the professions in developing business succession planning advice competencies; they are a natural extension of their skill set.

There are very few financial advisers who would dispute that the demand for their services is as tough as it’s ever been.  And yet, despite these tough conditions and their natural affinity with business succession planning, many advisers seem to shy away from the market opportunity, seemingly daunted by the complexity of the task.

Perhaps it’s time to rethink your attitude. Considering the sheer scale of the market and the size of the largely unmet need, can you afford to ignore it?

According to published government statistics, small and medium size enterprises contribute around 58% to Australia’s GDP and employ over 6 million Australians (defining SME’s as employing less than 200 people).

In 2009, there were 2,051,085 actively trading business in Australia – less than 1% of those business were ‘big’ business.

That’s a significant number of people whose financial security is inextricably bound up with their business.

And what’s often underappreciated is that it’s not just the proprietors whose financial security is at risk. The ‘forgotten’ people in business succession planning are the staff of these 2,051,085 businesses

Based on these numbers and drawing on research from EIM Business  and Policy Research, a research institute based in the in the Netherlands that studied the issues of Succession Planning and Small business  in the Eurozone and  which documented the following finding:

The importance of successful business transfer and the pervasiveness of the business  transfer challenge among small business is well documented. European estimates are that approximately 30% of firms in a transfer situation are on the brink of going bankrupt due to a bad preparation of the succession (European Commission, 2001). The European Observatory for Small and Medium-Sized Enterprises estimates that this results in 6.3 million jobs that are at risk in Europe as a result of poor succession planning.

BRIA has estimated the human impact on a lack of adequate succession planning in Australia as follows:

In 2009 Government figures estimate that 319,400 SME’s ‘exited’ the market. A simple calculation from the available data, and using the 30% figure from the EIM study, suggests that this put at the risk the financial security of some 271,000 employees in addition to at least 319,400 business owners. (The data not indicate whether the business structure was sole trader, partnership etc).

That’s over 580,000 Australians every year who may be directly affected either as employees due to bad preparation for succession planning or because it is their business that is being exited.

That’s also a lot of people who would benefit from business succession planning advice from an experienced adviser.

BRIA believes that figures like these clearly demonstrate that business succession planning remains one of the most important and largely underestimated and underfunded issues facing small business in Australia.

BRIA also believes that now is the time for a new generation of Risk Specialists, who have a new approach to business risk, using modern engagement methods and with the support they need to succeed.

BRIA’s Business Risk Connect Program is the next generation of business risk training programs. BRIA call their approach ‘Positive Risk Management Solutions’.

BRIA is a new dimension for the Financial Services Industry. Offering training, mentoring and coaching, BRIA provides the platform for developing the leading Business Risk Advisers of the future.

For more information about these courses, click here.

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