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Succession Plans Are Essential for Family Businesses

Emil Deister founded the Deister Machine Company in 1912. The business makes pieces of equipment known as vibrating screens which are used in the mining industry to separate different sizes of gravel, stone, coal, and sand. Despite ups and downs, the company is still in business today shipping products around the world and employing 160 individuals in its four plants. In fact, not only is the company still running, but because of solid business succession planning it is still family owned and operated.

This weekend the Journal Gazette profiled the current CEO and chairman of the enterprise, 82-year-old Irwin Deister Jr. The man was recently honored by his company for his 60th official year as an employee of the family business. He represents the third generation of family leaders of the company founded by his grandfather.

Unfortunately, the Deister family is unique its ability to maintain its family business throughout the years. Ninety percent of American businesses are family owned, but less than one-third of them survive to the next generation. Even fewer make it into the third generation like Deister Machine Co. Many family businesses in our area fail to survive throughout the transitions because of a lack of a New York business succession plan.

The process of ensuring the smooth transition of a business into the next generation is a difficult one for many. It involves tough discussions about mortality, family preferences, and conversations about letting go of a venture that may be a life’s work for those involved. Yet the challenges of the process should not be a deterrent to responsible planning.

For example, while still going strong after 60 years on the job, Irwin Deister and his family co-owners have long had a proper succession plan in place to ensure that the business carries on. He has worked with his cousin to divide responsibilities. Details in his will provide for his interested relatives to buy his shares of the business. In addition, the family has had preparations made to determine which of the younger children are interested and capable in succeeding in running the operation.

Proper local business planning demands the use of a variety of professional assistants. For example, a New York estate planning lawyer will be able to aid in the estate affairs as well as the preparation of the involved legal agreements. They supplement the work of accountants and financial advisors who can assist with issues like tax payments and investment strategies. While it may seem daunting at first, guidance exists to make the process feasible for all business owners. The most important point is to acknowledge the need for a proper succession plan and take the first step.

See Our Related Blog Posts:

Many Forget to Include “Letter of Instruction” As Part of Estate Plan

Parents Grapple with Effect of Inheritances and the Meaning of Money

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