Foreword -
What will be your legacy?

As a leader, your principal focus is on the success of your trucking company. Your leadership is critical not only to the short-term success of the company, but also for its long-term success – even when you are no longer in the picture.

One of the most important concerns facing trucking companies is developing and implementing an appropriate succession plan. What legacy will remain after the transfer has occurred?

In the end, succession planning can prove valuable and even profitable to the business. But it takes effort, experience and, most of all, time. Yet, most trucking executives are swamped with day-to-day challenges like driver recruitment and retention, insurance rates and maintaining loaded miles. Making the time for something you hope will be a long-term worry tends to take a back seat.

Ultimately, however, you must face reality. Either you will plan and control the succession of your business, or succession will occur anyway without planning and at the whim of outside forces. Which do you think makes for a more successful transition, financially and emotionally? In fact, failure to plan for an orderly succession can mean the loss of the business itself.

So what is succession planning? What it’s not is the simple transfer of the operating business from one generation to the next. This is but one choice among many. Rather, succession planning is a process that involves determining your objectives and choices in the direction of your business, and planning for taxes, asset protection and your estate.

You begin with a general idea of what you would like to see happen with your business:

• Do you want to sell your business?
• Do you want to develop a plan whereby you can transfer the business to family members or key management inside
  the business?
• Should your business go public?
• Are you best off to liquidate your equipment, collect your accounts receivable and go home?
• Or do you want to continue to grow and run the business and proceed under a strategic plan by which your business
  is the consolidator?

Once you choose a general direction, the process takes you to a business valuation, which is the linchpin in the financial portion of your succession plan – financing the transaction and structuring it in terms of income tax, gift tax and estate tax. While life insurance may play a critical role, it’s not sufficient if an objective is to have a financial payout during the owner’s lifetime. And how do the elements of the plan affect the owner’s estate? You no doubt have heard the horror stories of how a person works all his life to build a business just to have his successors sell it to pay the death tax. A properly structured plan can avoid that situation as well.

This manual is a good launch pad for succession planning, but it’s no substitute for technical expertise and experience at every stage. Recognize, too, that your personal needs and desires continue to change over time, and so do those of your business. Succession planning isn’t a process that you complete. It’s a journey that never really ends