Succession planning is one of the most important — and most overlooked — tasks for essential service business owners. Many owners spend decades building their business but very little time thinking about what happens when they are ready to step back. The result is often a rushed sale at a discount, or worse, a business that simply closes when the owner retires.
The ideal time to start succession planning is three to five years before you intend to exit. This gives you time to strengthen the business, reduce owner dependency, and position it for maximum value. Key steps include building a management layer that can operate independently, documenting key processes, and ensuring compliance records are current and complete.
You also need to consider your personal goals. Do you want a clean exit or a staged transition? Are you open to staying involved in an advisory capacity? Do you want your employees to be retained? These preferences will shape the type of buyer you should look for and the deal structure that works best for you.
For essential service businesses in New Zealand, the succession opportunity is particularly acute. A large cohort of business owners is approaching retirement age at the same time, and there are fewer young tradespeople starting their own firms. This creates a window where well-prepared businesses can attract strong offers from strategic buyers who see long-term value in the sector.