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- Rick Spence, Financial Post Published: Monday, July 28, 2008
It would be nice to think heaven has a big room up front reserved for entrepreneurs who have created jobs, wealth and innovation; one that offers a bottomless pot of fresh coffee, high-speed Internet access and maybe a putting green out back. But if you die with your business records in a mess, you could be putting your surviving partner, family or friends through hell on earth sorting out your affairs.
Elizabeth Verwey, an efficiency expert in Toronto, learned this first-hand when two relatives, both of them business owners, recently died before their time.
Everyone who passes away leaves a legacy of paper, possessions and unfinished business to be cleaned up. But business owners may be the worst perpetrators: There's that messy desk to be cleaned out, customers to contact, bills to pay, meetings to cancel, contracts to terminate and Web sites to shut down.
As Verwey saw friends and family members struggle to understand the minutiae of their loved ones' businesses -- even while they were still going through the grieving process -- she realized business owners should prepare detailed “business wills” well in advance to help their survivors cope.
Verwey, whose Small Office Mentors business provides entrepreneurs with productivity processes to save time and space, started looking for resources to help business owners prepare for unexpected death. But when she found herself having to pull together information from a range of sources, she realized this problem presented an opportunity.
She is now writing a “business wills” workbook aimed at self-employed entrepreneurs and the owners of businesses with up to 10 employees. (At larger businesses, she hopes, the owner is no longer a one-person show, and has colleagues who know where the inventory went or who to call in an emergency.)
The workbook will serve two functions: as a guide to help entrepreneurs record key operational details, and as a one-stop resource for the survivors. They will now know where to find the information they need to terminate a lease, write a cheque or collect a payment.
Of course, Verwey is hoping entrepreneurs who use her book will find an unexpected benefit: Having all this information in one place may save them time and help them appreciate the advantages of formal systems, such as having written client lists rather than keeping them all in your head.
She conducted her research by talking with lawyers and accountants, and interviewing entrepreneurs and their spouses. She discovered many people know nothing about their spouse's business -- and her husband was no exception. When she sat down to discuss her “business will” with him, he wondered why he had to know all this stuff. Verwey's answer was simple: “I have always run my business in a professional manner -- and I would like it to get closed down the same way.”
Here are just a few items Verwey recommends be on your bucket list: - Staff, customer and supplier lists; - Directions for selling or handing off the business; - Directions for communicating the owners' demise to clients and other stakeholders (your spouse doesn't want to be fielding your business calls for the next 10 years); - Names of trusted companies that could take over current projects to avoid excessive disruption for customers; - Lists of assets, including personal effects, and suggestions for disposition; - Location of information on accounts payable and receivable; - A legible list of appointments, so they can be cancelled later; - Banking information, along with names of banker, lawyer, accountant, etc.; - Lists of company Web sites, along with contact information for tech support; - Passwords for bank accounts, e-mail, online services and memberships; - Location of storage lockers or warehouses; - Details on upcoming ad campaigns and other initiatives to be cancelled; - Lists of memberships and professional associations.
All this may sound self-evident, but according to Verwey's research, few entrepreneurs have assembled this information for easy access in the event of their death.
“Not at all,” she insists. “Nobody is prepared.”
Verwey hopes to complete her $50 workbook by the end of August; she already has a public workshop on business wills scheduled for October in Toronto.
She hopes to do three or four more presentations next year, including one in Vancouver. For more information on the book or workshops, contact elizabeth@businesswills.ca. Verwey's project isn't expected to make much money: Most successful entrepreneurs have no intention of dying, ever.
But she points out that a business will can also come in handy for any owner who dreams of selling their business and getting out fast, or winning the lottery and moving to Mexico.
Either way, the better prepared you are for the transition, the sooner you'll be able to hit the beach.
--- - Rick Spence is a writer, consultant and speaker specializing in entrepreneurship. His column appears Mondays in the Financial Post. He can be reached at rick@rickspence.ca
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