Only 32% of business owners have a documented exit plan, according to the Exit Planning Institute’s 2023 national State of Owner Readiness survey. The same research found that 78% have not yet built a transition team.
Those numbers describe a lot of Long Island companies. Plenty of them were founded in the 1970s and 1980s, and the founders now have a son, daughter, niece or longtime manager waiting for an answer that hasn’t come.
Family business succession planning is less a single event than a five-to-seven-year project. Below is a phased timeline, the advisors you’ll need and a checklist you can print and bring to your next family meeting.
The Five Phases of a Family Business Transition
Each phase has a goal and a short list of actions. If you’re already “behind,” start with Phase 1 anyway. Compressing the timeline is possible. Skipping steps usually isn’t.
Phase 1: Five or more years out — Decide what you want
Goal: Get clear on the owner’s intentions and the family’s appetite.
- Write down what you want personally: income after you step back, your role (if any), your timing.
- Hold an honest family conversation about who wants to lead, who wants to own, and who wants neither. These are three separate questions.
- Get a baseline business valuation so everyone is working from the same number.
- Start documenting what lives only in your head: key customer relationships, pricing logic, vendor terms.
Phase 2: Three to five years out — Build the successor
Goal: Develop the second generation business leader, or confirm that an outside leader is the better fit.
- Define the role the successor will step into, with clear decision rights.
- Give them P&L responsibility for a division, location or product line.
- Have them earn credibility outside the family, ideally with some time working elsewhere or leading a project with real stakes.
- Pair them with a coach or peer group so they aren’t learning only from the person they’re replacing. See our Succession Planning & Leadership Development page for how that works.
Phase 3: One to three years out — Structure the deal
Goal: Decide how ownership and control will actually move.
- Choose the mechanics: gifting, an installment sale, a trust structure, a buy-sell agreement, or a mix.
- Separate ownership from management if not every heir will work in the business.
- Update or create a shareholder or operating agreement, plus a buy-sell agreement funded with insurance where appropriate.
- Model the tax impact with your CPA and estate attorney before anything is signed.
Phase 4: The transition year — Hand over the keys
Goal: Shift authority publicly and without confusion.
- Announce the change to employees, then key customers, lenders and vendors, in that order.
- Move signing authority, banking relationships and major accounts to the successor.
- Agree on the founder’s new role in writing. “Chairman” or “advisor” means nothing until the decision rights are spelled out.
Phase 5: The first year after — Let it stick
Goal: Protect the new leader’s authority and the founder’s well-being.
- Schedule quarterly check-ins between founder and successor, with an outside facilitator if tension is high.
- Resist the urge to overrule decisions in front of staff.
- Track a few agreed metrics (cash, retention of key people, customer retention) to show the transition is working.
- Give the founder a next chapter.
Who’s on Your Advisory Team
No single professional can do this alone. Most successful handoffs involve four roles working together.
| Advisor | What they handle | When to bring them in |
|---|---|---|
| Estate and business attorney | Wills, trusts, buy-sell and shareholder agreements, entity changes | Phase 1 |
| CPA | Valuation input, income, gift and estate tax modeling, entity structure | Phase 1 |
| Wealth advisor | The owner’s retirement income, liquidity, insurance funding | Phase 1–2 |
| Coach or peer advisory group | Successor development, family communication, accountability | Phase 2 onward |
Some Vistage Chairs run boards for professional advisors through the Vistage Trusted Advisor Program, which can be a useful way to find attorneys and CPAs who already work with family companies.
Next-generation leaders also benefit from their own peer table. Our Key Executive Board brings together senior leaders preparing to take the top seat.
Printable Family Business Succession Planning Checklist
- ☐ Owner’s personal goals and timeline written down
- ☐ Family meeting held on leadership vs. ownership vs. neither
- ☐ Current business valuation completed
- ☐ Successor identified (family or non-family)
- ☐ Successor development plan with clear milestones
- ☐ Key processes and relationships documented
- ☐ Buy-sell and shareholder agreements reviewed
- ☐ Estate plan updated to match the business plan
- ☐ Tax impact modeled by CPA
- ☐ Communication plan for employees, customers and lenders
- ☐ Founder’s post-transition role defined in writing
- ☐ Contingency plan if the owner is suddenly unable to work
That last item matters more than people expect. A succession plan that only works on your preferred schedule isn’t a full plan.
A Long Island-Specific Note
How to transition a family business on Long Island comes with a few local wrinkles worth raising with your advisors.
New York’s estate tax is separate from the federal one. For 2026, the federal basic exclusion is $15 million per person, but New York’s is $7.35 million, per the NY Department of Taxation and Finance. New York also has a well-known “cliff”: estates that exceed the exclusion by more than a small margin can lose the benefit of it entirely. Ask your estate attorney how this applies before you assume you’re under the line.
Real estate is often the hidden asset. Many Nassau and Suffolk family businesses own the building they operate in. Deciding whether the property passes with the business, stays with the founder as a rental, or goes to a non-operating sibling can settle or start a family dispute.
The talent pool is regional. If the next generation isn’t ready, you may be recruiting a non-family president who also weighs offers from New York City employers. Factor that into your timeline and compensation planning.
Succession planning on Long Island also has an advantage: a dense network of family firms that have done this before. Learning from leaders one or two steps ahead of you is often the fastest way to avoid avoidable mistakes.
Start With One Conversation
Most family business succession planning stalls not on the legal work, but on the first honest conversation. If you’re a founder wondering whether your successor is ready, or a next-generation leader wondering how to earn the seat, that’s where coaching helps.
Explore next-gen leader coaching with Fenella Kim and find out whether a one-on-one engagement or a peer board is the better fit for where your family is today.