There are a number of considerations for business owners who are contemplating succession planning, including identifying a strategy that can provide access to liquidity or the ability to move on to another business venture. But it can be especially tough for craft brewers—who are deeply invested in their businesses and take pride in their vocation—to identify an ownership-transition solution that aligns with their personal goals as well as their loyalty to their breweries and local heritage.
But if selling to a large brewery or a private equity firm isn’t appealing, an employee stock ownership plan (ESOP) might be. An ESOP is a qualified retirement benefit plan that provides a company's employees with an ownership interest in the company. The ESOP is funded by the employer with tax-deductible contributions in the form of company stock—or cash, which is used to purchase company stock—and it operates through a trust, under the direction of a trustee or other named fiduciary.
For craft brewers looking to access hidden liquidity, gain tax benefits and reward their teams—all while remaining independent—an ESOP may be a tailor-made solution. Here are five reasons why:
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The tax and employee benefits offered by ESOPs make them a succession planning option you may wish to consider seriously—here's why.Read article about Is an ESOP Right for Your Business?
Thinking about your ownership-transition strategy? Here's why employee ownership might be a good option for your business.Read article about Retiring Ownership via an ESOP
If you're considering ownership transition, look no further—here are the most important factors to consider for each option.View infographic about Planning Your Ownership-Transition Strategy
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