According to Cancer Research UK, one in two people in the UK will develop some form of cancer in their lifetime. This is a truly shocking statistic. However, major improvements in diagnosing and the treatment of cancer means more and more people are surviving cancer.
This article does not constitute advice. Professional advice should be taken prior to acting on any part of it.
Survival rates for cancer are improving
People typically live ten times longer after the cancer diagnosis, compared to the 1970’s were the average survival rate was one year after diagnosis.
The death rate from cancer has remained constant over the last sixty years and it is predicted that it will increase over time.
The main factors for this are an aging population and the growing number of people who are obese.
It may come as a surprise but cancer has a close correlation with income. People who are on lower incomes, generally tend to smoke and drink more and eat a poor diet. All these factors can increase someone’s chance of getting cancer.
There is good news, however. The death rate for some of the more common types of cancer, such as breast cancer is on the decline. This is down to better education, quicker diagnosis, improvements in the treatment and aftercare of cancer patients. In fact, breast cancer survival rates have doubled since the 1970’s.
How cancer can affect a business
There are 5.5 million businesses in the UK. This is figure has increased by 23% in the last 7 years.
96% of these businesses (5.3 million) are classed as micro-businesses. This means they employ between 0-9 people.
Whilst, these businesses are structured in different ways, one theme runs throughout them – the majority have failed to protect themselves if the founding member or a key member of staff falls ill or dies from something like cancer.
A lot of businesses fail to put in place a business succession plan as they feel it is too expensive to do so.
Business succession plan
A business succession plan will help you decide what to do if someone becomes ill and they can’t continue to be involved in the business, if someone dies, or if someone decides to sell their stake in the business.
The plan should ideally be drawn up when the business is formed, or when a major change takes place within the business, such as the addition of a new partner. Whilst there is no set layout for a succession plan, it should be realistic and achievable.
It typically contains details of:
- the successor – family member or business partner
- timeframe
- restrictions that you want to put into place
- legal considerations – buy-sell agreement, reference to a will
- risk management – steps you can take to reduce the risk to the business
Other things to consider
When planning for the loss of a key business figure it is important to have enough cash to cover the cost of replacing this person and to cover the loss of any profit.
It may be difficult to calculate these costs but it is important to be as accurate as possible. When working out how much it will cost you to replace someone, their salary is the starting point, but you also need to consider things such as recruitment costs, training and bonuses.
For business protection, speak to Darren
Dental & Medical Financial Services have been helping doctors and dentists with protecting their business for over 25 years. Call to discuss your options.
Tel: 01403 780 770