Marlon has spent years building his business.

Focusing on the hot niche of on-demand food delivery, he helps restaurants set up "ghost kitchens" with no dining rooms to fulfill more orders faster. His expertise in choosing ideal locations and setting up streamlined kitchens ensures that his company is continually growing.

But what would happen to Marlon's business if something happened to Marlon?

Although Marlon is fictional, this is just one of the critical questions that Renee Drake, Director of Commercial Banking at First Horizon Bank, and Paul Lankau, a Financial Advisor at First Horizon Advisors Inc., ask business owners when they sit down to discuss a succession plan.

“Like all of us, business owners don't know what they don't know," Drake explains. “Most successful entrepreneurs started out with a great business plan, but they may not have revisited it over time as the business has grown.”

In many ways, making a succession plan is just like making a business plan – but perhaps even more important.

“Business owners spend all day, every day, figuring out how to build that business and keep that business running. They don't have a lot of time left for thinking about what happens if they die early – or when they're ready to retire,” Drake says.

Indeed, 72% of business owners have not made a succession plan, according to Securian Financial Group.  Those who have one may not have kept it up to date, Drake says.

Here are some of the critical questions Drake uses to get business owners planning for the future:

1. Would your business be able to continue operating without you?

If Marlon were to unexpectedly become disabled or die, would his business still provide for his family? He knows the firm is valuable – but without the specialized knowledge he brings, who would buy it?

The truth is, many businesses become devalued if the founder is unexpectedly unable to continue their role.

“We've seen companies go out of business when an owner passes away or becomes disabled without a good succession plan in place," Drake says.

Something to consider: Identify a key successor, help them build their skills and knowledge, and plan for their future role. If that includes an ownership stake, the plan can include a buy/sell agreement or a purchase over time.

Marlon needed to look no further than his own household for his business's future leaders: He trained his son and daughter to do everything he does.

“After a period of grieving, they would be able to fulfill every existing contract," Drake says.

For other business owners, the successor may be an associate or a partner.

2. What would happen if your partner unexpectedly exited the business?

Whether it's through a sudden death, a divorce, or other circumstances, it sometimes happens that a business partner is no longer able to fill their role. If no plan has been made, this can lead to awkward and undesirable situations.

“How would you like to be in business with your partner's spouse?" Drake asks. Having a spouse or someone else you have no working relationship with inherit your partner's share could bring a lot of uncertainty to your business's future.

A buy/sell agreement could help here, specifically one that presents the opportunity for the company itself or the remaining partner to purchase the former partner's share.

But what if neither the company nor the remaining partner has enough funds to purchase the share?

Something to consider: "Plan for an unexpected buyout using life insurance. To fund a buy/sell agreement, the company can hold life insurance on all partners, ensuring that if one passes away, the company itself can purchase their stake," Lankau says.

3. What if some of your kids are involved in the business but the others are not?

Marlon knows that his son and daughter are enthusiastic about taking over the business one day and building it into an even bigger success to support their own families. But what if Marlon had a third child who was studying marine biology and wanted nothing to do with commercial kitchens?

With most of his net worth tied up in his business, Marlon wouldn't want to treat his third kid unfairly by leaving them nothing. But he also wouldn't want to leave them a share of a business controlled by their brother and sister, a situation that has led to conflict and resentment for many families.

Something to consider: There are many approaches to this common challenge. "Life insurance could again play a role," says Lankau. Marlon could purchase a policy and name the child not inheriting the business as the sole beneficiary. A buy/sell agreement can also be helpful, if it is written to give the sibling not interested in the business the opportunity to sell their stake back to the company.

4. How will you retire?

Most business owners are counting on the wealth they hold in their business to fund their retirement. And yet, since most don't have a succession plan, they may not really know how they will get the money they need to live comfortably out of their business.

“They may know where they are now in their business, and where they want to be when they transition out, but have zero idea of how to get from here to there," Drake says.

Something to consider: The earlier a business owner starts planning for their own retirement, the better they will be able to lay the groundwork for a successful transition. They may choose to retain an ownership stake that comes with regular dividends. They may decide to diversify their savings by contributing to an IRA or other retirement accounts for themselves throughout their working years. Or they may plan to sell the business outright and use the proceeds to fund their golden years.

Addressing all of these questions helps business owners feel confident that the final chapter will be as successful as everything that came before.

"The way I describe it to clients is, the plan to take off and fly a plane doesn't mean much if you can't land it, right? The same goes for the best business plans," Drake says. "A lifetime of hard work can be undone without a succession plan to map out your final approach."

The path to successful transitions relies not just upon planning but also good, up-to-date information. Business owners should have a team they can rely upon to advise them in the most tax-efficient, safe, and effective methods of achieving the results they want.

First Horizon Bank embraces the team approach when advising business owners on their succession plans. Beyond the bankers and financial professionals available in-house, clients can be connected to trusted attorneys, accountants, and other resources to make sure they make informed choices about the future of their business – and their lives.