The Protect Stage – Safeguarding Your Automotive Business and Legacy

Running an automotive business – whether a dealership, repair shop, or parts manufacturer – requires precision, strategy, and resilience. Just like a finely tuned engine, your business needs every component working in sync to ensure longevity. The Protect Stage of the Five Stages of Value Acceleration is about safeguarding your business, wealth, and family from unexpected disruptions, ensuring you are never caught off guard.

Many owners focus on daily operations but overlook key protection measures. What happens if a key executive suddenly steps away? Do you have the right life insurance policies in place to support your family? Is your estate plan up to date? Without a solid protection plan, even the strongest businesses can break down.

Protection Starts with Awareness, Intention, and Action

One needs to identify vulnerabilities, implement strategies, and take action to ensure long-term security. Your approach needs to focus on four critical areas:

  1. Personal & Business Risk Management – Your Financial Safety Net

Just as a warranty protects a vehicle, the right financial tools protect your business and loved ones. These include:

  • Life insurance policies that align with your financial goals, ensuring your family or business partners are not left struggling if something happens to you.
  • Key person insurance to protect against leadership disruptions.
  • Business interruption insurance to cover unexpected shutdowns due to supply chain delays or other disruptions.
  • Workers’ compensation and employment liability coverage to safeguard your employees and mitigate legal risks.
  1. Estate Planning and Operating Agreements – Keeping Your Business in the Right Hand

A business is only as strong as the agreements that govern it. One needs to ensure:

  • Your estate plan reflects your business succession goals, preventing legal disputes.
  • Buy-sell agreements are structured to ensure smooth ownership transitions.
  • Operating agreements are up to date, detailing roles, responsibilities, and contingency plans in case of leadership changes.
  • Powers of attorney are in place, so the right people can make decisions if you become unable to.
  1. The “What Happens When” Folder – Your Emergency Toolkit

In the automotive industry, a toolkit is essential for handling breakdowns. Your business needs the same preparation. Organize essential documents, insurance policies, legal instructions, and financial details so your family and team have clear guidance in an emergency. This ensures that if something happens to you, your business does not come to a screeching halt; your team will have step-by-step guidance to keep operations
running.

  1. Fractional Executives – The Pit Crew for Business Stability

Every high-performance race team has a pit crew; your business needs expert support,
too. Bringing in fractional executives (CFOs, COOs, or HR specialists) can:

  • Maintain financial control during transitions.
  • Strengthen operational structure and cash flow management.
  • Ensure seamless succession planning and compliance. Determine where and when you need these experts to keep your business running at peak efficiency.

The SafeList: Identifying and Closing Gaps

Like a routine vehicle inspection, the SafeList process pinpoints potential risks and areas needing attention before they become costly problems. Protection is not just about avoiding breakdowns. It is about ensuring your business, your family, and your legacy stay in the driver’s seat, ready for any road ahead.

Twelve Points Business Advisors is proud to announce that we have joined the Massachusetts State Automobile Dealers Association. Following the addition of Taylor Duffy to the Twelve Points team, who brings real world experience of having run car dealerships, this was a logical step as we look to bring our broad business coaching expertise to the automotive space. An insightful article written by our very own Dave Clayman will be featured in the official monthly publication of Massachusetts Auto Dealer every month. Jump to page 52 to view his insight in the February edition.

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