Closing a Firm - Architecture/Landscape Architecture/Engineering
Hi All,
I just wanted to reach out and see if anyone had any experience with closing a professional firm when retiring. I am a landscape architect with my own firm, one employee (myself). I am looking to retire in the next couple years. I am wondering how to close my business. I will finish my contracts, but with this type of firm just because I finish my design work, typically it will take a couple years for the project to be built. I am not selling my company to anyone, I am simply ending it. I am wondering if I should send out an email to clients when I want to close the company letting them know I am closing and letting them know I am happy to share their working drawings with them if they get back to me in a timely manor. Or if I am obligated to stay open a certain number of years for construction administration. I plan on keeping my insurances (I think there is a type of insurance that you can get for non active companies, but will cover over a set period of time after the company ends). I plan on reaching out to a lawyer, although I am not quite sure which type would be the correct lawyer. But if anyone has any experience with this I would appreciate hearing their insights. Thank you.
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Hello! I don’t actually know anything about your question, but do have a child that might be interested in going into your field, so your post caught my eye. Congratulations on successfully being your own boss! Would you recommend that route to young people coming up? She’s still in high school, but has been interviewing people in the field to try and help determine which path she’d like to start on
It is a great career field. It uses a lot of creativity, math, construction design and attention to detail. No project is the same, so there are always new challenges plus the profession is broad. You can work in public or private sector, large scale urban planning to residential projects. If your daughter wants to know more I could setup a Teams meeting and share some of my type of projects with her and answer any questions. It is hard to decide what you want to spend the rest of your life doing at age 18, so I think she is a head of the game interviewing different professionals.
What a kind offer! I’m sure she would love to learn more about the field and your experience. Would you be comfortable sharing your firm’s website so I can pass it along to her? I think there is a way to private message on this site….
Thanks again for your reply,
Brooke
Howdy, I was (or still am to some degree) in a similar situation and can at least provide my high-level thoughts. I stepped away from my one-employee (myself) civil engineering consulting company about 18-months ago. I only had one client and had a few months of coordination with them to have all my project obligations off-loaded to my "successor" consultant.
I would recommend consulting with small business attorney to confirm "proper" steps, but mine generally advised to keep my LLC open/up-to-date, and maintain an extended reporting period on my professional liability policy to have some coverage for projects that ended recently or were in review/construction. My ERP policy is through ASCE (as were my policies prior to stepping away), and I'd bet there's options from wherever you've had your policies to-date. The ERP policy isn't cheap (it's basically an extension of your current professional liability over the next ~1-3 years, but you no longer have business revenue to pay for it), so I actually reduced my professional liability coverage limit (since I was no longer bound by the 'high' limit of my client contract), then started the ERP on the reduced coverage limit. Like most other insurances, I consider it a necessary evil to sleep a little better at night.
Congrats on the retirement and new adventures! Happy to discuss more, if that'd be helpful.
Thank you for all the information. It confirmed a lot of things I was thinking. I guess my biggest concern is telling clients that I am going out of business or closing up shop. Especially new clients that will have a shorter period of construction administration. I have thought about declining work in the last year and allow that to be a buffer for clients to have questions answered and plans revised as needed before I shut down. But at the same time I just want to be done.
I completely understand the "one foot on the boat, and one on the dock" feeling of how to continue existing work and also be trying to move onto the next phase of life. I will say I wasn't 100% sure I wouldn't go back to active work (and thus need to re-apply for policies, etc) when I started the "mini-retirement" almost 2 years ago, but I can now safely say I won't be going back to the field.
From a practical standpoint, my understanding is that you can't start an ERP-style policy until there is no new "liablity" meaning you couldn't start that policy unless you truly are done with projects/billing clients.