Promoting from within, the right way
Most internal promotions fail in the first 90 days, not because the person was wrong, but because the support wasn't there.
Tell the team why, in plain words
A short explanation ('we're promoting [name] because [specific behaviors]') heads off resentment before it forms. The team usually knows. Saying it out loud locks it in.
Re-train, don't assume
Being great at the work isn't the same as leading it. Block out training time for new leadership skills, the same way you would for a new technical skill.
Pay the title, not just the promise
Promoting someone without a clear pay change is the fastest way to lose them to a competitor. If the new role is real, the new comp is real.
Take your version of this question further
This is one operator-tested angle on the question. Your shop, your size, your trade, and your team change the answer. Ask your specific version inside Ask a Shop Owner to get a response grounded in how owners like you actually handled it.