MUNCIE, INDIANA (news) – Seventy percent of all family businesses never get beyond the first generation, according to Churchin Family Business Advisor. With such alarming statistics, many family business owners may wonder how to make sure their family business thrives. Family businesses are often created not only for profit, but also to bring a family closer together and give it a unique bond. With only 3 percent of all family businesses extending beyond four generations, a family business owner may want to lay a stable foundation sooner than later.
Always Plan Out Your Succession in Advance
If any of your children are disinterested in the family business, it’s best to learn this early so that you can plan accordingly. According to the Small Business Administration, succession planning is one of the best things you can do to ensure the longevity of your business. At the same time, you should make sure that none of your family members feel pressured into the family business. If they do, it’s likely that they may eventually sell their part of the business or simply become unhappy.
Separate the Business Side from the Family Side
CNBC suggests it’s best to draw lines between business and family issues. You should create a specific business structure and urge your other family members to follow business arrangements. At the same time, you should make sure that your business does not encroach upon your family life. Make sure that you and your children are still setting aside time for your family, even when there is business to be done.
Find the Right Positions for the Right People
As with any business, you should always make sure that the right people are in the right positions. If a particular family member excels at accounts payable, you can put them on Quickbooks invoicing, but if they absolutely abhor technology, it’s a bad idea to put them in charge of the IT. Business News Daily encourages family business owners to look critically at their family members and ensure that they are all in a position that suits them. Not everyone can be, or should be, in charge of every task.
Don’t Be Afraid to Ask for Help
Having a family business doesn’t mean that you can’t hire outside help. If you do feel that you need outside support, hiring someone from outside of the family will be best for everyone involved. When hiring someone from outside, remember that they have become a part of your business “clan.” Alienating your employees or business partners simply because they do not share a biological bond is a certain way to eventual self-destruction.
A family business comes with unique challenges but also some exciting benefits. You get to work with the people you love the most and you are allowed the security of knowing that every dollar your company makes is going into the future of your family. Many of the largest corporations on earth started out all in the family. Family businesses that do survive often thrive through loyalty and affection, and they offer incredible benefits such as flexibility, support and stability. When you start a family business, you are creating the beginning of an incredible legacy.