Are you hoping to give your business to your children? Are you the adult son or daughter who is hoping to take over the family business?
Well, there’s good news and bad news. The bad news is something you may have already heard before: About 70% of family businesses fail trying to move into the second generation.
The good news, of course, is that you can be part of the 30% that makes it by doing a little careful planning regarding the transition. Try using these pieces of advice:
It doesn’t matter if the “new boss” is family. Your employees likely feel like family too. Help them adjust by telling them what changes to expect — and what they can rely on to continue. Let them know if their jobs are secure and explain how the new management style is going to differ from the old.
The new generation is bound to want to make some updates to how business is handled or the technology you use. Your marketing campaigns may be outdated or there could be basic gaps in your social media present. If you’re the original owner, realize that the next generation has to do things their way. If you’re the new owner, don’t let anxiety over your parents’ feelings keep you from doing what’s best for the business.
Even if you were raised to inherit the family business, there may be employees around who know things about the business that you don’t. Let them know you welcome their advice and information. Similarly, it’s smart to reach out to professionals who can help you transition. An accountant or financial advisor should always be involved. It’s also smart to have an attorney with experience in business development legal issues on board.
For more information on how we can help your business make the leap from one generation to the next, contact our office.