Family business succession is a family business

 by Hispanic Chamber of E-Commerce team

Do you wish to see your family business remain a family business? Many business owners truly do care about seeing their company stay in the family, which is perfectly natural—but it won’t happen without some careful and deliberate planning. If you want your children to one day assume control, this should be done well in advance, long before you actually plan on stepping down.

This is partly to ensure that your children are ready for this responsibility, that they feel confident in their abilities to run the company—and that you feel confident in them, as well. Additionally—and at the risk of being morbid—you frankly don’t know how long you have to conduct this training; should something unexpected happen to you, it’s important for the business that your kids are able to step up and assume control.

•  Succession planning matters

This isn’t just a matter of training and mentoring, of course, but of actual, formal, legal planning. That’s the first step we recommend in this process: Meet with an attorney to set up a succession plan now, clarifying who you want to take over control of the business when you retire, or should you pass away.

• Communication is key

Communication is another important concept—and here, we remind you that it really is a two-way street. Start the conversation now by inquiring as to whether your children even want to take over control of the business. If they don’t, well, that may be disappointing to you—but it’s likely going to be more trouble than it’s worth trying to talk them into taking over the company if they don’t really want to.

Also, be open in communicating with your kids what running the business is like. Share with them the joys and the frustrations of it—your biggest sources of satisfaction, your biggest obstacles, and something of your daily routine. Help them get a feel for what running the business is like.

•  Train and mentor

Of course, you’ll want to train and mentor your children on-the-job, which will look different for different family businesses. One thing we would recommend to everyone, though, is that you give your children exposure to all aspects of running and working in the business; train them in every single department, from customer service to bookkeeping. They do not have to master everything, but they do need to have a basic familiarity with everything.

Start them young, too. Cultivate interest from a reasonably early age—and set them on a path toward true success running the family business.