The entrepreneurial spirit is running high in today's society. People want to go into business for themselves for numerous reasons, whether it be to have the freedom of being their own boss, to increase their earning potential, or simply because they have an idea no one else has ever had. However, while many people are ready to go into business for themselves, few want to start a family business. These businesses encompass multiple members of their family and have the capacity to be passed on from generation to generation. For the rare entrepreneur who wants this type of businesses, this is for you.
The Business
When forming a family business, first consider the business. As opposed to a typical sole owner situation, a family business is a little more complicated. The idea is that this is a partnership between people who are related. However, it must truly be a business partnership, not a personal one. Therefore, everything must be in writing.
Start with the business plan. This will name the owners of the business as well as their specific roles. This will also name the mission statement and goals of the business, how it will be financed, and even how internal issues will be handled. Your business plan should also include a succession plan, which will address two scenarios: (1) if you will pass the business on to another family member or (2) if the business will be sold to a third party who is unrelated to those in the family business. The more details present in your business plan, the less surprises you and your family will experience that can cause bigger issues down the road.
Start with the business plan. This will name the owners of the business as well as their specific roles. This will also name the mission statement and goals of the business, how it will be financed, and even how internal issues will be handled. Your business plan should also include a succession plan, which will address two scenarios: (1) if you will pass the business on to another family member or (2) if the business will be sold to a third party who is unrelated to those in the family business. The more details present in your business plan, the less surprises you and your family will experience that can cause bigger issues down the road.
The Family
The difference between a traditional business and a family-owned business is, obviously, the involvement of family. Family is always personal; therefore, emotions often run high. You leave the office only to see the same people at home, during the holidays, and on special occasions. This does not have to be a bad thing. However, in order to make it positive, you must address that family is part of your business model. To accomplish this, you must address the role in which your family will play in the business and the role your business will play in your family. Clear boundaries must be set to make sure you and your family do not become so engrossed in the business side of life that you are constantly bickering or only discussing business. Your family must come first as a family unit. Emotions must be allowed to have a place in your life. Similarly, family events should not always revolve around business and business functions. These boundaries are necessary to have a healthy home life as well as a successful family-owned business.
The good news is there is help specifically for those entrepreneurs looking to be family business owners. Hubler for Business Families has been helping families run successful businesses and even more successful families for over 30 years. Before you start your family-owned business, contact them today at (612) 375-0640 to help you develop a plan to keep your business and family successful for years to come.
The good news is there is help specifically for those entrepreneurs looking to be family business owners. Hubler for Business Families has been helping families run successful businesses and even more successful families for over 30 years. Before you start your family-owned business, contact them today at (612) 375-0640 to help you develop a plan to keep your business and family successful for years to come.
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