(“But of COURSE the kids will take over the business when we retire!”)
You’ve worked hard to create a successful business for your family, and maybe even have several immediate or extended family members working in it. In doing so, you’ve created a legacy.
And who wouldn’t want to continue their legacy through the next generation if there was a logical successor who was interested and qualified to pass it on to?
Before you do, here are a few practical considerations based on work with clients that might help you avoid some of the common pitfalls experienced by others. Depending on family circumstances, I might even suggest that ‘passing it down’ should not be the automatic default for your family or your business until some issues are worked through. No doubt, raising these issues and discussing them with loved ones may be a difficult and delicate task, but
YOU OWE IT TO YOURSELF, AND TO YOUR FAMILY.
Given the disappointing survival rate of passed down businesses (30% for 2nd generation, and only 10% for 3rd generation), we’re obviously getting something very wrong or it wasn’t meant to be at least 70% of the time. If forwarding this article can be used to initiate needed discussion with others, please feel free to do so. Maybe your actions will create another family success story or at least avoid a huge disappointment. For the sake of simplicity throughout this article, let’s refer to your successor(s) as “Chris”, whether it be a she, he, or they.
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