If you run a family business, succession planning is essential. Meet with an advisor who can bring the family together to help create a plan for the future that will minimize conflict. Who do you want to run your business when you pass away so that it stays successful? It is important to find a balance between engaging your successor’s interest and doing what is best for the company. One possible point of conflict is to transfer a controlling interest to the person you want to run your business and transfer a noncontrolling interest to other family members. The problem with this is it may create confusion and conflict that may lead to court battles and even selling the business. Before that happens, plan for possible solutions. A business can be split into separate branches, or family members can buy out each other’s shares. A good succession plan takes thought and professional assistance. Don’t wait to start this process.
(From “Tips for a Smooth Business Succession” by Amelia Renkert-Thomas)