Multi-Generational Businesses

As a multi-generation firm, we relate to family businesses.
We have experienced a large number of the same issues they have, or are still experiencing. Although a family run business has the same concerns every business has, there are other dynamics to address, which can compromise decisions.

In a family business you need to consider other issues.
For example, when a typical owner considers selling his or her business their primary objective is to sell at the highest price possible. In a family operated business, the sale or transfer to the next generation may be less focused on the financial gains of the owner, with more attention paid to the smooth transition to family members. Then there may be other issues to address such as which family sibling should be made President? Who will be more responsible in managing the financial aspects of the operation? Are there relationship differences to address? One of the more sensitive issues to address can often be how to develop a clean exit strategy so the new generation can take over?

Then there are financial and tax considerations.
How is company stock allocated to family members? How is each family member compensated? What type of value do you place on the business? What type of payment terms can be established? Are there alternative ways to pay for the purchase to limit tax liability and/or minimize the parent’s risk? What about estate and gift planning options?  Even though a family member may be taking over, the parents may still need the proceeds from the sale to fund their retirement.

We facilitate family meetings.  
These meetings set goals, conduct strength, weakness, opportunity and threat (SWOT) analysis to develop a common mindset and a forward looking plan. This aligns the family’s goals and keeps them focused. Experience makes a difference.