How do you transfer a family business?

Successfully transferring a family business over to the next generation involves a lot of big decisions for both the current and new owners. Understanding the factors involved is key to making this transition successful. This infographic outlines the key factors that you will need to consider during this process.

Factors to successfully transferring a family business

Make it process, not a one-time event

Proper succession plans can take years to execute. Planning should start early and outline important transition dates and goals.

Bring in key family members early

The more familiar non-family employees are with the future management, the better. Bringing in key family members for management positions before ownership will allow them to really understand the company.

Require education

Define the education requirements you require the next generation to obtain. The reality is that the feeling of nepotism will decrease if people feel like the position was earned, not given.

Put the plan in writing

Oral agreements are the first step, but it’s important to put them in writing. Relying on memory can lead to confusion and disagreements. If everyone involved has signed a document, it can be easily referenced in the future.

Communication is key

Once you have a plan in place, it needs to be communicated, both within the family and within the organization itself. Any changes you make along the way should also be communicated.

Get outside help

It’s important to consult professionals during this process such as lawyers, accountants, and financial advisors. They can help you put together a proper succession plan in order to guide you through the process.