The last thing on a young family business owners’ minds is what to do when they’ve finished running their businesses. From identifying a vision and defining a strategy, to managing operations, family business owners are very busy people. With many jobs to be done, the focus is often on the midterm impact rather than long term legacy. In the majority of cases, the thought of this impending reality may never even cross their minds until it’s time for their retirement. At this crossroads, most envision handing the empire they’ve built down to the next generation as part of their family legacy. Though this next-generation succession may feel as simple as moving from a to b, even the most professionalised and well-aligned families find succession a huge challenge and milestone. What’s more, though succession is often the expected outcome, there are times when life and business do not proceed accordingly. If recent events have taught us anything it’s that today the only constant is change.
‘The best-laid schemes of mice and men go astray’
– Robert Burns
A family may face certain situations that prompt them to sell their primary business or their investments outside of core business may grow more substantially than the company itself. Such changes could necessitate a shift in strategy and a fundamental transition from being a family business to becoming a business family.
Key factors that spark the transition
To buy and sell is the game. When a family has built a successful business, they may consider selling to the highest bidder. There are a number of other reasons which might prompt this decision, however, broadly categorised into the following key factors.