Family businesses are different to other businesses in many ways – they are close-knit, more informal, and precious to every employee. Family businesses hold sentimental value which means they offer their own joys and difficulties, but ultimately they need to be profitable just like any other business. When it comes to writing a business plan for your family business, there are a few things you should consider.
How are you treating your business?
When family members go into business together, many aspects of work life are informal. There simply might not be the same processes in place that you would find in other businesses – there might be informal business arrangements, and some things might be taken for granted. However, for the business to be lucrative it should be treated like any other, and your business plan is a good place to start implementing this.
Who’s in charge?
One of the things that might not be quite so formal as in a regular workplace, is the management hierarchy. Setting out official roles for each family member can help to allocate responsibility and also give you a framework for your decision-making processes and dispute resolution. Emotions can run higher than in other workplaces when everyone has a close relationship and is emotionally invested, so official process and structure can be helpful.
How will your business transition between generations?
When a family business has a rich heritage and story behind it, it is often important to keep it in the family and pass it down to the next generation. However, this isn’t always simple – some family members might not want to be involved in the business, or there might be disagreements about how the business is run. All this takes place while the family is trying to keep the business profitable, and older generations may also be using income from the business for their retirement. A business plan is a good place to document your exit strategy and determine how your business will continue and evolve over the coming years.
Does everyone agree?
It is important that everyone’s goals are aligned and that everyone involved is in agreement with how the business should be run. While people might not agree on every small detail, a unified view of the future can help you to better manage the business. Writing a business plan can help you to figure this out – you’ll be creating a centralised document that everyone can contribute to and refer to in the future.
If you would like any help with writing a business plan for your family business, get in touch online using the form on the right, or call 01604 420 420.