Partnerships – Keeping It In The Family

bizmanagementcirclesAfter my discussion of general business partnerships the last few weeks, I felt it was fitting to write on a subject matter that many people often avoid talking about – family partnerships.

Working with others is difficult as is, let alone when adding personal relationships to the mix. A family partnership adds more challenges, and it is important to consider these before agreeing to work with relatives.

The most critical question to ask yourself is “are you bringing the family member into the partnership because they can help grow the business and complement your skills, or simply because they are related to you?”

In my experience, it is often the case that family partnerships are based on the wrong reasons.  For example many SMB owners invite their children into the business in hopes that they’ll take over the business, want to help out a family member who is out of work, or hire their spouse as a way to improve childcare arrangements.

Unfortunately, it is often the case that when family is involved, family comes first and the business comes second.

Using my 4 steps from last week, I’ve outlined below what you should consider before adding a family member into a partnership dynamic.

1. Giving Up Control

If you’re bringing in a family member who does not actually have the skill set you need or is not complementary to your abilities, then it is unlikely that you will trust them to effectively do their job and that takes away from your own work and productivity. Think of the value they bring to the business.

2. Setting Common Goals

Sometimes your passion, determination, and perseverance are not mirrored in a family member, so setting common goals can be difficult if they do not feel aligned with the business’s goals.

3. Working as a United Front

Mixing family and work can mean bringing personal matters into your business. What happens at home does not always stay at home! The concern is personal issues may be transparent to staff, clients, and suppliers, which can seriously hurt the day-to-day business operations as well as relationships with stakeholders.

4. Putting the Business First

The old saying “family comes first” applies to many aspects of life, but not business.  Involving family means that the business is often going to take a back seat when a family “issue” arises like needing time off, or meeting deadlines.  If only one partner puts the business first, then it can not only hurt a partnership, but also hurt the business.

What are your experiences with family and business? Have you ever been a part of a family partnership, or worked with one? Let me know in the comments.

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Starting A Business – Think First, Act Second (Part 3)

franchise

If you’re thinking of purchasing a franchise, your process is going to differ greatly from those thinking of starting a business or purchasing an existing one. Franchise ownership brings with it a unique set of challenges, risks, and benefits that some do not completely grasp.

The first and most important question I ask anyone investing in a franchise is “have you done your homework?” The number of franchises available is endless, and what most don’t realize is a franchise is more than just your typical fast food restaurant or retail store. It is important to move past the bricks and mortar concept of a franchise and see the franchise world in its entirety.  For example the professional services franchises industry, which handles white-collar jobs, like career coaching and banking services, is surging ahead of the typical retail franchises.  Spurred by middle-management and upper-management individuals with expertise in a field, they are looking for some type of business opportunity and this type of franchise is an opportunity for individual professionals to be part of a larger brandwith access to many resources.

Choose your industry and do your research! As I said last week, knowledge is power. Every franchisor has different regulations and policies and as such, they cannot all be treated the same. You must dive into the nitty gritty details of each franchisor and decide which businesses truly meet your criteria. Make sure that your goals and values align with those of your franchisor.

Once you have narrowed down your options, determine if they are financially feasible. Franchises require an up front investment, so it is imperative, as is with any business, to ensure you have the capital necessary from the beginning. On the plus side, franchises are a known, fixed investment unlike start-ups or existing businesses where there can be daunting hidden costs.

Once you have purchased a franchise, enjoy the benefits! If you partnered with the right franchisor, you will receive ongoing support from the franchisor in terms of training, resources, marketing, and much more! With an established brand, your selling power is increased, your ramp up period is shorter, and your likelihood of success is greater.

Ultimately, you must find the franchisor that best suits your needs and ensure that your short and long term goals are consistent. If you can find your match, a franchise partnership may be right for you!