How to get out of a family business
The family business is a time-honoured tradition within the UK and some of our biggest and best-loved brands started out as a small family business, including Warburtons, Cadbury’s and Sainsbury’s.
However, it’s not for everyone and with so many options available to the younger generations these days, thanks to the internet, new generations may be looking to break away from the family business and make it on their own.
Should you leave your family business?
You may be thinking about leaving the family business to work on your own business or projects, or maybe there has been a dispute within the family that has caused you to make this difficult decision.
Whatever the reason, leaving a family business can be a difficult decision to make and it’s important that you know exactly what you are giving up before you do so.
Not only do you have to think about the personal ramifications of leaving, but you need to also think of the financial and contractual obligations that you may be tied up in. This is why hiring an accountant and a solicitor is your best bet for helping you make that all-important decision.
First of all, think about:
- What will you be moving on to? – A more stable job role, or a new venture that is secured and ready to go…
- When will you go?
- Who will be taking over from you once you are gone?
- What are the legal obligations?
- What are the financial obligations?
Ensuring you have a stable job to move on to is the best way to get started, it may be something you’ve been working on, on the side of your regular job role or something you’ve been planning with an external business partner.
Talk to Adrian Berg
Family business expert
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How to leave a family business
The most important thing to remember is professionalism, you don’t want to completely burn all bridges with your family and their business, so ensure you stay professional throughout the process.
This is something that many family businesses struggle with, as they have a level of comfort and ease with each other that most business partners don’t have. This can make business both easier and more complicated!
If you are thinking about leaving your family business, ensure you have spoken to the other members before taking any formal action and start to create a plan for your departure. Once you have set out an informal plan, you can then start to take more formal and legal steps to leave the business.
If you are in a situation in which you are not able to talk the other members of your family business, then start to seek financial and legal support as soon as you are 100% sure of your decision. An accountant and a solicitor will be able to offer you the best advice and tips on what your financial and legal obligations are and the best ways to handle them.
What do you need to think about when leaving the family business?
Your family business will most likely have an accountant that handles all the financial side of things, so it is worth chatting to them one on one to find out what you would be responsible for and what actions you will need to take when leaving.
Seeking legal advice will also be your first point of call, especially if you own or own part of the family business. Sorting out the contractual side of things before making your final step out of the door will ensure everything is tied up before you go.
The single most important thing is communication. Whether that is between your family or between your legal advisors. Keeping open and streamlined channels of communication throughout the whole process will make the experience easy and stress-free.
Want to find out more about our family business accounting services? Get in touch with us today!