When doing business succession planning, business owners are often passing the company down to their adult children. They assume that their children will want to run the business and follow in their footsteps.
But is this actually true? It’s very important to talk to your children first so that you can make a succession plan that actually fits their lives. In many cases, business owners find out that their children are not interested in inheriting the company. And that’s definitely something it is best to know from the very beginning.
They may not be a good fit
In some cases, children don’t want the business just because it isn’t what they envision for their life. Maybe they have no idea how to run a business or what they’ll need to accomplish. To them, it seems more like an overwhelming burden. If you leave a child your business and they feel this way, odds are that they are just going to sell it to someone else as quickly as they can.
They may be more interested in the money
Additionally, remember that some children may be more interested in the money than having the business as an asset. They would prefer it if you sold the company and just left them the earnings. This could be because they have their own goals in life or they have their own career. They’re not going to put those things on hold. Inheriting money can certainly help them accomplish these goals, but they have no plans to drop their own career and start running a business that they haven’t been involved with before.
Certainly, this doesn’t mean you shouldn’t leave the business to your children. It just means that you need to have an in-depth conversation with them before you do, and the two of you need to explore your legal options.