I recently attended a function held by the St. Louis Business Journal regarding family businesses and how they had transitioned to the second, third, and even fourth generations. It was a program of interest to me because so many HVAC and sheet metal businesses have traditionally been family-owned and have been passed from father to son. I was especially interested because I have seen many instances throughout the years where the transition from father to son has not gone as smoothly as had been anticipated. For many reasons, I have seen these healthy, successful family businesses fail during, or shortly after, the transition period.
Some of the issues I have seen that have complicated the transition period include the heir apparent never really wanted to take over the business but didn’t know how to tell dad; family members who are not involved in the business become highly interested if it is determined there is significant value to the company; and if a son or daughter gets married along the way, then his or her spouse brings a whole new set of thoughts and ideas for the business that may never have been considered. While those are just a few of the complicating circumstances that occur, I’m sure you can see how transitions can result in some serious headaches.