How to Run a Successful Family Business

Family businesses make up a major proportion of new businesses in Australia every year. There are many benefits to going into business with family, including more support from established relationships, access to family funding and growing wealth within the family with a common goal. However, family businesses also come with some unique challenges.

As a family business ourselves at Transact Group, this is a topic close to our heart. In this article, we share 7 tips that will help you establish and run a successful family business.


1. Make sure the relationship comes first

Before all else, you need to establish clear boundaries between personal and business matters. Limit business discussions outside of the office, or at least ensure that your business talk is not encroaching on the enjoyment of others during family time.


2. Have defined roles based on your strengths

Different family members will have different strengths and weaknesses, and this can be used to both benefit the business and increase job satisfaction. Clearly define each role with KPIs and set responsibilities, and allocate tasks based on the role description and individual strengths.


3. Seek external advice

The decision-making process within a family business can sometimes become to closed, causing the business to stagnate. Seek external advice regularly, either from a board of advisors, coach or specialised contractor, and avoid the tendency to keep business issues within the family.


4. Use clear contracts

Every aspect of the business, from employment to finances, should be clearly stated in a contract or formal business plan. Not only does this act to minimise conflicts, but can also be used to settle legal disputes should they arise down the track.


5. Address each family members’ needs and personal goals

Each person within the family business will have different goals for the future, and a clear path to reach those goals within the business can increase motivation and encourage long-term commitment.


6. Require outside experience first

Requiring younger family members to get a taste of the outside world before joining the family business is a great way to future-proof the business. At least three to five years of experience in an unrelated industry gives the new employees an understanding of how the business world works outside of the family bubble.


7. Develop a succession plan

A succession plan details how the business will be handed down to the next generation, and should be written by a lawyer or succession specialist. It is an important tool to avoid conflict within the business, as well as act as a roadmap for investors or financiers in future.


If you are thinking about purchasing a business with family members, contact Transact Business Group to start the planning process and look into successful businesses already on the market. As a family business ourselves, we are passionate about helping others have the same success.