Starting your own business is a big moment, and when you decide to involve your family, it can involve some extra challenges.
On the one side, a family business can mean that everyone is more committed to the business’s success.
On the other hand, not properly considering what role each family member will pay and what their time is worth might cause negative feelings.
If you want to start a family business and aren’t sure where to start, make sure to consider these 7 points first:
One of the first things that you need to consider when you’re thinking about starting a family business is registering your new business properly.
In the United Kingdom, for example, according to the business experts at https://help.uniwide.co.uk/how-to-set-up-a-business-in-the-uk/, you can register as a sole trader, partnership, limited liability partnership, or a limited company.
The United States and Canada have similar categories, depending on whether your business is a solo venture, a group of partners, or a larger-style corporation.
Think about how ownership will be divided and how many family members will be involved, and then decide on the right type of registration from there.
One of the most important aspects of going into business with family members is deciding who will take on what roles.
Depending on skill levels, and the amount of funding provided by different people, it may make sense for some of your family to have a larger stake in the business than others.
Plan a sit-down meeting with everyone that wants to be involved in the business, and work together to decide what jobs each family member will take on, or what they might contribute in other ways.
It’s important that everyone comes out of this meeting being happy with the decisions, so make sure you’re willing to compromise somewhat.
And, of course, make sure there’s a written record of the final decisions that can be referred to in the future if necessary.
Once the individual jobs have been decided on, it’s time to start thinking about payment.
Cash flow can be limited in a business’s early days, so coming up with realistic compensation is a big part of starting a family business.
Begin by researching the average wages for the jobs each family member is taking on, and then adjust as necessary.
In some cases, your family may prefer having a larger stake in the ownership of the business even if that means a smaller wage initially.
Once again, as with the jobs each family member is taking on, make sure that salaries are accurately recorded and documented.
It will likely be helpful in many cases to hire a lawyer to write up contracts for each family member, so there is no confusion about the scope of work and payment involved.
Creating a Website
Whether you’re launching a brick-and-mortar operation, a locally-provided service, or a fully digital venture, your business will benefit from having a website.
If needed, start simply by buying the domain name for your business and using a free hosting platform to set up a simple landing page.
Make sure your website covers the basics: the hours you’re open for business, the address, the phone number, and the products or services that you offer.
As you grow your business, you may decide to expand your website to increase sales or attract new customers.
But, in the early days, simply ensuring your business has a presence online is an important early step of any business launch.
Ideally, one of your family members may have a flair for marketing and be able to take on that aspect of the business.
But, if not, it’s important to think about how and where you’re going to promote your business and build up your customer base.
If need be, consider hiring a marketing manager to help promote your new venture in the most effective way possible.
If doing that isn’t budget-feasible, then start small by creating a Facebook page and using it to offer customer support and collect reviews.
Using social media marketing for your small business is ideal when first starting out, since it provides a free way to advertise to those in your area.
Plan the Physical Location
While online-only businesses are more popular than ever, brick-and-mortar locations are still essential for many small businesses.
In some cases, a small office space may be all that’s needed at first, especially if you’re providing a trade or service rather than a physical product.
But, in other cases, you’ll need a larger location that’s open to the public, whether you’re launching a new coffee shop or an antique furniture store.
Paying the rent or mortgage on a physical location can easily become one of the biggest expenses when you start a family business, so make sure to shop around.
And when it comes to furnishing your location, checking in with the family members involved in the business can be a great idea.
With everyone chipping in a few items they don’t currently need at home, you may be able to handle interior decor with almost no actual purchases.
Check In Regularly
When it comes to running a family business, it makes sense to check in with everyone regularly to ensure they’re still happy with the current situation.
After all, as the business grows and attracts more customers, jobs that were easily handled by one family member may become jobs that need additional support.
Plan to have a family business meeting at least once yearly, so that everyone in your family that’s involved in the business can share their suggestions and feedback moving forward.
The best part of checking in with your family members is that it can be fun as well as work.
Plan some other activities, let family members bring spouses and children, and the family business meeting will be an event everyone will look forward to.
Deciding to start a family business can be a great way to make money while also building a future for you and your loved ones.
But, before you get started, it’s essential to ensure that everyone involved has a clear idea of their role, responsibilities, and compensation.
When you make sure the family members involved are equally dedicated to the business, you’re all the more likely to succeed, and grow closer together as you do.