Running a family business can be one of the most rewarding yet challenging things in the world. You have to balance the art of being cutthroat in a bid to make maximum profits while also making sure that your family members are content and motivated. So where do you start to achieve that balance? And are there some specific strategies that you should be implementing in your day-to-day operations? Let’s find out as we cover three secrets to growing a successful family business.
Reduce Your Monthly Expenses and Lower Your Personal Debt
Most startup businesses are self-funded, as banks typically won’t loan money to a new enterprise without a proven track record and some years in business. Much of the cash you use to finance your new operation has to be drawn from your personal finances. You’ll need these funds to pay for the equipment, operational expenses and initial inventory as you start out. One of the best ways to free up cash for use in your new venture is to refinance student loans . Most college graduates have significant student debt due to college costs that have skyrocketed over the years. When you refinance your individual loans and consolidate them into a single note, you’ll be able to cut your monthly payments and save substantially over the course of the loan.
Identify the Key Strengths Each Family Member Brings
You can tap into the fundamental power of a family-based business if you focus on the key strengths and skills that each person brings. While you may, at times, just need to fill a position to keep the lights on and the business running, ideally, you’ll tap into each person’s strengths. When you focus on their top skills and put them in positions that take advantage of those strengths, you’ll be on the path to success. In order to truly understand how to do this, it’s helpful to have everyone take some of the sophisticated personality and profiling tests. These surveys and processes help uncover each person’s areas of brilliance and really lets you know what drives and motivates each individual. By investing in this process, you’ll help ensure that you get the best out of everyone.
Choose Your Family Members Wisely
With a family business, all the dynamics of a relationship are there plus you have all of your finances, career hopes and dreams, and economic survival on the line too. If you are looking to add a family member to the team, think twice and see if that’s right for them, for the business and for you. This can be a great way to improve your self-respect by asking the tough questions. You need people with positive energy and a can-do attitude, and you don’t want to add problem family members to the mix. It’s hard enough to fire an employee that you don’t know personally so can you imagine how difficult it would be to tell your sister, brother, aunt or niece that they’re not a good fit for the business? The more you have to do this, the more difficult it will be to retain the relationships that you once valued.
