The business may not earn enough to pay its way. There may be serious family splits, and you may not have the confidence or trust in your children. All these realities must be examined by the business owner in order to plan realistically for the best needs of the owners, the business, and family members. A third common mistake is confusing equality with fairness. Treating all the children the same and not preparing a leader for the business usually causes long-term business succession problems.
Every business has special needs to succeed in future generations.
Competent management, cooperative ownership with similar goals for the business, and proper capitalization are absolute necessities. Management by consensus usually does not work when family issues are involved. Disharmony can destroy a business, which is not fair to anyone. A fourth mistake is using the wrong advisors. Succession planning requires the most competent advice available.