Also, the advisors are never all brought together at one time to focus on issues. This is one of the most difficult issues family business owners face. They love their children equally and want to treat them all equally when it comes to distributing the results of their life's work. Since the family business amounts to such a large percentage of their net worth the owners decide to split the stock equally among children. This is a recipe for disaster.
Most family businesses pay little or no annual dividends or distributions.
Non-employee children often grow impatient with an asset which is illiquid, provides little annual income and growth in value cannot be easily measured. Employee family members grow weary of the second-guessing and questioning about dividends. In the end it becomes easier to sell and be rid of the hassles than to keep fighting with people who don't work in and cannot understand the business. The common thread running through all five of the most commonly given reasons for failure is a lack of planning. Most family business owners think of themselves as supermen or superwomen.