family-business
Share on facebook
Share on twitter
Share on linkedin

How To Scale A Family Business

Keeping the business running for years is the goal for many business owners managing a multi-generational company. This is especially since, aside from being an entrepreneurial endeavor, a family business also involves an emotional investment from its members. But aside from ensuring that operations are running smoothly, there may also come a time wherein the idea of scaling your family business is worth exploring.

A Quick Guide To Scaling A Family Business

business teamwork hug together support cooperation group colleage

Scaling a family business can open opportunities for growth and increase the company’s profit. For one, it’ll allow you to tap into a larger market and accommodate more clients. But along with this opportunity, the demand and workload of a family business also increase. With that, the organization must ensure they’re able to cope and deliver. 

While this can be a promising move for the family business, it’d be good to note that this will require a lot of planning and consideration to ensure your company’s growth is supported. And to help you get started, here are some insights to keep in mind when scaling your family’s business:

1. Assess The Business’s Finances

Not all business is the same, and now that you’re scaling up your family business, you’ll need all resources that you can get to accommodate your growth plan. As such, one of the things you can do is conduct an audit of your current budget and understand how your resources are being spent. This can be a great exercise to determine misplaced funds and reallocate them to support your business as your scale up. 

Join Our Small Business Community

Get the latest news, resources and tips to help you and your small business succeed.

On the other hand, another option you can consider is getting additional funds to support your operations. You can use this money to hire more employees or purchase new equipment. And to help you learn how to obtain a small business loan, you must first understand what they are and how they work.

Business loans are among the many financing options you can explore. In this setup, a bank or other financial institutions can grant you the fund you need for your capital, which comes with interest rates and other fees. Lenders will rely on your credit score and financial history to determine whether or not you’re eligible for a loan.

2. Get Everyone On The Same Page 

Family businesses often have multiple generations working together. And while it’s a good thing that each member has their own unique set of skills, knowledge, and experiences, the challenge is bringing everyone together on one page and making them work towards the same goal while respecting each other’s strengths and weaknesses. 

To do this, you need to create a shared vision for your company, especially if multiple family members are involved in making decisions. This shared vision should be communicated so that everyone is on the same page about what the company stands for and what direction it wants to take in the future. This can go a long way in promoting good communication between family members and preventing potential issues from arising.

3. Consider Getting Accounting And Investment Support

As the family business expands, the more hands-on members should be in overseeing its operations, which includes administrative tasks and handling the company’s finances. And as the company’s profits continue to increase, more proper wealth management becomes essential. Hence, to help you with this, consider looking for family office services

Such companies offer various services, including accounting and bookkeeping, and legal services, to name a few. But to ensure quality service, always consider the firm’s experience when looking for family office services. Ideally, you’d want one that has been in the industry for years. You’d also want to work with a team you can trust and who’ll prioritize what’s best for the family.

4. Streamline Workflow And Processes 

As mentioned, as the family company grows, the scope of the business could also expand, leading to an increase in workload and demand. Hence, the need to keep up with these changes to ensure it operates more efficiently. This is where streamlining current workflow and processes come in. And one of the ways to do this is by leveraging technology.

There are various tools and software that will allow you to automate processes like nurturing leads, managing your customer database, and inventory management, to name a few, eliminating the need for manual tasks.

5. Discuss Family Dynamics And Organization Structure

Besides understanding the technical side of managing a company, running a family business also entails a discussion about family dynamics and succession planning. Clearing the hierarchy and organization structure is a critical process that can help avoid disagreements and conflicts down the road. This can also help ensure everyone is aware of their role and what’s expected of them. 

In addition, as the family business matures, it can be helpful to have a discussion about who will take over. And as you choose a successor, remember that they must understand the business inside out and shares the goals and vision of the family business’s founders.

Wrapping It Up

Scaling your family’s business is a significant decision that can boost profits and allow you to remain competitive in the market. Hopefully, the tips outlined above can give you a good start as you grow your business.

Join Our Small Business Community

Get the latest news, resources and tips to help you and your small business succeed.

RECENT POST

beach resort

How to Book a Villa on wiotto

To answer the question of when it is better to book the Maldives, it is worth distinguishing between the time spent on the islands and