
THE EXIT PLANNING BLOG
Keep up-to-date with exit planning, succession planning, industry trends, unique specialty insights, and useful content for professional advisors and business owners.
Share this
EPI MythBusters – I Don’t Need a Detailed Exit Plan Because my Daughter Will Take Over the Family Business
by Colleen Kowalski on November 24, 2020

Managing a Family Owned Business involves navigating business decisions as well as family relationships. As a family business owner, you might think that you do not need a detailed exit plan. After all, exit plans are for people who do not know who will be taking over their business – you know you are giving the business to your daughter. The problem is, without a detailed succession plan, you are setting your daughter up to fail in a business that has not maximized its value prior to transition. Not to mention the fact that your daughter might not want to be the successor of the family business.
Family Members vs. Management Team
Family run companies need to have alignment between family members and management when it comes to the business vision and plans. Without a complete and detailed succession plan in place, the likelihood of a successful intergenerational transfer is slim to none. According to the PWC 2016 Family Business Survey, 43% of Family Business Owners have no succession plan in place. Believing that transferring your business to your child is as easy as a simple handshake deal greatly diminishes the value of the business. Handing over your business to a child without planning can create hostility in your management team as well. Key employees may become flight risks after feeling slighted in succession discussions. With the addition of a detailed family exit plan, you increase the value in your company through value acceleration, prepare your successor with an organized report of financial information, and include management team leaders in the process.
Succession Planning in Family Business
About half of business owners want to transfer their business to a child but only 30% do so. Family’s are not without their conflicts, especially in family businesses. 32% of family businesses surveyed by PWC in 2012 were apprehensive about the transfer of the business to the next generation and 9% saw the possibility of family conflict as the cause of this apprehension. This apprehension leads to succession plans being pushed aside for as long as possible. While an owner might know they want one of their children to take over the family business after they retire, they have no set plan for how to transition their business to the second generation. Failing to plan has led to 47% of family business owners who would like to retire in the next five years to not have a successor.
Working with a CEPA and a Family Business Advisor will help to finalize a family business succession so owners can enjoy watching their child grow the family business after their retirement.
Share this
- Blog (413)
- CEPA (283)
- exit planning (215)
- CEPA community (151)
- Business Owner (94)
- Exit Planning Summit (69)
- EPI Chapter Network (60)
- Content (46)
- EPI Announcement (43)
- Value Acceleration Methodology (41)
- Webinars (36)
- Exit Planning Partner Network (30)
- Marketing (30)
- 5 Stages of Value Maturity (25)
- Books (23)
- 2023 Exit Planning Summit (20)
- Exit Planning Teams (20)
- Leadership (17)
- family business (17)
- Exit Options (16)
- CPA (15)
- EPI Team (15)
- Intangible Capital (15)
- women in business (15)
- Excellence in Exit Planning Awards (13)
- Black Friday (12)
- Chapters (12)
- Chris Snider (12)
- National Accounts (12)
- Small business (12)
- charitable intent (12)
- personal planning (12)
- EPI Academy (11)
- Financial Advisors (9)
- About us (7)
- Insiders Bash (7)
- Podcast (7)
- Walking to Destiny (6)
- Exit Planning Content Library (5)
- Owner Roundtables (5)
- Scott Snider (5)
- State of Owner Readiness (5)
- Value Advisors (5)
- financial planning (5)
- 5 Ds (4)
- Five Ds (4)
- executive training (4)
- 2024 Exit Planning Summit (3)
- Awards (3)
- Case Studies (3)
- Owners Forum (3)
- forbes (3)
- EPI Thought Leadership Council (2)
- Three Legs of the Stool (2)
- Whitepapers (2)
- Business Owners Forum (1)
- Exit & Succession (1)
- Peter Christman (1)
- Veteran (1)
- business consultants (1)