Keeping it in the family: planning succession without the fallout

Tenth in the succession and exit series. Following the post on selling to a staff member, this one looks at the other insider option, passing the business to family, and the fairness and preparation problems that come with it.

Passing the newsagency to a son or daughter sounds like the happy ending. Sometimes it is. Just as often it turns into the hardest thing a family ever does.

Family succession fails not because the business is weak, but because the plan is unspoken. Assumptions sit unaddressed for years, then surface at the worst moment. Getting this right takes as much planning as any sale to a stranger, and more honesty.

Start with an honest question

Does the next generation actually want it?

Too many owners assume a child will take over because it would please them, or because the child once said something encouraging a decade ago. The child, meanwhile, may feel trapped by duty and quietly dread it.

Ask the question directly and early. Give them room to say no without guilt – this is critical. A newsagency handed to an unwilling successor helps no-one. It burdens the child and puts the business you built into hands that do not want it.

If they do want it, the real work begins.

The fairness problem

The hardest part of family succession is rarely the business. It is the other children.

If one child takes the shop, what do the others get? The business is often the largest asset a family owns. Handing it to one and leaving the rest to split the remainder can breed resentment that outlasts you.

There is no single answer, but there are principles. Be transparent with everyone, not just the successor. Separate the idea of equal from the idea of fair, because they are not always the same. A child who works in the business for years has earned something a sibling who never set foot there has not. Get these conversations into the open while you are alive to have them, rather than leaving a will to detonate later.

Prepare the successor properly

A child who grew up in the shop knows the counter. That is not the same as knowing the business.

Bring them through the parts owners hide. The banking, the supplier accounts, the tax, the wage bill, the lease. Let them make ordering decisions and live with the results. Hand over real authority in stages, and step back as they grow into it. The goal is a successor who can run the shop without you before you leave, not the day after.

Resist the urge to hover. Nothing undermines a successor faster than a parent who hands over the keys but keeps making every decision.

Get the structure right

Family transfers carry tax and legal consequences that catch people out. Capital gains, stamp duty, the treatment of the trading entity and any property all matter. The rules are not simple and they change.

Involve your accountant and solicitor early, and treat the transfer as a proper transaction even though it is family. A clear agreement, in writing, protects the relationship. Handshake deals between parent and child are where families come undone.

The point

Keeping it in the family can be a fine outcome. It is not automatic and it is not easy.

Ask whether they truly want it. Be fair and open with the children who are not taking over. Prepare your successor as you would any new owner. And get the structure advised properly. Do that, and you protect two things at once: the business, and the family.