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By Mikey Rox / Len Penzo dot Com
August 16, 2016
Farmer holding infant standing in work shed
Thomas Barwick—Getty Images

Thinking about going into business with a family member? Tread lightly. One disagreement could rip that relationship to threads, but you’ll give yourself the best chance of success with these tips on how to keep a family business from tearing the family apart.

Foster a Business Mindset

One of the biggest hurdles to overcome when going into business with family is hurting a family member’s feelings or making them feel unimportant or undervalued. This happens easily when there are various positions of power. Combine that catalyst with individual egos and you have a recipe for certain disaster.

“It’s difficult to keep all the past relationship baggage out of business, but you have to compartmentalize,” says Jennifer Moss, founder and CEO of, who works with her siblings. “If I pull a sister off of a project, she can’t feel it’s personal; it’s all about the bottom line.”

Clearly Define Expectations

It’s not uncommon for family members to get lax at work, especially if they’re not an owner of the business, which makes it critical to your own success that duties and expectations are clearly outlined. DeAnna Kennedy, author of the book Find the Talent Within You and Sell It! has worked with her daughter for about 20 years. Kennedy suggests drafting specifically defined job descriptions and hour expectations with titles and pay rate. With these details on paper, you can avoid at least a few of the problems commonly associated with employees who take advantage of unclear expectations.

Read More: Why You Need a Household Strategic Plan — and How to Create It

Praise Good Work

“Everyone wants to feel appreciated, and it’s important to let the family members know when they’re doing a good job,” Moss says. In other words, everyone needs praise and compliments from time to time to keep morale elevated. You would do it for non-relative employees, and you need to do it for relatives too.

Communicate Regularly

If you are business partners with family members who may not be in the same place often, you need to find a way to keep the lines of communication open and have access to the decision-making individuals at all times. Moss suggests using social media, online chat services, and texting to check in with the team regularly.

Read More: Why Don’t You Ever Have As Much Money As You Think You Do?

Address Time Off

Family members might think they qualify for nepotism, especially when they want something that benefits them — like time off — but you have to avoid making special arrangements and creating unique circumstances for family members. You need to document vacation requests, days off, and sick leave as you would any other employee. There are no privileges for family members that non-family employees wouldn’t get.

Schedule Reviews

Not all family businesses work out. Sometimes you have to let a family member go because they’re not pulling their weight, and you’ll have an easier time of it if you’re documenting their progress through quarterly or half-yearly reviews. Sit them down privately to discuss what they’re doing right and where they can improve. If it’s a situation where the problem areas aren’t improving, at least you’ll have documentation that you gave this relationship a fighting chance before cutting it loose.

Read More: 3 Financial Building Blocks That All Parents Should Teach Their Kids

Don’t Let Business Seep Into Family Time

“It’s easy to start talking business when everyone’s together, but set aside a specific time and place for that,” Moss advises. “Don’t bore other family members with business talk. Keep your business private — even from other close family members, who aren’t involved.”

Train the Next Generations

Is your business going so well that you’ll eventually need someone to take it over? The trick is to make the transition as smooth as possible and give the business the TLC it needs to survive new people at the helm.

“What’s going to happen to the business when you can no longer participate? Are there children or grandchildren that can take over? If so, get them involved early,” says Moss. “We gave our high-school children data-entry jobs to let them get familiar with the business. Then, after they graduated from college, they had a choice if they wanted to participate or not.”