AllintheFamily_Body.jpgby Iris Dorbian.

 

For some small business owners, being partnered up with a family member can be the best of all possible worlds. The familiarity factor, coupled with a trust that has built up over time can be a decided advantage over working with someone you barely know.

 

Yet, that same element of familiarity can also, at times, be a drawback. Attitudes that might not be freely expressed with a non-relative partner might be given free reign with someone who’s a relative. The reason is obvious: Business partners who are relatives might be more forgiving or lax toward the misdeeds of those whom they know very well versus non-related colleagues. Or they might feel they have no other recourse but to accept the unprofessional behavior of their partner because he or she is a family member.

 

How then can small business owners learn to work effectively with partners who are also relatives? What tips—and caveats—should they heed to create an effective and harmonious work environment?

 

Be transparent in your communication

Having a family-based partnership that ends up resembling a twisted dysfunctional family dynamic will never work. If both partners are serious about wanting their business to succeed, they will need to be honest with one another from the start.

 

Marilyn Schlossbach, who as co-owner of Kitschens Hospitality Group, operates five restaurants at the New Jersey shore with her brother Richard, strongly echoes this takeaway.

 

“You have to be very clear what your weaknesses and attributes in business are,” she says. “Whether it’s a husband or a relative or a really close friend who’s your partner, there’s a tendency to get emotional because you’re intimate with one another. So you really have to be honest [when you communicate]; but also keep attitudes in check so you can be more professional in your operations.”

 

AllintheFamily_PQ.jpgImplement HR-related guidelines

When a small business owner is partnered with a relative, there might be a temptation to take advantage of this relationship by taking unapproved absences or excessive sick leaves. That would be a strategic mistake. Treat your familial partner with the same professional courtesy as you would a regular colleague. That means coming up with a working calendar that will be acceptable to both you and your partner.

 

Marc Lewandowski, vice president of the Rockville, Maryland-based Planning Needs Financial Group, agrees. He run his independent insurance agency with his father Charles, who founded the company 26 years ago. “You need to take those processes from an HR perspective that many larger companies [take for granted],” he advises. “For example, I enjoy taking off for golf maybe once a month, especially in the summer months. It’s hard to play golf in the winter. [My father] doesn’t approve of that because golf is not a reason why one should take off for work,” he notes, laughing.

 

Lewandowski, who joined his father three years ago at the firm, has resolved this problem by formally accounting for his hours. “I’m now in the process of doing a spreadsheet where I’m logging my time,” he says.

 

This doesn’t mean that Lewandowski is fully in the clear when he needs to take a sick day.

 

“If I’m ever sick, my father will often call me and ask how I’m doing and feeling,” he says “I’m sure a lot of it has to do with him really wanting to know that I’m feeling better. But there are instances where he has said, ‘Okay if you feel better, then it’s good enough for you to come to the office.’ That can be trying sometimes.”

 

Have a strategic plan for your future

Whether it’s to map out future goals or family succession, it’s imperative that you and your family partner have in place a strategic plan for your business. Schlossbach is an ardent advocate of this best practice.

 

“My brother and I hired a strategic planner to help us put our vision on paper and lay out what the next six months, one year, five years, ten years, would look like for each of us,” Schlossbach says. “This takes into account what I want out of this partnership and business and what he wants out of this because we have different needs and goals for ourselves. It’s just to make sure we’re clear on this so it doesn’t get crazy because at some point I might want something different.”

 

SBC newsletter logo.gifDon’t be afraid to have the majority interest

Having a partnership with a family member that’s completely equal is ideal in the abstract, but may be impractical in real life if both sides become embroiled in a seemingly irreconcilable disagreement on an issue. To prevent an impasse, it may be necessary for someone to have a majority-controlling stake in the business.

 

Schlossbach says this is a rule about partnerships she learned years ago from a mentor. “One person always has to have a 51 percent stake in the business,” she notes. Schlossbach knows whereof she speaks, since she has the controlling stake in her business. “Somebody has to have that extra one percent of control so that if there is a breakdown or if you’re not totally on the same page about something 100 percent, the person who has the majority vote has to say this is how it’s going to go,” she explains. “And it may not be right—it may be wrong. But it’s also very hard to come to conclusions when people are too equal in the conversation.”

 

Make sure your personalities mesh well together

It stands to reason that if you go into business with a family member, just as would be the case with a non-related colleague, you’ll want to make sure you both get along and can spend long hours in each other’s company. Certainly, pairing up professionally with a relative with whom you invariably have heated altercations will not make for a fruitful professional union.

 

Lewandowski feels a key reason why he and his father thrive as partners is because they’re both “easygoing.” Yet that doesn’t mean they don’t disagree on some items, particularly marketing. Lewandowski is a champion of nontraditional marketing channels such as search engine optimization, while his father favors more traditional marketing tools. But despite that, Lewandowski hails the partnership as a reciprocal exchange of respect and admiration.

 

“I’m actually honored to be working with him,” he says. “It’s a great pleasure.”

 

Becoming business partners with a relative can lead to disaster if neither party is clear or realistic about their expectations. However, if both take the union seriously, treating it with the same respect and courtesy they would accord to a non-related associate, then the partnership could yield immeasurable rewards, both personally and professionally.