No one lives forever. When there is a leadership transition, whether because of death, incapacity, or retirement, many businesses fail. Often, this consequence could have been avoided with foresight and planning. Whether the goal is to sell to employees or an external buyer or to transfer control to a new generation of family owners, business owners cannot simply wait and expect that things will work out for the best. Carefully considered and regularly updated succession planning is a crucial component of family business resilience.

In a family business, each stakeholder occupies one or more of the following three roles: family member, business owner, and business employee or manager. Some participants occupy all three roles simultaneously; others may be family owners but not managers. The governance challenge is managing the expectations of family stakeholders in different positions of authority and risk taking. Generic governance best practices need to be adapted to fit the needs of the business. For example, some family businesses create a separate family advisory board to communicate with family stakeholders.

Tax rules and other regulations have increased in complexity, making it a challenge for well-intentioned business owners to keep track of what is necessary. Many regulations serve essential purposes, including public safety and worker protection, so it is crucial to ensure that businesses are well informed and have the resources they need to meet their compliance obligations.

Every South Carolina family and small business should identify key vulnerabilities and make adjustments to enhance its resilience to disaster. This planning should include the safety and wellbeing of employees, data security, and the ability to overcome business disruptions. The resilience of locally owned businesses is integral to the resilience of their communities.

Especially when co-owners are family members, it can be hard to anticipate the possibility of serious disagreements. Experienced lawyers can help navigate these disputes when they arise to preserve business value and, if possible, to avoid further rupturing of family relationships.

For many family and small businesses, especially those that are located in rural communities, it can be hard to find affordable legal and accounting services or to find a bank willing to extend credit. These challenges can be exacerbated for business owners who serve historically underrepresented and disadvantaged communities. By partnering with the S.C. Bar and with organizations including the S.C. Small Business Development Center, SCORE, and S.C. Competes, the Family and Small Business Program is working to address the gap in access to financial and legal support.