Dinn, Hochman & Potter, L.L.C.
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A family-owned business can profit from an outsider's perspective

If you are the proprietor of a family-owned business, you are most likely related to much of your workforce. In fact, your spouse, children or siblings may all hold the most important positions in your company.

There are several advantages to this arrangement. For one, family loyalty helps ensure that you can trust those with whom you make your most important decisions. Moreover, relatives typically have a more personal, vested interest in the success of a family-owned business.

But you should not ignore the possible benefits of placing an outsider in a key or senior position. In an article posted on an online small business website, members of an entrepreneur group commented on the virtues of giving outsiders important roles in family-owned businesses.

One of the surveyed group members stated that an outsider can provide a clearer perspective on important aspects of a business. For instance, the outsider could make a more concise assessment than family members regarding a relative's ability to fill a position within the company.

Another group member pointed out that sometimes no one in the family has the requisite skills to perform an important job effectively. An outside leader could bring attributes that buttress and enhance your strengths. And by not being part of the family, the outsider does not have the same emotional investment in the situation and thus can be more objective.

Of course, family members will probably always hold most of the primary positions in your business. But you will still need to have a business plan that clearly delineates everyone's role in the organization as well as the manner in which your business processes are to be executed.

To this end, you may want to bring in one more outsider; an attorney who has experience providing services to closely-held businesses. The attorney can help you craft a business plan aimed at helping you and your family achieve your goals.

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5910 Landerbrook Drive, Suite 200
Cleveland, OH 44124
-6500

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