During my first meeting with a dealer, he pointed to a desktop picture of his two sons, ages eight and seven at the time, both wearing paper gold crowns.

He said, “That's my problem today, they both work in my business and both still want to be the one who wears the crown!”

He added: “Neither is willing to work for the other. This has caused lots of sibling rivalry.”

His wife then said, “If this doesn't stop, we'll sell the business before we let it destroy our family!” The dealer agreed, and recalled clashing with his father over the dealership. He was not going to go through that again with his sons.

My partners and I have heard many similar stories from dealers. But when it comes to the decision to actually sell, this is often hard to do, especially when most dealers enjoy their business and want to keep it.

So usually they do nothing, hoping family problems will resolve themselves somehow.

Another dealer told me, “I've got a real problem. I've got three sons, and in a business there can only be one boss. I'm going to have to make a decision and when I do, two will be angry!”

He was voicing his version of the proverbial family-business problem of choosing a successor. He obviously cares about all of his children, yet he doesn't want to make a decision that will jeopardize the future success of his business.

For many dealers, it gets more complicated if a spouse feels differently

By not knowing what to do and not wanting to open up a can of worms, again the temptation is to do nothing.

In a third situation I encountered, the dealer has one highly qualified child and one that is passionate about wanting to become the successor, but may not have what it takes.

The dealer said, “There is no way these two could work together so I'll probably give two of my stores to each of them.”

Obviously this solves the problem of them working together, but it may set the one child up for future failure, if he is unable to run the dealerships.

Again, Dad loves his children and wants to help both of them, but is conflicted on how he can resolve this issue so both the family and business aren't damaged.

So, how do you pick your successor without destroying your family?

The most important question is whether your son or daughter capable of running the store today if something happened to you.

No one should be designated as your successor until ready and capable of being approved by the manufacturer.

In each of these cited situations, because none of the next generation was ready, I said, “Put that decision on the back burner and focus everyone's attention on getting your children prepared so all of your children will be successful.”

One of the two sons described above asked, “Have you ever seen siblings able to run a dealership successfully together?”

My response: “Definitely.” But for this to work, both siblings have to be committed, hard-working, willing to work at communicating with and respecting each other. They must affirm each other's contributions and differences and not keep score.

Most siblings have skill sets that complement each other and this can be leveraged to run a dealership operation. If they can resolve the family issues, this type of partnership can be enormously successful.

However, it won't work for everyone. It would be the wrong to put some siblings together. When this is the case, often dealers look to set up children in separate stores.

But first determine commitment and capability. It solves nothing to set up children for failure, despite your good intentions. Children in business must earn the right to wear the crown.

Certified financial planner Hugh Roberts is a partner with The Rawls Group and a Board Member of the International Succession Planning Assn. He is at 818-702-0889 x 155 and hbroberts@rawlsgroup.com.

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