ALBANY — There is nothing more fulfilling than making partner and proudly stating, I am an owner. With ownership comes pride, a sense of accomplishment, equity, debt, being the boss, and of course the bragging rights. Before you ask for a piece of the family business, we recommend you ask yourself the following five questions:
Do I have sufficient knowledge and understanding of the business? Certainly, you may have spent your summers planting, harvesting, feeding, and or taking the fruits of your family’s labor to market. However, do you know how these areas all fit together? What is the impact of ‘sleeping-in’ and not making it to market? Or what is the impact of borrowing $150,000 to purchase a shiny new tractor to the overcrowded dairy operation?
Understanding the functional aspects of all business areas is important to farm decision making. More importantly, by learning and proving that you can work in all functional business areas you are gaining respect and building relationships with employees, managers, and future partners. Long hours, hard work, demonstrated success in accepting and managing increasing levels of responsibility are building blocks to long-term relationships and business success.
Can I manage myself? Are you aware of your emotions; how do you control your emotions? Emotions run high in the workplace and even higher at the farm family kitchen table. How well you manage your emotions will determine your overall success in the business as you must manage yourself before you can manage others.
In addition, self-management and personal financial management go hand-in-hand. Have you learned to control and manage your own money? When you are emotional do you engage in retail therapy and purchase expensive toys? Do you pay your bills on time? There is a direct correlation between being in control of your emotions and being in control of your money. Remember, as a partner, you will need to personally guarantee the farm business debts.
Emotional financial control is important.
Do I have interpersonal skills? In the workplace and particularly in a family business one must be able to communicate, resolve conflict, and make decisions as a team. Family members often put each other ‘in a box’ and aren’t able to view them in any other way. This stifles any potential growth in relationships and ultimately the business.
Growth through communicating means the ability to actively listen to others versus sending texts when others are speaking, as an example. Listening and understanding the views’ of others helps resolve conflict. We all know the results of yelling, slamming doors, and just plain not speaking. Certainly, listening and resolving conflicts are not easy. However, both are needed to make decisions and move the business forward.
What type of business enterprise am I joining? Many people want to become partner but are unsure what this means in business terms. Will you be a member in an LLC? Will you own shares of the business? What language do you want in the buy-sell agreement? Does entering the business require your spouse/future spouse to sign a prenuptial agreement? What assets/equity have you accumulated to contribute to the business? More importantly, if you or another partner chooses to leave the business, what is the impact? Planning an exit strategy is almost as important as planning an entry strategy.
Am I committed to life-long learning? Humans and businesses evolve and new skills are required to remain effective. Here are a few ways you can develop your skills: spend extra time learning and listening to each person on the farm, learn more about your personal finances, enroll in self-development courses. Two of our favorite include LEADNY and Dale Carnegie’s How to Win Friends and Influence People. Of course, New York FarmNet is always available with free and confidential consulting at 1-800-547-3276 https://www.nyfarmnet.org
Erica Leubner, MSW is a Farm Family Consultant with NYFarmNet. Sheila Marshman, PhD is a Professor of Agricultural Business at Morrisville State College and a Farm Management Consultant with NY FarmNet.
—Erica Leubner, MSW
Sheila Marshman, PhD
NY Farm Net
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