In many cases, passing the business on to your family is as much a matter of personal preference as a commercial decision. Nevertheless, it is worth thinking about the possible commercial implications.
Passing ownership of the business to your family can avoid much of the expense and disruption of any form of sale. However, a reluctance to involve external investors may constrain the business's ability to grow. Retaining family ownership may also mean that the family's investments are heavily concentrated in the business, leaving the family at risk if it runs into problems.
As far as management is concerned, the overriding concern is whether any family member is both interested and has the right skills and experience. Even then, keeping management in the family can lead to a narrow-minded outlook and lack of ambition. However, family managers will understand the culture of the company, and are often good at taking a long-term view of what is best for the business.
