I know the best way to maximize the financial value of my family business is to hire an investment banker and auction it off to the highest bidder. That’s all about leverage, right? And I need to achieve enough financial security to continue our current lifestyle through retirement.
But my two adult kids really want the business. They’ve been working in it for years. And unfortunately, they just don’t have the cash to pay its true market value. I want them to have it, too. What should I do?”
My recommendation? You can almost certainly achieve your financial goal and your family-related goal, but you will likely leave some money on the table. And that’s perfectly fine, as your priority is family control over money.
To accomplish this, don’t auction it off. Instead, hire a business valuation expert/appraiser and then work with your kids to ensure all your interests are satisfied.
This is another instance of where leverage should take a back seat in the negotiation (in addition to those instances in my last two columns: Don’t Gouge Your Customers – Even If You Can (Part 1) and Do The Right Thing (Part 2).
Here, the personal family relationship is just more important than the money. It’s not always about the money.
Latz’s Lesson: Consider your personal goals in negotiations, especially family-related ones – sometimes they trump the leverage and the money.
* Marty Latz is the founder of Latz Negotiation, a national negotiation training and consulting company that helps individuals and organizations achieve better results with best practices based on the experts’ research. He can be reached at 480.951.3222 or Marty@LatzNegotiation.com.