Passing your rental business on to the next generation

With proper planning, passing your equipment rental business on to the next generation can be a win-win situation

I am happy to report that the family owned and operated rental business is still alive and well. I've had the honor and privilege of advising a number of family rental businesses that have entered the fourth generation of owners. Congratulations to all of you.

Success in a family owned and operated equipment rental business didn't come easily for any of them. Even if you are the first generation in a relatively young rental business, you know that the people part of the business is often the most challenging.

So often the type-A personality drive of the entrepreneur that helped navigate the ship through rough waters in previous years sours the family crew members on wanting to take the helm when the captain wants to get off the ship.

Many rental business owners would secretly love to have their children take over the business. But there is often a major communication disconnect that makes this impossible. There are many ways to structure the organization and communication of the business to make this seemingly impossible scenario a successful reality. With the more than 1,000 family owned and operated rental businesses I've advised, I have found that each one is indeed unique and requires a different approach.

However, sometimes there are no offspring or they have completely different career interests. There are times that it just wasn't meant to be and I recommend that the business be sold to others when the present owner wants out.

On the other hand, I have dealt with many family owned rental businesses that have more than one family member who wants to run the business. Sometimes the present owner's desire to be fair and equitable with all the offspring makes terrible business sense - and can make everyone in the company miserable. It's important to have a rental business expert objectively analyze the situation and make objective recommendations.

I think all of you would agree that it is very unhealthy (for the business and for the family members themselves) to let major family business disagreements in the form of arguments continue to fester. Some problems just don't go away by themselves.

It's inspiring to see each new generation of owners taking over, and through more sophisticated planning and execution, grow the company beyond the dreams of the previous generation. There should be a major celebration each time your company ship is put in the hands of its next generation captain and crew.