Family Business Issue

[ncpostingabout]

Part of a family business and my sister who has been involved for not that long has become very successful within it and now wants to set up her own business to make more money.

AIBU to feel a bit sad about this?

Of course from a business perspective we out many hours and time into training her etc and just feel it's a bit premature really.

Also just feel a bit sad by it and unexpected.

NC as of course want to remain anonymous

Are you a lot older than her? You’re sounding more like a parent than a sibling.
You say she’s not been there that long so she can’t have benefited that much from coaching and mentoring. Though she has, from the opportunity.
Saying it’s been threatened by previous staff members - have you acted on that and added poaching clauses where possible?

It’s hard to say as you can’t share details.

But say she’s trained as a hairdresser in the family salon and now wants to experience running her own business (maybe with a different salon vibe) why should she be forced to stay in a situation that’s not ideal for her?

Jamie Oliver worked in his parents’ pub, didn’t he? Then he wanted to do his own thing.

I think if she’s not doing anything underhand, you should support her venture.

No, we’re all just employees as only some of the family are employees but all of us grandchildren will be (or are) shareholders as the biz is in a trust (we’re third generation)

Just read your update that you’re a partial shareholder and been involved for over 10 years - that’s even worse as it sounds like she wants to compete with you.

I would say that most people underestimate how hard it is to set up and run your own business, so she might well never get it off the ground.

It doesn't sound like a joint owned family business, it sounds like you employed your sister, and now she is hoping to move on. I don't think that is unreasonable.

I'm not sure what you mean by saying you wouldn't accept another employee doing this, how would you stop them? It is very normal for people to move on with their careers. Generally a newly set up business will not be a significant threat to a well established business.

Sorry if I'm being misleading, she doesn't have any shares in the business and yes is an employee - I can't give details I'm sorry but please understand she know nothing about anything before starting and the training and mentoring has been thousands of pounds invested - understand when running a business an initial investment is made while that person trains so when people jump ship after not that long in the role the investment is short lived - hence what I mean it's premature.

@Newusernameaug technically it would be competing but I also feel like there's enough business out there so isn't really my main concern - it's just the lack of conversation and offering to perhaps consider doing something jointly so they get the coaching and mentoring long term as I have many years experience of the sector so as another poster mentioned it's just the shortsighted way she gone about it it find a bit sad

I would block her access to your customer contacts immediately. Hopefully your customers will be loyal. I think it is an absolutely disgraceful way to treat your family. She should be ashamed of herself.

@Stompythedinosaur there are non competition clauses on the contracts but aside from this I would never stop anyone moving on from their career at all but it's the fact she wants to leave but not leave and set it up while working here

I'm imagining this as an estate agents. So your sister has tried it out, likes it, learnt how to do it... and now wants to set up on her own but by using your company to ease the transition.

I would tell her, this often happens, and how it works in this industry is that you leave, start up a new database of your own, there is no way of doing it for two enterprises at once, thats not how life in estate agency works. Good luck.

You say she’s become very successful in it though, so you’ve possibly had your investment back already. This is business, you train employees, but you don’t have a guaranteed payback time. So you can put clauses in contracts if you are spending hard cash on training for repayment, or if it’s time - pay less during training.

Imagine your sister was working for someone else and really hit her stride at this and said - “you know what sis? I’m seriously thinking of going it alone!”
As a business owner yourself, you’d probably be proud of her!

Like I said above, for me it comes down to whether she’s been underhand. If you run a hand car wash and she’s setting up on the other side of the road having used her inside info to offer your large taxi contract 2% cheaper - she’s horrid!

But there are plenty of scenarios where she wouldn’t be.

Maybe in 5 years time her business will have taken a complimentary direction and you’ll decide to join to again in a business that’s now equipped to knock out the competition!

You’re right, it’s definitely more complicated. But you are where you are.

Is there anyway you can try to turn this into an opportunity, which might get you off the hook from having a messy situation to deal with? How about offering her a franchise of the business, with your blessing and support (even if it’s not heartfelt).

She can do her own thing and run her own business, which is what she obviously craves. The business might benefit indirectly by not having all the investment wasted- she’d still be making a contribution to it. And it might help expand your business if successful. Plus, it would keep the family relationship intact.

Just trying to think of things that you could do that might work, or limit the damage.

@CrapBucket it's not estate agency but I see what you mean yes because trying to do two enterprises at once is just not right IMO and I don't think I should ignore that just because she's my sister? As business everyone has to take the risk and as much as I want to support why should I do it at the detriment of myself and make it risk free for her? It's not fair or AIBU?

“it's the fact she wants to leave but not leave and set it up while working here”

Yeah, unless that’s something that can work in your favour - she’s taking the piss!

@DomesticShortHair yes that sounds like a very good suggestion, completely agree I think we need to work out a franchise situation

If she's really good and successful and you want her to stay then offer her more money or a subsidiary that still makes you a share of the money

Honestly, that does sound like your ego has taken a hit! Like - why doesn’t she appreciate all my mentoring and experience?!!

I do think you have valid complaint too, as you’ve now posted that she’s taking the piss trying to go solo on your time. Nope.

But just that one post sounds like ego rather than business.

Right then, my work here is done. Just need to change my username to John Harvey-Jones, and then I’m off into the sunset. 😂

I hope however it woks out for you, that it works out for you.

Seriously enforce the on competition clause in your contract stop letting people take the piss

@ncpostingabout you have my sympathy as it’s not a nice thing to do.

I’m going to suggest 2 things, the first is to formally set out the terms of your sister leaving the business and setting up on her own. Make it clear in writing she will get no assistance, if relevant she can’t use your businesses equipment etc. that she will not be offered a job if her business fails etc.

The second is to review your contracts for all employees. If it costs £ to train new employees it may be reasonable to require them to stay for 12 months after being fully trained to recoup your investment. Remember your time spent training is a cost.

For both get legal advice.

I would also sit down with your sister and state you are disappointed but understand. However, she needs to understand you will not provide coaching and advice if she leaves and that she has to stand on her own two feet. No coming crying to you if she can’t manage all the hidden aspects of running her own business. That you want to keep the family relationship so you must both agree no business talk at family meetings.

@Quitelikeacatslife it is difficult because there is a lot of people involved in the business so it becomes difficult to pay someone more although I agree there is something to be said for a different type of role within the business

@Testina I think you've summed it up nicely! It probably partly is ego driven but I almost feel bad not slowing her to go solo on my time too and told her just as much so it's reassured me that so many posters have said this isn't acceptable too as almost felt guilty for drawing the line with this

@DomesticShortHair 😂 thank you for your posts

@Princessglittery thank you. I do think all of our contracts need fully reviewing absolutely. It's a shit show at the minute - running business is so hard to have time to do all these things. They already have non competition clause in them but don't have anything about training costs

@ncpostingabout I’d certainly be stomping round my house muttering that she was an ungrateful bloody cow! 😉

It’s hard to suggest how to handle it without knowing the business - and I’m not trying to draw you out on that!

I’m not sure that franchising is the way to go. If her primary driver is to retain all earned money for herself, or to completely be her own boss, then you’re likely to invest more time into mentoring her and then she’ll just do the off further down the line. Same feelings, more time invested - and from a business point of view, perhaps a much bigger network / client base from the brand you built.

I don’t necessarily agree with telling you’d never have her back. If she’s good at the job, why not? Not if she’s going to yo-yo multiple times, but if in 2 years she called you and said, “sis - love the job, hate the business admin!” then she could be an even more skilled employee bringing her client base back in with her. I think you could let her go with your blessing, and say if there’s a space for her she can come back. I mean - lucky her to have such an opportunity and potential safety net, and I’d be jealous that I did it the hard way. But -could be good for your business.

But I do totally agree that she can’t develop her business on your time.

“It's a shit show at the minute - running business is so hard to have time to do all these things”

As she will find out 😆
My husband has his own business and has a 50/50 partner. She only does “the job” whilst he runs it - with time away from clients carved out to do so - “office morning”. There’s no resentment - works well, they’re happy, it’s a low paid industry so there’s no reason to feel he’s carrying her for the same money. But the business would last 3 months if she was running it 😉

@Testina lol thank you - when you say it cold enough good for business do you mean if she tried it and it didn't work out? And came back? You think it might set a good precedence is that what you mean?