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Differentiating Yourself in the Family Business Market

One of the most lucrative markets for insurance sales is family-owned businesses.  And, as the estate planning market wanes or possibly even disappears, the business succession planning market is likely to become even more important as well as more competitive.

One of the biggest challenges facing practitioners is how to differentiate themselves from the competition in their chosen market.  If you are seen by your prospects as “just another salesperson or product pusher,” it can be very difficult to gain access to decision makers.  One way to stand out in the crowd is to offer a unique service as opposed to focusing on price or gimmicks.

The typical family business advisor tends to treat the business owner–often the entrepreneur who started the business–as the client.  Accordingly, all discussions and decisions are directed toward meeting the entrepreneur’s needs.  Unfortunately, those needs frequently are at odds with those of other members of the entrepreneur’s family.  The upshot of all this is that the plan developed with input only from the current business owner often fails when the owner dies or retires.  The statistics found in a recent Gallup poll are alarming.

  • Only 30 percent of all family-owned businesses survive into the second generation.
  • Only 12 percent make it to the third generation.
  • Only 3 percent of all family businesses continue to operate at the fourth generation level and beyond.

Obviously, there is a great need for family business succession planning and, more specifically, planning that works.  The key is not more lawyers and accountants or more perfect wills, trusts and balance sheets, but rather a new approach to business succession planning–an approach that can distinguish the practitioner from the competition.

The Family as the Client

The key to developing a plan that will actually work and help the business survive is to expand the definition of “client” to include the entire family.  Upon reflection, doesn’t it make sense to include the potential successor owner in the planning process?  Doesn’t it also make sense to include other family members who will be impacted by the plan in the process?  Including all family members and spouses in the planning process practically assures success because the plan is more readily supported when it’s viewed as “our” plan rather than “his” or “her” plan.  We tend to support those ideas that we have helped develop.  On the other hand, we will sometimes even work to defeat plans we feel have been imposed on us–it’s human nature.

So what is the best way to include the family?  There are two major elements in a process I call Family and Business Renewal (FBR for short) that incorporate the family as client.

The first is during the interviewing or fact-finding phase.  Rather than interview the business owner alone, I interview all family members–including spouses–in order to identify everyone’s views of the business and their perceived role in it.  Controversies, rivalries and other factors with potential to impact the business transition quickly emerge.  Based on the information learned in these in-depth interviews, it is possible to craft a wealth transfer plan, including the succession of business ownership, that suits the needs of everyone in the family.  When everyone is involved from the beginning and everyone gets a chance to provide input into the plan, support emerges naturally.

The Family Retreat

The second major component of the FBR process is to present the wealth transfer recommended solution to the entire family in a retreat setting.  The retreat is conducted at a neutral setting, away from the stresses and distractions of the business.  Each family member is asked to respond to three questions:

1. What are your expectations f0r the retreat?

2. What do you admire most about your family and the family business?

3. What changes would you like to see?

The answers to these questions help everyone in the room understand the position of all the other family members.  At the end of the retreat, after the new plan has been reviewed and discussed, the family is asked to accept and implement the plan.  If the interviews were thorough and the plan designed with everyone’s input considered, acceptance is almost automatic.  It remains the job of the advisor to follow up on details and make certain the plan is implemented as intended.


The additional effort required to facilitate this process justifies charging a fee.  Depending upon the complexity of the business and the number of family members to be interviewed, fees in the range of $10,000 to $40,000 are reasonable.  This, of course, highlights another advantage to using this approach.  The fees represent additional income for the advisor.  In addition, this process positions the individual as advisor to the entire family, not just the current owner.  The result is the potential for future business opportunities with the next generation of owners.


So there are a number of reasons to modify the usual system of working only with the needs of the business owner in mind.  The “family as client” approach is a way to distinguish yourself from your competition, builds a deeper relationship with current and future owners alike, generates additional revenue and results in a wealth transfer plan with a high likelihood of success.  Clearly, the FBR approach is good for the planner, the family and the business.

About Karl Bareither

Karl Bareither
Karl Bareither, CLU, wealth transfer specialist is founder and president of Family Business Renewal (FBR) System, Inc. (, established in 1969 as a fee-based family business planning firm that uses a holistic process approach to transfer wealth and renew both business and family. Bareither has also developed tools that enabled him to move beyond tax, legal, and financial planning.  These tools have been brought together into a comprehensive process called the Family Business Renewal (FBR) Process.  Karl is now teaching other financial services professionals how to use this system to revive the human voice in a technical world.  Advisors are taught how to blend technical expertise with a unique process approach that enhances business success and family harmony.  He has written two books, Becoming a Wealth Transfer Specialist and Planning a Family & Business Legacy, which describe the FBR system and recount many of his 40 years experience working with agriculture businesses and families. Karl can be contacted at (805) 595-2089 or by email at  

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