Family Business Articles and Facts

Family Business Articles

 

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“The world was not left to us by our parents. It was lent to us by our children.”  -African Proverb

 

 

Family Business Facts

 

Some of the prevailing statistics concerning family businesses and their impact on the economy are quite surprising. Here are just a few:

    • About 35% of Fortune 500 companies are family businesses in which the founding family has, on average, 18% of firm equity.

    • 85% of family-owned firms that have identified a successor say it will be a family member. (Raymond Institute/MassMutual, American Family Business Survey, 2003)

    • More than 30% of all family-owned businesses survive into the second generation. 12% will still be viable into the third generation, with 3% of all family businesses operating at the fourth-generation level and beyond. (Joseph Astrachan, Ph.D., editor, Family Business Review)

    • Family Businesses are providing a growing opportunity for women with 24% of Family businesses with a female CEO or President. And 31.3% of firms indicate that the next successor is a female. Additionally, nearly 60% of all firms have women in top management team positions (MassMutual American Family Business Survey, 2007).

    • Family Enterprises account for 64% of US GDP.

    • 95% of family businesses engage in some form of philanthropy.
 For more statistics and information about family Business, click here..
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“The Family Business 100: America’s Largest Family Companies” (Family Business Magazine, 2011)
  1. Wal-Mart
  2. Ford
  3. Cargill Inc.
  4. Koch industries
  5. Carlson Companies
  6. Comcast Corp.
  7. NewsCorp.
  8. HCA Holdings
  9. Bechtel Group
  10. Mars Inc.

 

 

Family Business Challenges
 

Family owned businesses face many unique challenges that derive from the overlap of family, ownership, and management systems. You may recognize your own family business in a few of the challenges listed below:
  1. Growth limitations.  Lack of capital and resistance to re-investment in the business or pursuit of outside resources artificially stunts growth.

  2. Non-business issues. Family problems, including health issues, marital affairs and financial problems create difficult political situations for other family members.

  3. Soft structure. The frequent lack of clear policies and business norms for family members may lead to operational confusion.

  4. Limited vision. Lack of outside input on how to operate the business, as well as competing visions held by various family members may limit new opportunities.

  5. No written strategy.  Long and short-term plans often remain undocumented.

  6. Compensation issues. Compensation and benefits for various family members may not reflect their actual participation or may conflict with non-family compensation packages.

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