We may not realize that most successful businesses get their start by being family owned. While there are many things to think about in the business world regarding finances, advertising, etc, family-owned businesses have a strong foundation in which to build upon. The largest motivating factor for workers is to be able to support themselves and their families, while at the same time being able to be true to their core values. This is what makes a family-owned business ideal to build upon. Any business that employs people from multiple generations can attest to the differences in how to approach things like strategy and risk and this does become more of an issue for family businesses than traditional ones when the business is handed down to the next generation. Usually, the founders of the business are willing to take chances in order to ensure that their business will grow. You will also find that they can be reluctant when it comes time for them to retire to let go of the control over their business. It can become like their “baby”, they’ve created it, molded it, watched it grow and now have to take a back seat in the decision making processes and that can cause tension. For the later generations there is more pressure or perceived pressure to protect their family’s business and image. They also may be reluctant to make changes because the business practices have worked thus far. Still another advantage is the knowledge that can be passed down through the generations about the business, which is not normally seen in the case of a traditional business. By being able to pass on these traditions their customers have a chance to learn what to expect from the company and it often gives them an advantage of customer loyalty. So while there is not magic answer as to how to ensure a family-owned business will continue on for generations to come, it is important to remember these key advantages one might have over their competitor’s traditional business.
Key Takeaways:
- One of the advantages of a family business is it’s more likely those involved with it will share common values.
- Second or later generations of those who come into a family business are often more invested in defending, rather than growing, the business.
- The legacy factor, where family members are personally invested in maintaining the success of the business, is notable in family operations.
“In many ways the family business system is the optimal business model, providing you have a strategic plan for both the business and the family.”
Read more: https://insidesmallbusiness.com.au/planning-management/getting-the-basics-right-in-family-businesses
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