How to survive like a family business

Published on November 27, 2019

There’s a fundamental stability in family businesses, from the smallest mom-and-pop corner shop to the large enterprises playing a powerful part in the economy, which is not always apparent in other companies. .

While they don’t always perform as well as competitors during times of plenty, when times are tough, they are ready to pull through and survive.

This is because the owner of a family business has longevity front of mind, rather than a meteoric business performance hike. The CEO of another company might be more inclined to take big risks because at the end of the day, the company is allowed to fail, they are not invested whole-heartedly in the company, but rather in their career. The company is always separate to an outsider – but for a family business, the lines are blurred.

A family business owner owes it to the family to look after the business as if it’s another member of the clan – and this leads to some interesting characteristics.

A family business is frugal in the good and the bad times

In times when the economy is booming, capital-driven companies are enjoying the luxuries that profit provides, but also hedging bets that could land them in trouble come a recession.

Family businesses, on the other hand, tend to view profit and perks more holistically – saving for a rainy day when the profits are high and quickly being able to scale back when times get tough. This more balanced way of viewing profits allows a family business to be less affected by outside forces.

Family business owners also have a different view of what “perks” are in the business. While a CEO of a non-family owned business needs rewards for a job well done, a family member CEO will see it as their obligation to bring the wealth back into the business, and into the hands of the family themselves. Keeping the business thriving is more important than the latest sports car.

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