The family business must reinvest the benefits in order to survive

scottMarch 8, 20180
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According to the research of “Competitive Factors and Financial Analysis on the Family Business” recently presented a 60% of family business quit the distribution of dividend and they rather reinvest the benefits with the objective of surviving in the half and long haul. Specially now, that the crisis seems to be forgotten and the growing of benefits is between the 10% and a 5,3% of the improvement of the employment generated.

Still the family business was special for the maintaining of the employment, even in the most difficult times of crisis. The objective in these first years of recovery has been to reduce the indebtedness, to expand their templates and to improve the productivity and profitability. In this way we are looking to strength the business on the short and half haul by guaranteeing in this way its future.

Stay being competitive

One of the main brakes for the growing of the family business is its size. The companies of this category count with more than 100 employees that have a profitability of the 8,1%. Is in this point where you can see its future, not threatened but committed, by not having the enough critical mass to fight and invest what it’s needed in order to stay being competitive.

The government institutes of these types of companies, a 61,2% counts with an only administrator, while the 35% counts with an administration board. The families’ boards are minimum option. The most of them are managed by a delegated counselor with 17,9% average year on the charge, with any universities studies in half of the cases and that is related to the family.

The companies with less than 25 employees reduce their average profitability to the 5,18%, almost three points low, but the most concerning fact is, a point and a half lower than the non-family business of the same rank. In this way, it is asked to the Government a bigger effort to support these types of companies in tax, commercial and labor manner.

To establish a “but”, the succession is addressed as a problem, especially in the smallest ones. Particularly in the business that have an autonomous that is also a worker they find certain problems when it’s time to find a successor, even inside of the family. The children usually don’t have the desire to work on the business of their parents.

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