Why is family businesses not common? | Discussion Bucks

Why is family businesses not common?

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Moseschidera

Moseschidera

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Families spending so much time together can be great but it also has downsides for business. When you work with people you're related to, it's hard to leave problems at the office sometimes. Little disagreements or annoyances that happen during the day might continue even after hours. At the dinner table people still want to talk about work issues they were arguing about. No proper switch-off. And you can't really get away from it all on weekends! You're always around your annoying cousins/siblings. Might be why a lot of family businesses end up not working out long-term. Too many little annoyances build up over time and then bigger fights start. Easier to run a business when you can get distance from people at the end of the work day.
 
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A lot of great families have been able to forge great businesses. Some good examples are Rothschild, Guinness etc. The major problem that a lot of family are independent minded and family bond is not strong. In some families, people don't eat together, communicate with each. Now, family members are engaged in watching TV, pressing their phones.
 
magnus2022 said:
A lot of great families have been able to forge great businesses. Some good examples are Rothschild, Guinness etc. The major problem that a lot of family are independent minded and family bond is not strong. In some families, people don't eat together, communicate with each. Now, family members are engaged in watching TV, pressing their phones.
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You are right, the modern world definitely presents challenges to traditional families. Everyone leads such busy lives now and technology enables distractions like never before. Maybe families need to make more effort spending time outside together each week to connect without devices. Small steps like that could help strengthen bonds to help businesses stay in the family long term.
 
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It depends though I have seen some family business that is going pretty well, then again most times family business does not go well cause not all family members have the interest in the family business.
 
Not all members in the family have business inclination.They prefer to work in companies or big corporations. They don't understand the importance of family business. When discuss about at dinner table, it create chaos all negative.
 
The dead of the business owner might bring the business to an end so no more family business. Again, no able habds to run the business effectively as it should
 
Currently, family businesses are not managed traditionally, but have become corporations or limited companies, where the family is only the majority shareholder. So there is no commotion or fighting as you might imagine. Several well-known family businesses such as BMW, Walmart, Ford, Samsung, Nike etc.
 
You have raised a valid concern. But there are so many exceptions in the market. In India, most of the top notch established brands are family business. And they have been doing good for generations. Tata, Birla, Hinduja, Reliance, Adani Groups to name a few. Yes, sometimes family problems have come in news too. The two brothers of Reliance group did have differences and that were obvious and impacting the business and company shares. But then they tackled it maturely with legal interference and divided the business.
 
Family businesses are still very popular. It depends largely on how exposed the members of the family are. Globacom, a major telecom provider in my country is a classic example of how family businesses should be run.
 
Stardom22 said:
lts a very difficult thing to manage a family business. Most of them do really have some issues.
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Yes it comes with issues that even extended family would want to have a say. So I prefer my own business and I run it thr way I want it
 
Suba said:
Currently, family businesses are not managed traditionally, but have become corporations or limited companies, where the family is only the majority shareholder. So there is no commotion or fighting as you might imagine. Several well-known family businesses such as BMW, Walmart, Ford, Samsung, Nike etc.
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That's the case for big time businesseses to create a family corporation but for the ordinary they do solo proprietordhip.
 
Starmix said:
That's the case for big time businesseses to create a family corporation but for the ordinary they do solo proprietordhip.
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Large companies also originate or start from single family companies. However, the next generation agreed to divide according to capital ownership and the form of the company was still solo proprietorship.
 
Suba said:
Large companies also originate or start from single family companies. However, the next generation agreed to divide according to capital ownership and the form of the company was still solo proprietorship.
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It's also beneficial to create a corporation with binding laws but must be managed by a skilled person, voted or appointed.
 
This is because it's very difficult to run the business that most stakeholders are the family members.
This would be very difficult to take legal action against them in case of some business issues that may arise on the business.
 
Stardom22 said:
This is because it's very difficult to run the business that most stakeholders are the family members.
This would be very difficult to take legal action against them in case of some business issues that may arise on the business.
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It will be very difficult as they are still family. So the best bet is to create yours and run it to perfection
 
Family business are seen but very rarely, my uncle started doing it but there were too much misunderstanding seen between my uncle and his close relative.
 
SHAHID987 said:
Family business are seen but very rarely, my uncle started doing it but there were too much misunderstanding seen between my uncle and his close relative.
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When a family is not really mature, it is better to go solo than try to run a family business because it would always backfire with hatred and strive amongst family members.
 
Family is not common because of the interest, passion and capital. In my place the usual business operators that involved their families are Chinese.
 
Suba said:
Currently, family businesses are not managed traditionally, but have become corporations or limited companies, where the family is only the majority shareholder. So there is no commotion or fighting as you might imagine. Several well-known family businesses such as BMW, Walmart, Ford, Samsung, Nike etc.
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Yes, that's the case with most of the well known businesses in our country. They did start as family business but later on became limited companies or corporation. And the family has major shareholder. That's a nice sorted way for family businesses to run and sustain in long run. Reliance, Tata, Adani, Hinduja..they all are running as Limited company.
 
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