While family businesses represented 67 percent of all Australian companies in 2021, new research reveals today that only 1 in 3 people would start a business with someone from their family.
The study, commissioned by COS, an Australian-owned and operated company offering product supply solutions for the workplace, surveyed over 1,000 Australian workers and uncovered that the majority of people these days would never consider starting a business with a family member.
The main reasons were ‘You shouldn’t mix business and family’ (50%), ‘It would be too hard to separate the two’ (32%) and ‘I would argue with them all the time’ (20%).
Interestingly males were more open to it (41%) compared to their female counterparts, and 25-34-year-olds were the most likely age group to start a family business (45%).
On Family Business Day, Co-CEO of COS, Belinda Lyone says,
“Being part of a family-owned and operated company shouldn’t be like an episode of Succession, in fact quite the opposite.”
She observes: “There is something extremely special and rewarding about working in a family-owned and run company. Whether you are part of the founding family or an unrelated employee, working for a company that has a strong sense of values, its mission and vision, and one that is able to prioritise people over profit, are just a few of the positive drawcards.”
But Belinda adds that it certainly isn’t for everyone, “I’ve now been in the business for 17 years, but I still remember those early days well, and it wasn’t easy. In our family it’s a rule that you must work somewhere else before entering the family business, and I’m thankful for that as it has helped my confidence and made me realise which parts of running a business I was most passionate about. Often people think that taking the reins of a family business is an easy route, but it definitely comes with great pressure and responsibility, so it’s not a decision or opportunity that should be taken lightly.”
To guide anyone considering starting a family business, the strategies Belinda and her sister Amie implemented at COS to successfully take over their father’s business of 45 years are:
- Clearly define roles and responsibilities for all family members involved.
This is the golden rule, because it’s important the role is only accepted if the person is clear and passionate about what they will be doing on a day-to-day basis. For example, at COS Belinda focuses on the strategy, sourcing and sales, with Amie focusing on the team, service levels and logistics.
- Develop a conflict resolution plan before any issues arise.
Every team and family experiences conflict at one point or another. Understanding how conflict will be handled and resolved is essential. At COS for example, no conflict is expressed in front of staff members and there is a safe word to signal when the discussion should be moved to a private location.
- Set boundaries around family time and business time.
Having clear divisions around when is family time and when is company time is imperative. For example, don’t discuss business on the weekend or at family events. It’s also important to foster family relationships separately to the professional relationship to ensure quality time together is still achieved.
- Never use nicknames.
Calling everyone by their first name is a must – there is no space for ‘Mum’ or ‘Dad’ in a workplace. For employees looking to work for a family business, if first names are not used this is a huge red flag as it indicates there may be issues setting and maintaining personal and professional boundaries.
- Have a vision for the future.
No matter whether a person is creating a start up with a sibling or taking the reigns over of a corporation from a parent, to be truly successful the team must take full responsibility for the future direction of the business, as well as all day-to-day operations. Without strong goals for the future, the entire company will suffer.
Belinda concludes, “As long as there is strong communication and a mutual determination to succeed, working with family is an honour. Not only are you able to deepen the family relationship and bonds, but you’re able to create or build on a legacy that can live on for generations.”
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