Family businesses have been existing for many centuries, and come in various shapes and sizes. Nowadays some people believe that it is the best way to run a business. In my opinion, everything has its upsides and downsides, The same can be said for family businesses, ultimately it depends on the people pulling to strings, for the business to be up and running.
There are advantages to have and operate a family business, such as loyalty. If all the employees of the business are members of that family, then there is deep-rooted loyalty involved. All the members will have a vested interest in the business to run smoothly. Another advantage of running a family business is that the youngsters of the family already know all the ins and outs of the family business. Some elders in the family already teach the younger generations about the reigns of the business. An example of these advantages is be House of Hermes, which still is run by family members rather than the board of directors.
As there are upsides to owning a family business, there are a few major downsides as well. One major disadvantage is the financial risk associated with it, as all the eggs are kept in the same basket. The family becomes more vulnerable if the business does not perform well, and if they do not have any other source of income at their disposal. Such an example can be, when the 2008 depression hit, many families’ businesses struggled as there we not business nor there were other job openings. Another major issue is at times of conflict among the members, the arguments can easily be brought home, which disrupts not only business relations but also familial relations.
To conclude, yes, there are instances where having a successful family business is the ultimate dream for people, it comes with many rewards and sacrifices. It is up to the family to weigh the advantages and disadvantages according to their respective family dynamic and finances.