Share |

Australian family businesses pessimistic about future

Only a quarter of Australian family businesses saw an increase in profitably and market share over the past three years, and less than half expect the market to improve in the next year, according to research out of a Melbourne university.

Only a quarter of Australian family businesses saw an increase in profitably and market share over the past three years, and less than half expect the market to improve in the next year, according to research out of a Melbourne university.

The report also found family businesses did not feel the federal government gave them enough support.

Produced by RMIT University, Australian family businesses: Surviving, not thriving, found only 40% expect the market to improve in the next 12 months.

A total of 91% of family business owners don't think the federal government is offering them enough support, although they are similarly pessimistic about the opposition, with 83% feeling the coalition of centre right parties – likely to be elected in September, according to current polls – will not help them.

Professor Kosmas Smyrnios, one of the reports authors, said family business owners were more pessimistic than their non-family counterparts because they have extra concerns such as succession and having adequate funds for retirement.

The report found 58% of family business owners envisage themselves working beyond retirement age because they are concerned they will not have an adequate pension or savings. Smyrnos reckoned "the market is not as strong to enable them to exit the business as easily as in the past".

In the last 10 years the number of family businesses involved in manufacturing has halved to 20%. Smyrnos put this down to the fact Australia's neighbour, Southeast Asia, is the global hub of manufacturing, while high labour costs and the persistently high Australian dollar have made continuing in the sector unviable for many family firms.

Despite family businesses frequently being praised for offering greater opportunity to women than non-family firms, only 9% of daughters were likely to get involved in the family business compared to 36% of sons.

There was no one explanation for this difference but female respondents cited issues such as confidence, the importance of a good work-life balance and greater seeing greater opportunity elsewhere as reasons for not joining the firm.

The research was published in partnership with international tax and auditing firm MGI, surveyed 5,000 Australian family businesses and entrepreneurial firms.

Click here >>
Close