Challenges and Prospects
Challenges and Prospects
Family Businesses play a significant role in the world. According to KPMG’s researches, family businesses account for about 60% to 80% of the entire global enterprises and also make up more than 40% of the Fortune Global 500. Family businesses create over 70% of the world’s GDP. Compared to general private company, family businesses are totally different in essence. Under the operation model of taking the family as the core, the vision of enterprise owners and the family members have become the push and pull factors for the growth of family businesses. Therefore, the right approach in making a family business grow continuously and in meeting the expectation of every family member is the key point and the most essential aspect one must consider in order to be successful in handing down the business to the next generation.
Inheritance and Succession to face the challenge from generation to generation
According to the research conducted by the Family Business Network, there are about 70% of the family businesses globally that cannot be passed on to the second generation, and 90% of them will not be able to make it to the third generation. Therefore, making and implementing a succession business plan is very important. A comprehensive survey on the family businesses in Taiwan shows that Taiwan's economic development is closely related to family businesses. A number of family businesses are over 70% and its market value accounts for over 60% of the publicly listed and OTC enterprises in Taiwan, which are mainly in the financial, industrial and information technology industries. The average years of family businesses in Taiwan is about 28 years, and the average age of business owners is around 60 years old. Therefore, it’s about time for the succeeding generation to make the right decision for a successful family business. Unfortunately, there are still more than half of the business owners in Taiwan who have not yet made any plans in entrusting their business to the next generation. In recent years, the issues related to enterprise inheritance, cultivating the preceding successor, and family business governance have been revealed along with the aging family business owners. With all these concerns, there’s a call for an urgent need to come up with an appropriate approach in dealing with a successful family business in the near future.
KPMG Family Business think tank, the most trustworthy consultant for you
KPMG have invested a lot of resources and enthusiasm in different area of family businesses. We have cooperated with many family businesses for over 100 years since our establishment. KPMG family business think tank gathers the top experts in the field of family business from all over the world. We understand their needs and make sure they are well taken care of, and in return, we have their full trust and confidence. Our consultants will combine all the network resources of our global members to provide the most efficient, professional, and optimal solution in assisting every family business.
Family Business Service
Succession and next generation