News: Family owned businesses are critical for the economy

Family businesses are critical for the economy

KPMG Global Head of Family Business, Christophe Bernard, recently gave some insight into the importance of family businesses in emerging markets like that of South Africa.


Partner, Global Head of Family Business

KPMG in France


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Critical for the economy

The below article originally appeared on this site.

From jewellery, to fine dining, market gardeners and even manufacturing, South Africans have proved that family and business can make ‘sense/cents’. Enterprises like Sunrise Fruiterers and Damjees grew from humble beginnings to viable businesses, creating jobs and contributing to the economic growth of the country. 

But family owned businesses are not just a South African phenomenon. There are many leading international brands that have started as a family concept, and have established themselves through the generations. This, and the challenges faced by such businesses were explored at the first ever Family Business Conference, hosted by KPMG’s office in Port Elizabeth.

By midday Sunrise Fruiterers on Brickfield Road in Durban is bustling. Customers push through the narrow aisles of this unassuming tin structure, picking fresh herbs, potatoes and a fruit or two from the wide selection on display.

The distinct aroma of curry, pickles, fried samosas and chili-bites wafts through the store, adding to its warm, inviting appeal. It is here were relationships are essential, as explained by third generation owner Krishie Birjanund. This is part of the legacy passed down by his great grandfather, who started the business almost 50 years ago. This rich history is literally painted on the walls of the store.

As the business and the family grew, Birjanund’s father began establishing more Sunrise stores throughout Durban. These were handed down to his children, while Birjanund took over the original business. This was done in a bid to protect the brand from family conflict. But it is not family disagreements that concern Birjanund. It’s the question of who will take over from him. 

It is a different story for 37 year old Yasheen Nathoo. He is the fourth generation owner of the renowned Damjee’s Jewellery stores in Durban. For him, it was a natural progression into managing the business. And this is how he is bringing his own son into the business. Barely able to reach the counter-tops yet, he joins his dad every week at the Gateway store.

But while the NaTo read the article on the SABC website.thoos have found an ideal way of dealing with their own differences, conflict remains a major risk to family owned businesses, as explained by Paris based KPMG Global Head of Family Business Christophe Bernard. Another major challenge surrounds the question of succession. Bernard says many founders struggle when it comes to the letting go of the reigns to the next generation.

Despite these challenges, Bernard believes family owned businesses play a critical role in the economy.

To read the article on the SABC website.

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