Scaling up

About the Survey
 
About the PwC Family Business Survey 2012
We’ve talked to almost 2,000 respondents, large and small, around the world, from both developed and emerging markets, across a broad range of industries. We found remarkable similarities among the diversity.
Scaling Up
 
Scaling Up
The next frontier for more and more family businesses is overseas expansion: 67% of respondents had some level of international sales in 2012. By 2017, that number will jump to 74%.
Skills
 
Skills
Recruiting and retaining the right talent is a challenge for family businesses: 64% of them are planning to bring in non-family management in 2012.
Succession
 
Succession
While 4 in 10 respondents will pass on ownership and management to the next generation, 25% will pass on ownership but bring in professional managers,citing the next generations lack of skills as an issue.
Territory insights
 
Territory insights
While our survey revealed striking similarities among all family businesses, we found -- as might be expected, given the vastly different regional economic conditions around the world -- some significant variations in outlook and habits.
Download
 
Download the Survey
Read our report on what family businesses in 2012 are thinking and planning as they look to compete in an increasingly global marketplace.
 

The next frontier for family businesses: Overseas expansion

Family businesses, like other businesses, are facing big pressures to start expanding overseas in order to remain competitive.

Our survey clearly indicates that more and more family-run firms are being driven by competitive pressures -- or market openings due to innovation -- to get past their instinctual reluctance to avoid excessive risk… and are entering into foreign markets.

Nearly three-quarters (74%) of our surveyed family firms expected to have international sales by 2017 -- a ten per cent jump from today. The numbers were especially strong in Hong Kong and Singapore, as well as in Southern Europe. And while, not surprisingly, most were contemplating expanding close to home (be it within Europe, or the Americas, or Scandinavia), the trend of globalisation is inescapable.

Still, significant obstacles remain. In addition to the usual challenges of financing a scale-up and the complexities of international supply chains, family firms also face many problems that are intrinsic to their very nature.

Scaling up to overseas markets: Easier said than done

Most family firms have self-preservation in their DNA, the strength of the family culture and values tending to a market positioning that is reactive by nature.

Most have an aversion to leveraging their balance sheet or mortgaging physical assets -- which makes raising growth capital difficult -- and issues of ownership, succession, and the hiring of outside managers can present unique problems as well. So can an unwillingness for family members to relocate.

Our survey illustrates these challenges. Our respondents cited understanding the business culture overseas (20%), competition (19%), local regulations (19%), exchange rate fluctuations (16%), and local economic conditions (16%) as the main challenges they saw to expansion. A number also referred to the difficulties of managing a far more complex international supply chain.

Yet the march to internationalise in their markets continues -- underscoring that for most of our family-run businesses, the word “business” still comes first.

Dive into the details

Benchmark your company
Helping you to understand how you compare

How do your challenges, strengths and resilience compare to those of your peers across the world? We've got the qualitative and quantitative data from our large-scale survey of 1,952 family businesses across over 30 countries. We've used this knowledge to create a benchmarking tool that will not only help you see where you are, relative to your peers, but help you set a strategic course for where you want to go. Benchmark your company

What family businesses told us

Austria
 
“Listed companies have better access to equity. Limits using private equity for family owned businesses results in growth restrictions for family owned businesses.”
USA
 
“In the next 12 months, a top issue for family firms will be continuing to deal with a struggling economy, global as well as domestic.”
Mexico
 
“International competition is now much more structured, much more professional, but on the other hand, this leaves large market niches that large companies are not attacking, precisely because of the agility of family businesses”
Australia
 
“[The greatest challenge is] consolidation through globalisation. Customers are getting bigger, which will put greater pressure on size of the family businesses as against large multinational or publicly owned corporates.”
Finland
 
“Operating in many places is hard work. We operate in 50 countries and they all differ from each other. We have to learn local cultures and habits and financial legislation and taxation vary from country to country.”