The Importance of Family Business in Global Economy

In a world of multiculturalism and geographical diversity people are starting to see that buying from multinational corporations isn’t all that’s hyped up to be. The importance of family businesses is quite shocking in itself because of the difference in values and marketing that we are confronted with when putting a multinational enterprise next to a family owned business.

When speaking of the values themselves we come to see that the meaning behind the word itself, its mission, connects seamlessly to how they spend their money. In an economy that is constantly in motion the result is that smaller firms are losing when it comes to making a profit. The bigger companies get the contracts and family businesses don’t seem to know how to manage themselves in a world that relies on cost savings and doing everything faster rather than better. A unique piece of art created by a family enterprise will be a lot more distinctive than a broche made by machines, but not cost efficient.

Surviving a new generation

A larger issue seems to be the fact that the chances of the business surviving past the third generation decrease significantly as time goes by. The idea seems to be that when the children are supposed to take the reins of the company they do so resentfully and therefore become ineffective business owners. A country that seems to understand the underlining issue is Japan. The importance of family business in Japan has led business owners to even adopt sons in their families in order to ensure the continuation of the companies. That in itself is a striking thought.

Communities and the importance of family businesses

The global economy might survive the disappearance of Mom ‘n Pop shops, but communities will not. In a close unit community, small family owned businesses have proven their importance through the way they help those that live there. The values that they uphold and they way they do so make them very important for people in times of economical hardship. Since small businesses have fewer employees than a multinational it creates a close working relationship between workers and owners. It also makes it more likely that people will try looking for solutions rather than firing right from the start to cut their losses. This in turn lowers the rate of unemployment. The fact remains that family businesses are important to each and every one of us.