Family Businesses Can Survive Through Recessions
Tips for Family Businesses to Survive and Thrive When Tough Times Hit
Can You Revive Your Distressed Family Business?Â The first step to figuring that out, Steven F. Agran explains, is an objective assessment of cost structure.Â What determines whether a business can be cash flow positive at current sales levels or even at lower levels, if sales continue to decline?Â Find out here.
Family businesses have been the backbone of the American economy for years. Entrepreneurs entered industries with low barriers and grew prosperous enterprises through ambition and perseverance. But the start of the 21st century saw the sale of many family-owned businesses as second- and third-generation owners chose to monetize their investments. The family companies that remained found themselves competing against companies where sales growth and EBITDA, rather than family values and long-term profitability, were the overriding goals.
Many family business ownersâ€™ reaction to the recession and mismanagement of finances hurt their profits and viability. Growth opportunities and wealth quickly vanished. However, by making some important changes to their strategic business plans and improving communication with business partners, these companies can again become prosperous.