All in the family
Family businesses provide millions of jobs in Canada. Anyone can start a family business on a shoestring, in a basement, or a garage. Growing them beyond a hobby with a few hundred dollars in annual sales is difficult. Keeping them alive for the next generation is even tougher. Less than half of family businesses make it to the second generation. Only about 10 percent get to the third. “Shirtsleeves to shirtsleeves in three generations,” said Seagram founder Sam Bronfman. His grandson, Edgar Jr., fulfilled that prophecy through a foolish merger with Vivendi that slashed the family fortune from $8 billion to $2 billion.
There are lots of reasons for failure in any family business. The founder may not want to let go. There may be no one looking ahead at what happens next. Fully two-thirds of family businesses are doing no planning or preparation for the next generation of leaders. Moreover, families often get into arguments, even in large companies such as the grocery Steinbergs, the paper Krugers or the french-fry McCains. Disunity has ended many a business when there are warring factions that can’t abide power inherited by an older sister or younger brother who has been a bossy bother all their lives.
These and other family business issues will be discussed by an online panel this Thursday, December 16 at 2 p.m. EST. The event, sponsored by the Canadian Business History Association, will be led by Dimitry Anastakis, professor of business history at the Rotman School of Management. Panelist Gordon Pitts has written numerous books on Canadian business including “In the Blood: Battles to Succeed in Canada’s Family Businesses.” I will be the other panelist and have written books about such family businesses as the Eatons, Canadian Tire and the aforementioned Bronfmans.
If you’d like to join us on Thursday, please click on the bottom line of the image below. That will take you to the Canadian Business History Association site. Scroll down to the section called “Recent News,” look for “Fortunes and Family Feuds,” and click again. Registration is free.