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Some Factors in the Profitability of Small Family Businesses
| Content Provider | Semantic Scholar |
|---|---|
| Author | Masuo, Diane M. Lee, Gary Jek Chong |
| Copyright Year | 2001 |
| Abstract | Operating a family business can be a profitable and rewarding experience. But there may be costs to members of the family. Family members often work for no pay, and the business may utilize resources that would otherwise have been available for family use. In a fam ily business, because the boundaries between work and family activities are less distinct, the use of resources in one sphere can impact positively or negatively on out comes in the other sphere. For example, we found a positive and direct relationship between family success and business success in family business households (Masuo et al. 2001). While higher levels of family suc cess are associated with higher levels of perceived busi ness success, the reverse is not true, we found. Factors such as firm size, type of business, level of profit, and net worth may help to explain this one-way relation ship. We examined information from a national survey of family businesses in an effort to inform prospective entrepreneurs about what successful family businesses are like. The data are from 708 business-manager house holds from rural and urban areas in all 50 states that were surveyed in the 1997 National Family Business Survey of small, family-owned businesses with less than 99 workers. The owner-managers worked at least 6 hours per week year-round (or a minimum of 312 hours in the previous year), and they lived in the same household with at least one other adult family member. We compared the characteristics shared by most of the profitable businesses surveyed with those of the least profitable businesses. The sample was divided into quartiles according to business profit, with the most prof itable group representing the top quartile and the least profitable group representing the bottom quartile. The top quartile businesses • earned between $48,000 and $7 million annual profit • averaged 0 unpaid workers and 18 paid workers • were not home-based • were largely in the service, retail trade, and construc tion industries. |
| File Format | PDF HTM / HTML |
| Alternate Webpage(s) | https://scholarspace.manoa.hawaii.edu/bitstream/10125/12214/1/ET-3.pdf |
| Alternate Webpage(s) | https://www.ctahr.hawaii.edu/oc/freepubs/pdf/ET-3.pdf |
| Language | English |
| Access Restriction | Open |
| Content Type | Text |
| Resource Type | Article |
