Starting a business with a spouse, parents, siblings, children or other family members is not like the typical startup.
According to the Family Firm Institute, family-owned businesses comprise two-thirds of the companies worldwide. However, only 30 percent endure into a second generation, 12 percent to a third, and 3 percent to a fourth.
The typical snare of a family business is putting too much weight on family and not enough on business. Rarely are the qualities of a healthy business entirely compatible with family harmony.
When the business is going well, there will be jealousy. When it is going badly, there will be blame.
The earliest stages of a family business are the most ominous. Family members can join the promise of a new venture without clear definitions of their roles, duties, compensation–and, should they become problematic, exit arrangements.
To avoid miscommunication and hard feelings in the future, advises StartupNation.com, always put family business relationships in writing.
While various family members may qualify for similar duties, they must be divided up to avoid conflicts. Significant decisions can be reached together, but disputes over minor procedures impede the overall progress of the business.
The dominant structure of a thriving family business is having one person serve as the ultimate leader of the endeavor. When this leader is resilient and competent, he or she can persevere, stay focused, and proceed with their responsibilities and intentions despite the obstacles and challenges.
These capabilities are especially essential in a family business where professional and personal issues frequently become intertwined.
Leaders of strong family-owned businesses know that setting boundaries among participating family members is critical to continuing success. Precise methods of communication must be installed.
Since business quandaries and differences of opinion are inevitable, consider weekly meetings to assess current progress and plans, air differences, and resolve disputes. Moreover, keep family issues out of the boardroom and office.
Keeping pace with the times is vital to any business, more certainly those with multigenerational roots. Regardless of age, family members must continuously evolve and deliver or risk alienating both employees and customers.
Furthermore, so-called sympathy jobs should not be open as a last resort to children, cousins, or other family members for any reason. Employment must be based on the experience, knowledge, or skills a family business demands.
For leadership and staff positions the business demands, look outside for the qualities family members do not possess.
Book review: Create new markets in a blue ocean
Blue Ocean Strategy has emerged as one of the more popular business strategies in recent memory. Why? The strategy aims to not just improve your competitiveness but to instead make your competition irrelevant.
Rather than beating competitors in markets already gripped in a death struggle, Blue Ocean Strategy suggests that companies create uncontested market space and new industries, or blue oceans.
Those who uncover blue oceans first may enjoy strong growth and minimal competition. They might also define the rules for the new industry.
Sound like pie in the sky? Throughout the essays found in the book “Blue Ocean Strategy Reader,” authors W. Chan Kim and Renee Mauborgne recount past examples of blue ocean success while also offering insights for those looking to uncover the next uncontested markets.
One frequently cited example is the entertainment company Cirque du Soleil, which created a blue ocean in what seemed like a declining red market. Traditional circuses were already going out of style in 1984 when Cirque du Soleil launched a new circus experience that appealed to upmarket patrons who traditionally enjoyed orchestras, ballet, and opera. Kim and Mauborgne argue that by doing so, Cirque du Soleil created a blue ocean.
Facing minimal competition in their blue ocean, Cirque du Soleil has grown from one show in one city to 19 shows spread over 300 cities and is closing in on $1 billion in annual revenues. Meanwhile, Ringling Brothers and Barnum & Bailey both shut down in 2017 after offering traditional circus experiences for nearly 150 years.
The essays in “Blue Ocean Strategy Reader” cover a range of topics and offer actionable insights.
Goblins and candy bars: Retailers could be in for a treat in 2021
‘Tis the season for candy, costumes, and scary movies. As Halloween approaches, expect retailers and analysts to closely monitor consumer spending and other trends.
Halloween is the second biggest spending holiday in the United States, trumping Thanksgiving, Easter, the Fourth of July, and all the rest.
And Halloween spending has grown considerably over the years. Back in 2006, Americans spent “just” $4.96 billion. In 2017, spending peaked at $9.1 billion before cooling to $8.8 billion in 2019.
The COVID-19 pandemic put a bit of a damper on the 2020 Halloween season, with some families skipping or cutting back on trick-or-treating, parties, and other celebrations. The National Retail Federation estimates that spending dropped to $8.05 billion.
What about the 2021 Halloween season? Candy giant Hershey conducted a survey and found that 54 percent of consumers were likely to buy more candy this year, and trick-or-treating could be up by as much as 45 percent.
If so, that could bode well for retailers and trick-or-treaters alike.
The COVID-19 pandemic, among other factors, impacted consumer expenditures across the board in 2020 with annual Real Personal Consumption Expenditures (PCE) falling by 3.9 percent. Now, accounting giant Deloitte projects PCE to rise by roughly 7.6 percent in 2021 compared to a year prior.
Meanwhile, the National Retail Federation regularly conducts spending surveys and so far has found that back-to-college/school and Mother’s/Father’s Day spending has likely increased in 2021.
Companies bet on green packaging
Amid increasing environmental concerns, some companies are rethinking how they approach packaging, aiming to minimize their environmental footprint while reducing waste and potentially cutting costs.
Packaging company DS Smith argues that better packaging could save companies $46 billion per year by reducing global logistics costs.
Wasted space is a key concern, with many goods shipped in oversized boxes and the like. With better-designed packaging, companies can reduce wasted space, allowing them to move more packages per shipment and reduce the amount of materials used.
Sustainable packaging may also attract customers. McKinsey has found that up to 70 percent of consumers are willing to pay more for sustainable packaging. More than 60 percent claim to have already gone out of their way to buy sustainable packaging, while 57 percent have made significant lifestyle changes to reduce their environmental impact.
Nestle has pledged to make all of its packaging recyclable, reusable or compostable by 2025 and has allocated $2 billion in pursuit of that goal. Unilever aims to recover half of its plastic packaging and this past March, allocated $15 million to the Closed Loop Partners Leadership Fund.
Market analysis firm Market Research Future estimates that the sustainable packaging market was worth $305.31 billion in 2020 and will reach $470.3 billion by 2027.
Governments are also working to reduce waste. Canada aims to achieve zero plastic waste by 2030 and India has announced plans to phase out single-use plastics, such as plastic bottles. In the U.S., Connecticut is moving to implement minimum recycled content requirements and Maine implemented the first Extended Producer Responsibility law, requiring producers to contribute to environmental stewardship.
How to become a successful entrepreneur
If you want to run your own company and become a successful businesswoman, here are some tips to help you achieve your goals.
• Believe in yourself. Confidence in your abilities is crucial if you want to attract employees and investors who see the potential of your product or service. This will ensure you build a solid team around you.
• Decide on a mission. If there’s a goal that’s important to you, make it the mission for your business. This will help keep you on the right track. You should also determine what sets you apart from your competitors and, above all else, be passionate about your pursuit.
• Prepare yourself mentally. A good state of mind will make it easier for you to face challenges head-on when they arise. In addition, being ready to overcome failures and keep moving forward is a key part of the process.
• Don’t be afraid to go for it. Stop doubting yourself and overthinking your plans, and just launch your business. Whatever skills you’re lacking, you can pick up along the way. Remember that books and training programs can be great resources.
• Manage your time wisely. Since it can be challenging to juggle various professional and personal responsibilities, don’t be afraid to delegate tasks. In order to succeed, you must be organized and know how to make the most of your time.
Now, it’s up to you to show the world what you can do.
How to buy a small business
Business ownership is a dream for many people, and an alternative to starting from scratch is to buy an existing business. But where to begin?
First, with loads of due diligence. The more preparation, the better.
Your prep work starts with an honest look at your own experience, lifestyle, and desires to figure out what type of business you want to buy. It’s helpful to search for a business that aligns with your interests and skills.
Next, make sure you assemble a good team. An accountant will help you decipher financial information, and an attorney will help with negotiations and advice for structuring transactions.
You can search for available businesses in a number of places, from Craigslist to networking events and conferences. The website BizBuySell has thousands of listings.
When you do find one you’re interested in, the seller will likely ask you to sign a nondisclosure form or confidentiality agreement. The reason is that you’ll be privy to a lot of proprietary information that the seller wants to make sure remains private, should you decide not to buy.
You and your team will review financial and business documents to analyze the profitability of the business, as well as whether they’ve remained up-to-date on necessary licensing and forms.
Among others, these may include:
* Business licenses and permits
* Organizational paperwork
* Contracts and leases
* Financials, including tax returns, profit and loss statements, cash flow statements, balance sheets, accounts payable and accounts receivable, debts, etc.
* Organizational chart
* Inventory and equipment status
* Insurance documents
* Client or customer lists
* Intellectual property
Finally, if you decide to buy, you’ll have a stack of paper to review before purchase. These include things like a bill of sale, transferring ownership of vehicles and equipment, the lease and more. You might also ask the seller to sign a non-compete agreement, so they don’t start a new business that competes with yours.
Why you should work for a fast-growing company
Is there a fast-growing company in your area that’s hiring? If you’re ambitious and love taking on new challenges, applying for a position with a business that’s undergoing major growth could be a great career move.
It can be exciting to join a company that’s developing quickly. For example, working to establish new products, services, territories, and markets can provide a unique challenge that keeps you on your toes. In addition, the dynamic atmosphere of a fast-growing company typically fosters strong bonds with co-workers and puts your skills to good use.
In many cases, fast-growing companies attract talent by providing a range of employee benefits including competitive salaries, flexible hours, and the opportunity to work remotely. The company may also offer access to health facilities, free food, and other perks.
In short, joining a company that’s quickly growing could be a great opportunity.
If you’re hoping to make a career change, working for a fast-growing company is a great choice. You’ll have the opportunity to build new skills and grow your existing talents.