Will The Kids Take Over The Business?
For owners of family businesses, nearly half want to keep the business in the family. But, only 13% believe it is very likely that it will actually happen.
There are an estimated 5.5 million family owned businesses in the U.S., and about 40% of those businesses get passed on to the second generation of family members. But, that percentage drops significantly when it comes to the business staying within the family beyond that: only 13% and 3% of family owned businesses pass on to the third and fourth generations, respectively.
- Family owned businesses contribute 57% of GDP
- Family owned businesses employ 63% of the U.S. workforce
- Family owned businesses create 78% of all new jobs in the U.S.
48% of the owners of a family business would like for a family member to eventually take over, and when the business has 20 or more employees, that percentage increases to 62.5%. However, the reality is that only 23% think it is likely, or 13% very likely, that a family member will actually take over. Only 7% of operating businesses were inherited. The average life span of a family owned business is 24 years.
For more information from Docstoc, please visit here.