fbpx
You're Reading:A Friend’s Story As A Family Owned Business Problems Example

A Friend’s Story As A Family Owned Business Problems Example

by Tasos

}

Feb 8, 2016

SPONSORED ADVERTISEMENTS

LATEST NEWS

Cyber Monday Extended:

.........................................................................

*Support our brand new social channels:

.........................................................................

ElegantThemes: Cyber Monday Has Arrived! New Prizes 💰 New Bundles 💰 Huge Discounts. Every qualifying purchase comes with our biggest discount of all time, a free prize, a pack of website templates and exclusive access to dozens of additional product deals👇 Current Free Prizes: 69

DepositPhotos: Winter offer, 100 images only $80. PLUS Free Photo: beautiful-view-sea-coast. PLUS Free Video: partial-view-manicurist-applying-nail.

EnvatoMarket: Grab December's free items. There are always new freebies ready for you to enjoy on Envato Market. Website templates here on ThemeForest, WordPress plugins, graphic assets of all sorts, thousands of background music tracks and more. Get them while you can!

NameCheap: Proven Website Security. Protect against malware threats. 80% off SiteLock. Protect and enhance your website, for less. Get constant threat monitoring, instant malware fixes, and vulnerability patches.

Icons8: New outlined icons. Experimental pack of 250+ icons. Different line weights and perspective give the real badges feeling. 50+ different categories, and it will grow more!

.........................................................................

Dec 09:

NewsTarget: DAMNING DOCUMENTS UNCOVERED: CDC directly colluded with Twitter, Facebook to censor free speech

[Censorship Revelation series]

[China buying up the world’s GOLD supply in preparation for new world reserve currency designed to END the DOLLAR]

Makeleio: Κατά πλειοψηφία εγκρίθηκε το νομοσχέδιο «Διαδικασία άρσης του απορρήτου των επικοινωνιών, κυβερνοασφάλεια και προστασία προσωπικών δεδομένων πολιτών».

TheGatewayPunditTexas Governor Abbott Bans TikTok on State Devices

Ethnos: Σκάνδαλο μεγατόνων στις Βρυξέλλες: Αξιωματούχοι τα «έπαιρναν» από χώρα του Κόλπου - Πρώην ευρωβουλευτής μεταξύ των 4 συλληφθέντων

[Μόνο βόμβες από δω κ στο εξής]

ZeroHedge: G-7 Offers $15 Billion To Vietnam, Up From $2 Billion, To Transition To Renewables Months After Country Snubbed Climate Ambassadors

Reuters: Vanguard quits net zero climate effort, citing need for independence

[Ship abandoning?]

Congress: H.R.9157 - To define the dollar as a fixed weight of gold, and for other purposes.

[Jul 10 This bill requires the Department of the Treasury to define the Federal Reserve note dollar in terms of a fixed weight of gold, based on that day's closing market price of gold. Nesara]

WebMarketSupport: How To Write A Professional Business Bio They Will Remember

[Eyes 👀 on Japan]

[JAG Arrests Ex-Twitter Lawyer and Dishonored DOJ Stooge James Baker]

[Η Γενική Συνέλευση του ΟΗΕ (UNGA) ψήφισε ένα ψήφισμα που καλεί το Ισραήλ να απαλλαγεί από όλα τα πυρηνικά του όπλα και να θέσει τις πυρηνικές του εγκαταστάσεις υπό την επίβλεψη του Διεθνούς Οργανισμού Ατομικής Ενέργειας (ΔΟΑΕ).]

[Η ΑΑΔΕ ξεσαλλωσε Όχι για πολύ][Elon about to unlock 1.5 billion accounts on Twitter. When does a Bird Sing?]

[Serbia tensions
El Salvador army x-motive
Brazil EBS prep
Germany sirens
Ukraine Russia China Taiwan
refrain
France weekend 🚦 (incoming)
Qatar heating
Iran same
US supreme
Flip 6771
Hellas final 🛑 signal]

[#education is falling apart, especially in the US n other western countries. Stop the madness.]

[New currency Russia+China Anti-dollar? Digital & asset-backed Outside the Western banking system Countries that will join forces, won't have to pay off their debt to western banks Rumors today? facts tomorrow!]

[Economy The Egyptian government has approved Egypt’s participation in the #BRICS New Development Bank $$ where r u?]

200+ business & marketing tools collection 72x90 banner
black friday cyber monday banner 728x90

Problems in business are very common. But when problems arise in family businesses, the results are often catastrophic.

How many times have we witnessed such sad incidents?

There is nothing worse than having a family fight over the business, position, money.

There are many cases where lives were lost.

The power of money is unlimited, it even transcends family ties.

We created it so that we could trade and improve our lives, but we could not control its influence on us and let it dominate us.

We put more emphasis on acquiring material goods instead of investing in human relationships.

But while money is omnipotent, it does not have the power to buy everything.

A little oxymoron!

Today I want to share a friend’s story as an example to avoid.

Example of Family Business Problems

The beginning of the problem

I have been following his story since the problem started. And that was 10 years ago. I know this experience cost him a lot, but on the other hand, I believe he now has a future ahead of him.

He was working in his father and uncle’s factory, a local business with local customers. The two brothers started this business 25 years ago.

But both brothers were married and soon their children grew up. My friend is the youngest of 2 brothers, but the only one involved in the company.

On the other hand, his uncle has 3 sons, and they all participate in the company.

At some point in the future, the factory would be divided into 4 young men. My friend would have 50% (his father’s share) and the other 3 brothers (uncle’s side) would have to share the remaining 50%.

And that was the reason that sparked an ongoing battle between the two elderly brothers. His uncle believed that his sons were at a disadvantage. They were three against one and had to share 50%. But he could not legally support it.

The law is clear, the percentage of one of the original partners is shared among his descendants, regardless of how many they are.

And everything changed

This was something the friend’s uncle should have thought of earlier as the father of 3 boys. He knew the plant could not feed so many families. Maybe he could motivate one or two of his kids to other businesses.

His uncle started stealing money from the company to buy real estate and for personal expenses.

He was not present on time, he was late, he did not show up other times, and he left his older brother and my friend to deal with the workload and obligations alone.

His sons were aggressive and almost violent against my friend.

Eventually, the uncle started a new identical business with a new name in the same area trying to get as many customers as he could from his brother and blamed him.

The consequences

Now the 2 brothers do not talk to each other. The 4 young men, the children, did not exchange a word all these years.

In addition, everyone had to face an inevitable marathon of courts.

They lost money, reputation, and customers. But above all, they lost their composure. And they ruined their relationship.

But things could have been worse, fortunately, no blood was shed.

What can we learn from this story?

When starting a new business with a partner, in this case, a family member or relative, we need to look to the future. If this business is going to last (and why not? That’s the ultimate goal of any business, to last) then new members may be involved. Children, spouses, or other relatives.

We must be prepared for change. Psychologically and financially.

In this case, what is the mistake of the 4 young men? None, they inherited a problem.

It was sad to watch my friend talking about it. Two brothers who once joined forces and looked to the future with hope and managed to build a profitable business that lasted almost 30 years, broke up in the worst way. Everyone was trying to protect their children.

A healthy business with a big brand was disbanded. My friend did not choose it, he could not do otherwise, he was a young boy when he started working there.

But can we be fully prepared?

Well, no one can answer so easily, no one can predict the future. Even if we are prepared, some problems may arise.

As a rule, if you can avoid working with family members and relatives, do so. It is best to create something yourself or with the help of an external partner or co-founder.

If we can leave the family out of business so much the better. A family must remain united, in every way.

We know the power of money and how much it corrupts our souls and alienates us.

Far and beloved…as the saying goes.

Interesting Statistics

About 70% of family businesses fail or are sold before the second generation gets a chance to take over.

Only 10% remain active to lead the third generation, and this happens in private companies.

Unlike public companies, where the average term of a CEO is six years, many family businesses have the same leaders for 20 or 25 years, and these extended terms can increase the difficulty of coping with changes in technology, business models. and consumer behavior.

%

Family businesses that fail before the 2nd generation takes over

%

Active private companies led by the 3rd generation

Average term in years of managing directors in public companies

Average term in years of managing directors in family businesses

Instead of being a small part of the global economy, family businesses make up 80-90% of all businesses worldwide.

%

The percentage of family businesses worldwide

We Teach

Marketing & Business

Live on Zoom

Your host: Tasos Perte Tzortzis

Schedule an interview so we can evaluate where you are right now, your needs and goals, and we'll give you a detailed analysis of how the workshops work

*30-Day Free Trial

Epilogue

I hope you are inspired by this story and use it as an example so that you do not get involved in adventures with your family business.

“As we can see from the statistics, family businesses are the majority.

Business problems are inevitable and ongoing, we must act prudently, decisively, and take our responsibilities.

Because in case of financial or personal disputes the consequences can be tragic.

Another article has finished, here on WebMarketSupport. I am waiting for your comments and your thoughts. Till next time.

Tasos Perte Tzortzis

Tasos Perte Tzortzis

Marketing Consultant, Creator of the "7 Ideals" Methodology

Although doing traditional business offline since 1992, I fell in love with online marketing in late 2014 and have helped hundreds of brands sell more of their products and services. Founder of WebMarketSupport, Muvimag, SummerDream.

I enjoy reading, arts, science, chess, coffee, tea, swimming, Audi, and playing with my kids.

marketing publishing mastery private training workshops featured banner
roobet-Dec-2022-250x250
wealthy-affiliate
Divi WordPress Theme
Bulletproof your Domain for $4.88 a year

Find a domain starting at $0.88

powered by Namecheap

Archives

2 Comments

  1. Daniel Lara

    Hi, Tasos! I lived a similar (albeit much less intense) situation in my family and have decided on the same thing you suggest: never do business with family. Even though everything may start based on the best intentions and ideas, you never know what is going to happen down the line. If the business perseveres and lasts for a long time, eventually you start having external influences and opinion from wives, husbands, offspring and all sorts of complicating factors that can easily disrupt the established context in the beginning.

    Reply
    • Tasos

      Absolutely Daniel , family businesses are a great risk.Although they all start under the best conditions a possible fight in the future can be proved painful for all.

      You made a wise decision leaving family out of business , this can ensure that all the members stay united.Family is above money.

      Thank you for stating your personal experience here with me.All my best.

      Reply

Submit a Comment

Your email address will not be published. Required fields are marked *

Newsletter

Marketing, Business, Economy, Multimedia

Get access to marketing and business training, sales secrets and personal stories from the entrepreneurial world, downloads, exclusive discounts and bonuses, and the newsletter to scale your business

I’m celebrating the release of the “7 Ideals” methodology, be part of the movement!

Exclusive Access & Lifetime Bonuses

“7 Ideals” Methodology

Read More

Latest Posts

The Magic of the "7 Ideals" methodology (beta)

The Magic of the "7 Ideals" methodology (beta)

I'm opening up a beta group so you can test a part of our methodology at no cost!

With my value-driven customer-centric strategy and proprietary frameworks, the marketplace is going to change.

 

The main framework of the method is explained in detail

I also released the basic principles that are infused in everything we do, the most important part, and

I shared the story of how I got here.

 

I'm introducing a special form of live events that no one is using and that will help your brand thrive and impact the world.

Plus I have developed a revolutionary funnel strategy. 

 

Become one of the first new-wave business owners that deliver superior user experiences due to our secrets.

LIMITED SPOTS (we kick off this month)

 

UPCOMING WEBINAR this Sunday Oct 23 @ 10 pm GMT+3

LAUNCHING PRODUCTS LIKE A PRO

You have Successfully Subscribed!

Pin It on Pinterest

Share This