Some people think that the best way to run business is within the family. What are the advantages and disadvantages of a family run business?

Many companies today are owned and managed by more than one member of the same family. There are obvious advantages to

this

type of

business

managements, including possessing common values and loyalty.

However

, it is quite common that family-run businesses often suffer from lack of expertise and favouritism. One evident benefit of family-run enterprise is that family members often have shared values.

In other words

, family members are likely to share the same ethos and beliefs on how things should be done.

This

gives a

business

an extra sense of purpose and pride, which can be considered a competitive edge for a company. IKEA, Dr. August Oetker, Ford Motor Company and Wal-Mart are all examples of successful family-owned businesses, all employees of which are committed to their company values and are willing to build a long-lasting enterprise.

Moreover

, loyalty is

also

a benefit which can be attributed to family-run companies. Strong personal bonds mean that people are likely to stick together in hard times and show the determination needed for

business

success. During the 2008 global family-owned firms were the ones to sustain the least losses regarding financial matters.

Nonetheless

, running a family company, has obvious disadvantages.

Firstly

,

such

companies may suffer from lack of skills or experience. So, some family businesses may appoint somebody into roles for which they are not exported enough or have no training and skills for.

This

can have a negative effect on the success of the

business

and lead to a stressful working environment.

Additionally

, it is hard to be objective when choosing to promote an employee, regardless whether they are a member of your family or not. Family-owned companies oftentimes show favouritism towards a relative

instead

of promoting the best worker. It is important to make

business

decisions for

business

reasons, rather than personal ones, but

this

can sometimes be difficult if family members are involved. In conclusion, today there are numerous companies that are owned and run by a member of one family. While

such

businesses have benefits, including motivation and loyalty, there are

also

major drawbacks,

such

as unqualified staff and in-group bias.