As a business owner you
may be concerned about a few statistics I learned about recently. For example, would it bother you to know that
only 30% of family businesses survive into a second generation? Sadly enough it gets worse as only 12%
survive into a third generation. While a
paltry 3% to a fourth generation. This
is a trend I and my team are passionate about and working hard to reverse. There are many tools that favor businesses to
transfer to succeeding generations.
There is an Irrevocable Trust and even a Generation Skipping Trust to name
only two.
Here are two other
sobering stats. 80% of all businesses
fail in the very first year. By the
tenth year 96% are out of business. Part
of this dilemma stems from owners not concentrating on Profits and Losses. Profit is theory while cash is King. Here’s one small tidbit. By cutting expenses by 10% one can leverage
this to increase profits by 50%.
Small, family businesses
are the backbone of the American economy.
35% of all Fortune 500 are family owned businesses. Such family owned enterprises account for 64%
of the Gross Domestic Product (GDP).
They account for 78% of new job creation and 62% of America’s
employment.
Let’s work together to
strengthen family owned business in the Capital Region!