A profile of Australian family businesses.
Type of Industries
Figure 5.1 shows a breakdown of businesses into the 11 industry (ASIC) categories. Over 25% of owners are in manufacturing, 32.8% in the wholesale or retail trade, 13.2% are in construction, and 5.1% are in the technology area.
Establishment of business
On average, family businesses in Australia have been established for 28 years, ranging up to 150 years (i.e. fifth generation firms). Approximately 9% have been owned by the same family for 5-10 years, 35% for 11-20 years, 23.5% for 21-30 years, 20% for 31-50 years, and almost 13% for longer than 50 years.
Number and type of business locations
Over 67% of firms have only one business operation, ranging up to 28 national locations; with 33% having more than one location, and almost 8% report having overseas locations.
Only 13% of family business owners (21%) indicate having seriously considered moving their business operations (or part) offshore.These findings confirm that small-to-medium family firms rarely choose to internationalise their organisations (Fernandez & Nieto, 2005).
Legal structure
As expected, family businesses favour a private company structure (73.1%); followed by family trusts (18.8%), unit trusts (6%), and partnerships (2.6%).
Ownership structure
For those owners who consider their enterprises to be family firms, Figure 5.2 shows that about 80% note that 100% ownership is through one family, 11% indicate that more than 50% but less than 100% of ownership is through one family, 7.3% through a group consisting of more than one family, and 1.7% report that the family has control or provides management to the business.
Approximately 58% of family business owners report never having considered expanding business ownership to nonfamily managers (27%).A small proportion of family business owners report that equity in the business is held by nonfamily members, with 8% of those indicating that the equity is held by nonfamily managers/ employees; average amount of equity = 25%. Almost 3% report that equity is held by nonfamily investors; average amount of equity = 19%.
Note: While every attempt was made to obtain a representative random sample; participants appear to be over-represented in the manufacturing, technology and communication services, and retail and wholesale sectors, but under-represented in finance, property, and business services.
Please note that in the body of this Article, except in Tables and where the context makes it clear, statistics for nonfamily business owners are included in parentheses.