My successor is ahead of me: only a third of family companies survive the generational change

By: Trademagazin Date: 2023. 04. 26. 11:24

The number of family businesses in Hungary now exceeds 150,000, and their economic importance is enormous, as they account for about a fifth of domestic companies with billions in sales. However, on average, only 30 percent of them survive the first generation change, so it is not an exaggeration to say that the fate of a significant part of SMEs depends on this process, which requires a series of multidimensional, business and emotional decisions – it is no wonder that it even inspired a popular television series question. We covered the important topic with András Avidor, business development and networking expert, head of BNI Hungary.

We are living through turbulent years in the global economy, but the domestic companies that were among the first to be founded forty years ago have seen a lot: regime change, market opening, crises, EU funds have come and gone in recent decades. Among the SMEs that form the backbone of the national economy, the proportion of family businesses is still growing dynamically, and based on Opten’s figures, the sales revenue of more than 2,100 of them exceeds the billion dream limit. In the ownership structure, the most typical kinship relationship is still the marital relationship, but the parent-child relationship can also be seen in about 50,000 businesses.

“I experience on a daily basis how much of a challenge generational change is in most companies, with many doubts and tormenting questions: is my child suitable for a leadership position? When should I apply it, how should I prepare it? What if I don’t think you’re up to the task? Let’s not forget that a 30-40-year-old family business is truly a lifetime’s work at stake”

– says András Avidor, founder and head of BNI Hungary.