Family Businesses in Spain: Challenges and Successes
The importance of family businesses in the economic development of a country is an indisputable fact, even more so if the consequences of their business activities on the integral development of a society are analyzed. In Spain, they represent 85% of all companies, generating 70% of GDP and employment. In total, the 2.9 million family businesses employ 13.9 million people.
In this article, we’ll explore the corporate structure, challenges, and some successful examples of family businesses.
Corporate Structure of the Family Business
How do family businesses work in practice? This type of structure is made up of several members of the same family who share the same financial objectives. The company is controlled and managed by the different members of the family. The company is transmitted from generation to generation. Family businesses in Spain take various legal forms. The legal structure and ownership of the company are often closely linked to succession planning, a critical aspect of family business management.
Family Business Challenges
Family businesses have their advantages: a shared sense of success and pride, strong traditions and family values, and stability and flexibility that make them the envy of their competitors.
However, this coin has its reverse side. Family conflicts, communication difficulties, and accusations of favoritism by staff members outside the family can thwart growth ambitions and hinder the proper functioning of any family business. So, family businesses must find a way to face the challenges that lie ahead, in order to mitigate the associated risks, preserve cohesion within the company and, above all, within the family.
Examples of Family Business Success
Despite these challenges, a large number of family businesses have managed to grow and prosper over generations.
We can cite the Italian fashion company Prada.
Founded in 1913 by the Prada brothers. The company has been able to reinvent itself and maintain its position in the competitive world of luxury fashion. Miuccia Prada, granddaughter of one of the founders, is now the design director and has led the brand to innovation and global recognition.Another example is the fashion company Mango.
Founded by the Andic brothers in 1984, Mango has grown to become one of the most recognized global fashion brands, with a presence in more than 100 countries.Finally, we can count the Mercadona supermarket, the leading supermarket in Spain. Founded by the Roig family in 1977, the company has experienced constant growth thanks to its focus on product quality and customer satisfaction.
