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Sat, Nov 23, 2024 | Jumada al-Awwal 21, 1446 | DXB
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UAE: Family businesses need massive growth to allow future generations to live comfortably
These organisations 'have the opportunity to leverage the passion and enthusiasm of the next generation,' expert says
From left, Amin Nasser, Private Business Senior Advisor, PwC Middle East, Neeraj Teckchandani, Chief Executive Officer and Director, Apparel Group, Suresh Vaidhyanathan, Chief Executive Officer, Special Projects - Ghassan Abboud Group, Venkat Mahadevan, Managing Director, Head of Consumer Business, Citi UAE and Udaya Indrarathna, Ambassador of Sri Lanka to UAE participate in a panel discussion on Nurturing Legacy- The Strengths and Challenges of Family-Run Businesses during the i3 Innovate, Inspire, Influence event organised by Khaleej Times Events in Dubai on Wednesday.—Photo by Neeraj Murali.
Family businesses in the region need a double-digit growth rate so that the next generation continues enjoying the luxury lifestyle, businessmen and analysts said during a conference on Wednesday. Businesses must also work on sustainability as the governments are very focused on this aspect.
This was stated during a panel discussion at the Innovate, Inspire and Influence (i3) Conference held in Dubai on Wednesday. The conference was organised by Khaleej Times, the first English newspaper in the UAE.
Many diplomats, businessmen, CEOs of large family-owned businesses and senior officials from various sectors attended the one-day conference, which was held in Dubai Downtown.
Amin Nasser, private business senior advisor, PwC Middle East, said family businesses need to work hard for a common vision with technology and innovation among the biggest drivers of growth.
“Family businesses have the opportunity to leverage the passion and enthusiasm of the next generation,” he said.
During the panel discussion, executives delved into the world of family-run businesses, exploring the unique strengths and challenges faced by these legacy enterprises.
Neeraj Teckchandani, CEO and director, Apparel Group, said they always challenged themselves to remain relevant and ahead of the competition and this has been the core of the group’s success.
Suresh Vaidhyanathan, CEO of special projects - Ghassan Abboud Group, said, historically, family businesses had humble beginnings but have grown into conglomerates.
“Family businesses typically started with one sector and over time there was a diversification in terms of products and geographies. They built sold organisations with a lot of employees. Over the decades, there was always the scenario where the chairman continued to have a strong influence on the company. When it comes to innovation, it is always the founder who is doing it from day one."
“But during the pandemic, there was some major disruption to the entire business model and they suddenly found themselves with depleting revenues and cost was too huge. Their readiness for digital disruption was poor. So, they were caught in a situation where entire business viability was questioned,” said Vaidhyanathan.
Venkat Mahadevan, head of consumer business for the UAE at Citi, also stressed on planning of succession for family-owned businesses.
“It is not an easy task and it is a very sensitive process,” he added.
Globally, it is estimated that only 30 per cent of businesses have done proper succession plan. “If we look at family-owned businesses, from first generation to the second, the survival rate is 50 per cent, and from the second to third is 10 per cent. And some of them may not even survive at all because of lack of succession planning,” he added.
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Waheed Abbas
Waheed Abbas is Assistant Editor, covering real estate, aviation and other business stories that directly affect the lives of UAE consumers. He frequently reports human interest stories, too.
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