New survey shows PA family businesses confident for 2012

Family firms to rev up state/regional economic engine

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ELIZABETHTOWN, PA (02/29/2012)(readMedia)-- Results from a new regional report, The Family Business Confidence Survey, reveal optimism among family business owners for 2012, according to researchers at the Department of Business and the S. Dale High Center for Family Business at Elizabethtown College.

The survey is the first ever to examine family businesses in PA. It was designed to assess family business confidence in the future from an economic and hiring perspective; to document best practices in succession planning, strategic planning, and human resource management; and to understand how family businesses view and respond to the current economic and regulatory environment.

"This report is unique in several ways," said Dr. Cristina Ciocirlan, assistant professor of management and project principal. "It is timelier than national- or state-level surveys. It also alerts state policymakers to the specific concerns of family businesses."

Key findings from the report suggest that two-thirds of the 72 respondents are upbeat about their own prospects, expecting increases in sales revenues and profitability in 2012. More than one-third of family businesses plan to hire more employees next year, while about 40 percent plan to increase their capital expenditures. A majority of respondents plan to increase spending on technology investments and upgrades

Moreover, PA family businesses realize the importance of investing in human capital and innovation. Ninety-seven percent of family firms plan to keep constant or increase their training and development expenses, while a very large number (85 percent) intend to maintain or increase their research & development expenses.

While slightly less than half of family businesses indicated that they are pessimistic about the future of the U.S. economy, they are more confident in their individual ability to grow and prosper

"Family businesses are confident about their future," said Michael N. McGrann, executive director of the High Center, who assisted with the project, "because they have a significant control of their own destiny. In the long term, they have proven themselves to be flexible, more innovative, and more competitive than non-family businesses."

The report also offers good economic news for customers of family businesses. "Moving forward, they will be buying," McGrann said. "They are ready to put their money where their mouths are, so to speak."

Dr. Sanjay Paul, chairman of the Department of Business, was the third scholar working on the project. "Family businesses are of crucial importance to our economy. Yet, they face unique challenges. We hope these findings will help family businesses make timely decisions as well as capture the attention of lawmakers and regulatory agencies," Paul said.

The report also includes data on the internal challenges and external challenges facing family businesses in addition to ways that PA can make the regulatory environment more business friendly.

In late November and early December 2011, an anonymous survey was emailed to High Center members and other family businesses. Respondents included family businesses from the following PA counties: Lancaster, Dauphin, Allegheny, Luzerne, Indiana, Bucks, and Montgomery. Five interviews were also conducted with randomly selected family businesses.

On average, the age of businesses responding was 50 years, more than two generations have held control or ownership of the business, and they employ 74 full-time equivalent employees.

The 26-page report includes an executive summary and key findings are available in a downloadable report from the High Center website.

For more information, contact the S. Dale High Center at FBC@etown.edu or call 717-361-1275.

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Note to editors: Principals are readily available for phone/email interviews.

Elizabethtown College, in south-central Pennsylvania, is a private coed institution offering more than four dozen liberal arts, fine and performing arts, science and engineering, business, communications and education degrees. Through personal attention, creative inspiration and academic challenge, Elizabethtown College students are encouraged to expand their intellectual curiosity and are given the opportunity to become a bigger part of the world through experiential learning-research, internships and study abroad. Elizabethtown College's overall commitment to Educate for Service is fulfilled as students are taught intellectually, socially, aesthetically and ethically for lives of service and leadership.

Visit www.etown.edu for more information about Elizabethtown College.

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With almost 50 member family businesses, the S. Dale High Center for Family Business at Elizabethtown College is one of largest resource organizations for family-owned firms in the United States. Created by a group of business people, family business owners, and representatives of Elizabethtown College, the Center helps family businesses achieve family unity and prosperity, continue their legacy of entrepreneurship, and create social and economic wealth across multiple generations. Serving south-central Pennsylvania and beyond since 1995, the Center believes that strengthening entrepreneurial families enhances the community and the economy as well. More information is available at the website: www.centerforfamilybusiness.org, by emailing FBC@etown.edu or by calling 717.361.1275.