Family businesses in Romania have performed well over the last year, according to a new study by consultancy firm PwC. Of those surveyed, 71 percent said they had seen in increase in sales in the last 12 months. Looking at the next five years, 61 percent of respondents said they expect steady growth, while 13 percent will take a more aggressive approach, including mergers and acquisitions, according to PwC’s Family Business Survey.
However, the study also found that a quarter of family businesses are taking a more cautious approach and “plan to consolidate their structure at the current turnover level.”
The single greatest concern for the family businesses that spoke to PwC was the present condition of the market. More than half of the respondents deemed market conditions the biggest challenge currently faced by their company. Also among the external factors causing worries was increasing competition, with 32 percent of the businesses surveyed citing it as a difficulty. The study suggests that Romania’s tax system is an issue for many family businesses – 42 percent of those questioned expressed concerns over the current tax regime. Meanwhile, government policy and regulation was deemed an issue by 29 percent of respondents.
PwC’s study showed that difficulties in obtaining financing are perhaps beginning to ease with only 13 percent quoting this as an obstacle for their business. Romania’s Central Bank (BNR) got a at least a partial vote of confidence – just 16 percent expressed doubts over the effective handling of exchange rate fluctuations.
Nearly 40 percent of the family businesses were worried about recruiting and retaining staff due to competition from multinationals. The lure of big salaries and opportunities for advancement give big companies an insurmountable advantage over small family held firms in the battle for the best staff.
Overall, PwC found that Romania’s family businesses feel under appreciated by both government and society at large. The study indicates that they want to see a stable and predictable legislative and fiscal framework, better infrastructure in Romania and improvements in education to better prepare students for the labor market.
PwC provides consultancy services via a network of firms in 158 countries. The network works with more than 180,000 people to provide advisory, tax and assurance services to companies around the world.