The results of the second edition of the African family business barometer, conducted by KPMG Enterprise in Africa, have been incorporated into this report to highlight both the similarities and differences between business families based in Europe and Africa.
Business families play a significant role in both economies, but as in Europe, the significance of their contributions are rarely fully appreciated due to the lack of accurate data. This year’s survey explored similar topics to those covered in the European family business barometer and the results for Africa have been included in the respective infographics within the report. We have also obtained insights from the respondents on matters pertaining to tax, financing and philanthropy.
Confident about the future
African family businesses are coming off a strong year of growth and are positioning themselves to maintain that momentum over the next 12 months. In fact, 73 percent of this year’s African barometer survey respondents said they were confident or very confident about the economic prospects for their business over the next 12 months.
This confidence is supported by increases in turnover, employment levels and strategic investments planned for the next 2 years. Approximately 57 percent of respondents reported an increase in turnover over the past financial year, compared to the 2016 response of only 39 percent. Only 13 percent of respondents reported a decline in turnover, compared to the 28 percent in 2016. Hiring of new staff was also up but not as much as in 2016, with 29 percent (2016: 39 percent) of respondents indicating an increase in employee numbers.
Strategic priorities in Africa
As in the 2016 survey, the top two priorities for the next 2 years are to improve profitability and increase turnover, however, this year’s responses revealed a change in how they plan to achieve this. The rapid advances in technology and innovation across the globe are also taking place in Africa and, therefore, it is not surprising that becoming more innovative is now a top priority for business families in Africa. This is further supported by 81 percent of respondents in this year’s survey indicating that their strategic plan for the next 2 years includes investing in technology and innovation, compared to only 49 percent in the 2016 survey.
