Factors Preventing Intra-Family Business Succession of Family-Owned SME Firms in Bangladesh: An Empirical Evaluation

This research aims to identify the factors preventing intra-family succession, investigate incumbent opinions and evaluate the lack of formal succession planning among family-owned SMEs in Bangladesh. This study employed a quantitative approach and 250 purposively selected incumbents of family-owned SMEs were given a semi-structured questionnaire in person. The survey data was analyzed using binary logistic regression. This study explored various issues associated with succession planning that affect the attitude of incumbents regarding the choice of a successor. These, among other reasons, hamper intra-family succession and have meant the absence of any formal succession strategies that pose a danger to the sustainability of family businesses of SMEs in Bangladesh. The study is narrowed down to a survey sample of 250 family-owned SMEs within the context of Bangladesh. It may not be able to cover the entire population of family-owned SMEs worldwide. The incumbent, who is the primary respondent of the research, may not provide an unbiased opinion. The study focuses on the incumbent-related factors preventing family business succession since formal succession planning is necessary to provide smooth transitions that would be sustained in the business. This study is an empirical assessment of the impediments to the effective family business succession in the developing country of Bangladesh. It can offer some insights into what thwarts family-owned SMEs.