Micro Family Businesses in the Czech Republic from the Perspective of Multiple Criteria Decision-Making

Faculty of Economics, Department of Management, Sokolská třída 33, 702 000 Ostrava, Czech Republic

^* Corresponding author: vojtech.meier@vsb.cz

Abstract

Research background: Family businesses are undoubtedly important in both the Czech and international economy. They also play a crucial part in globalization. They have always been providing the largest job source in the private sector all over the world. However, over all these years, there has not been a unified definition of family business, which makes the government hard to distinguish between family and non – family business. Thus, this complicated the administrative and legal process. Finally, in 2019, the definition of the family business in the Czech Republic has been specified, which has facilitated many administrative and legal processes. Simultaneously, the management of Czech family businesses is currently facing the first “post-revolutionary” transition of generations. Many family businesses are deciding whether to maintain or to change the type of business entities.

Purpose of the article: This article aims to determine the most advantageous legal form of business for micro family businesses.

Methods: This article uses the Saaty pair comparison method and TOPSIS method. In addition to the methods of analysis, synthesis, and comparison, the selected methods of multiple criteria decision making are used in the article.

Findings & Value added: The results of the decision analysis revealed that, based on the criteria considered (legal, accounting, tax and managerial), the most optimal legal form of the family business is self-employed. Apart from the results, the research adds value to this topic for the Czech business environment, in which future scholars can compare between the Czech Republic and the other countries.