Profitless Growth Plagues Over Half of Malta's Family Businesses, Survey Reveals

More than half of Malta's family businesses are chasing turnover growth that is eating into their profits, according to the Family Business Survey 2026 presented by The Malta Chamber.

The survey, released during the third family business conference organised with EMCS Advisory and the Family Business Office, found that 55% of family businesses saw profits stall or decline despite higher sales in the post-pandemic years.

The phenomenon is most acute among mid-sized firms with 10 to 50 employees, described as the 'scaling canyon', and companies in the importation and distribution sector.

Silvan Mifsud, Vice President and Chair of the Family Business Committee at The Malta Chamber, presented the findings. 'Expanding turnover is meaningless if it merely dilutes profit margins,' he said.

'The survey findings reveal 55% of family businesses saw profits stall or decline despite higher sales, in the post pandemic years, trapped in relentless daily firefighting. Long-term survival demands breaking this cycle through disciplined governance, digitalisation, and a clear strategic plan that turns volume into sustainable profit.'

The survey also showed that companies with an active written strategic plan have a markedly superior financial trajectory. Traditional informal setups cannot handle expanding turnovers efficiently, prompting businesses to standardise roles and professionalise processes.

Minister for the Economy Silvio Schembri said family businesses are among Malta's most enduring success stories, creating jobs and investing in communities across generations. He highlighted support measures available and stressed the importance of skills, training, and digitalisation.

Dr Joseph Gerada, Regulator of the Family Business Office, said the survey shows encouraging progress in how families plan for the future, but challenges remain in turning growth into stronger profits.

Jordy McKay, Head of Corporate Banking at BNF Bank, offered a blunt assessment: 'Turnover is vanity, profitability is sanity, cashflow is reality.'

Kurt Muscat from EMCS Advisory warned that businesses risk falling into the same trap if they do not professionalise through stronger governance and invest in productive capital. In a tight labour market, wage growth outpaces productivity growth, resulting in lower profits.

The message from the conference is clear: growth without structure is a liability. For Malta's family business community, the path to sustainable profit runs through governance, digitalisation, and strategic planning.