Keep it in the family, smaller businesses are urged

ONLY a third of Yorkshire’s 213,000 family firms are expected to be handed over to the next generation, according to a study by an influential pressure group.

Family firms make up almost half of the UK mid-sized business sector, and account for 63 per cent of all private businesses in Yorkshire.

However, many will face an uncertain future when the current owners retire. The Institute for Family Business (IFB) wants more companies to emulate the success of firms like Bettys & Taylors of Harrogate, and understand the advantages of keeping business in the family.

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The IFB will hold a seminar in Leeds today to encourage more of the county’s family-owned firms to think seriously about succession planning.

An IFB spokesman said Bettys & Taylors, and the York-based building firm the Shepherd Group, reflected Yorkshire’s strength in the family business sector.

The IFB’s free Family Businesses Challenges event for family business owners will be held today at The Queens Hotel in Leeds from 4pm to 6.30pm, followed by drinks and networking. IFB Director General, Grant Gordon, said: “By empowering family businesses, the IFB believes a new era of growth in the sector could be unleashed in Yorkshire, particularly with mid-sized family businesses.

“The Family Business Challenges programme will help family businesses to strengthen their management practices and increase their competitiveness both here and abroad.

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“If we can increase the number of family firms handing on the stewardship of their businesses to the next generation, then we have the potential to secure thousands of UK jobs, and boost the economy.”

Mr Gordon said family-owned firms faced recurring issues around “generational transition”.

He added: “We have to ensure organisations can adapt and change. They are very keen to learn from each other about best practice. In the UK, nine million people work in family businesses. Seven per cent of all family businesses are based in Yorkshire.”

He said firms could benefit from having “a very tight vision” about their market, and a generation was emerging who may not join their family’s firm until they were well into their thirties.

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Minister for Business and Enterprise Mark Prisk said: “The Government’s Mid-Sized Business growth review identified UK family businesses as a key part of this sector, and we support the IFB in its drive to raise awareness of best practice among family firms in Yorkshire.”

Bettys & Taylors, one of Britain’s best known tea and confectionary businesses, came under the spotlight last year, when its chief executive left the company after a few months in charge.

Andrew Baker became the first non-family member to take the helm of the tea and confectionary business when he replaced Jonathan Wild in 2011.

When Mr Wild joined the business in 1975, it employed 350 staff and had an annual turnover of £1.6m. In April 2011, when he retired, staff numbers had risen more than threefold to 1,246, sales had grown to £103m and Taylors of Harrogate was producing the third largest tea brand in the UK, and exporting to more than 30 countries worldwide.

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In September 2011, the company issued a statement confirming that Mr Baker had stepped down, and wishing him every success in the future. When asked about its succession plans, a company spokesman said yesterday: “Bettys & Taylors is a family business, owned by three generations of shareholders. Jonathan Wild, the great nephew of Frederick Belmont, the founder of Bettys, retired as our CEO last year. Lesley Wild, also from the family, remains as our chairman.

“Both the family and the business, acknowledge that in the future, the business will be family-owned but not necessarily family led. Over the last few years, both the family and the business have been working towards this by strengthening the board, family council and executive teams, revising the family constitution to ensure that the family’s vision and values continue to live without direct hands-on family leadership, and developing the organisation and its people.”

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