Family Businesses: The backbone of the economy
FAMILY businesses employ more than 9 million people in the UK, account for a quarter of UK GDP and in this region include Warburtons, Timpsons, BetFred, and Liverpool retailer Home Bargains.
According to the Institute of Family Businesses they are “the backbone of the economy”, and unlike many other enterprises have a long-term view, which helps many to be successful, stable and sustainable.
Mark Hastings, director general of IFB says: “It is built into their DNA to pass something better on to the next generation. They are clearer about how to get growth and investing back into the business over a longer time horizon than many other businesses,” he says.
The family relationships in a business can have pros and cons. On one hand many consumers like to deal with family firms because they know quality and service will be high, because those within the business are personally-invested in its reputation and success. On the flip side family businesses can become dysfuctional when relationships break down.
Family business fast facts:
:: Family businesses account for two-thirds of firms in the UK private sector.
:: There are around 3 million family businesses in the UK, made up
predominantly of small and medium-sized enterprises (SME).
:: UK family businesses provide 9.2 million jobs, 40% of total private sector employment.
::Family firms generated revenues of £1.1trn in 2010, or 35% of private
sector turnover.
::On these revenues, family firms made a £346bn value-added contribution to UK GDP, or nearly a quarter of the total.
::Family businesses are estimated to have contributed £81.7bn in tax
receipts to the UK Exchequer, or 14% of total government revenues
in 2010.
::The highest sector concentrations are in agriculture and extraction
(89%), hotels and restaurants (85%), and in wholesale and retail (77%). The sectors with the highest absolute number of firms were business services (including real estate) and construction.
