Scottish family businesses are the engine room of the Scottish economy with many of them having been around for generations. Recent studies have shown that around 65% of all private businesses in the UK are family controlled and that family firms account for around 25% of UK GDP, over 45% of all UK employment and create significant wealth too.
In celebration of Scottish Family Business Day on the 3rd February, Paul Andrews, Founder of Family Business united, hosted a Q&A session throughout the day on Twitter. As proud members of Family Business United, AAB got involved in the event to support this fantastic sector.
As Paul Andrews explains, “There are over 6 million family firms in the UK today with Scotland well represented and they really are the backbone of the Scottish economy. The contribution made by the family business sector in Scotland deserves to be recognised and the aim of Scottish Family Business Day is to champion the sector, put family firms on the map and in light of the year we have all just been through, provide a sense of community, shared purpose and positivity for the future. Undoubtedly, as the nation starts to recover from the effects of the pandemic, family firms will have a vital role to play and be integral to the recovery across Scotland.”
“Our most recent research quantifies the scale of the contribution too, with the Top 100 Scottish Family Businesses generating £20 billion turnover, £1 billion in profit before tax and employing over 112,000 people annually. The impact of these firms on communities across Scotland is really significant, as is their contribution to the local, region and national economies of Scotland,” outlines Paul.
Paul concludes, “We are looking to the future and hopefully Scottish Family Business Day 2021 will be a chance to focus on the future, the next stages in the economic recovery after the pandemic, and an opportunity to celebrate and recognise the contribution family businesses have made over the past year, their resilience in adapting to everything that has been, and continues to be thrown at them, and to be optimistic about the future of the sector too. Family firms are the backbone of the Scottish economy and will remain so for generations to come.”
Here's a roundup of Pauls’ questions and our answers from the Twitter event last week in case you missed it:
Why do you think that Scottish family firms are so important across Scotland?
Family businesses are fundamental to the Scottish economy, accounting for well over half of all businesses in Scotland and spanning the full spectrum from sole traders to the largest companies in the country.
Which family firms do you see as great ambassadors for the Scottish family business sector?
Family firms strive for excellence by innovating new practises and letting go of traditions that no longer add value. There are so many great ambassadors including James Donaldson & Sons, through diversification and their unfaltering dedication to quality and service, remain within the Donaldson family, six generations later.
Turner Group embrace diversity through encouraging freedom of expression and teamwork by sharing ideas, skills and resources that fuel the company and individual growth. Keeping people at the core of everything they do.
Robertson Group are committed to investing in the future of people and communities by thinking locally and working to deliver services and infrastructure that will stand the test of time.
What values are at the heart of Scottish family firms?
Family Businesses all share a similar goal, to create a lasting future for employees, communities and their business. Integrity, Teamwork, Communication, Sustainability and People are all some of the key values & building blocks to their long-standing success.
What are the major challenges facing Scottish family firms today?
The short-term challenges facing Family Businesses today are similar to those of all businesses. The pandemic caused most to focus on damage limitation to ensure survival & presented challenges around resilience & cash flow management.
Longer-term the focus tends to shift to succession & the next generation. Many retirements & succession plans were postponed due to the pandemic, with owners reluctant to pass on the business in a time of crisis.
Looking ahead, there is an opportunity to take a proactive approach to succession. Paul Andrews and Mairi Mickel are looking to support the next generation in family businesses with a dedicated peer group.
What do you think makes family businesses special?
In addition to being commercial entities, focused on making their businesses a success, family businesses are driven by an ethos of contributing to the community & protecting their legacy.
Whilst each business is unique, this common purpose of striving to strike the right balance between commerciality & heritage makes all family Businesses special.
What do you think is the most important factor in helping family firms stand the test of time?
In addition to successfully striking the right balance between being commercial & protecting legacy, continuing to evolve & change are key to standing the test of time, in addition to recognising when independent support is required.
Engaging with specialist advisors who not only aid day-to-day operations but who can help shape the future of the business and facilitate potential growth, going above & beyond core business compliance by seeing the 'bigger picture'.
Which family firms in Scotland have gone above and beyond to make a difference during the pandemic?
Adaptability has become crucial for family businesses. Even more so throughout the pandemic. Some found new ways to support their community. Macphie and Loch Lomond Distillery, are one of many distilleries that pulled together to produce hand sanitiser for those in need.
What three words do you think sums up the very essence of family business today?
Three words that sum up family businesses today are Integrity, Sustainability and People.
AAB's first client was a family business. Now, with over 30 years of experience working with family businesses, and as proud members of Family Business United, we understand and appreciate the importance of helping this fantastic sector.
For further information, or if you have any questions, please contact our Family Business Team