Research reveals sector's scale
Family firms ‘need support’ to help growth ambitions
Family firms, like the Graham dairy family, make up the bulk of the private sector
A family business leader has called for more help to support a sector of the economy that now accounts for 85% of all private firms in Britain.
A new report by the Institute for Family Business Research Foundation launched today reveals that the family business sector is facing a number of barriers to growth.
Institute director general Elizabeth Bagger said: “We need to help more of our smaller family firms to overcome the barriers they face, and support them in scaling up and successfully transferring ownership through the generations.
“For those first generation family businesses looking at succession for the first time, it’s important too to realise that you aren’t alone.
“The family business sector offers so much potential for long term growth. Championing and supporting our mid-sized firms, and helping smaller family businesses to scale up, must be a priority as we look at what our economy will look like in the years ahead.”
For the first time the report includes information on who manages family firms and female representation in leadership roles. It reveals that family SMEs are more likely to have female leaders than non-family firms – 81% of family SMEs, compared to 58% in non-family SMEs, reported having at least female director, owner or partner.
The report shows that while 91% of family SMEs are family managed, as businesses grow, they are more likely to employ non-family members to run the business, with around half of medium sized family firms non-family managed.
Report shows more than 13 million people work in family firms
There are 4.8 million family-owned businesses in the UK – 85% of all private sector firms.
Family firms generated £1.7 trillion in revenue in 2017
Family businesses contributed £598bn to UK GDP in 2017 – 28% of the whole UK economy in that year.
Family businesses contribute £182bn in taxes – more than the NHS annual budget in 2017/18
Across all regions, more family firms have increased, as opposed to decreased, their employee headcount when compared to a year ago
More family SMEs have female leaders than non-family firms
Mid-sized family firms – the UK’s Mittlestand – showed higher levels of growth with 56% of mid-sized family firms growing their turnover, and 51% increasing the size of their workforce over the past year.