Partner Article

UK entrepreneurs keep it in the family

UK entrepreneurialism is apparently a family affair, as nearly 60% of owner-managers involve a relative in the business. The figure comes from research conducted by consultancy firm the Tenon Forum. Their study found that over a third of entrepreneurs actually have a family member as an official employee, and around 13% use relatives as investors. The report also pointed out that many of these family members are offering their serves for free – around 8%.

Michaela Johns, director of business services at Tenon, said: “It’s great to see that 21st century family businesses are flourishing in the UK despite the many unique challenges they face each day. Our research highlights that they are well on track to continue to grow and succeed for generations to come.”

However, Johns said business owners should be ‘wary of shoe-horning relatives into hereditary roles which they are not well-equipped or appropriately skilled for’.

She said: “Many solid businesses have been run into the ground by second or third generation owners who did not possess the ability or commitment needed for the business to thrive.”

The findings backed up the notion that using family members as employees was not necessarily beneficial in terms of business growth. Less than 20% of firms with a turnover of more than £20m had family members on the payroll compared to 69% of firms turning over less than £1m.

This was posted in Bdaily's Members' News section by Ruth Mitchell .