Stemcor, Swire Group and Laing O’Rourke also reported sales of £5.1bn, £4.2bn and £3.5bn this year respectively. Meanwhile Shop Direct, the online and home shopping company, entered the top 10 for the first time. The Liverpool-based group, which owns the Littlewoods and Kays brands, reported a turnover of £1.9bn; a rise of more than 10% over the year.
So why are family-run businesses bucking the trend when it comes to growth? According to recent research by the University of Birmingham for business organisation the Unquoted Companies Group, those who work in a family-owned business are more loyal and feel more secure than those in other businesses. This inspires a stronger work ethic: those who work in family businesses tend to work for longer, putting in an average of 38.4 hours a week, compared to their private-sector counterparts who do 32.9 hours, the research also suggests. Considering almost one third of Britain’s GDP comes from the family business sector, IFB Director General Grant Gordon says the businesses are vital to the economic recovery.
Then again, the majority of family-owned businesses aren’t likely to remain so for long. Baroness Kingsmill, MT’s regular columnist, pointed out recently that only around 30% of family-owned firms survive the first generation and only 3% are still in business into the fourth generation. Lack of talent, or just a desire to break free of the legacy, means many heirs do not succeed in developing the family business, she says.
Others, like the British lingerie firm Rigby & Peller, sell up because they think another firm can lead the company to more ambitious growth. The Kenton family, which has run the business for almost 30 years, announced today it is selling an 87% stake to Belgian bra-maker Van de Velde for £8m.
The family bought the business in 1982 for £20,000, and since then their lingerie has supplied the Queen and Lady GaGa. Founder June Kenton says its time to hand over the straps as the company needs a partner to fulfil its ambitions for growth internationally. The family will still be involved in the running of the business though. And as the examples of the bigger family-run businesses suggest, that’ll probably prove to be a good thing.