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Generation Magazine is a quarterly publication for family businesses
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contents
opinion
upfront
meets
northern ireland’s finest
expert
prosperity
ten
panel
review
24
05We must showcase our family firms for all to see
07News and highlights from the world of family business plus shortlists announced for Red Ribbon Awards 2013
22Behind the scenes with John Jones, Triplar, Paragon and Rock Choir
35Shining a light on family businesses in NI
46The professionals talk capital allowance, debt management, online social media and selling the family firm
58Discussing business ethics, leaving a legacy, family ownership and addiction
69Getting started with online marketing
70Our experts are in the hot seat to answer your burning questions
73Recommended reading from our family business library
76A day in the life of Harry Legge-Bourke at Glanusk Estate
I N T H I S I S S U E
p.26
p.48
p.62
Generation Creative Team: Creative Director: Anita Brightley-Hodges [email protected] Head of Design: Daren Beaumont [email protected] Designer & Illustrator: Chloe Smith [email protected] Photographers: Jeremy Baile RGB Digital [email protected], Nick Gillott [email protected]
Brewin Dolphin is one of the UK’s largest independently-owned private client wealth managers, with 39 offices throughout the UK and Channel Islands. Committed to personal service, we offer a wide range of financial solutions to help you make the most of your investments.
For more information, please contact Philip Kenyon on 0203 201 3495 or email [email protected]
www.brewin.co.uk
Brewin Dolphin is delighted to support the Family Business Place
The value of investments can fall and you may get back less than you invested.
Brewin Dolphin is a member of the London Stock Exchange and is authorised and regulated by the Financial Services Authority No.124444
Family Business Place_210x285.indd 1 18/03/2013 10:52:16
3Generation SPRING 2013
editor’s letter
“We are driven to provide the most comprehensive and useful resource for family businesses in the UK”
Welcome to the first issue of Generation magazine for 2013 – and what a 12 months it has been. We’ve been honoured to meet some of the most inspirational entrepreneurs in the country, all leading their family businesess through turbulent times with passion, integrity and a determination to grow.
Not only did we host the most inspiring, engaging and energetic family business conference of the year, Family Ties, we also launched a dedicated awards ceremony for the Red Ribbon Awards – the ONLY awards to celebrate the achievements of British, family-run firms of all shapes and sizes.
2012 was a monumental year for us and we’ve built up a great network of friends in the family business space along the way. To celebrate, 2013 sees us increasing Generation magazine to four times per year, developing an incredible new website and hosting a series of regional family business forums. Not to mention securing an enviable line-up of
speakers for this year’s Family Ties annual conference (21 Nov) and planning the most spectacular Red Ribbon Awards ceremony yet (5 July).
In between all this, we managed to squeeze in a front cover shoot and interview with the fabulous John Jones MBE who has gone from a student with no academic prospects, to a national success story now working with leading artists around the world. We also meet the family behind Triplar; winners at last year’s Red Ribbon Awards, Paragaon; a business soon to celebrate 100 years and Caroline Redman-Lusher; the woman behind Rock Choir with two world records under her belt.
At Family Business Place we are driven to provide the most comprehensive and useful resource for family businesses in the UK. Our job is to help family firms succeed so please get in touch if you have a great piece of news you’d like us to publicise, want to know more about our events or simply want to know what the family business sector has to offer.
InspIred to succeed
AMALIA BRIGHTLEY-GILLOTT, EDITOR-IN-CHIEF
Best wishes
Brewin Dolphin is one of the UK’s largest independently-owned private client wealth managers, with 39 offices throughout the UK and Channel Islands. Committed to personal service, we offer a wide range of financial solutions to help you make the most of your investments.
For more information, please contact Philip Kenyon on 0203 201 3495 or email [email protected]
www.brewin.co.uk
Brewin Dolphin is delighted to support the Family Business Place
The value of investments can fall and you may get back less than you invested.
Brewin Dolphin is a member of the London Stock Exchange and is authorised and regulated by the Financial Services Authority No.124444
Family Business Place_210x285.indd 1 18/03/2013 10:52:16
4 Generation SPRING 2013
contributors
Subscription and Advertising enquiries: [email protected] / Editorial enquiries: Amalia Brightley-Gillott [email protected] Production enquiries: Anita Brightley-Hodges [email protected] / Designed and Published by Family Business Place www.familybusinessplace.com ISSN 13644776
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1. amalia Brightley-Gillott, editor-in-Chief, Generation Magazine and Family Business Place 2. anita Brightley-Hodges,
Managing Director, Family Business Place 3. David Johnson, Leaders Matter 4. Charlie Mullins, Pimlico Plumbers
5. Cathy Booth, BDO Centre for Family Business 6. alex McKellar, Portal Tax Claims 7. Jo Haig, fds Corporate Finance
8. andrew Segal, HW Fisher 9. Sarah-Jane Watson, Farrer & Co 10. Simon Webley, Institute of Business Ethics
11. Steve rosenbaum, Independent Family Business Consultant 12. rupert Phelps, BNY Mellon
13. David Philpott, Fields of Life 14. Jeremy Baille, RGB Digital 15. nick Gillott, Nick Gillott Photography
16. Chloe Smith, Family Business Place 17. Graham Keepen, Foxgrove Associates 18. norma Stewart, Wellers
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5Generation SPRING 2013
Amongst younger and more junior people setting out on their careers, there is an increasing recognition that a family business will often engage in more training both initial and ongoing. Short term financial return can be adjusted to free up funds to support local concerns, and engage in philanthropic activity. All this has been well received by the more socially conscientious young.
We will no doubt hear more from Government about the increase and diversity in apprenticeships, and this should be grasped by family businesses that are well placed to offer this type of long term training. All the better, if they are partially funded!
More work does need to be done at more senior levels. There are many examples now of where a family business has created a reward structure that includes some form of modified share ownership without affecting family control. There are more international roles now available to executives, and as the overall level of management becomes more professional in family businesses across all sectors, so it will attract talent.
Excellent work is being done by such organisations as Family Business Place, IFB and by family business advisors in educating and advising family businesses on their governance and in lobbying Government. We should all consider how to extend our activities to offering a more proactive and aggressive stance on extolling the virtues and rewards of working in the family-owned business sector.
The social and economic climate is probably about right for such a foray.
www.leadersmatter.com
opinion
Over the years, we have all watched with varying degrees of interest the rise and fall of the financial services sector, the highly-geared and relatively short-term investments by private equity groups, and the love-hate relationship between investors and Boards in publicly quoted companies.
Throughout these events, family businesses, be they family owned and professionally run, or family owned and run (I have always objected to the notion that a family business cannot be family owned and family professionally run, but that is the current terminology) have proved themselves to offer stability and sustainability. With a few notable exceptions, Clarks, JCB, Wates et al, these businesses have retained a low profile, often only recognised at local or regional levels.
This preference for a lower profile has not helped in attracting new talent to the family sector, and negative perceptions do exist. Stories abound of the mill owner approach to management – the workers will be flogged daily until their morale improves. Reports of profligacy amongst family owners are common, as are those of nepotism and poor management appointments. However, it seems to me that things are even worse amongst our political leaders, in some of our major public sector institutions, and I can vouch personally for mill owner attitudes in publicly quoted companies. Not that I ever actually got flogged.
I think it’s time for the family business sector to change gear in promoting itself and the opportunities that it can offer to both young talent and more seasoned management. As a long term recruiter of senior non-family executives into family owned businesses, I have often observed a fundamental misunderstanding on the part of executives what family businesses are about. The long term approach is interpreted as sleepy or dull, shareholder policy is limiting to executive reward, and the arrival of next generation creates glass ceilings.
The important news is that there are some excellent executives of working in these businesses who are well rewarded and well motivated, and the number is growing. There has been a growing recognition amongst management that a well organised family business will offer a number of things that other ownership models do not.
Shout it loud and proud
“there has been a growing recognition
amongst management that a well organised family business will offer a number
of things that other ownership models
do not”
David Johnson, Director of Leaders Matter and Chair of a Next
Generation Council wonders why family businesses aren’t doing
enough to raise their profile and attract new talent.
For example, there is increasing talk about alignment between owners/shareholders and management. In public companies and private equity environments this is achieved almost exclusively by financial means. In family business a much closer alignment can be achieved through both financial and non-financial means.
i think it’s time for the family business sector to change gear in promoting itself and the opportunities that it can offer to both young talent and more seasoned management
“
For further information please contact Richard Lane, Head of the Entrepreneurs& Family Business Group
Tel: 020 3375 7548Email: [email protected]
"Farrers lawyers act as counsellors in the true sense." Chambers & Partners 2011
Farrer & Co is a modern London law firm with a longtradition of working with successful families, supportingand advising them on a wide range of issues spanningboth their corporate and personal needs.
www.farrer.co.uk
Magazine A4 advert 4:Layout 1 24/05/2012 12:08 Page 1
7
upfront
Generation SPRING 2013
Midlands-based Toye & Co has entered into an agreement with Stability Investments regarding the development and future sale of its London property. The company will immediately receive a significant cash injection and two new directors are being appointed to the board.
Toye & Co has exceptional manufacturing craft skills and a reputation for producing products of the very highest quality. As a consequence of this deal, the company is now able to invest in its Midlands operations to improve efficiency and enhance the service
it provides to its customers.“This is an exciting
development for us, heralding a new era for the company” said Chief Executive Fiona Toye. “In exchange for a large London facility that no longer suits our needs we now have both the resources to invest and innovate for the long term future of the business and new expertise on our board. This is an excellent platform from which we can look forward to our next three centuries in business.”
www.toye.com
the team at Family Business Place are thrilled to share the wedding of Generation editor-in-Chief, amalia Brightley-Hodges to nick Gillott.
amalia and nick met eight years ago shortly before she went off to study Marketing
and Pr at the University of Central Lancashire. nick is a freelance photographer and has photographed many of the features for Generation magazine, often accompanying amalia on interviews with family businesses around the
country. they wed on 25th august 2012 in amalia’s village church in Kent with 150 guests joining them for a reception at the family home.
“at Family Business Place we live and breathe family. So it’s fitting that my new husband
is part of the team (and handy he’s a photographer!) and we can share the success of our family, and our family business. We had the most fabulous day and a huge thank you to everyone for their love and support.” amalia ends.
Celebrations at Generation HQ
investing For the Long term
8
upfront
Generation SPRING 2013
Coolings Garden Centre in Kent is proud to be celebrating 100 years as a family business in 2013.
as a young 17 year old, arthur Cooling started growing crops as a part-time job in Chislehurst in 1913. He used one acre of land at the rear of the high street and before long his first second-hand greenhouses were built in 1920.
arthur’s son Michael joined his father to create a partnership trading as Coolings nurseries. the first garden centre was opened in 1964 selling fertilisers, insecticides, peat and compost. in 1966 arthur sadly died but left a strong foundation for the company to develop.
A family business is marking its 50th anniversary with a calendar of events for 2013, a party for staff at its county headquarters and 50 themed activities throughout the year.
Pukka Pies, which employs 280 people at its plant in Syston, was founded in 1963 by chairman Trevor Storer and has grown from the family kitchen to produce 60 million pies a year. His first product was the steak and kidney pie, and his wife Valerie produced the recipe for the chicken and mushroom pie. Like all the pies, the recipe remains the same today. The family links continue with Trevor’s sons, Tim and Andrew Storer, who are co-managing directors.
Tim Storer said, “We are delighted Pukka Pies has reached 50 years of business and will be looking to celebrate the year in typical Pukka Pie style.
“In challenging economic times, we have enjoyed excellent levels of growth and the recent £7 million factory extension is enabling us to continue that success story.”
Today Pukka pies are sold in the UK, Ireland, Spain, Greece, Portugal, Germany, Austria, Belgium, Malta, Gibraltar and France.
www.pukkapies.co.uk
Piefection
Bremont is pleased to announce the launch of their new British watch making facility in Henley on thames, South oxfordshire. the beautiful oak framed building in the heart of the Chiltern Valley has been custom built to provide an ideal facility for the manufacture of their high-end mechanical watches.
Founded by brothers, nick and Giles english, Bremont is on a long-term staged investment programme to develop mechanical watch manufacturing expertise
in the UK and will be assembling and finishing off key movement and case components in Henley.
Giles english Co-Founder of Bremont, “our intention has always been to bring as much watch manufacturing back to the UK as we can and we are at the start of an exciting period in the company’s growth. Britain has an illustrious history of watch making and considerable engineering talent for us to utilise, we intend to make the most of it. naturally we are
still very dependent on our wonderful Swiss engineering partners and staff who we continue to work with and thank them for their on-going support.”
Bremont continue to build and promote their British heritage. With the successful opening of their Mayfair store last July, the new British based headquarters reinforces the ethos of the brand and marks an exciting future for British watchmaking.
www.bremont.com
Manufacturing excellence
100 Years
now, 100 years later, Paul Cooling is current chairman of the company which has seen expansion across two sites as well as a coffee shop named ‘arthur’s’. in 1990 the 14-acre Gardener’s Garden Centre site situated at rushmore Hill was purchased, followed by
the purchase of their second site in 2004, Coolings Green & Pleasant, at Main road.
Look out for special offers and events at Coolings to celebrate their 100th year in business.
www.coolings.co.uk
9
upfront
Generation SPRING 2013
Birmingham-based Fracino, a manufacturer of cappuccino and espresso coffee machines scooped the Winner of Winners prize at EEF’s fourth Future Manufacturing Awards.
The ceremony was hosted in London at the Grand Connaught Rooms where around 500 manufacturers attended.
Fracino carried the day with victory in the Winner of Winners category having already received recognition for Outstanding Export achievements.
“We love manufacturing in the UK. It’s the best,” said Fracino’s leaders as they grasped their trophy.
Fracino began life as an importer of Italian espresso machines to the UK but moved into patenting its own products then began manufacturing 20 years ago for a UK customer base.
The collapse of Lehman Brothers in 2008 and the beginning of the global financial crisis made company chairman and founder Frank Maxwell realise that “we had all our eggs in one basket,” and an aggressive export growth strategy was adopted by the firm.
The company now derives around 25% of its turnover from export sales and is pushing hard into fast growth markets in South America and South East Asia this year its leaders told EEF’s guests. This is partially in order to counteract the negative impact of eurozone uncertainty on key markets closer to home.
A revamped website and online sales strategy will be at the center of Fracino’s continued international growth.
Founded in 1963 by Frank Maxwell the business includes three generations and is celebrating 50 years of trade this year. Fracino has grown into a well-respected manufacturer of quality products and employs around 40 members of staff as well as family members.
www.fracino.com
if you have an exciting
piece of family business
news just give us a call
and let us know.
We could feature you
in the next issue of
Generation and on
familybusinessplace.com
Contact us by email:
or telephone: 01732 220 120
Double award Win For Fracino
in January 2013, Henry Poole & Co was proud to receive Her royal Highness the Princess royal, who presented the company with the Queen’s award for enterprise in international trade; an award it views as the most prestigious business award in the UK.
the award was presented as a crystal bowl depicting the Queen’s award emblem.
Henry Poole & Co, est. 1806, is the longest standing bespoke tailor on Savile row, often referred to as the
founder of Savile row itself. every suit is made in the workshops below no 15 and no 16 Savile row whether it be livery for Buckingham Palace or the royal Mews, a Churchill pinstripe three-piece destined for the boardroom or a tailcoat cut for a Mansion House banquet.
Her royal Highness was escorted through the Henry Poole & Co’s show room, workshop and the archive where the ledgers of Queen Victoria, the Princess of Wales, empress of russia and the
empress of the French, were on display.
the family-run business has held a royal Warrant to produce livery for the royal household since 1869 and made garments for the likes of Winston Churchill, Charles Dickins, Dr Livingstone, tsar alexander ii of russia, J.P. Morgan and emperor Hirohito of Japan.
70% of Henry Poole & Co’s sales are from international trade with trips to the USa, Japan and europe. Last year total sales were up over 8%,
demonstrating the strength of the company in a difficult market.
angus Cundey, Chairman of Henry Poole & Co said, “We are extremely honoured to host Her royal Highness to receive the Queen’s award for enterprise in international trade. Henry Poole & Co has been exporting its trade and craft for over a century and is thrilled to be witnessing resurgence in the British male fashion industry.”
www.henrypoole.com
Savile row tailor receives enterprise awards
R O M N E Y M A R S H W O O L S
Rushfield, Giggers Green Road, Aldington, Kent TN25 7BT01233 721800 • [email protected] • www.romneymarshwools.co.uk
Baby & Nursery Range
Soaps, H&B Lotion & Shampoo
Handpicked Gift Baskets & Hampers
Throws & Cushions
Scarves
Well Being Range
Romney Marsh Wool advert:Layout 1 17/03/2013 23:45 Page 3
11
upfront
Generation SPRING 2013
Hall’s, created by David A Hall from a butcher’s in Edinburgh 80 years ago has been sold by current owner, Vion, to another esteemed Scottish family business, Browns Food Group.
Although the merger came with a severe loss of jobs, the move by Browns, which is headquartered in Kirkconnel, Dumfriesshire, will see the retention of the Hall’s production in Scotland, and the van sales operation will continue to operate throughout Scotland. Fifty Hall’s employees will be retained in that area.
Browns Food Group is a UK food manufacturer, supplying retail, food service and wholesale markets.
The group operates from seven manufacturing sites in Scotland and England, producing and supplying an extensive range in quality cooked meats, pre-sliced and whole joints, ready meals, salmon, poultry products, convenience foods and a variety of delicatessen items. The entire group boasts a product range which extends well into the thousands.
Browns finance director Alan Hill said “The family that owns Browns Food Group are passionate about their business.
“It is early days, but we are looking to grow Hall’s both in terms of investing in the brand, and hopefully with people going forward. It will all depend on how well it does.”
Mr Hill added, “They are passionate about food brands and think that Hall’s has been a bit of a sleeping giant. We want to grow it back to what it was when David A. Hall was in charge.”
www.brownsfoodgroup.com
two Scottish Family Dynasties Become one
as the Diamond Jubilee year drew to a close, it was announced that the Goring Hotel in London was to receive a royal Warrant of appointment to HM the Queen for Hospitality Services.
as a proud supporter of the family business sector, and judge for the 2012 red ribbon awards, George Goring can look back at his time at the helm of the Goring with pride, especially now that his son, Jeremy, has been awarded the royal Warrant.
Jeremy Goring, whose family built the Belgravia hotel over 100 years ago, said:
“We are hugely honoured to have been appointed a royal Warrant holder by the Queen. to be able to display Her Majesty’s coat of arms is something that the staff will be enormously proud of. Without doubt this is the most important recognition their work could ever receive. it is made all the more special for us because i believe this
is the first royal Warrant the Queen has ever granted to an hotel.”
the Goring family continues to run the hotel 103 years after it was built by Jeremy’s great grandfather in 1910. throughout that time it has continued to provide some of the very highest levels of hospitality to be found anywhere in the world.
the Goring has welcomed royal guests ever since it first opened its doors. the Coronations of George Vi and our present Queen saw the hotel filled with foreign royalty attending these great occasions. in 2011 the Duchess of Cambridge famously stayed at the hotel the night prior to her wedding, leaving for Westminster abbey on the morning of the 29th april. it was reported around two billion people watched Kate exit the Goring with her father as she headed to Westminster abbey to marry Prince William.
www.thegoring.com
Fit For a King
Established in 1973 by Colin Moir, A1 Flue Systems, the only flue manufacturers solely based in the UK have recently completed two major contracts including the chimney and flue system in London’s iconic Shard.
The completion of The Shard along with another big project, the Co-operative Group’s head office in Manchester, has been a great way to celebrate 40 years as a family business.
Since the opening of The Shard in early 2013, the firm can look back on their achievement proudly. A statement from MACE Construction said “We were very impressed with the technical expertise A1 Flue Systems were able to provide and how well they managed works during their part of the construction phase. There was a lot of bespoke design and manufacturing required and the
Dizzying new Heights
quality of their final installation was extremely high.
John Hamnett, A1 Flues senior contracts manager, said: “We completed a number of highly prestigious projects in 2012, including St Pancras Chambers and the King Cross T1 development.
“Starting 2013 by finishing off projects on two of the UK’s tallest buildings has been a great boost for our company and hopefully enables us to promote further our bespoke manufacturing ability in a year which will also see us celebrate 40 years as a family run business.”
www.a1flues.co.uk
❝ It is wonderful that you create such a good forum for family businesses and the opportunity for them to network. THEME TRADERS
❞
Family Ties annual conference & Red Ribbon Awards 2012Last year, Family Business Place played host to two of the most talked-about events of the family business calendar - Family Ties conference and Red Ribbon Awards.
Family Ties featured a line up of inspiring speakers from family-run firms around the UK including Boodles, Bremont, Floris, Gold Care Homes and Glanusk Estates. We also celebrated the achievements of family businesses of all sizes and sectors at the prestigious Red Ribbon Awards and recognised them for the contribution they make to the UK economy.
See what’s on in 2013, visit www.familybusinessplace.comPhilip Wright, Walter Wright Hats
Anita, Amalia, Olympia & Ka Lai Brightley-Hodges, Family Business Place
Michael & Nicholas Wainwright, Boodles
Harry Legge-Bourke, Glanusk Claudia Nicholson, AVI Kimmberly Lau, AVI Helen Thomas, Westons Cider
Ravi Gidar, Gold Care Homes
Family-run businesses are undoubtedly very different to other companies... A set of awards that recognises, celebrates and supports that difference is fantastic. TRIPLAR
❞
It was a very enjoyable day and in addition to the great presentations we met so many interesting people and will keep in contact with many of them! FLORIS
❝
❞
❝
Graeme Downer, Saxophonist
Giles English, Bremont Chue Li, Maven Foods
❝ We were delighted to win two awards, especially against such prestigious competition. ASHBOURNE INSURANCE
❞
We are delighted to support
Family Business Place – both at
the Annual Conference and the
Awards where we can see so
many of the members together
sharing their stories and
enjoying themselves.
BREWIN DOLPHIN❞
❝
Sarah Smits, Ashbourne Insurance. Winner ‘Customer First’ and ‘Ambassador’ award sponsored by Downers Design
Jonathan Neame, Shepherd Neame. Winner ‘Longevity’ award sponsored by Brewin Dolphin
Rosedale Funeral Home, Winner ‘Best Small Business’ award sponsored by Sarasin & Partners
John Jones, Winner ‘Lifetime Achievement’ awardsponsored by Family Business Place
Jennifer Kerfoot, Winner ‘Young Gun’ award sponsored by AVI
Henleys Medical Supplies, Winner ‘Family Business of the Year’ sponsored by Institute for Family Business
CUB, Winner ‘Community Involvement’ sponsored byMy Ten Days
Family Business of the Year• Bastows
• Hall-Fast Industrial Supplies
• Jacksons Fencing
• East End Foods
• Hobbs House Bakery
• Shepherd Group
Entrepreneruship• Downers Design
• Martin Construction
• Go Ape
• Rock Choir
• Headen and Quarmby
• John Jones
Innovation• Haigs Food Hall
• Cantifix Ltd
• Wold Top Brewery
• Bremont Watch Company
• Fudges Bakery
• A1 Flue Systems
Best small business• Moments Fostering
• Ayegardening
• Hall-Fast Industrial Supplies
• Carddies Limited
• CUB Ltd
• Lamont Pridmore
Customer First• Bastows
• Travel Counsellors
• Stevenson Brothers
• Sherwoods
• Harry Harper
• The Goring
2013 20132013
The Red Ribbon Awards are the UK’s
most prestigious family business awards
celebrating the achievements of British,
family-run companies of all sizes and
across all sectors. Family Business Place
are honoured to announce the finalists
for each category. Winners will be
announced at the Awards Ceremony on
5th July at the Lancaster London Hotel.
Announcing the 2013 Finalists
TO BOOK Red Ribbon Awards & Charity Dinner tickets GO TO: www.familybusinessplace.com/awards2013 For sponsorship enquiries talk to [email protected]
Red Ribbon Awards & Charity Dinner5th July 2013, Lancaster London Hotel
Tomorrow’s brand• Stoke Park
• Wold Top Brewery
• Bremont
• Prestat
• Dr Martens
• The Cambridge Satchel Company
Fastest growing business• Romney Marsh Wools
• Hallmark Consumer Services
• Bremont
• 99p Stores Ltd
• Cook Foods
• Martins Bakery
Young gun• Gary Hilton Be Anyone Fancy Dress
• Chris Lamont Lamont Pridmore
• Caroline Bell Shepherds Purse Cheeses
• Nicholas Muirhead Scottish Leather
Group
• William Shipley Shipley Estates
• Tom Barrett Barrett Steel
Corporate Social Responsibiity• Hall-Fast Industrial Supplies
• William Jackson Food Group
• Henry Orchards and Sons
• Johnstons of Elgin
• The Entertainer
• Clinton Devon Estates
Longevity• Angels the Costumiers
• HJ Sock Group
• HMG Paints
• Toye & Co
• Dege & Skinner
• Fudges
New frontiers• Fracino
• Triplar
• Component Force
• Clarity Stamp
• Mr & Mrs Smith
• Sporty Co
Ambassador• David Johnson Leaders Matter
• Juliette Johnson Coutts & Co
• Peter Musgrave Musgrave Group
• Chris Kelly MP Family Business APPG
• Grant Gordon Institute for Family Business
• Peter Leach Peter Leach & Partners
Lifetime achievement• Michel Roux Le Gavroche
• Brian & Alan Stannah Stannah
• Jacqueline Gold Ann Summers
• Dame Mary Perkins DBE Specsavers
• Lord Michael Heseltine Haymarket Media Group
• Lance Clark Clarks
❝ Winning this award has opened so many doors for us, and the opportunity to build great business relationships with other family businesses. ❞Barbara Gray - MD Clarity Stamp
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eyebrow running head
My journey to work, like that of a lot of people, is usually set to a soundtrack of radio news, which tends to get me wound up or slightly angry, and very, very occasionally, hands-in-the-air excited.
Recently, I heard someone being interviewed on BBC Five Live about apprenticeships and he said: “£8,000 is a huge lot more than what you get as a university student. There’s no debt attached. You are learning and you’re being paid at the same time.”
Regular Generation pundit, Charlie Mullins from Pimlico
Plumbers explains how larger firms are jumping on the
apprenticeship bandwagon. Something he has tirelessly
been championing for years.
And who was this advocate of the thing I hold to be the single biggest tool we have to return the UK to the top of the skills pyramid?
No, for a change it wasn’t me, it was none other than Richard Hamer, education director and head of early career programmes, at one of the most hi-tech companies on the planet, BAE Systems.
He went on to explain that, as a company, BAE Systems couldn’t get what they needed in an employee from the universities. Therefore, 240 of the company’s 400 top managers had completed in-house apprenticeships.
And thankfully BAE Systems are not alone in this. Last year it was Ernst & Young deciding to
upfront
Grow your own talent
nab the best young talent. They harvested the cream of the crop directly from A-levels, putting them through university whilst paying them.
Looks like we have ourselves a new trend! The corporate world seems to be saying ‘we can do better’ than the universities with their general, and often irrelevant degree courses.
But is this really a new concept, or is it a case of back to the future?
In the plumbing and building industry we’ve been running this model for, well … pretty much for millennia. The phrase apprentice, be it ‘sorcerer’s’, ‘printer’s’ or ‘plumber’s’ means learning your trade over a period of years, not in theory, but in practice. This is what these corporate giants have moved towards, and I think it vindicates what I have been saying about youth training and unemployment for years.
This is exactly the kind of thing we need to get out into the public domain. The idea that you can learn some of the most complicated trades in-house, without the need for university cannot but help destroy the mind-set that, to have a “real career”, you must be a graduate.
However, that attitude is still alive and well and proving hard to shift. According to figures from the universities admissions body UCAS, the number of applications is on the rise.
While this is extremely frustrating, especially when you consider how happy I was just 48 hours earlier while listening to Mr Hamer extol the virtues of apprenticeships, there is at least some positive news coming out of universities.
It appears that students are turning their backs on modern
languages and applying for science and engineering courses. Applications for engineering courses rose by 8.4 per cent, which is a positive sign, because if the universities prove they are good for something it will be to create graduate engineers who can apply their degree-level skills into practical applications that benefit their future employers and the economy.
Projects like the High Speed Rail Link will need university-trained civil engineers to put the projects in place, which will, in turn,
The idea that you can learn some of the most complicated trades in-house, without the need for university cannot but help destroy the mind-set that, to have a “real career”, you must be a graduate.
“
“
create opportunities for other skilled trades people, who can actually build the railway, who will have been trained through apprenticeships.
So if companies like BAE can tap into a better pool of “on the job”-trained apprentices mixed with a handful of these university-educated engineers who have actually completed courses relevant to the real world, then we will have started to crack the issue.
www.pimlicoplumbers.com
QUOTE WI/0113
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If you are in any doubt whether the investment is suitable for you, please contact an independent financial adviser. This advertisement has been issued by Asset Value Investors Limited (“AVI”). AVI is the investment manager of British Empire and is authorised and regulated by the FSA (FRN#119270). AVI is registered in England No. 01881101. Registered Office: 20-22 Bedford Row, London WC1R 4JS, England.
British Empire uses gearing techniques (leverage) which will exaggerate market movements both down and up which could mean sudden and large falls in market value. Please refer to the Key Features Document for further details of the risks affecting your investment. Tax treatment depends on individual circumstances and may be subject to change in the future.
19GeneraTion SPRING 2013
20 Generation SPRING 2013
Become a FrienD ofFamily Business Placefor only £50Join the UK’s most vibrant family business network for just £50 per year
Become a FrienD of Family Business Place and get exclusive access to free publicity, discounts, events and more.
Family Business Place (FBP) is the UK’s leading network for family businesses. Our mission is to help family businesses succeed by giving them free publicity, making introductions to others with similar issues, giving them access to the best professional advisers and celebrating their achievements.
By becoming a FRIEND of FBP, you will have exclusive access to our network of family-run businesses. This includes some of the UK’s most successful household names as well as thousands of small family businesses and a pool of talented advisers.
Contact Amalia Brightley-Gillott
E: [email protected] T: 01732 220 120
• One year subscription to Generation - official magazine of FBP (quarterly)
• Discount and priority booking on all FBP events (including Red Ribbon Awards and Family Ties annual conference)
• Publication of your press releases across all platforms (magazine, website, social media etc at the Editor’s discretion)
• Discounts on family business products and services including hotels, wine, food and much more
Become a FRIEND of FBP online - www.familybusinessplace.com/friend
21Generation SPRING 2013
upfront
the institute for Family Business (iFB) continues to produce thought leading research into the family business sector and present a consistent core message to government on the vital and vibrant contribution family business makes to the UK economy.
international family business leaders gather in London Since the last edition of Generation the IFB has successfully hosted the world’s largest family business conference, the Family Business Network (FBN) International Summit. Now in its 23rd year, this is only the second time the conference has come to the UK; the first being in 2000.
Over 837 family business leaders from more than 40 different countries gathered in London to explore the theme of ‘Extraordinary Performance’ and discuss how firms can generate long-term sustainability in their organisations and enhance competitiveness.
Ross Warburton, the chair of this year’s Summit, emphasised the role of ‘patient family capital’ in ensuring sustainable success. He stated that the family business sector is proving robust in the face of economic adversity. In a recent international survey, 60% of respondents said their family business had grown by at least 5% in the 12 months to June 2012.
Sustainable Value CreationA key focus of the FBN summit was examining the challenges and opportunities for family businesses in delivering sustainable value creation. These discussions were supported by a new report by the IFB Research Foundation, Sustainable Value Creation, which is freely available to IFB members and can also be purchased by non-members from our website.
The report deals with the
long-term issues that often have no direct financial return, but which can have a material impact on the ability of an organisation to create long-term value. The research suggests that companies who focus exclusively on financial metrics could miss the long-term value issues wrapped up in the sustainability agenda.
In an FBN International member survey 72% of respondents indicated that they had a corporate strategy relating to environmental, social and governance (ESG) issues, confirming that sustainability is firmly on the agenda within progressive family firms. The report helps those who are yet to formulate a strategy, or who are looking to improve their current approach.
Working with BiS and the treasuryIFB continues to work closely with the Department of Business, Innovation and Skills to help the Government better understand and support the family business sector. In recent months this has involved advising on both the Heseltine review, and on the work of the Business Schools Taskforce.
The Business Schools Taskforce will be reporting later and hopes
a Voice in Westminster
to set out a practical framework to help business schools to better understand the needs of medium sized businesses.
Many of our membership have demonstrated a clear demand for more Family Business focused training which is not currently being fully met by UK Business schools. The report presents a tremendous opportunity for business schools to work more closely with family firms and we look forward to supporting BIS with implementing the report’s recommendations.
The Heseltine review presented the government with a strong challenge to present a strategy for growth. The IFB submitted
evidence for the report, had a number of meetings with the review team and agree with many of its conclusions. We will encourage the government to help unlock the potential of family firms by providing incentives and removing barriers to family business investment and innovation.
engaging with MPs and PeersAt the end of last year we held the second annual reception of the All Party Parliamentary Group on Family Business (APPGFB). Sponsored by the IFB, this is an important opportunity for family firms to talk directly to parliamentarians about what they can do to support our businesses.
We were delighted to welcome, hot off the back of his recent review, Lord Heseltine as our main speaker. As Chairman of his own family business, the Haymarket Group, Lord Heseltine is uniquely placed to understand the needs of family firms.
The group is proving to be an important communication channel for family business and allows us to reiterate our messages to the government. We hope to see you there.
www.ifb.org.uk
left: Grant Gordon,
Chairman of IFB
at the Annual
Reception of
APPG for Family
Business
DON’T LOOKBACK IN ANGER
As a dyslexic young boy, John Jones’ old school teachers didn’t believe he would
amount to anything. Fifty years later, Anita Brightley-Hodges meets the man who has
proven them all wrong and now works with some of the world’s leading artists.
make frames. He became the first company to introduce a collection and delivery service to galleries and business soon began to pick up.
Today, the family-run, bespoke picture framing company has grown to encompass a highly skilled team of 90 crafts people and designers. Their expertise in fine art and conservation framing enables them to produce virtually any kind of high quality frame design, including metallic, perspex and wooden frames, all made entirely at their 38,000sq ft workshop. Over the years John Jones have expanded into new services including museum quality art materials, printing, fine art installations, artwork conservation and collection management.
Their clients include London’s most prestigious galleries, auction houses, corporate firms and private collections as well as some of the most famous artists in the world such as Francis Bacon and David Hockney.
John Jones used to drive an Evening Standard van, as did his father before him. From a young age he learnt how to make
a quick buck (including selling horse manure from the back of his van) and soon became a young ‘entrepreneur’. Being dyslexic, John’s teachers told him that he’d never go very far because he didn’t have the academic skills. This only made John even more determined to create his own success.
As a sideline, John would help his brother, an artist, make picture frames and sell them to make extra money. He soon realised that he could do things more efficiently than his brother and introduced machinery to the process. After a while the two brothers went their separate ways, the business went into liquidation and John had to start again.
John’s new venture went from strength to strength. He bought his first shop, an old pawn brokers, and employed people to just
meets
22 Generation SPRING 2013
DON’T LOOKBACK IN ANGER
The secret to John’s success? “Years ago, an artist called Gordon House told me that if I can’t do it myself, find someone that can. I’ve always lived by that and it has served me well throughout my career.” Says John.
Although John is the driving force behind the business, he has a great support network of family members around him who all play different roles. John’s sons Matthew and Kristian are Managing Director and Sales Director and his daughter Kelly oversees the HR department. Matthew’s wife Kate is in charge of marketing the business.
“Unfortunately for my children, I’m a serious fuss pot. I want everything to be immaculate. I like to open up in the morning, and lock up at night and take great pleasure in making decisions with my sons knowing that I can trust them to take that decision forward. They’ve given me the courage to take the next step and embark on new ventures” (including building their new state of the art premises in London).
John is well known for his knack of identifying and supporting up and coming artists and has bought pieces over the years which have increased in value. They now have
24 Generation SPRING 2013
their own £1million collection. John once gave some spare space to a photographer who was tracking Obama’s campaign. She was so touched by his generosity that she and her husband nominated John for an MBE which he received in 2012.
John is a humble, down to earth character who has become successful through sheer hard work. He is still very modest and committed to nurturing a caring business. He knows the name of everyone who works for him and visits the office every week to make sure things are still being done the ‘John Jones’ way.
“I wish I had more time to spend with my children as I missed out whilst I was building the business, my wife has been crucial in keeping our family together and making sure we all share a spag bol regularly. But I’m incredibly proud of what my children have achieved and the feeling of confidence they’ve given me to pursue other things. I was so delighted when Matthew and Kristian said they wanted to join the business – we wouldn’t be the business we are today without them.”
www.johnjones.co.uk
25Generation SPRING 2013
john jones: Winner ‘Lifetime Achievement’ award at the Red Ribbon Awards 2012
FACING THE
MUSICCaroline Redman-Lusher, Founder of
national sensation, Rock Choir, tells Anita
Brightley-Hodges how years of teaching
and a passion for music has lead to two
world records and a sell-out gig at the O2.
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26 GeneRation SPRING 2013
When I first met Caroline backstage at an awards ceremony, I was immediately struck by her excitable face and the
sparkle in her eyes. At the time, I wasn’t entirely aware of quite how pioneering she was in the contemporary choir phenomenon.
A professional singer and musician, with grade eight certificates in both violin and piano from the Royal School of Music, Caroline started performing professionally at fifteen while studying for a classical music scholarship.
After a few years chasing her dream of a record deal, Caroline soon realised that performing in pubs and clubs in London wasn’t for her and returned home to Surrey to become a music teacher. A few years later she started a Rock Choir for her students and with a small loan from her father, David, she slowly began to expand with more choirs launching every month. The beauty
of Rock Choir is that you don’t need to be able to read music and the songs are popular tunes including rock, pop and soul. So for the average person, who just wants to get involved, it’s a fantastic way to be part of something.
The choirs continued to grow steadily in number, but then one day, the BBC got hold of an interview she had done and Caroline became an overnight sensation. In that moment, everything changed and Caroline’s life was propelled into success beyond her wildest dreams.
“There are moments, like when we book London’s O2 arena for a Rock Choir gig, that I have to pinch myself at just how far we’ve come. We were such a small operation, working from home and now we’re a fantastic team of talent with 17,000 members around the country.” Caroline explains.
At the heart of Caroline’s world is her close-knit family – her father David (Captain Rock Choir!), her husband Stuart (Finance Director) and her sister Elizabeth (Brand Ambassador). David in particular is a huge influence on Caroline who likes to share her dreams with him and knows that he’ll always be 100% behind her.
“When you become a member or an agent of Rock Choir, you become part of the family. So when we’re interviewing for choir leaders, we
make sure their values are aligned with ours. Without trust and loyalty, we’d fall into the same traps as any other business but I feel blessed that we have such a great team around us.”
Caroline finds that working with family means lots of late night discussions, difficulty in breaking away and a strain on relationships. She says it’s a 24/7 job with very little chance to enjoy time away from Rock Choir.
“In the past we were so engrossed in growing the business that my husband and I never took any time away for ourselves. And that’s not healthy. So we’ve started getting holidays booked well in advance just to make sure we actually go away! Rock Choir is our baby but we need to be in a place where we enjoy it so time together is important.”
So what does the future hold for Caroline and her Rock Choir journey?
Rock Choir currently turns over £4.5million through their membership subscriptions with 57 agents (choir leaders) around the UK. But Caroline isn’t stopping there.
“We’ve made our mark on the UK and I’m passionate about continuing to grow. We’ve looked at the concept of franchising and expanding into America. I know that I can’t be everywhere so I’m not adverse to the idea of letting someone else grow the business elsewhere. It would be a dream to play Madison Square Garden!”
Caroline also has ambitions to start the Rock Choir Foundation, helping people in hard hit areas to enjoy life through music. As someone who already does a huge amount of work for charity, she is itching to get her own show off the ground and start choirs in prisons, council estates or anywhere that needs her help.
And lets not forget that this is a woman who has already broken two world records and is aiming for a third, so I’ve no doubt that global domination is just around the corner.
www.rockchoir.com
below: Rock Choirs sing all over the UK including an annual concert at London’s O2 arena.
left and bottom right: Founder and visionary Caroline Redman-Lusher
meets
27GeneRation SPRING 2013
Bremont is an award winning British company producing aviation inspired timepieces at our new watchmaking facility in Henley on Thames, South Oxfordshire.
Time began for Bremont when we embarked on a journey to make beautifully crafted pilot’s watches of exceptional quality. Flying historic aircraft has been in our blood from an early age, as has our love for watches and all things mechanical.
Our timepieces are tested beyond any normal call of duty (and not just in the workshop), and are immensely precise and durable. We make our watches to a very high specifi cation for the price point and every watch in our standard range is chronometer certifi ed. We stand by our product and are one of the few companies offering a 3 year warranty on every watch we produce. We hope you get the same satisfaction as us when you try on a Bremont.
Born in the air, defi ned in the cockpit, assembled in England.Bremont mechanical chronometers are made by professionals to exacting standards.... for the rest of us.
Bremont.com | Facebook.com/TestedBeyondEndurance | Twitter.com/BremontWatchCom
TESTED BEYONDENDURANCE
ALT1-C/CR
Bremont is an award winning British company producing aviation inspired timepieces at our new watchmaking facility in Henley on Thames, South Oxfordshire.
Time began for Bremont when we embarked on a journey to make beautifully crafted pilot’s watches of exceptional quality. Flying historic aircraft has been in our blood from an early age, as has our love for watches and all things mechanical.
Our timepieces are tested beyond any normal call of duty (and not just in the workshop), and are immensely precise and durable. We make our watches to a very high specifi cation for the price point and every watch in our standard range is chronometer certifi ed. We stand by our product and are one of the few companies offering a 3 year warranty on every watch we produce. We hope you get the same satisfaction as us when you try on a Bremont.
Born in the air, defi ned in the cockpit, assembled in England.Bremont mechanical chronometers are made by professionals to exacting standards.... for the rest of us.
Bremont.com | Facebook.com/TestedBeyondEndurance | Twitter.com/BremontWatchCom
TESTED BEYONDENDURANCE
ALT1-C/CR
FROM BEDROOM TO BOARDROOM
Amalia Brightley-Gillott meets the
family behind Paragon, a family business
headed up by twins David and Robert
who work from their office where their
bedroom once stood.
There are not many companies nowadays that have thrived as a family business for almost a century. Paragon – one
of the UK’s leading providers of commercial laundry services – is in that category.
The company started as a small family business back in 1918 and was founded by Percival and George Stevens in Birmingham, although moved its Head Office to Hatherley in Cheltenham in 1924. Over that time Paragon has flourished with a growing number of teams spread across the Midlands, Wales and South of England, where the business is now one of the UK’s largest independent commercial laundry companies, providing services to both the hospitality and industrial markets.
A pioneer in the industry, Paragon has sought to employ local people since the very beginning. One such example is the Little family, whose family’s collective service to Paragon amounts to a staggering 325 years, with Tim Little being the last of the family to retire, only a few months ago.
Today the company employs around 600 staff, promising in its advertising strap line to provide ‘simply better laundry’ and a ‘squeaky clean’ service, and is jointly managed by twin brothers David and Robert Stevens – both third generation family members.
The list of Paragon’s offerings is as extensive as the marketplace is diverse. The company offers crisp, clean table linen; sturdy, hard-working boiler suits and every launderable item in between as well as comprehensive floor protection, serving everyone from hotels and restaurants, to garages and manufacturers. There’s a high probability you regularly come face to face with Paragon’s linen across the UK and further afield; you may have even spotted their brightly liveried vehicles travelling up or down a motorway.
However, the path to becoming a large business has not always been easy. The Stevens
meets
30
family and the management team they have assembled around them, have successfully innovated their way around challenges and opportunities, managing in the process to build a business that combines a conspicuously Paragon blend of the best of a family business with the management techniques of a world class corporation.
Proud of their heritage, the Paragon family admits there are implied positives that come with the phrase ‘family business’, such as stability, commitment and continuity. These can be as important to potential employees as they are to customers. Consequently, the Stevens twins are keen to capitalise on their family business values but with recognition that no individual (or family!) has a monopoly on all the best of ideas, hence the desire to integrate non-family, proven business managers into the senior and middle tiers of management. The Stevens have been conscious that without safeguards, family businesses can easily become introspective and less open to changes or new ideas, something the family have actively resisted over the ten decades of building a profitable concern in a competitive marketplace.
One such innovation was the inception of the Brilliant Laundry Group, a sales and marketing organisation comprising 11 independent laundry companies who together, across 21 sites nationwide, compete for and win national business that they might not have been large enough to secure on their own. Today, Brilliant delivers national contracts for some of the UK’s biggest names in hospitality, including Travelodge, Hilton, Hotel du Vin and recently managed the laundry for the Olympic Village! In fact Brilliant now services almost 35% of the national hospitality market.
Paragon operates out of six strategically placed sites in Nottingham, Ross, Kington, Yeovil, Newport and Cheltenham and whilst its national accounts through Brilliant are a key factor to its success, they are proud to have significant local alliances with customers such as Honda in Swindon and Wyke Farm in Somerset – the Farmhouse cheddar brand that has won more awards than any other.
A healthy self-awareness has allowed Paragon to sustain innovation and fresh ideas to keep up with the changing market environment. As David Stevens says, “The industry has been under lots of pressure during the last few years, including the loss of a number of laundries, so we decided that in order to survive and expand,
we needed to apply an aggressive marketing and investment policy to help ensure that we were on the radar of more potential customers.”
All businesses are facing similar challenges these days but the hospitality industry has been amongst the hardest hit. Yet Paragon has survived a number of economic crises in the past, hence its determination to stay ahead through innovation.
Looking to export markets, Paragon’s NewGen brand is now operating laundries in Doha, Abu Dhabi and Dubai and has several pipeline projects which they hope will come to fruition in 2013.
David and his twin brother Robert joined the family business at the age of 18, becoming joint Managing Directors in 1995 - “We recognise in our current structure that family leadership will not necessarily follow through but we do have third and fourth generation family members working in the business. We all spend a lot of time at work, so it’s important that we are happy here!”
In fact, the head office used to be the family home. “By a twist of fate (and a ‘change of use’ planning application),” says David, “my current office at Paragon HQ used to be my old bedroom when I was a child growing up!
“That’s just one of those quirky family business oddities that you don’t get in normal businesses!”
www.simplybetterlaundry.com
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31Generation SPRING 2013
this page
top: Staff working on the linen back when Percival and George Stevens were in charge
above: Modern technologies have transformed the business
opposite page
left: Twin brothers Robert and David are joint Managing Directors
top: Head Office in Cheltenham back in 1924
PIMP MY SHOP!Boasting an impressive client list, Triplar are one of the UK’s leading retail and commercial fit-out specialists.
Amalia Brightley-Gillott gets to the bottom of what makes this modern, innovative family business tick.
Over three decades ago, Mike Rodwell and his younger brother Stephen started a business fitting out the interiors of
commercial and retail spaces. Now, with his son Tim as Managing Director, Mike can proudly say that Triplar are a leading shop fitting specialist with clients including Nike, Levis, Lush and Dr Martens.
“From day one, we’ve had the ability to plan and execute our business strategy as we see fit. As a family business there’s a trust shared between senior members of the team and we can react quickly if we need to adjust our tactics along the way.” Mike says.
As with many of those at the helm of family-run firms, Mike’s passion lies in creating a business that cares. Whether it’s the attention to details with clients, or nurturing the skills and talents of employees, Triplar are proud of their reputation for being a great company to work for.
Triplar’s values as a company run parallel to those of the family with integrity, care and service top of the list. They’re a hugely progressive firm, constantly looking to develop new ideas and expertise. But the management know that they will only ever be as good as their people so place high importance and invest in training and development of all their team.
“It’s important that we, as a family, lead by example by imbuing the company with a strong sense of integrity. We look after our staff and provide our customers with an excellent level of service and that sets us apart from our competitors. We’re also fiercely independent financially which means we’re in control of our own destiny and not answerable to anyone except ourselves.” Mike explains.
Triplar are proud ambassadors of family business and make it clear in all of their marketing communications. In 2012 they were triumphant winners of the ‘Fastest Growing Business’ Award at the Red Ribbon Awards for family business. They make sure that all their clients understand the ownership, management structure, responsibilities and affiliations from the earliest stages of their relationship.
“We actively seek customers who are likely to share our values and we theirs – ensuring that we never have to be anything we’re not,
or compromise our family business values we consider to be so important, especially in these times” Mike says.
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32 GeneraTion SPRING 2013
below: Rock Choirs sing all over the UK including an annual concert at London’s O2 arena.
left and bottom: Founder and visionary Caroline Redman-Lusher
But life in a family business isn’t all plain sailing as Mike well knows and many of his concerns are shared by other family-run firms around the UK.
“Long term succession planning is a constant consideration and a difficult challenge that all families face. There is no model or template you can follow – the process has to be entirely of your own device. Great support from family business networks and good advisers does make it easier though.”
Current attitudes of the UK banking sector also makes business particularly challenging for Triplar and the sector as a whole. Coupled with instability in the eurozone (where Triplar conduct more than half their business) makes trading conditions difficult. Mike wants to develop relationships with like-minded suppliers in the UK – something they are working hard to do, but is a constant challenge.
Moving forward, Triplar plan to grow organically throughout their operational area, which is currently predominantly the EU. But they do maintain a watchful eye on useful acquisition opportunities.
Periodically Mike uses outside consultants to give them a health check, and ensure that, because they are very close to the operational end of the business, they don’t lose sight of the main objectives and continue to be on track. The business’ first generation of ownership and involvement is coming to an end, the second generation will be operating at peak
performance for about the next 15 years – by which point the third generation might be beginning to show interest and looking at the future direction of the business.
“If I could give some advice to someone thinking about joining their family firm, it would be to make sure you understand at least the rudiments of the ‘in house’ culture and identify something unique to add to the mixing pot. Ask to speak to some non-family members of the team and take a look at the accounts for previous years, with help if you need it.”
“At Triplar, we perhaps do not have a typical family business profile when it comes to our experience and current board set-up. Both me and my son Tim developed our careers in corporate environments before setting up Triplar as it is now.
“So in many ways, we’ve had to learn about the dynamics of a family business before setting the context of Triplar’s profile and long term development plan. And as relationships develop with new customers we are able to understand the culture of the client and absorb it into our operations and service levels – something which one has to learn quickly in corporate life. We also have an external director on our board, who again helps us raise our heads from the day-to-day of our business.”
www.triplar.co.uk
this page
top left: Mike and Tim Rodwell win ‘Fastest Growing Business’ Award at the Red Ribbon Awards 2012
top right: Triplar work with Dr Marten’s to transform their retail spaces
opposite page: 10th anniversary pop-up store for Crocs
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33GeneraTion SPRING 2013
FAMILY CONSTITUTIONBOOKSBringing together all of the family’s thinking, plans and aspirations that will stand the test of time, The Family Constitution Book is the critical point of reference for:
Employing family members • When the inevitable happens:•
The unanimous principals of the entire family • Greater harmony • Inspiring future generations•
For further information visit www.familyconstitution.co.uk
For a private consultation call Anita on 07815 497417 or email [email protected]
Rights and Responsibilities
For further information visitwww.familyconstitution.co.uk
For a private consultation callAnita on 01732 220120 or [email protected]
FAMILY CONSTITUTIONBOOKSBringing together all of the family’s thinking, plans and aspirations that will stand the test of time, The Family Constitution Book is the critical point of reference for:
• Employing family members • When the inevitable happens:
• The unanimous principles of the entire family • Greater harmony • Inspiring future generations
Rights and Responsibilities
NortherNirelaNd’s
fiNest
37Chain Reaction CyclesRacing Ahead
Hilden BreweryHistorical Moments
39ClearhillSpend a Penny
40TG EakinSeal of Approval
Martin ConstructionFirm Foundations
41Brett MartinInvesting in the Future
McKeever HotelGroupPeople First
43Morelli’sA Sweet Success
35Generation SPRING 2013
to Protect and serveCathy Booth, Senior Manager at the BDO Centre for Family Business in
Belfast explains how crucial it is that Northern Ireland protects its many
family-run businesses, for the sake of the economy at whole.
the northern ireland Factfile:
It’s true that most family businesses
across NI are small, but it is also true
that many are among the largest and
most successful in the country. With
approximately 34 of Northern Ireland’s
top 100 businesses being family-owned,
and an estimated 75 per cent of all
businesses in NI being family-run, the
economic impact this sector does and can
further make to the local economy is not
one to be dismissed.
Given the role the family business
sector plays as a driver of local economy
and employment, not to mention
philanthropic giving, it is alarming that
studies suggest approximately half of
family businesses anticipate a transition
to the next generation within the next five
years. Needless to say, if these ownership
and management transitions are not
handled properly, the negative impact on
the NI economy would be profound.
I realise I am preaching to the
converted when I say that family
businesses are unique - in that they
involve the intersection of family,
management and ownership, with
family members bridging all three areas.
As family businesses evolve through
successive generations and more family
members take an active interest in the
business, divergent goals, values and
expectations can surface. If the family
does not have the foresight to put good
governance processes in place to deal
with these challenges, both the business
and family can suffer or fail.
Over the last twenty five years the
BDO Centre for Family Business in
Belfast has been helping business
families manage the challenges of family
business. In addition to our expertise
and ongoing work directly with family
businesses, BDO have been working
hard to ensure the family business
voice is presented and represented at
ministerial and governmental level. We
pledge to continue to seek support and
assistance for the sector to ensure access
to and provision of services where such
intricate and complex issues, that only a
family business has to deal with, can be
dealt with.
Given the extraordinary importance
of family businesses to the culture and
economy of NI, it’s fair to say they
are a resource worth preserving and
protecting.
www.bdoni.com
Capital: BelfastPopulation: 1,810,863GDP: £33.2 billion
Known for: Saint Patrick, Titanic Belfast, Giant’s Causeway, Mountains of Mourne and the Walled City of Derry
36 Generation SPRING 2013
northern ireland’s finest
This small family business has been
producing award winning beers since
1981 and is now in its second generation.
Hilden Brewery is the former home of
Helen Barbour, a daughter of Milne
Barbour, who married Thomas Andrews,
designer of the Titanic. They celebrated
their wedding at Hilden house.
Hilden Brewery recently launched its
new family of bottled beers. The Belfast
Quarters are brewed to celebrate some
of the City’s most historic and renowned
areas and comprise the Titanic Quarter,
Cathedral Quarter and Queen’s Quarter
beers.
Titanic Quarter Beer - The first of
the Belfast Quarter Beers was specially
commissioned to mark the regeneration
of the Queen’s Island site. Today the area
is at the beginning of a renaissance which
will put the quarter back as a focal point,
not only of Belfast’s commercial but also
social and cultural world.
All Hilden Brewery beers are
available at the Tap Room restaurant
at the Brewery, Molly’s Yard, The John
Hewitt, The Dirty Duck, The Duke of
York, Hillside and all Northern Irish
Wetherspoon’s bars and lots of free-
houses all over England and Scotland.
www.hildenbrewingco.com
historical Moments
In 1984 George and Janice Watson
made the decision to open a bike shop,
which saw George leaving his job in
the road service and embark on their
journey into bicycle retailing and
repair. Thoughts of worldwide success
weren’t the main priority when, armed
with just a £1500 bank loan, they set
up Ballynure Cycles, in the small village
of Ballynure in Northern Ireland.
“Janice and I had always been
keen cyclists and used to spend
holidays touring on our bikes,” says
George. With him also having a great
level of mechanical experience after
spending his youth working on cars
and motorbikes they were ideally
positioned to create a great family
bike business.
By 1998 their next little shop in
Ballyclare was about to burst with
stock. This was when a difficult
decision had to be made – move to
a bigger retail unit in Belfast whilst
trying to manage a growing mail order
business, or bite the bullet and move to
a warehouse focusing almost totally on
mail order. The family took the second
choice and now, nearly 30 years later,
Chain Reaction Cycles are the largest
employer in the local area. As an
indication of just how far theyve come
since George started in 1984, they are
now Royal Mail’s biggest customer in
Northern Ireland and Parcel Force’s
largest export account.
Despite their growth and all of the
changes, the business is still owned
and run by the Watson family and
they are proud to still have the original
CRC crew. George and Janice’s three
daughters, Lola, Sabrina and Georgina
all have active roles in the business.
George is the figurehead, making sure
things are run to the standards he set
out in 1984, Janice runs the Accounts
department, whilst their son Chris is
the Managing Director. The CRC family
has now grown to over 500 dedicated
members.
www.chainreactioncycles.com
Chain Reaction Cycles, the world’s largest online bike store, has grown
through hard work, a strong family ethos and investment in stock,
systems and most importantly people.
racing ahead
Hilden Brewery was established
by Ann and Seamus Scullion in
1981 and is Ireland’s oldest
independent Brewer.
37
northern ireland’s finest
Generation SPRING 2013
Clearhill was formed in 1992, by MD
Brendan McAreavey. Clearhill are specialist
suppliers of coin-operated equipment to
entertain customers and provide a valuable
source of additional revenue for shopping
centres. On a £ per sq ft basis they
guarantee impressive results from their
customers’ mall space. From kiddie rides,
toy & candy carts to photo booths and
plush cranes, Clearhill provide the whole
portfolio of vending solutions.
The business currently includes
three members of the McAreavey family
who are actively involved in the day-to-
day running of the business. Brendan
is an impassioned leader and, as MD,
is responsible for thinking about new
innovations, guiding the culture of the
company and developing a strategy
for the future of the business. His two
spend a PennyThis flourishing family business brings
colour and fun to shopping malls
across the country.
sons, Brian and John both look after
separate parts of the business with Brian
responsible for managing operations
and sales activities, and John overseeing
Clearhill’s finance function.
“We were all taught from a young age
that hard work was the most important
factor in succeeding at anything we do.
We are a very close family and trust each
other with everything; this is an aspect
that we appreciate in our business, from
employees to suppliers. The creativity
stems from our father, his ideas and ability
to innovate have encouraged all our family
to think outside the box. This is a key
factor in why Clearhill puts innovation at
the top of its agenda.” John says.
Clearhill believe that family run
businesses have a USP over non-family
run businesses in that the company
usually means more to the family, so they
actively promote that.
“We think that customers appreciate
the level of attention and service they get
from us as a family business so we tell new
customers from the start of a relationship,
so they can get a feel for the type of service
they will receive.” John says.
“The economic climate is a huge
challenge for families in a business
context. Nothing can be taken for
granted, so everyone must be prepared to
work harder and smarter to achieve our
ambitions. Businesses must be operating
lean and efficient in this environment
and that means that every employee must
show their worth to the organisation.
“For Clearhill, we are in the early
stage of a transitionary process. 11
years ago, my father Brendan employed
Brian and only 2 years ago, I joined the
business. The three of us form the senior
management team. But for someone
thinking about joining their family
business the most fundamental decision
is; can you work with your family
members on a day to day basis? If not,
then think of something else, there are
plenty of business opportunities, but you
shouldn’t put your family relationships
at risk. I feel I’m in a very privileged
position to work with my family, if the
mix is right and you can communicate
well, there isn’t a job like it!”
www.clearhill.co.uk
39Generation SPRING 2013
northern ireland’s finest
Having made their mark in Northern
Ireland, Martin Construction are
now putting down roots in the
UK’s capital.
TG Eakin Limited is a medical
device manufacturer, dedicated to
the production of high-quality skin
protection products for use in stoma and
wound care. The company was formed
in 1974 by Tom Eakin, a pharmacist in
Dundonald, just outside Belfast. As a
result of having a close family member
with a urostomy and listening to the
problems of ostomates visiting his
pharmacy, he felt a strong desire to help
improve their quality of life. Since then,
the company has gone from strength to
strength and now supplies ostomy and
wound care products around the world.
Still a family owned and run
business with Tom’s sons Paul and
Jeremy now at the helm, the company
now export their products to more than
30 countries and the range of products
seal of approval
Tom Eakin has built an award-
winning business with his
sons, Paul and Jeremy, in the heart
of Belfast.
manufactured have increased. With
2010 marking the 30th birthday of the
Eakin Cohesive® Seal being introduced
to the UK market, there are over 15
million Cohesive® Seals being sold
worldwide on an annual basis.
Quality is of the utmost importance
at TG Eakin Limited and the company is
registered as meeting the requirements
of the ISO 13485:2003 standard. The
staff take great pride in producing
top-quality products, matched by high
levels of quality and hygiene evident
throughout the premises.
This effort has resulted in TG Eakin
Ltd being an award-winning company. In
2010 alone the company was recognised
on several occasions through being
awarded the Queens Award for Enterprise
for Exporting Achievement, Northern
Ireland’s Best Small/ Medium Business
accolade, being named as one of Ireland’s
Best Managed Companies in the Deloitte
Awards as well as being identified as ‘One
to Recognise’ in the Sunday Times Profit
Track 100 companies.
www.eakin.eu
firm foundations
Established in 1976, Martin Construction
has over 35 years’ experience in providing
a level of service which no one else offers
in the construction industry. Second
generation Gary Martin is currently at the
helm and, having made his first million
at just 17 years old, is set for an incredibly
successful career despite the woes of the
Irish construction sector.
The key ingredients to the growth of
Martin Construction and their expanding
client base have been to offer a high
quality, reliable and efficient service. They
maintain focus on clients at all times,
exceeding their expectations at every
opportunity.
Martin Construction continue to
provide a full range of construction
services from minor repairs, maintenance
and refurbishment through to new build
in both the commercial and residential
sectors. They have a wide client base
including developers, government
departments, professional consultants,
commercial companies and private clients
and have offices in Londonderry and
London.
Their founding values of service,
quality and reliability continue to guide
them in everything that they do. An ethos
of social responsibility and sustainability
inspires them to continue to improve in
all aspects of the business.
“This business, as with all my ventures,
is a family business. I work with my
brothers: I’m the numbers guy. The great
thing about working with family is that if
I’m ever off the mark, they care enough to
intervene. We talk about business all the
time. Business is life, or at least it touches
every part of your life.” Gary ends.
www.martin-construct.co.uk
40 Generation SPRING 2013
northern ireland’s finest
Eugene McKeever is Managing Director
of the McKeever Group which he
founded with his wife, Catherine,
and now also includes their daughter
Bridgene, Head of Sales and Marketing.
With thirty years in hospitality,
Eugene McKeever is one of Northern
Ireland’s most experienced hoteliers.
His first business was Granagh House
restaurant in Randalstown – since
then he has bought and sold a number
of businesses including Portglenone’s
Wild Duck Inn and the Balmoral Hotel
in Belfast. Today the McKeever group
owns Corr’s Corner, the Dunsilly
Hotel in Antrim and the Adair Arms in
Ballymena.
Employing 160 people, the company
has gone through the current downturn
without making any redundancies.
Eugene is keen to emphasise the strong
focus the Group places on training and
development of staff: “The people who
People first
A commitment to his staff has
seen Eugene McKeever weather the
economic storm.
work for us are the most important
resource. Central to what we do are
employees who feel part of the company
and who feel that their job is secure.
“The corporate market was a
great market to be in. A few years
back there was a lot of business but
that has changed. Companies are no
longer bringing as many people over
for meetings and conference calls are
becoming more and more common.”
The group’s recent acquisition, the
Adair Arms, is a slightly different venture
in that it’s located in the heart of a town.
The building has close links to the Adair
family – Ballymena is built on land given
to the Adair family by King Charles
I – and was designed by the architect
Charles Lanyon. McKeever plans a major
refurbishment of the iconic building
during which the hotel will stay open.
“Something I say to all those working
in our industry is not to engage in a knee-
jerk reaction. We can’t compete with the
M&S £10 meal deal and shouldn’t try
to. Once you cut prices it’s hard to go
back to quality. We can’t focus on price
alone – our bars, restaurants and hotels
have to offer a pleasant environment and
experience – that’s what people will pay
for.”
The hotel market is very fluid with
changing costs and consumer spending
patterns. Eugene McKeever is someone
who knows his business and knows what
works - a calm voice which is vital for his
sector during these times.
www.mckeeverhotelgroup.com
Established in 1958, Brett Martin is
a privately owned family business
which has become one of Northern
Ireland’s most successful independent
manufacturing companies
turning over €140 million. With
headquarters located on its founding
site in Co. Antrim, the company
has grown in scale to employ over
800 people at several locations
throughout the UK and Europe.
investing in the future
Brett Martin is a global player
supplying specialist plastic products
for the construction, fabrication, print
and display sectors worldwide. The
company’s product portfolio includes
an impressive range of plastic sheets,
factory engineered rooflight systems,
and, plumbing and drainage systems. A
commitment to an ongoing programme
of investment in the latest manufacturing
technology, innovation and product
development ensures that Brett Martin
products remain at the forefront of
its chosen markets. Throughout its
operations in the UK and Europe, the
Group aims to be a professional, solid
partner for distributors, customers and
end users.
Managing Director, Laurence Martin,
who runs the business with his brother
Brian says “The benefit of operating in
numerous markets and sectors is that
we tend to be able to weather recessions
well, as not all areas tend to be impacted
at the same time. The global nature of
this recession has meant that it has been
very challenging, but as a business, we
responded early and appropriately and
have taken a number of calculated risks
which have positioned us very well to
benefit as markets improve.”
www.brettmartin.com
41Generation SPRING 2013
northern ireland’s finest
HAPPYANNIVERSARY!Whether you have been in business for 20, 120 or 200 years, your success deserves to be recognised. We design and produce spectacular and innovative books that will capture your achievements. The process is simple and enjoyable, we will:
Hear your story and identify special •
Collate all material including photographs•
Write or edit your story • Design something amazing and unique • Use the latest printing, finishing techniques •
Present the book in its own presentation box•
Our job is to help your business shine.
For further information visit www.familyconstitution.co.uk/anniversaries
For a private consultation call Anita on 07815 497417 or email [email protected]
landmarks and triumphs
and memorabillia
and materials available
For further information visitwww.familyconstitution.co.uk/anniversaries
For a private consultation callAnita on 01732 220120 or [email protected]
HAPPYANNIVERSARY!Whether you have been in business for 20, 120 or 200 years, your success deserves to be recognised. We design and produce spectacular and innovative books that will capture your achievements. The process is simple and enjoyable, we will:
• Hear your story and identify special
• Collate all material including photographs
• Write or edit your story • Design something amazing and unique • Use the latest printing, finishing techniques
• Present the book in its own presentation box
Our job is to help your business shine.
landmarks and triumphs
and memorabilia
and materials available
“
the outbreak of World War ii in 1939 saw the family scattered far and wide, only to be reunited at their Portstewart home by luck and a series of incredible coincidences
“
After Italy declared its support for Hitler
in 1940, Angelo Morelli was one of many
Italian immigrants interned in a camp
on the Isle of Man. He was put on a
deportation ship to Canada, but taken off
board at the last minute. The ship was
sunk by a German U-boat in the Atlantic
with total loss of life.
The first Morelli family member to arrive
in Northern Ireland was Joseph Morelli.
He opened a small cafe in Ballymena
in 1907, and was joined by his brother
Dominic who opened a fish and chip shop
in Coleraine. When Dominic returned to
Italy, his business was taken over by a
third brother, Peter, who quickly added
an ice-cream parlour and taxi service
to the emerging empire. In 1929, he
branched out further, opening The Ice
Palace in Portstewart.
Around the same time, nephew Angelo
Morelli arrived in Northern Ireland.
Great Uncle Peter was opening a cafe in
Portrush and agreed to sell Angelo the
Portstewart shop. After marrying in Italy,
Angelo came back to the province and
worked hard to build up his business.
In 1937, Angelo’s sons, five year old
Nino and four year old Corrado, were
sent to their grandparents in Italy to learn
about their Italian heritage, ancestry
and language. However, the outbreak
of World War II in 1939 saw the family
scatter far and wide, only reunited at their
Portstewart home by luck and a series of
incredible coincidences.
Morelli’s ice-cream parlours are a familiar and mouth-watering sight for visitors
to the north Antrim coast. The shops in Portrush and Portstewart are known
far and wide for their delicious sundaes and creamy ice-cream, but most are
unaware of the extraordinary history of this Italian immigrant family.
a sweet success
Meanwhile, Angelo’s wife and
youngest son, Guido, were ordered to stay
with another Italian family in Portadown.
Because of Portstewart’s coastal position,
they were deemed to be a threat to naval
traffic. Other local Italians, who had been
born on British soil, took over the running
of the business.
For Nino and Corrado in Italy, news
of their family was scarce. When the
Allied forces reached Italy, they fled their
home alongside their grandparents. The
brothers had no idea if their parents were
still alive, nor did their parents know
anything of their sons’ fate.
By a remarkable coincidence, an army
officer from Portstewart recognised the
Morelli name in a Red Cross camp in
Italy, and made sure that the two young
boys were well looked after, eventually
receiving news of their family back in
Northern Ireland. The same officer then
helped Nino and Corrado get back to
Ireland in 1945. The Morelli family were
reunited in Portstewart once more.
The family did not let their wartime
experiences hold them back, and their
businesses developed rapidly. Aside from
shops in Portstewart and Portrush, a
franchise means that famous Morelli ice-
cream can be now be enjoyed throughout
Northern Ireland.
Nino married a local girl, and the
couple had four children, three of whom
now work in the family business. Nino’s
eldest son, Angelo, has spread the Morelli
name worldwide, and he is now a social
worker in Australia.
Corrado’s son Dino made his name as
one of Britain’s best young racing drivers.
Now professionally retired, he owns
thriving bingo businesses north and south
of the border. Angelo senior returned to
Italy with his wife in the early 1990s.
www.morellisgelato.com
43Generation SPRING 2013
northern ireland’s finest
What can you do in Ten Days?‘My Ten Days’ is an initiative to encourage owners and managers of family businesses to kick start their Corporate and Social Responsibility strategy. By giving one employee an extra ten days paid leave in order to do something truly amazing, they can improve the lives of many in the UK and overseas.
‘My Ten Days’ allows individuals the opportunity to fundraise and volunteer for the charity of their choice without having to worry about not having enough holiday allowance and so leaves them free to make a real and fantastic contribution.
Whether it be hiking up Mount Everest to fundraise or donating time to a local care home, collectively the family business community can make a huge difference.
For more information visit www.mytendays.org
or contact: [email protected] or 01732 220120
‘My Ten Days’ is an initiative of Family Business Place.
46 Generation SPRING 2013
A History of Debt Managementandrew Segal looks back at how
far we have come since the days of
being incarcerated or even executed
for owing money.
In the words of an old song, ‘Fings ain’t what they used to be,’ thanks be to heaven.
The history of bankruptcy where an individual, a debtor, owes his or her creditors money they can’t afford to pay, reads like a Hammer horror story.
In earlier centuries a bankrupt’s hanged body could be left to rot, publicly, in a cage designed for the purpose of leaving the dead debtor in full view of the local populace. The practice was stopped when townsfolk in various parts of the country expressed their revulsion, not at the sight of the corpses, but rather at the level of local taxes required to be levied to support the practice.
The last of the public hangings of recalcitrant bankrupts took place in 1711 in Spitalfields Market. Whilst there might be some today by whom the community would expect to benefit by their being dispatched in this way, viz: Some of our higher profile bankers; we like to think we’ve reached a more advanced level of maturity and civilisation.
Debtors’ prisons such as the Marshalsea existed until the mid to late 19th century. Indeed, whilst the Debtors’ Act of 1869 effectively ended the era of the debtors’ prison, the last to close was Coldbath Fields in Clerkenwell, but not until 1885. History? Yes, but actually, pretty recent. My grandfather was born in 1880. Maybe that makes me history as well.
The debtors’ prison regime was harsh to the point of being brutal. Inmates paid a lodging fee, and were expected to purchase food and water before paying an exit fee, if they were fortunate enough to be freed eventually. Thousands died of starvation, in some cases taking their families who accompanied them as well. Others, unable to escape their corrupt gaolers, committed suicide. Samuel Byron, son of the poet Lord Byron, incarcerated for non payment of debts, railed against the prison regime and its heartless barbarity.
Worth a mention, the Clink Prison, (from whence the term, ‘going to clink’), in Clink Street, is still there, now as a prison museum. Take a look at it, and read about what went on there. You’ll find it hard to believe. Then go to Borough Market nearby for a refreshing coffee and toasted cheese sandwich. You might need some sort of refreshment.
Charles Dickens father languished for a time in the Marshalsea which itself
experts
andrew Segal, HW Fisher
SpecialismDebt management
ProfileAndrew works with those facing insolvency to help get them back on track before that day comes.
www.hwfisher.co.uk
47Generation SPRING 2013
featured in Dickens’ novel, Little Dorrit; Mr Dorrit spending some twenty years there until his debts were paid off through an inheritance. The effects of his father’s incarceration stayed with Dickens for the rest of his life and undoubtedly influenced his writing and his feelings for the poor.
Curiously amidst all this misery there were some open prisons where high flying bankrupts could have the finest wine, women and song provided. Quite literally. Sound familiar? Among these, the Fleet and the King’s Bench even allowed inmates to conduct business and occasionally live a short distance from the prison itself. Does anything change?
Even after the last debtor’s prison was closed there remained the work houses. Not specifically for bankrupts, but for those fallen on hard times; the regime had inmates up at 5.00am and to bed at 8.00pm. Women mainly did laundering services and men broke rocks, among other things. Almost as bad as going to
Illus
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experts
the history of bankruptcy where an individual, a debtor, owes his or her creditors money they can’t afford to pay, reads like a Hammer horror story.
“prison, and a form of punishment for being poor.
The workhouse system was abolished by The Local Government Act of 1929, taking effect in 1930. Many however continued to operate under the new guise of Public Assistance Institutions until The National Assistance Act of 1948 which finally did away with the Poor Law. Southwell workhouse, now a museum, was used for temporary accommodation for mothers and children until as recently as the early 1990s.
Things in regard to bankrupts began to change as early as 1914 with the Bankruptcy Act, and perhaps the most definitive legislation to date in the 1986 Insolvency Act. Since then there has been a raft of further legislation including the 2002 Enterprise Act, which among other things amended the term for bankrupts to just one year for the honest debtors, rising to up to fifteen years for the dishonest ones. But more of this in my next article.
48 Generation SPRING 2013
A Little Birdy Told Me...Social media has become an integral
part of the marketing strategy for
many family businesses. Our two
experts, anita Brightley-Hodges
from Family Business Place and
Sarah-Jane Watson, Farrer & Co
investigate the implications of
taking your business online.
anita There’s no disputing that the recent phenomenon of social media, namely Facebook, Twitter, LinkedIn, YouTube, Instagram, Google+ and Pinterest has transformed the way the world works.
Companies need to study their client’s buying behavior online and adapt their strategy appropriately. Can they build a loyalty to their brand through Facebook? Manage their reputation on Twitter? Network with prospects on LinkedIn?
Marketeers will tell you there’s no handbook for social media. It takes strategy, management and monitoring in order to adapt on an almost daily basis. Get caught snoozing and a dozen of your competitors will have already overtaken you and be speaking to your customers.
Whilst companies spend millions agonising over how to reach their audience online, the average Joe is oblivious and is more concerned with seeing their friends’ pictures from Saturday night, watching videos of a latest dance craze and stalking their favourite celebs.
Whilst for most of us this is harmless daily fun, for many involved in a family business, the impact of what they say and share online can have significant consequences. There is often a huge blur between the work and private life of someone at the helm of a family business. Sure, their PR team have probably told them that it’s great to get their name out there, raise their profile a little and let customers engage with them directly. But unless what they are saying is being monitored, this could cause all sorts of problems.
I recently started following someone on Twitter who runs a large family business manufacturing food. At first I was intrigued to see some behind the scenes photos of the factory, hear what he had to say about new regulations and gauge his opinion on trends in the market. But after a few weeks, I was ready to unfollow him. Many of his tweets were full of profanities, and shameless plugs, he was constantly attacking other brands, never replied to my questions and I had absolutely no interest in his weekly knees up with the boys.
A real shame, when his family business brand is one of family values, integrity and customer service.
But in a completely opposite example, I’m also connected with a tiny family company local to me who produce organic products for the home. In this instance, the business owner IS the brand.
Her updates are funny, useful, relevant and totally in line with the values she portrays for her business. I feel like I’ve really got to know her, her passion for the company and the organic market at large. When I asked her a question, she replied immediately and invited me down to her shop. So I popped in and bought my mother a beautiful hamper of products. When I got home, one of the bottles was damaged so I sent her a message on Twitter to ask if I could come in and buy another one. Instead, she had two more delivered to my home as an apology.
Here are two distinct examples of how social media platforms can be used. On one hand, it can do more damage than good. The food manufacturer clearly doesn’t have a PR team to manage what he is saying online. It also makes me think that he’s not a particularly pleasant man to work for and I have deliberately steered clear of his products in the supermarket. I wonder if he realises the consequences of what he’s saying in his 140 twitter characters?
On the other hand, social media can be an invaluable tool in engaging with customers, managing complaints and ultimately, making a sale. The organic lady is a great example of how to make social media an integral part of your business. If you make a plan, discuss with your team what message and values you want to portray, and ensure the whole business believes in it, you’re on to a winner.
experts
anita Brightley-Hodges,
Family Business Place
SpecialismMarketing & Social Media
ProfileAnita has spent the last 30 years helping business owners grow through strategic branding and marketing
www.familybusinessplace.com
Sarah-Jane Watson,
Farrer & Co
SpecialismEmployment law
ProfileSarah-Jane is an Associate advising employers and employees on a wide range of contentious and non-contentious employment matters
www.farrer.co.uk
49Generation SPRING 2013
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Sarah-JaneUsing social media for recruitment Not only are social media sites a useful forum on which to advertise job roles, they are also increasingly being used by businesses to obtain information on, or to vet potential candidates as part of the recruitment process.
Whilst there is no legislation prohibiting employers from considering information on a candidate’s social media profile when making a recruitment decision, there are issues that can arise from doing so.
Due to the extent of information available on social media sites, which could include details about a candidate’s sexual orientation, religion, marital status, or age, for example, employers could be at greater risk of discrimination claims by unsuccessful candidates (discrimination law applies to the recruitment process as well as to the employment relationship and the termination of the relationship). By way of example, a business cannot discriminate because of a candidate’s religion if it did not know the candidate’s religion but will lose this possible defence where it has come across such details when reviewing the candidate’s social media profile. To ensure you are in the best possible position to justify any recruitment decision then, it is important to ensure that recruitment decisions are based on objective criteria and to keep written records of the objective reasons for accepting, or rejecting each candidate.
negative comments by employees and damage to reputationA number of businesses now block employee access to social media sites in the workplace. However, this does not prevent an employee from posting comments about their employer, work, colleagues, or customers using a home computer or personal smart phone. Given the widespread audience such comments can be communicated to, they can have a negative impact on the business and can damage the business’ reputation.
There have been a number of cases recently where employees have decided to vent their anger/frustration/annoyance at their employer, their colleagues or their customers on social media sites. By way of example of just one such case, an employee posted comments on Facebook stating that she worked in a nursery“ and I do not mean working with plants”. This prompted a comment that suggested she worked “with a lot of planks,” to which the employee responded “2 true xx”. Unfortunately, two of the employee’s colleagues were also her Facebook “friends” and they reported her comments to their manager. The employee was suspended and disciplinary proceedings commenced. Despite apologising for her actions in writing, the employee was then dismissed on the basis that her comments could potentially damage the business’ reputation. The employee brought a claim
for unfair dismissal and the Tribunal found in her favour. The employer failed to put forward evidence that the employee’s comments had, or could have damaged the business’ reputation. The Tribunal also found that insufficient weight had been given to the employee’s unblemished employment record. Family businesses should consider implementing an IT or social media policy to inform employees of what is and is not acceptable in terms of the use of social media sites, and to clearly set out the ramifications of any breaches of such a policy. Where such a policy is in place, businesses will be in a much stronger position to take action. As stated, whilst disciplinary action may be appropriate in certain circumstances for breaches of such a policy, family businesses should be careful not to reach a snap judgement on the seriousness of the situation, before assessing whether any harm has actually been caused.
employer’s liability for actions of its employeesFamily businesses should be aware that they can be held vicariously liable for actions which constitute bullying, harassment or discrimination by their employees on social media sites, if they occur in the course of employment.
In a recent case, two members of staff used a colleague’s mobile phone to update his Facebook status to: “Finally came out of the closet. I am gay and proud”. The employer was found liable for the conduct of its employees which constituted sexual orientation harassment. This was because the comment was posted in the course of employment, during working hours and involved the company’s employees.
Unless an employer can show that it has taken all reasonable steps to prevent its employees from committing such actions, it will be liable for those acts even if they took place without the employer’s knowledge or approval.
It is therefore not only important to have an adequate IT or social media policy in place but also to communicate that policy to employees. Make sure you train and educate employees and managers on the rules contained within the policy and what the consequences of breaching those rules might be.
50 Generation SPRING 2013
The Final Frontier (the sale of the family jewels)Jo Haigh outlines the key factors a
family business owner might need to
consider when selling their business
due to a lack of suitable successors in
the family.
If you decide to go where others fear to tread, and if this road is one taken with purpose or due to pushes and pressure, it may help to know what monsters and angels you may face on this sometimes perilous journey.
Selling any business is not an easy exercise. Selling a family business brings with it substantially more issues.
First of all to tell you, how ever long you think it will take, it will take twice as long. Deal times from instruction of a corporate financier, if you decide to use one (and more of this later) to completion are now up to 12 months. An awful lot can happen in that period, good, bad and absolutely catastrophic as markets remain as volatile as Mount Etna.
Deals roll from pillar to post; tempers and tantrums, tears and smiles become the norm.
Oh and all the while you have your day job to do as it’s absolutely certain that the deal is not done until the money is in the bank (and even then it may be taken away from you).
Making a purposeful decision to sell as opposed to having no choice may seem a different route, but in fact the road map has quite a few similarities.
the starting pointNo heirs, no one willing to take over or no one suitable could force a sale, but equally poor or great performance may present opportunities or options that mean exit is the only route.
In my experience there are some key factors every business owner needs to consider when embarking on the sale of their family business -
experts
Jo Haigh, fds Corporate
Finance
SpecialismBuying/selling businesses
ProfileJo is a partner in fds Corporate Finance Services and specialises in putting together the right deal at the right time for growing businesses.
www.jo-haigh.com
action1) Check your shareholders agreement. Can you sell with or without all parties consent, and if you haven’t got the requisite votes what are you going to do?
2) Value. Do all parties agree on minimum figures, and do they understand the reality behind them, or are they delusional? Get professional guidance on this. You cannot second guess value. I have sold businesses where I have had offers ranging from £1m to £5m for the same company.
3) Who is going to do what in the process from an internal point of view, this is very distracting. Also you will be beauty parading to various buyers, you need your best “sales” people on show, and your best money man or woman. These may or may not be family members, think of it as selling a house, you need to present it in the best possible light and that means putting the toys and the dogs out of the way, and brewing the fresh coffee.
4) Get your house in order. Books, records, customer and employment contract sorted and get rid of, or at least be aware of, any nasties so you can be ready if challenged. One client, against all my advice, underplayed the final salary pension scheme issues. In due diligence this came back to haunt him as I said it would. In order to get the deal away, he had to accept a larger than needed chip to the price as the buyers threatened to walk, and there was nowhere else to go.
5) Be 1,000,000% certain you are committed to the sale at completion; this is going to feel very strange. You may feel guilty and hugely remorseful, certainly it’s not sold until it’s sold, but once pen is on paper on the sale and purchase agreement, it’s too late to reverse so have a plan for the new you and the new family.
Probably one of the most painful experiences I have had in the arena was with two brothers. They were second generation, with no heirs and a hugely successful company, they were approached by a large privately owned company with a life changing offer and so they set off on the sale process.
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One of their personal vital sales requisites was to sell to someone who they believed would carry on the legacy, and another family company fitted the criterion well.
Shortly before completion, the buyer announced they were subject to a takeover by a large multinational, and they would still like to carry out the transaction.
The brothers were faced with a terrible dilemma, 12 months of negotiations, and 2 weeks away from completion they had spent the money in their mind, bought the toys and gone off into the sunset.
They sold by the way, but I know for a fact it’s haunted them as their 60 year of business has been absorbed into oblivion. Something they tell me Mum and Dad never let them forget.
the processYes you can do this yourself, you can sell your own house and it’s got some similarities, but if you are busy now imagine doing another full time job because it’s exactly that.
If you take your eye off the ball at any point throughout this process and the deal falls through, you may not be able to go back to the same business you once loved and cared for.
action1) Get the best adviser you can, they may not have your industry experience but that’s not relevant. What is important is they understand your deal size and your family. You must like them, you are going to be spending a lot of time with them and you must listen to their advice. They have probably seen this 100 times before. Large corporates use it to score points and look good, and all with your inheritance, so you need someone who will fight your corner and come out with a good and fair deal. This is particularly important if you have to work an earn out to get the cash value you need, as they need to be the bad cop to your good one.
2) Keep a private life. You need to escape this as it will be full-on at times and it’s essential to keep a sense of balance. A sensible personal life is essential to maintain your sanity, so steer away from Sunday lunch table debates.
3) Have an essential list of no compromises, about 1/2 dozen items and no more. This will help you and your adviser steer the deal and cope with the inevitable brinksmanship.
One deal due to complete on 23rd December, hit trouble when the buyers announced at completion a desire to drop the purchase price by 15%. When asked why they had the audacity to say because they could!
They mistakenly had chosen their wrong adversary as my client had been well versed in this tactic, and we all folded our papers and walked from the room without a word.
Chased to the car park now nearly 3am in the morning, the buyers insisted on knowing what we were doing!
We all left and I can tell you we all had a very poor Christmas.
Sure enough early January the deal was back on and completed, but it was the clients fortitude and their aide-mémoire that gave them the confidence to stand firm.
CompletionWhatever date you were given it will never happen. The corporate finance calendar is not the lunar one rather the loony one, August and December, little if nothing happens. Remember if anyone can ruin a great commercial deal it will be the lawyers, so keep them on a short lead!
action1) If it’s a cash out deal you may still need to do a perfunctory hand over, and it’s going to feel very strange going back into the business even for a short time. Be prepared and then get away as soon as possible.
2) If it’s an earn out, every day will be hell by and large (I am not one to mix my words here). I have yet to meet anyone who enjoyed this and it will be the little things that get you; the change of brand, the change of long term suppliers and advisers etc. Stand back, concentrate on the end game and make sure this process is as short as possible.
3) Have another life planned, you may not believe it but you will soon get bored with the lotus eating life if you have been used to manic. Most people last a year at most!
So I hope this has given you a small insight into the pros and cons when selling a family business. Be cautious, not scared and remember that he who cares is likely to win.
T: +44 (0)20 7437 5050www.boodles.com
T: +44 (0)20 7437 5050www.boodles.com
54 Generation SPRING 2013
A Welcome Reliefalex McKellar from Portal Tax
Claims explains how many
entrepreneurs aren’t completely
aware of the windfall they can get
from the taxman through capital
allowances.
Capital allowances – a tax break available for businesses investing in plant and machinery – will be familiar to many entrepreneurs up and down the country. However, very few appreciate the full extent of the tax relief they are entitled to. Research published by HMRC earlier this year suggests that very few family businesses understand the correct process for claiming relief, even for commonly understood items such as computers or furniture for the office, under the capital allowances rules.
However, the opportunity extends much further than that and the benefits for businesses that claim to the full extent allowable can be significant. So why do allowances so often go unclaimed and how do you ensure that your company is not missing out on valuable tax relief?
Capital allowances generally arise from capital expenditure on purchasing or building commercial property, refurbishments and extensions to a property or investment in plant and
machinery for the business. It is in relation to ‘plant and machinery fixtures’ installed within their commercial property that businesses routinely miss out on tax relief as most simply do not appreciate the breadth of what could be claimed on. In general, plant refers to “apparatus used for carrying on a business” and a huge
range of items from air-conditioning equipment and generators to alarms and lighting systems can fall into this category. Case law demonstrates that even items such as paintings or sculptures displayed in communal areas and forming part of the ambience drawing customers in can be considered as plant when used for business purposes.
In one case we recently handled at Portal Tax Claims, a business running a hotel which was purchased for £748,800 was able to demonstrate £301,667 in capital allowances that were then used to make a claim against their taxable profits. Typically, capital allowances of around 30% or more of the purchase price of your commercial property can be realised, depending on the type of business – a welcome helping hand from that unlikely benefactor HM Revenue & Customs.
In the majority of cases, providing you have made a profit in the previous 2 years, a company will receive a lump sum of any tax rebate they are due from claiming the capital allowances. This allows you to invest back into the business.
experts
alex McKellar,
Portal tax Claims
SpecialismCapital allowance
ProfileAlex specialises in helping business owners get tax relief through capital allowances.
www.portaltaxclaims.com
typically, capital allowances of around 30% or more of the purchase price of your commercial property can be realised, depending on the type of business
“ “
1 Seek specialist advice - Many business owners simply rely on their accountant to deal with any tax related issues but sometimes specialist expertise in a particular area is needed on top of that. Capital allowances are one such point, plagued by grey areas of case law and legislation and needing specialist involvement.
2 Don’t forget about improvements - If you are upgrading your property then remember that the cost of upgrades can be offset against your profits over the period.
3 Services can count as qualifying expenditure - Invoices from electricians, architects and other professionals relating to refurbishment work or construction of a new building should also be considered when filing a capital allowances claim.
our top 5 tips for managing your capital allowances claim
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4 raise capital allowances if you are buying a new building - If a commercial property you are about to buy has already had allowances claimed against its fixtures and fittings then you may be able to negotiate the price down. Likewise, if it hasn’t then factor in that a detailed claim can provide you with a real cashflow boost when tax relief is granted.
5 act sooner rather than later - If you wish to take advantage of the allowances, you should act fast. The new legislation being phased in will make it a requirement to act at the time of sale and in the meantime inflation could be reducing the value of the claim you could make as it is based on the property’s purchase price at the time –
not its current value.
We are a Family Firm that stimulates ideas and dialogue for family businessesTalk to us about how we can help you create success for the next generation.
Throughout the UK there is growing recognition of the contribution that family businesses make to the national and global economy, in terms of employment,
revenue generation and support for the community at large. By continually striving to offer more, and better, to the family business community, our goal is to become THE leading resource for current and future generations of family businesses.
Meet the Firm
Succession is a critical issue for family businessesIs it ready to be handed on? Does it need to evolve to reflect changing markets? Does it match the aspirations of the next generation?
Whatever business is being passed on, it needs to feel comfortable with the way it looks, confident in the way it acts, and happy that its heritage and personality shine through at every customer touchpoint, from brochure to web, exhibition to advertising.
Values are shorthand for everything your family business stands forThese come in all shapes and sizes, ranging from trust, loyalty and honesty, to integrity, stability and good old fashioned hard work. Our skill lies in understanding family values and inherent characteristics and turning them into competitive advantage.
We understand the strengths of family businesses:• Blood ties• Unsociable hours to get the job done, often for free• In tough economic times, they plan and maintain
the long-term view• Cautious in their approach to business and change
Talk to us about how we can help you create success for the next generation and call Anita Brightley-Hodges on 01732 220120 or email [email protected]
www.familybusinessplace.com
Family business focussed• Decisions are made with family wellbeing
constantly in mind• Often at the heart of the local community and
a force for good.
Many family businesses have lost sight of their origin and values due to:• Ebb and flow of time• Tougher trading conditions• New technologies, systems and processes• Changing customer and market needs• Shifting consumer attitudes• New management who are not family members.
At Family Business Place, we can help family businesses distil and prioritise what’s important; provide insights and inspiration; and reflect and communicate our findings internally and externally, with clarity and conviction.
Our services include:Consultancy: Succession Planning, Governance, Non Family Execs, Family Conflict, Mentoring, Philanthropy
Strategy: Marketing, Sales, Branding, Internal Communications, PR, Social Media, Web
Event management: Family Ties Annual Conference, Red Ribbon Awards, Seminars, Business Celebrations
Publishing: Generation Magazine, www.familybusinessplace.com, Newsletters and Magazines. Books: Family Constitution, Autobiography, Family History, Business Anniversary.
At Family Business Place we create opportunities for family businesses to share stories, publicise achievements, engage with professional advisors and create a network of contacts with similar needs, issues, frustrations and experiences. We embrace all types of family businesses, from Morgan Cars and Warburtons to JCB and Specsavers. You can be a husband and wife start up or a multigeneration success.
had strayed from the motivations of its Quaker forefathers.
Some family run businesses are of a size where they don’t feel they need to provide guidance about their values in a formal code of ethics. They believe that their employees know ‘how business is done around here’ without it having to be written down. Even when codes are not formally expressed, family business owners assume their values are known within the family and business.
But codes of ethics help define and preserve a family’s core values across generations and during their expansion. Setting down the foundations of how you do business in a way which can be referred to by future generations, or by a member of staff who has never met you, can protect, not just the sustainability of the business, but also its reputation. A famous example is one from the 1980s.
Passing on your values Simon Webley explores how a
family business’s founding values
and ethics can sometimes be lost
following growth and expansion.
At a recent discussion event at the Institute of Business Ethics (IBE) on the subject of ethics and the City, someone said that family owned and run businesses had a much better record regarding integrity than larger publically owned organisations. I do not know where their data came from, but it is a universal assumption that family businesses could teach the larger companies a thing or two about integrity!
Ask anyone who works for a family business about its values and most will say that they tend to be people-oriented with an emphasis on collectivity, rather than individuality (the good of the business, rather than personal bonuses). By their very nature, those that run family businesses are likely to take a long-term view, with a deeply felt sense of stewardship, borne out of a responsibility to both the family and the community in which the business operates.
These values hold true for those businesses which are still small enough for the family to have a strong influence over day-to-day decisions and recruitment. If you know every staff member in your firm, and consider them ‘part of the family’, the chances are that those employees share your values; just like you, they want what’s best for your company and your customers. You have, after all, employed them because you recognise that attitude in them. But this hands-on approach to recruitment cannot last forever. As companies grow, or as family businesses get passed down the generations, a chasm can develop between the original founding values and how business is actually done.
Consider Bob Diamond, former CEO of Barclays – when questioned, he was unable to say what Barclays founding values were - honesty, integrity, plain dealing - an example of how far the bank
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58 Generation SPRING 2013
Simon Webley, institute of Business ethics
SpecialismEthics in business
ProfileSimon is Research Director at the Institute of Business Ethics and helps a range of businesses with ethics in their organisations.
www.ibe.org.uk
Family-business owners may not be able to manage ‘beyond the grave’, but they can pass on a legacy of core ethical values of which to be proud.
““
The Johnson & Johnson family had established their Credo – a code of ethics which set out the company’s responsibilities, the first of which was to “the doctors, nurses and patients, to mothers and fathers and all others who use our products and services”. A crisis occurred when some bottles of one of their brand pain relievers, Tylenol, in a store in Illinois, was found to have been poisoned. In an age before mobile phones, the senior management were on a plane somewhere in the middle of the Atlantic and could not be contacted. Staff used the Credo to help them make the decision to recall the product throughout the State. The decision was a right one, not only because it saved lives, but it also substantiated Johnson & Johnson’s reputation for integrity. Organisations with an undefined ethical culture may have a different notion of the ‘right’ way to respond. For example, they may wait for legal advice instead of taking the initiative,
ethics trainees!). These days, E-learning can offer a simple but effective way to introduce the topic and start internal discussions about ethical issues and ‘how business is done’.*
Establishing and embedding core values and a code of ethics is one part of creating a sustainable family-run company. It will help to create workplaces where employees feel safe and comfortable to question and challenge decisions, and if necessary, accept that by adhering to
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59Generation SPRING 2013
or deny any allegations, with potentially disastrous effects for both the wider public and the company itself.
Once the company’s values have been articulated, it is equally important to ensure they are communicated. Offering training in how to solve ethical dilemmas can help, not only by giving practical tools, but also in sensitising staff to issues which may arise. This needn’t be complex, or take up hours of time better spent working (a common complaint amongst business
the core values it might mean foregoing profitable business. Although family business owners may not be able to manage their firm from ‘beyond the grave’, they can pass on a legacy of core ethical values to the next generation of which they can be proud.
*The IBE’s E-Learning Tool Understanding Business Ethics is available as a CD-Rom or download in English, French, German & Spanish from £10 from: www.ibe.org.uk
honesty, integrity plain dealing, values
people-oriented community, collectivity
legacy, values
GIVE BACKAs family businesses become more successful, some feel compelled to find a way to help make their local communities and the world a better place, either through charitable giving, projects or giving circles.
We can help design and produce publications that showcase good giving and help you to:
Identify your philanthropic purpose • Design a brand to encapsulate your purpose, • commitment, values, vision and actions Produce a tailored and beautifully crafted book, •
diary or website
“Be the change you want to see in the world”Mahatma Gandhi
For further information visit www.familyconstitution.co.uk /philanthropy
For a private consultation call Anita on 07815 497417 or email [email protected]
For further information visitwww.familyconstitution.co.uk/philanthropy
For a private consultation callAnita on 01732 220120 or [email protected]
prosperity
61Generation SPRING 2013
rupert Phelps, BnY Mellon
SpecialismPrivate wealth and Family Office
ProfileRupert is responsible for developing relationships with family offices and their advisors in the UK and EMEA region.
www.bnymellon.com
Closely Held, Closely Kept As family businesses grow, it can
often be difficult to decide how
ownership of that business is
managed. rupert Phelps explores
the options available.
How should families own their stakes in companies? The Mellon family’s historic approach to this question as to the holding and nurturing of companies was widely known as the “Mellon System”¹, and was very focussed on what would now be termed governance, both in the sense of corporate and family.
A central component of this system was the retention of “closely held” companies: “closed” corporations in which the shares of stock are not publicly traded, but rather are held by a small group of people, often of the same family. Stock is therefore unavailable to outsiders, though in some situations, minority shares may be available to external investors. Such firms are, by their nature, resilient against hostile takeovers and proxy wars, but whilst they tend to be more stable (because their share prices are not determined by investment decisions but by the value of the company itself), they are restricted in not having access to as much working capital as listed corporations who have access to their wider shareholder base.
The approach which Andrew Mellon (AWM) and his brother Richard took to nurturing and developing these nascent companies was a consistent and coherent system. The brothers sought out business partners and investors who they were content to finance whilst allowing them to manage the daily affairs of the business. They never sought fast profits or high dividends, being committed to nurturing companies to prosperity, and once profitable, would reinvest profits back in. Profits were only sometimes distributed to shareholders through stock dividends. It was the principle of rejecting quick speculative success and devoting efforts to “make something grow”².
The Mellons’ disdain for reckless speculators was reinforced in the Crash of 1929 when the people who suffered the worst were those who had sought paper profits rather than nurtured real companies. Since the majority of AWM’s holdings were, in the great, family companies his own finances were insulated from much of the effects, and he continued to prosper (the book value of his assets actually rising by the end of 1929). AWM became one of the richest three people of his day³ in the United States, and so the Mellon System of closely held companies created a substantial legacy, both in terms of financial assets and cultural considerations. This approach had been begun by AWM’s father, Judge Thomas Mellon, founding the first single family office in American history4 the year before the progenitor of Mellon Financial Corporation was established in Pittsburgh in 1869. BNY Mellon, as it is today, builds on, and continues this knowing tradition of long term service to family offices.
The Mellon’s usage of closely held companies to act as vehicles to grow and store value was remarkable and effective in its prime years between the two World Wars. Two recent examples offer a modern slant to these observations about such company structures. The 2011 $2bn purchase of Facebook arranged by Goldman Sachs, highlighted a small but significant shift in the US capital markets of a tendency for privately held technology companies (and their owners) to sell equity to outside investors, whilst staying private5. The attractions of retaining a closely held company remain potentially strong, despite the challenges to that aim created by the capital requirements to generate growth. Similarly, the flotation of BTG Pactual in April 2012 valued André Esteve’s stake at up to $5bn, but he and his partners will not use the IPO to cash out of the company6. After the listing, the partners will only trade shares among themselves and not sell them on the public market. The legacy of closely held stakes is relevant and continues to live on. One can only ponder how Andrew Mellon might have applied his financial sagacity and approach to ownership to current investment opportunities in technology and finance.
Footnotes:
1. Used frequently in David Cannadine’s ‘Andrew Mellon’ (2006)
2. David Cannadine’s ‘Andrew Mellon’ (2006) Chapter 3
3. Time Magazine 2nd July 19234. Gregory Curtis, Greycourt White
Paper No.10 (2001)5. Financial Times 5th January 2012
6. Financial Times 6th April 2012
GIVE BACKAs family businesses become more successful, some feel compelled to find a way to help make their local communities and the world a better place, either through charitable giving, projects or giving circles.
We can help design and produce publications that showcase good giving and help you to:
Identify your philanthropic purpose • Design a brand to encapsulate your purpose, • commitment, values, vision and actions Produce a tailored and beautifully crafted book, •
diary or website
“Be the change you want to see in the world”Mahatma Gandhi
For further information visit www.familyconstitution.co.uk /philanthropy
For a private consultation call Anita on 07815 497417 or email [email protected]
The family will receive:• A regular update as the well is being
built via Fields of Life website• An invitation to see the digging of their
well and meet the villagers who now have hope
• Progress updates on next steps i.e farming, schools, medical attention, jobs
It’s a win win; for the poorest folk in Uganda to have their basic human needs met and for family businesses to reach out and do something practical, see immediate results they can be proud to share with their family and employees alike.
WellGood – it’s a family business thing.
DavidThose of you who know me, will be aware of my love/hate relationship with Africa. I have been going backwards and forwards to East Africa since the early 1990’s, yet over a period of 20 years, very little has changed. I love the people with their warm smiles and big hearts but I hate the poverty and death that every rural family endures. Indeed, the people seem to get poorer and hundreds of thousands of children still die every year before they reach the age of five, because of water borne diseases.
WellGood – it’s a family business thingAs individual businesses it can be
hard for family-run companies to
feel like they are having an impact
with their charitable giving. But as a
sector, family firms have the chance
to do something totally amazing.
With success comes great responsibility. And at Family Business Place it’s our dream that each and every family business in the UK will step up to the plate and sponsor a drinking well for those living in extreme poverty in East Africa.
The WellGood campaign from My Ten Days will galvanise the family business sector and, by working as a community, we will create a united wave of desperately-needed support for those in need.
AnitaOne fine day in April I got an email from my chum David Philipott ‘Going to Uganda for a long weekend - do you wanna come?’
The experience changed my life. Together with eight other business owners and Fields of Life, we set about thinking about how we could individually or collectively make a difference. The challenge is so huge and what could I do? Little old me? Then a light bulb moment...WellGood is born!
The cost of a single bore hole well is just £3,500 and brings much needed clean water to 2,000 villagers who currently have to walk 2km each way to fill a single bucket! I want to spread the word to everyone in our family business community to step up to the plate and adopt a well. Simples.
Our partner charity, Fields of Life, will identify a region for a well to be sponsored by a family business through the WellGood scheme. The family business will then see a branded plaque on the well as a link for life.
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62 GenerAtion SPRING 2013
Anita Brightley-Hodges,
Family Business Place and
Founder of My ten Days
ProfileAnita knows that family businesses are inherently generous when it comes to charitable giving. She hopes that one day, every single one will sponsor a drinking well and change the lives of those in need.
www.mytendays.org
David Philpott,
Fields of Life
ProfileAn unrelenting ambassador of philanthropy amongst the business sector, David is the driving force behind UK businesses getting involved with the incredible work of Fields of Life.
www.fieldsoflife.org
wellgood
Headen & Quarmby
Downers Design
Rock Choir
Go Ape
John Jones
1 days
The WellGood campaign
from My ten Days - charitable
partner of Family Business Place
www.mytendays.org
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So why bother I hear you ask?Because no matter how big the challenge is and how depressing the statistics are, tens of thousands of people are having their lives changed for the better every day. And also, because no organisation I know is making more of an impact than Fields of Life.
Over the past 20 years, this small charity has built over 100 schools that are now providing quality education. And because of the wells they dig, the charity brings clean drinking water to a quarter of a million people every day.
The best hope for Africa is if we can educate a generation of leaders who will
change things in their country themselves. Only then will all the aid agencies be able to pull out. Indeed, there are already promising signs. The first bush children that attended the first ever Fields of Life school, are now going on to university and into careers that will allow them to influence government, health, education, finance and other aspects of public life in the future.
We will be building our new school in Lira, Northern Uganda. This is an area that was until a few years ago, terrorised by Joseph Kony (the world’s most wanted man) and his so-called Lord’s Resistance Army. Boy soldiers were conscripted into
his mercenary army and young girls forced into prostitution. Entire villages were rounded up into concentration camps. When I spoke to the villagers recently at a place called Acede, the oldest man in the group, told me that they still feared that Kony would come back and take their children away again. We want to show them by our actions, that this will not happen and one way we can do this, is by building a school, sinking wells and bringing a sense of normality to their broken lives. Now is your chance, get involved with the WellGood campaign.
www.mytendays.org
wellgood
Headen & Quarmby
Downers Design
Rock Choir
Go Ape
John Jones
1 days
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66 Generation SPRING 2013
The Parable of an AddictSteve rosenbaum explores the
relationship between parent and child
working together in a family business.
“I really don’t care what you think. Just do what you are told,” he said talking as he poked his nose and looked down from below his spectacles. My father spoke in a calm and monotone voice and he meant every word he said. “Defer to me. Do you get it? You have been provided for but you need to listen to what I am telling you.” The words, “you need to” stuck in my ears and kept whirling around my brain. He had a knack of forcing his will onto his family and suffocating them. It was both spiteful and crushing. It’s difficult to explain why I found this imposition of his ideas and passions so stifling and unbearable. I was 23 and had been working in the family business for over three years and we were having one of those chats again. It, or rather my father, or was it the family business were pushing me somewhere I did not want to be and slowly killing my spirit, my individuality. I had so many different ideas how we could make changes in the business which would make us happier, more profitable and stop the constant feuding with my older brother Alex, but, as the new kid on the block, I had no power and no voice. He continued, “I find these conversations very upsetting. I would never have challenged my father the way you do. I do not want to be stressed at my stage in life and I will do whatever is required to avoid these confrontations in the future.” He offered a veiled threat but I could not be sure exactly what that entailed. My crime had been to suggest that we should look at alternative markets to sell new products as our sales figures had recently taken a slight decline. My father loved to speak in metaphors. “This is Selfridges and we sell ties. If you want to sell bras, go to another shop.” What was that supposed to mean? I thought Selfridges sold ties and bras. He would take it in turn to unleash onto each of his sons over time and somehow this
had created a friction between Alex and I, although I held no grudge towards my elder brother. I could see my whole life and career ahead of me. I would keep quiet and do what I was told. I would eventually marry my some poor girl, have children, lose my hair at 40 and eventually, when my father died at the age of 100, Alex and I would inherit the business. I sighed heavily. My family knew nothing of my secret gambling life and I could feel the noose around my neck slowly tightening. These conversations created a feeling of anxiety and worthlessness that had affected me deeply both mentally and even physically for many years. Was the blueprint for my life set? How compliant would I need to be in order to have close familial relationships with dad and Alex? The depths of my despair, my continuous frustration and ebbing self esteem were my secret burden that I kept buried deep in my heart and I knew that my gambling activities would inevitably surface and all my feelings and my world would come crashing down.
Let’s go back though, way back to my adolescent years and try and trace how I had become a gambler, no, more than that – an addicted gambler.
I have fond memories of watching the Grand National with my father every year from the age of 10. It was so thrilling cheering on our own selections and going with dad to collect his winnings. Sometimes we would pick horses based on their names and other times depending on who the jockey was or the trainer. The big screens in the bookmakers, the bright colours of the rider’s outfits, the graceful, beautiful and brave horses and all those folk huddled around the screen standing and cheering the race. It all seemed so exciting. A few years later I had discovered fruit machines and I recall quite vividly the time, at the tender age of 13, I gambled my bus fare home and had to walk 5 miles home in the rain. I had never discussed this with anyone and I was quite ashamed of my strange behaviour. By 15 I was playing and mastering the art of poker with my friends. I would spend hours winning all their coins with cunning play and bluff, only to give them all back at the end of the night as I wanted to keep playing with them. I wanted the “action” gambling was providing me. By 18, I was a regular at
prosperity special
Steve rosenbaum
Independent Family Business Consultant 07966 018 043
Profile
Steve works closely with business families to ensure growth and security for future generations. After many years of research around addiction in the family business, Steve chronicles his findings.
67Generation SPRING 2013
the local bookies and most of the London casinos although my salary from working in the family business was below average. I would spend most of my lunch hours in bookmakers and that equated to over 80% of my earnings. One weekend aged 19, I crept into my parent’s room where I found my father’s wallet lying next to his side of the bed. I took great care to make sure no one would see me and took two £20 notes without asking. My father did not seem to notice although I still felt awful afterwards but a few days later my memory had cast aside this anomaly event. This would not be the only time I stole money from my parents. I started to lose some of my friends in my early twenties as their going out activities interfered with my interest in gambling. As much as anything I could not afford it when they were going down the pub or to a nightclub.
What gave rise to these impulses? What was my motivation to gamble? Clearly the time and energy I was dedicating to gambling was not “normal” yet how had the tentacles of addiction crept into my life? On the surface, in my private life my childhood had been full of privilege and the trappings of success. We lived in a large comfortable Victorian house in Chelsea and I had enjoyed private education. I had a functional relationship with Alex although we constantly were at each other’s throats trying to beat each other at sport and vie for our parents love and attention. If you would dig a little deeper, all was not what it appeared at home. Mum and Dad lived a loveless and resentful marriage although we never
knew this until our twenties but you could feel the chill and lack of warmth in the family home. My father was consumed with the family business and as he spent more time there, he detached himself from fun, small talk and his family. The lively man that my mother had fallen in love with all that time ago had changed. He was a controlling, penny pinching but highly motivated businessman. There was a cruel and nasty streak in him that all the family feared and his behaviour was increasingly correlated to how successful the business was faring. When turnover fell, he was subject to terrible fits of depression and mood swings. He would be stinging in his criticism and sometimes physically menacing although he never hit me. Fortunately, he was seldom at home. When we did finally spend time together, he was unnecessarily strict, a lecturing bore and had huge weighty and unrealistic expectations on Alex and I. Mum tried to make up for this gaping hole in all our lives and now I am an adult I can see how she overcompensated by indulging us with treats, constantly pampering us and smothering us with food, cuddles, pets, toys, holidays and many more things when all we simply wanted was time with our parents and their unconditional love. The riches that surrounded my childhood, seemed to mock me, as the disparity between how my life must have appeared to outsiders looking in and the pain that filled my heart every night when I would go to sleep. Wealth promised so much but even that could not compensate for what was truly missing in my life. For years
prosperity special
I suffered in silence this conspiracy of neglect by my parents.
What I am saying is that my automatic responses as a child, teenager and later as an adult were based on impulses and restraints which had their own motivations rooted in my conscious and unconscious experience of living in a certain life where I learned my parents version of what was good and bad. My parents bought me my first car, a Porsche 911, aged 17 without me contributing a penny. That seemed good. When the business almost went into bankruptcy in 1986, my parents would have screaming arguments. I remember my mother picking up a knife in the kitchen and threatening to stab my father to death. That was definitely bad. The complex system of rights and wrongs and the values of my parents slowly and surely seeped into my life and I did my best to decode what crumbs of happiness and higher moral principles were on offer. My motives and impulses were forming and being derived from generalised emotional states of, for example, stability, happiness, sadness and excitement. At the same time I was subconsciously forming my sense of what it felt to like and dislike different situations and people. This process of learning by association was giving rise to my way to evaluate and interact with others. This period in my life seeded impulses, urges and a value and belief system that has led to actions some of which I am rather ashamed of, after years of eventful family history and repetition.
Continued in next issue.
67
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69Generation SPRING 2013
ten
Plan your attack. Don’t jump in feet first without a strategy. It’s easy to get carried away without any real goals which will just end up in you wasting your time.
online won’t replace offline. People still like to do business face to face but social media is a great support tool and can reinforce your message.
123
456
78 910
10Family businesses are often shy when it comes
to promoting themselves online. the team at
Family Business Place talk through ten easy
steps to getting started with online social media.
Decide why you want to use social media. To promote a product? To get customers into your shop? To raise brand awareness? Define your goals before you start. Define your audience. Are you talking to
other businesses? Consumers? What demographics do you want to target?
Where does your audience hang out? Facebook isn’t just for teens, Twitter is a great way to talk to the press, Pinterest is really useful for people planning a wedding. Find out what platforms your audience use.
What are you going to say? Be useful, be the place they come to for the latest news in your sector, provide interesting and compelling content. No more than 1 in 10 updates should be promotional.
Pace yourself. It’s easy to launch with 10 videos on YouTube, 20 tweets a day and 10 Facebook updates. But is it sustainable? Better to do fewer things regularly than lots of sporadic efforts.
involve the whole business. Your content will be far more interesting if you get opinions from other members of your team and even customers and suppliers. What do they think is a hot topic?
Be part of the conversation. It’s called ‘social’ for a reason – make sure you engage with people, reply when someone contacts you and don’t rely on auto-responders.
Deal with complaints, don’t just ignore them. Social media can leave you open to angry customers but tackle them head on. It will also make you look at where you went wrong in the first place.
www.familybusinessplace.com
70 Generation SPRING 2013
i am the Financial Director of a family run business that employs approximately 150 people. i have been made aware that the
company will need to provide our employees with a workplace pension soon but i’m not sure when or what to do?
The Government has introduced legislation that means every employer will have a duty to put a pension scheme in place. You’ll also
have to automatically enrol certain workers into the scheme and make contributions on their behalf. It is particularly pressing as the staging date for companies with 150 employees on the payroll is May 2014.
There are strict guidelines for informing the Pensions Regulator and the employees that you have met all of your duties as an employer. You are responsible for providing:
1. Information to eligible jobholders: They should be told that they are being automatically enrolled, given information about the scheme. They should also be told that they have the option to opt out.
2. Information to the pension provider: You need to ensure that the necessary personal information for each eligible jobholder is passed on within one month of each person’s automatic enrolment date.
3. Information to the Pensions Regulator: You need to inform the Pensions Regulator what the company has done in order to comply with the duties within two months of the staging date. You should tell them about the company, the chosen pension scheme, the number of people who have been automatically enrolled, about who has postponed their enrolment; and who isn’t eligible for automatic enrolment.
www.foxgroveassociates.co.uk
Q
a
Graham KeepenPartner
Foxgrove associates
Specialism: Independent Financial Advice
panel
T H E P RO F E S S I O N A L SWhether it be legal, financial, sales or marketing, our experts are here to guide you and your family business in the right direction.
We are a family business who manufacture luxury goods and are re-launching our website. Can i take
photos of the products myself or should i commission a photographer?
The answer to this question is one of those age-old sayings; you get what you pay for. In this day and age, everyone is a
photographer. Decent digital SLR cameras are more affordable than ever, cameras in phones come as standard now, and apps like Instagram can make even the most average photo look cool.
However, if you are trying to sell luxury products at thousands of pounds, a fuzzy picture from your camera phone just isn’t going to cut it. A good, professional photographer will be able to really do your products justice, highlight the craftsmanship and quality of the materials. They will also have experience in art direction, setting up scenes, and really showcasing your products to their very best.
And lets not forget that they will be able to work with you after the photos have been taken to crop the images, photoshop any imperfection, add effects and any other post-production work you need doing. They will make sure that the photos
you get fit perfectly with your new website and your brand as a whole.
They can also then be applied to adverts, social media icons,
marketing brochures, catalogues etc.
www.rgbdigital.co.uk
Q
a
Jeremy BaileManaging Director
rGB Digital
Specialism: Photography
If you would like to be
a part of the panel,
please email the Editor:
for more information
71Generation SPRING 2013
panel
What is HMrC’s new real time information about? and what do i need to do to comply?
A major change in payroll is set to hit UK businesses. Real Time Information (RTI) represents the biggest change in payroll since
the introduction of Pay As You Earn (PAYE) in 1944.All companies with up to 5,000 employees will need to start making RTI submissions from April 2013, with larger employers needing to comply by October 2013.
RTI is a new system for reporting tax, NI and other details to HMRC. As an employer you will be responsible for all tax deductions and calculations but instead of submitting this data once a year to HMRC (forms P35 or P14s), you will be required to send the figures at the same time as payment is made to your employees i.e. in ‘real time’.
How does my company best prepare for rti?The first step should be to check that all employee records held on your payroll are both complete and accurate. All information should then be verified before submission using the following sources: Passport document, Driving licence, Birth certificate, HMRC documentation, Department for Work and Pensions records.
What information needs to be submitted to HMrC?• Data that needs to be submitted when
employee is paid includes:• Employee name• Date of birth• National Insurance number• Employee address detailsThis information will be required for submission for all employees including temporary and casual workers and employees paid below the national insurance lower earnings limit.
www.wellersaccountants.co.uk
Q
a
norma StewartPartner
Wellers
Specialism: Finance & Tax
My family is celebrating 200 years next year. i want to do a Family Constitution but not sure what it involves?
Putting together a Family Constitution is something which needs to happen over time. Some families take six months, some take
two years, for others it’s an ongoing process. Essentially, a Family Constitution is your promise to the family and the business. It’s a confidential document that outlines the family’s vision and aspirations along with an agreement on the ownership and management of the family business.
Topics commonly covered include:
• Vision• FamilyCouncil• Leadership• Succession• Employmentoffamilymembers• Codeofconduct• Pay&Remuneration• Shareholders• Philanthropy
You will need to speak to each member of the family individually and explain the process. Each person sits with the facilitator and gives their viewpoint in an honest and confidential manner. A meeting with everyone then tackles any disagreements and items which need more consideration.
A draft constitution is drawn up. This is a working document which is amended until everyone is in agreement with how things should be. At Family Business Place, we create a beautiful Family Constitution Book for each member of the family to take away, refer to, and treasure.
www.familyconstitutionbook.co.uk
Q
a
anita Brightley-HodgesManaging Director
Family Business Place
Specialism: PR and Marketing
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It’s Your Right To Be WrongWorking with various athletes, peak performers, and entrepreneurs, Elliot saw that there are so many individuals out there who have big goals, big visions and big dreams, but they simply cannot move forward and achieve them. Their biggest obstacle is making mistakes. It isn’t necessarily the mistake itself but the fear of making the actual mistake.
However, The Coach with the Hat believes that making mistakes is an absolute MUST if you are to move ahead and achieve the end results you desire. The book teaches people the importance of mistakes, letting them occur in your journey and how they can actually be good for you. The book will teach anyone the benefits of taking calculated risks and how they can actually help you positively. ‘It’s Your Right to be Wrong’ is a powerfully written story of Elliot’s amazing journey, combined with observations and simple, effective lessons. It will help you move to another level in your life, and you will know after reading this book just how possible any goal really is. It offers simple lessons on how to silence your doubts, focus on your goals, and get the results you want.
Written by Elliot Kay Available at http://tinyurl.com/elliotkaybookReviewed by Anita Brightley-Hodges
Life’s Great Adventure How to categorise this book? Part autobiography, part life coaching, part instruction manual; other descriptions would be amazing, absorbing and challenging.
Through his honesty and passion it is easy to follow the ‘big lesson’ Deri introduces us to, that life is an adventure to be enjoyed or suffered. Deri quite reasonably proposes the former, providing tools in the form of exercises, thinking and thoughts we can develop, to enjoy ‘Life’s Great Adventure’.
As a personal development guide or an adventurer’s tale, this book is an engaging read - the combination of the two is possibly ideal. By explaining where and how he met the challenge and the lessons learnt during his gruelling adventures, provides an impetus to work through the exercises in the book.
Whilst I have not rushed out and signed up for a marathon, it is on my list. Deri has encouraged me to start, along with a few other thoughts and ideas I have neglected without realising.
Written by Deri ap John Llewellyn-Davies. Available at amazon.comReviewed by David Hutchinson
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73GeneRATIon SPRING 2013
74 Generation spring 2013
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76 Generation spring 2013
Was joining the family business always your plan?it was always the plan of my parents that i should inherit, although there was a choice not to take over. But i do believe that even they knew i wouldn’t turn it down being the 6th generation of direct descendants to take on the mantle.
What values have you learnt from working with family?patience, understanding and diplomacy, as well as the ability to listen to my mother who has had 70 years living at glanusk, on a day to day basis. The problems are the same as they were 50 years ago only in some cases the consequences of getting things wrong these days can lead to you ending up in the dock
What’s the best bit about working with family? in real terms i deal with my mother, but day to day issues are firmly with me and iona (my wife). One of my sisters and my brother live on the estate still and they do cast an eye over what is going on.
and the worst?Knowing the changes you are making are in some cases very unpopular with your siblings and mother. Actions can linger and simmer unless nipped in the bud quickly.
How do you spend your free time?What free time!!!?? Any spare opportunity is enjoying what we have here with iona, Lochy and serena. A picnic by the river or up the mountain, fishing, making camps, planting trees or clearing up branches around the park. going for rides on the ponies with the children much as i did with my mother and father.
24What would you advise someone joining their family firm?Have the role and responsibilities etched in stone so there is no issue of what you should have done, haven’t done or will do in the future. You need to earn everyone’s respect, which takes time.
Who inspires you?Warren Buffet for his foresight, sir richard Branson for his tenacity against all odds and ‘can do’ attitude, sir James Dyson for his innovation and general The Lord guthrie for his integrity.
Does money motivate you?Yes, without it the infrastructure and fabric will fall apart and its needed to grow the business. ’i would also like some to complete parts of ‘my bucket list’
Describe your typical day in the family business no one day is ever the same. The events business, general estates matters, document storage company, security company, Welsh government board position, river Association, Wales polo team all need time dedicated to them!
0730 - Woken for the school run0900 - Morning briefings for the day1200 - Lunchtime walk around park1400 - 1800 - Meetings and marketing calls1800 - Tea with children1900 - Bedtime bath and story1930 - personal admin2000 - Dinner with iona2100 - news night (a must!)Midnight - Bed!
www.glanuskestate.com
A day in the life of Harry Legge-Bourke
GLANUSK
HrS
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Keeping Memories Precious
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