Family and place
Family owned firms are critical to your place. Imaging loosing just under half your retailers, restaurants and hotels from your place. Statistics highlight the impact of family businesses on these sectors. According to the IFB 85% of all private businesses in the UK are family owned. 46% of all those employed in retail and wholesale work for family firms. Family owned hotel and restaurant businesses also account for 46% of the total employment in that sector.
How the ‘family business’ is lost in place consultations
It’s simple. Family businesses are involved in consultations but they are identified as retailers, hoteliers, restaurateurs or wholesalers. Numerous academic papers acknowledge that family businesses do have an impact on regional planning. They argue that the regional impact of family business may be down to a combination of the embeddedness of the family firm in their community and the role personal relationships play in local networks .
The academic argument on family business impact
Academic papers show that network roles and choices made by individuals within family businesses are different to those in non-family business. This is because family firms have a social and emotional attachment to their place, which is referred to as ‘socioemotional wealth’. Those with high socioemotional wealth tend have more positive impacts on their local community than non-family firms. In some cases family firms may value socioemotional wealth over financial performance. It should be noted that there is some evidence that this commitment to place, above financial reward, is not exclusive to family business. But family connection to place plays a key part in this decision .
The emphasis of public sector support for regional development on quantifiable measures such as GVA can identify the impact family firms have on place. However at times this may be overlooking the long term value of socioemotional wealth to that place.
Practical steps to ensure the longevity of family firms
Several organisations such as the Family Business Network and Family Business United celebrate the best of family businesses regionally and nationally. There are also others who work on supporting the successful transfer of a family business from one generation to another. Be the Business offer various levels of support or family businesses and are working on next generational family business workshops. Thomas Jardine & Co work with the Family Business Network and Be the Business and would be happy to put you in touch with either of these great organisations.
Bring place and family closer together
When making plans for the business sector in your place, please do not just focus on the standard industrial sectors. Consider the generational firms based in your place. Support them and encourage the birth of new family businesses in your place. Successful businesses that are based in a place will look after that place for generations to come.