As a business owner, finding time for family life whilst building up your empire can be a challenge. So, what if you choose to keep your company in the family instead?

According to the Institute for Family Business, an incredible two thirds of businesses in the UK are family owned – that is more than 4.8 million companies in total.

16,000 of these family businesses have grown into medium and large enterprises, and family businesses make up almost 50% of private sector employment.

Clearly, there are a lot of companies which thrive on working with family. If you’re already in business or are thinking about starting your own family-run company, here are Burton Beavan’s top tips for ensuring your family business can succeed.

Successful family businesses – why they work

The key to a successful business is trust and understanding with your stakeholders. Many find it much easier to go into business alongside family and friends due to their already strong relationship and understanding of one another.

Running a company with your family carries a huge number of benefits, including:

• Stability – longevity in leadership as family position tends to determine who leads the business.

• Loyalty – greater sense of commitment and accountability. Some family companies have been known to keep running for hundreds of years, passing down to each new generation.

Both family and non-family staff are committed to the success of the business and passionate about what the company stands for. Not just working to make the company succeed, but also doing it for the family.

• Flexibility – everyone mucks in to do everything, you’ll never hear “that’s not in my job description” in a family business.

• Forward thinking – as family companies tend to be comprised of many relatives all eager to make the business succeed for their children’s future, you’ll find a more long-term perspective when it comes to strategy and decision-making.

• Strong values – as the business owner, you’ll have the chance to pass on your own business and personal values to whichever family member takes over from you in the future. Family members take great pride in upholding your company culture and contributing to their local communities.

Successful family businesses – the struggles

Whilst there are many advantages to working with family, this isn’t to say that running a family business is easy. Whilst conflict is bound to happen within any company at some point or another, when your colleagues are your relatives, things can get awkward very quickly.

Complex familial relationships could be damaged by a business-related quarrel; potentially resulting in feelings of contempt. This can increase tenfold without the appropriate succession planning in place.

Many family business owners do not effectively plan who will take their place when they inevitably step down from their role. Either they are reluctant to admit that they will not be able to run the business forever, or simply have too much faith in their family to organise this themselves – often resulting in lengthy and expensive legal battles.

In addition to keeping your family problems outside of the office, it can also be difficult to keep work out of your home life when you’re related to your colleagues and staff.

Nepotism is also rife in family businesses, with many choosing to fill all senior positions with underqualified and inexperienced relatives without giving more suitable outsiders a chance to join the top tier.

Successful family businesses – steps to success

Whilst family businesses have a number of pros and cons, there are some things you can do to make sure yours keeps on running smoothly

1. Communicate

Communication is key to any business but when you run a family firm, it is critical. Many make the mistake of thinking that they do not need to hold formal meetings when they work with family, however this can lead to a whole host of misunderstandings and grievances arising.

Try to schedule a weekly meeting where everyone gets a chance to speak, highlight areas of the business they believe needs work, and generally keep the discussions open so everyone feels heard.

Make sure you also listen to members of staff that are not part of the family. Nobody wants to work for a firm with a bias, so when it comes to hiring and communicating with employees, make sure your treatment is equal and fair

2. Leave it at the door

This works for both your home and your office. It is absolutely essential that you allow yourself to shut off at the end of the day, so try to avoid talking about work when you’re outside of the office.

Similarly, keep family issues at bay as much as possible whilst you’re in your work environment. This is essential in making sure your family firm remains professional, and you don’t want something your husband said at dinner making things awkward at the shareholder’s meeting.

3. Get it in writing

Whilst it may be a slightly uncomfortable conversation, it is extremely important that you get any work-related agreements in writing. There may be more trust within a family firm, but contracts and policies should still be signed to avoid disagreements in the future.

We can help

Despite the need to keep certain areas of your firm more formal, running a business with your family is an extremely rewarding experience. You’ll have the chance to shape your company in a way that benefits your loved ones for years to come; reinforcing values and visions and giving the next generations the chance to thrive.

If you would like any further advice on starting up or running your family business, speak to the Burton Beavan team today on 01606 333 900 or email hello@burtonbeavan.co.uk.