By Paul Faulkner
When the Birmingham Awards confirmed that they were returning in 2021 after a year’s break due to the pandemic, I was delighted that amongst the new categories they were including in the event was an award to recognise the Family Business of the Year.
Why? Very simply because family-owned businesses are such an integral part of our business community and make a huge contribution to our economy, and yet are frequently overlooked or misunderstood, often falling outside of standard terms and ‘labels’ that are used to categorise and group businesses in an artificial way.
To a point, this is understandable, as a precise definition of what constitutes a family business can be hard to pin down. The Institute of Family Business (IFB) uses two main criteria, with the definition for a business with under 250 employees being where it is majority owned by members of the same family, and then for businesses with more than 250 employees or turnover in excess of £500 million being where a family owns over 25% of the equity.
Based on these criteria the statistics around the importance and contribution of family businesses to the UK economy are staggering. The latest IFB Research Foundation report, which draws on survey data from immediately before the onset of Covid-19, shows that there were 5.2 million family-owned firms in the UK in 2019 operating across all sectors and representing 86% of all private sector businesses. These businesses employed over 14 million people (51% of all employees in the private sector) and contributed £627 billion to UK GDP. In addition, it is estimated that these family firms paid £205 billion in tax receipts to Government in that period, all of which of course goes towards funding vital public services, including the NHS and our frontline covid heroes.
I am of course now working for a family business myself. The Richardson family business was founded in the first half of the 20th century in the Black Country, and is now a leader in real estate and growth capital investment with a business portfolio that stretches across the world. While our current interests may include the largest avocado grower in New Zealand, a US based medical real estate company and a Singapore based artisan bakery chain, the economic prosperity of the West Midlands continues to be of huge importance to the family. In this year alone we have opened the new West Midlands Designer Outlet Village in Cannock, a £120 million investment that has generated over 1,000 jobs in the area and should soon see Phase 2 starting construction, and launched the £100 million Richardson Enterprise Fund focused on providing growth capital to ambitious businesses in the region who have a proven track record of performance and exciting plans for growth.
The IFB report concludes by stating that, “If the UK economy is to thrive in the coming years it is essential that family businesses remain at the heart of it.” I couldn’t agree more, and that is why it is great to see the Birmingham Awards recognising and celebrating family businesses in this way.
Find out more about the Birmingham Awards 2021 at www.birminghamawards.co.uk