What does it take to build a successful multigenerational family business? Many of the world’s most enduring companies are family businesses. Coopers Brewery, Walmart, Samsung, and BMW all have a controlling family dynasty at their centre. But these successful family firms are a rarity; most family firms fail to survive multiple generations. The statistics are grim: only 30 per cent of family businesses survive the transition from first to second generation. Just 12 per cent reach the third generation. Why do so many successful family businesses fail after the founding generation? In my years of experience as a family business adviser, I have seen generational transitions fail for many business and family reasons, and I’ve seen several common threads connecting many failures. One major reason is a lack of financial education for children born into wealth. Heirs that are ill-prepared to manage money make poor decisions and squander their fortune. Perhaps the most famous example of dissipated wealth is that of the Vanderbilts, once one of the wealthiest families of the Gilded Age. During the mid-1800s, Cornelius Vanderbilt built the family’s fortune on railroads and shipping. At its height, his fortune totalled over $240 billion in today’s dollars, making him one of the wealthiest businessmen in history. While Cornelius was a self-made man, his descendants lived extravagantly, with little concern for preserving the family fortune. By the 1970s, there wasn’t a single Vanderbilt millionaire left. The Vanderbilts had also fallen prey to another common problem: the dispersion of wealth and control among many children, in-laws, and other relatives. This left the dynasty with too many decision-makers and not enough concentration of power to push through important decisions. Many families fail to nurture a sense of responsibility, history, and family values in the following generations, neglecting what we call the spiritual and family capital of the family business. Great wealth is a privilege and without a sense of stewardship and obligation, many rich descendants fall prey to ennui and boredom, failing to safeguard the family wealth or treat the business with respect. Many problems also happen at the intersection of family and business. One key issue that many fail to overcome is a culture of nepotism, which promotes unqualified relatives into positions of power simply because they are members of the founding family. Another issue is a lack of formal governance structures and succession plans that leave the business open to power struggles, family discord, and transition problems. A cautionary tale in this vein is that of the Anheuser-Busch company, which had been successfully run by five generations of the Busch family until it was bought in 2008 by InBev in a hostile takeover. The final years of the Busch family’s tenure were marked by family conflicts, power struggles, and financial mismanagement, dooming a 150-year-old company that had survived prohibitioners, world wars, and global competition. If you are the head of a successful family business, what can you do to ensure that your dynasty survives into the third, fourth, and fifth generations? A great deal. In my opinion, the most critical lesson is to take good care of the family side of the business and develop a long-term plan for your family’s future. Educate the next generations about wealth and responsible financial management as early as possible. Too many wealthy parents fail to teach their children how to responsibly manage their inheritance. Protect the family wealth by insisting on premarital agreements and separation of personal and family property. Cultivate a family culture around your family’s history and shared values. One way that many successful multigenerational families nurture a family legacy is by developing shared philanthropic ventures that help instil respect for family wealth and its future potential. Don’t make working in the business a requirement in the family; allow each member to find their own way in the world, within or without the business. Protect the business’ future by instituting formal governance and ownership structures that separate family control from the daily management of the business. These arrangements will make it easier for the firm to raise capital, bring in outside investors, and eventually navigate generational transitions. Professionalise the business by establishing employment standards for both family and non-family employees. Consider bringing in professional managers to run the business while retaining ownership stakes for your family. Most successful multigenerational family firms are largely run by professional non-family executives while members of the family focus on diversifying and managing their wealth. Begin planning for the eventual succession of your business. Whether you intend to train up an internal successor or bring in outside managers, proper succession planning takes years. Too many business leaders leave planning too late and put the business at risk of a sudden, unplanned transition. Family discord, power struggles, spendthrift grandchildren, and poorly qualified managers can all doom a family business. Ultimately, success requires many factors to align as well as a healthy dose of luck. Developing a successful multigenerational family business doesn’t happen overnight. It requires years of planning, careful management, and the cultivation of a family culture that prioritises stewardship and a family legacy of success.

What does it take to build a successful multigenerational family business? Many of the world’s most enduring companies are family businesses. Coopers Brewery, Walmart, Samsung, and BMW all have a controlling family dynasty at their centre. But these successful family firms are a rarity; most family firms fail to survive multiple generations. The statistics are grim: only 30 per cent of family businesses survive the transition from first to second generation. Just 12 per cent reach the third generation. Why do so many successful family businesses fail after the founding generation? In my years of experience as a family business adviser, I have seen generational transitions fail for many business and family reasons, and I’ve seen several common threads connecting many failures. One major reason is a lack of financial education for children born into wealth. Heirs that are ill-prepared to manage money make poor decisions and squander their fortune. Perhaps the most famous example of dissipated wealth is that of the Vanderbilts, once one of the wealthiest families of the Gilded Age. During the mid-1800s, Cornelius Vanderbilt built the family’s fortune on railroads and shipping. At its height, his fortune totalled over $240 billion in today’s dollars, making him one of the wealthiest businessmen in history. While Cornelius was a self-made man, his descendants lived extravagantly, with little concern for preserving the family fortune. By the 1970s, there wasn’t a single Vanderbilt millionaire left. The Vanderbilts had also fallen prey to another common problem: the dispersion of wealth and control among many children, in-laws, and other relatives. This left the dynasty with too many decision-makers and not enough concentration of power to push through important decisions. Many families fail to nurture a sense of responsibility, history, and family values in the following generations, neglecting what we call the spiritual and family capital of the family business. Great wealth is a privilege and without a sense of stewardship and obligation, many rich descendants fall prey to ennui and boredom, failing to safeguard the family wealth or treat the business with respect. Many problems also happen at the intersection of family and business. One key issue that many fail to overcome is a culture of nepotism, which promotes unqualified relatives into positions of power simply because they are members of the founding family. Another issue is a lack of formal governance structures and succession plans that leave the business open to power struggles, family discord, and transition problems. A cautionary tale in this vein is that of the Anheuser-Busch company, which had been successfully run by five generations of the Busch family until it was bought in 2008 by InBev in a hostile takeover. The final years of the Busch family’s tenure were marked by family conflicts, power struggles, and financial mismanagement, dooming a 150-year-old company that had survived prohibitioners, world wars, and global competition. If you are the head of a successful family business, what can you do to ensure that your dynasty survives into the third, fourth, and fifth generations? A great deal. In my opinion, the most critical lesson is to take good care of the family side of the business and develop a long-term plan for your family’s future. Educate the next generations about wealth and responsible financial management as early as possible. Too many wealthy parents fail to teach their children how to responsibly manage their inheritance. Protect the family wealth by insisting on premarital agreements and separation of personal and family property. Cultivate a family culture around your family’s history and shared values. One way that many successful multigenerational families nurture a family legacy is by developing shared philanthropic ventures that help instil respect for family wealth and its future potential. Don’t make working in the business a requirement in the family; allow each member to find their own way in the world, within or without the business. Protect the business’ future by instituting formal governance and ownership structures that separate family control from the daily management of the business. These arrangements will make it easier for the firm to raise capital, bring in outside investors, and eventually navigate generational transitions. Professionalise the business by establishing employment standards for both family and non-family employees. Consider bringing in professional managers to run the business while retaining ownership stakes for your family. Most successful multigenerational family firms are largely run by professional non-family executives while members of the family focus on diversifying and managing their wealth. Begin planning for the eventual succession of your business. Whether you intend to train up an internal successor or bring in outside managers, proper succession planning takes years. Too many business leaders leave planning too late and put the business at risk of a sudden, unplanned transition. Family discord, power struggles, spendthrift grandchildren, and poorly qualified managers can all doom a family business. Ultimately, success requires many factors to align as well as a healthy dose of luck. Developing a successful multigenerational family business doesn’t happen overnight. It requires years of planning, careful management, and the cultivation of a family culture that prioritises stewardship and a family legacy of success. About David Harland - A leader in the family business consulting field and Executive Chairman of FINH, co-founding the company in 1994, David is an expert consultant to families in business. David has facilitated multi-generational meetings of family business stakeholders to guide families through complex and emotional family communication challenges. His objective is to empower those families to long-reaching and sustainable communication processes across both family and family business communication models. David has worked extensively with family businesses across Australia, New Zealand and South East Asia, many of whom have transitioned into and beyond their second generations. By providing a process for the succession journey, David has assisted families to achieve measurable and specific outcomes. David holds both Australian and International Accreditation in Family Business Advising with Family Business Australia and the Family Firm Institute.

Check out the latest research into the dynamics and relationships in family firms in Malaysia. Entitled ‘The Family & The Business,’ this nationwide survey was conducted by Grant Thornton Malaysia in collaboration with renowned national management organisation, the Malaysian Institute of Management (MIM). In conducting this survey, they set out to explore the present scenario of family businesses in Malaysia, to further understand the characteristics of these companies and assess the management concerns, attitudes over the involvement of family members and their development plans amidst globalisation. Download and read the full report below:

An important segment of family businesses is spouses in business together or copreneurs. Copreneurs share the ownership and management of a business and represent an evolving area within family business. Setting up a business together as a couple requires planning, constant communication and a great deal of hard work. The business must be formalised and this includes deciding on start-up funds, creating a team (even if only made up of two people) and dividing roles and responsibilities. The result of a well-thought business plan can be emotionally and financially rewarding. Spousal support is a source of competitive advantage in this type of family business. Couples may decide to start a business venture together for a myriad of reasons. The drain on quality time at home and the lack of stability in a shifting global economy may be some of the drives. Other reasons for setting up are the ‘glass ceiling effect’ that stops women from reaching managerial positions, downsizing, redundancy, extended working hours and travel demands in the business world. Joint ventures offer the couple the freedom to run an enterprise and the flexibility to do so on their own terms. Couples running a business together can be one of the greatest tests of a marriage. Copreneurs have their own unique set of challenges as they attempt to combine loving, intimate lives and business lives focused on the bottom line. When not addressed, these dual relationships negatively effect the marriage and business. Keys to success are equality, independence, trust,commitment, compromise, confidence in each other’s work ethic, managing working and family conflict, role priorities and role clarity. The issue of equality within the couple business venture has drawn the interest of researchers. Females in copreneurships have equal needs for achievement as their partners; they bring drive to the business and also manage the household. Some research suggests that the sharing of tasks and responsibilities between spouses in this kind of firm is not necessary equal. It was found that women, apart from their central role within the business,also assume the traditional role of household manager, while men are mainly engaged in the firm and are responsible for the decision making process. A family business of this type cannot afford to overlook half of its potential talent. One cannot make generalisations about all spousal ventures,however, research has shown that there are scenarios where the venture works most smoothly when the wife takes a behind-the-scene role. When considering starting up a copreneurship the basic recommendation is to communicate at length and listen to each other’s concerns. This decision may be approached similarly to any new job and entails careful consideration of the pros and cons. Couples will need to decide if their marriage can bear the added physical and emotional load of running a business together. Trying to anticipate the critical issues helps as couples working together have a greater potential for tension and conflict. An adaptive response to this complex reality is to have specific and clearly defined roles. Planning for the future is an important consideration and task for the couple in business. It is never too early to plan for succession and think about one’s retirement as a couple.Children of copreneurs are exposed to the business at a very young age and are well-informed prior to deciding whether or not to enter the family business. This decision effects plans for the future of the business. Copreneurs reap the benefits of early succession planning ensuring the continuity of the business with minimal disruptions. An eventuality couples may not be prepared for is the disability or death of one of the owners. Preparing for this dreaded circumstance is emotionally a very difficult thing to do, however if the time comes to put the plan into practice, the surviving spouse will be in a better position to cope with the personal crisis without having to address a business crisis as well. Another reality for some couples in business is separation or divorce. The impact of divorce is complicated, difficult and painful with the assumption that the business will be divided or sold. Divorce may end a marriage but does not necessarily end a business or lead to a family dissolution. The ability of the couple to resolve differences and heal the pain of separation or divorce has both an immediate and a long-term impact on the health and prosperity of their business and the well-being of their family. Notwithstanding all the difficulties and emotional hardship there exist couples who continue to work together even after the termination of their marriage. The potential for success in post-divorce business relationships increases when there are elements of trust in the business rapport, ability to compartmentalise, synergy, commitment to the business and positive gender issues interact. Strategies for helping family businesses survive a divorce include specific legal contracts such as prenuptial agreements. The practical recommendations made by couples who own and run a business together are to clearly define each person’s duties and decide who will make the final decision in critical areas, as well as to invest in and find time to communicate as a couple with dignity and respect. Finally, the benefits of working together are to be enjoyed and valued. About the Author - Roberta Fenech - The author is an Occupational Psychologist currently reading for a PhD at the University of London.

Understanding family businesses entails understanding the ‘family factor’, more specifically family ownership, involvement, commitment, values, vision, self-perception and succession. Family businesses play a prominent role in the global economy. It is a unique form of business as it is subject to influence from the family. The family is the original economic unit from which all other forms of economic organisations evolved. Families in family businesses are a unique fusion of ownership, strategic influence, concern for family relationships and a dream of continuity. Understanding family businesses entails understanding the ‘family factor’, more specifically family ownership, involvement, commitment, values, vision, self-perception and succession. When addressing the family in the family business one needs to be sensitive to the way families define themselves as there is a great deal of boundary ambiguity, which can be navigated only via the family’s personal definition of family. Family influence in family businesses may vary from one-sided control of the strategic direction of the business to one where strategic control is left entirely in the hands of professional management. A family first philosophy or a business first philosophy may work well or fail, as a function of the changing demography of the family, and the environment in which the business operates. As both the family and business grow what is needed is not an enmeshment but a philosophy that mediates between a family first or business first approach offering a more balanced framework for decision-making and planning. Families share common goals and resources. As generations are added, the family business will have multiple family systems to consider. Each will have its own background, values, goals and development, but they are interconnected as a larger family system, as well as a family business. The family and business are not necessarily compatible and the family factor may impose costs and liabilities. Family, ownership and business clearly involve different and sometimes conflicting values, goals and actions and in a family business individuals may have multiple roles and priorities. Problems may arise from the unwillingness of family members to monitor, evaluate and discipline other family members such as in the case of nepotism. In other situations the family business may be more insular and self-interested than non-family businesses as outsiders are not trusted and seen as potential competitors and enemies. Family members may not always be able to supply the business with enough talent, for example, in businesses that require highly specialised knowledge of technology and markets. The family factor when invested in and harnessed well is a source of competitive advantage. This occurs when the family business puts high priority on the human capital, emotional capital, social capital and financial capital. On human capital one may say that family members are motivated, committed, flexible and have been socialised and trained early to understand the nature of the family business. Family businesses have an advantage in building social capital as they have a distinct ability to cultivate and nurture long-standing relations across generations.Social capital enhances value creation in all businesses but in family businesses these advantages are absorbed in family members’ social links and in the family network’s configuration, and therefore are more sustained across generations. Family businesses have the ability to attract and provide good quality due to the goodwill and trustworthiness generated by the family name and commitment over time to customers. Families leverage their social and professional networks to ease access of valuable resources. Family cohesiveness is central in accessing and generating valuable resources particularly in difficult times. The total value of the family business to family business owners is the sum of both the financial and emotional value. Family businesses also make non-financial valuations of investments and assets together with financial appraisals. Non-financial values of the family may push the family business to: take an investment diversifying business activity in order to lower total risk, but that at the same time is value driven; make investments in brands or sectors that bring high reputation to the family; hold steadfast in their reluctance to diversify the business portfolio because the founding member started the company in this line of business, expressing legacy value; family business owners may continue to employ workers even through outsourcing would be more financially beneficial. Family businesses enjoy the competitive advantage of strong trustworthiness if they leverage the interpersonal trust that emerges during the early stages of a family business. As the family business grows this trust needs to be supported with the trust that the family members leading the business are not only willing but capable of performing effectively. Transparency and clear policies also help build trust as the family business enters the stages of sibling partnerships and cousin collaborations. Communication is a vital ingredient in re-vitalising collective identity and interpersonal trust. About the Author - Roberta Fenech is a freelance Occupational Psychologist currently reading for a PhD at the University of London

Succession in terms of business leadership confronts the founder of a family business with a complex set of options as Peter Leach explains below. In broad terms these are: Appoint a family member Appoint a caretaker manager Appoint a professional manager Exit via sale of the business, in part or in par Exit via liquidating the business Do nothing. Each option is distinctive and carries its own set of advantages, disadvantages, opportunities and threats. Also, the scope and impact of these will vary from one family business to another depending on, for example: The ability to attract family and non-family successors who are willing and have the skills to carry on the business The financial needs of the family (for example, whether cash needs to be extracted from the business to provide for the retirement of the senior generation The personal and corporate taxation consequences of the different options The health and size of the business The external commercial and business environment at the time of succession. If there is a commitment to retain direct control over the business, the first option of appointing a family member to succeed is seen as particularly attractive by many founders. Research by IMD has found that, if there’s a suitable candidate, owners will choose a ‘family solution’ for several reasons: It gives their personal ideas and values a greater chance of survival They can feel their life’s work is in good hands They don’t lose contact with the business, and may even retain some influence over it They feel their sacrifices building up the business will have been worthwhile. The appointment of a non-family successor, either to a permanent position or as a caretaker (options 2 and 3), may become the strategy by default if no family successors are available, motivated or have the necessary skills for the task. Genetics do not guarantee that families can produce entrepreneurial business leaders generation after generation. In terms of exit routes, some form of sale as a going concern (option 4) is likely to recover most value from the business. Alternatives within this option include a trade sale (ie an outright sale of the business for cash),which may be particularly appealing where no suitable successors can be found, or a stock market flotation can be the best answer if external capital to finance growth is a priority. Similarly, a management buy-out financed by private equity funding (a sale by the founder to the existing management team, which may include family members), can offer a compromise between transferring the shares to the family and an outright trade sale. Liquidation (option 5) entails selling of all the company’s assets, paying its outstanding debts and dismissing the workforce. It also involves substantial expenses and is unlikely to result in the best price being obtained. Finally, the founder may simply avoid planning for succession by adopting the ‘do nothing’ approach (option 6), and here lies the central paradox. Despite founders professing that a ‘family solution’ is their preferred course, in practice the dynastic dream is rarely achieved. Doing nothing is the least logical, the most costly, the most destructive off all the options, yet is by far the most popular.

Andrew Drake suggests ten simple questions to consider before employing family members. All too often family firms have been found wanting when it comes to employing family members, not least the accusations of favouritism of family members and treating family members differently from their non-family counterparts. When a family firm deals with employees, irrespective of whether they are family members, it should have a common practice in relation to employment policies, remuneration and reward. This helps to ensure that issues are not created which have to be addressed down the line. Here are ten questions that should be considered by anyone thinking about recruiting a family member into the family business: How are you going to identify prospective employees from amongst the family? Are family members clear as to what is expected of them if they want to become employees? Do family members have the relevant experience and qualifications for the job in question? Do family members require a business mentor, either before or after they become employees and if so should that mentor be a non-family member? Do all family employees have a clear job description and career plan? How do family employees’ terms of employment compare to those of any non-family counterparts? Who should appraise family employees? Who should decide on their remuneration? Who decides whether they are appointed to the Board? Can in-laws become employees and/or directors? Family firms can engage in best practice by ensuring that the policies that they introduce are applied to all members of staff with clear communication of policies to ensure that everyone is treated the same way, thus helping to improve the underlying human resources framework within the business that can then help to recruit, retain and motivate all members of staff within the family firm too.

When it comes to wealth preservation, why have some families businesses been so successful while others have failed miserably? In my opinion, the secret boils down to a family ethos that values one thing over all others: capital preservation. The bear traps of inheriting money without purpose have been well documented in literature, Hollywood and the media. Thomas Mellon, founder of one of the wealthiest and longest enduring families in America, set up a tacit understanding that while spending was acceptable, it came with the expectation that each generation would become the caretakers of this capital and push it forward to a larger amount than he or she was given. This sense of ownership and responsibility was central to the family’s vision. But conserving family business wealth isn’t always so straightforward. Family businesses make up the foundation of the Canadian economy, but not all owners feel adequately prepared for succession, says Saul Plener of PwC. In the annual PwC Family Business Survey, family business respondents tended to fall into the second generation, or ‘Baby Boomer’ category, and are ‘looking for the best opportunity to exit.’ Unfortunately, he points out, a significant number of those surveyed “haven’t put the necessary effort into succession planning and professionalising the business to ensure long term survival.” One of the reasons why the professionalisation of the family business has become as challenge is because these types of discussions can be difficult. But succession conversations should take place several years before the business changes hands and wealth is passed down to the next generation. Discussions should centre around the financial plan, tax and legal implications, as well as family expectations. If you run a family business, it’s never too late to start. I also recommend hiring a family business expert to assist these often tricky questions. To get the conversation started, family members should rate their knowledge on the following question out of ten: 1. I understand the expectations about the transition of the business by the current owners (parents) and also the next generation. Mr. Plener says that parents often think they know what their children want to do, but they’re not always right. The next generation has seen the stress that their parents handle and don’t necessarily want to take on that level of emotional strain. Founders needs to find out the interests of the next generation as a beginning to the succession process. One owner was pleasantly surprised to discover his daughter was interested in being on the board of the family business. He had assumed his daughters weren’t interested, but he had not started that conversation. 2. We have discussed the distribution of capital. Has there been a systematic building of capital in a diversified investment portfolio over the years? Having capital invested outside of the concentrated investment into the business is wise as the optimism of many entrepreneurs has resulted in spectacular belly flops. By systematically taking money out of the business and putting it into a portfolio, the family will be looked in the worst-case scenario. With the security of a portfolio in place, the family and retirement costs are covered, and then entrepreneur is in a far better position to take the risks required to grow the business. Families can relax and relationships enhanced if everyone knows the strategy around capital. 3. We are on the same page about our long term-family goal(s). The longer the family has been in the business, the more the business means to its members. In material terms, it usually represents their largest asset and primary source of income. Beyond this, it is also a source of personal wealth and family tradition. Family members are usually proud of being associated with the business, especially if it carries the family name. After a sale, these families have to look for new means to keep the family together, to continue its legacy and preserve its wealth over generations. This is often the reason to set up a family office to create a platform to manage joint family activities, such as philanthropy, family investments or special projects such as private equity. Capital preservation is recommended as the central family goal which the next generations will need to understand and embrace. The next generation and family can then have the security to reactivate the family’s entrepreneurial spirit and create the next family business endeavour. About the Author - Jacoline Loewen is director of business development of UBS Bank in Canada. She is also author of Money Magnet: How to Attract Investors to Your Business. Article first appeared in The Globe and Mail and has been reproduced with permission.

A moving insight into what happens when your Uncle closes the doors and there is nothing you can do. Heather Leavens was a third generation director of the family business for 18 years until her Uncle decided to close the business. Powerless to do anything about it, Heather had to direct the winding down of the business. Paul Andrews spoke to Heather to understand some of the emotions involved in such a process. Heather Leavens joined the family business when her father asked her too, giving up her role in marketing and business development which at the time she loved to enter the fray. The business was formed in 1927 in Mississauga in Canada by her Grandfather and his two brothers, Art and Walt, in Belleville in Ontario, Canada. The original business began doing barnstorming, training pilots for war and mail runs to Pelee Island, Ontario. Great Uncle Art died in a plane crash and Great Uncle Walt left to pursue his interests in farming which is when her Grandfather took over running the business with his four sons and from a building in Mississauga, began to service and overhaul small aircraft like Pipers and Cessnas, maintaining a stock of spare parts and servicing specific plane parts too. Heather recalls her time as a child, way before actually joining the business when she used to work filing and cutting the grass. “My father got involved in the business as the second generation and growth came through diversification – first there was Leavens Boats and then a car dealership and even a business selling private jets,” she explains. “At the peak in activity there were operations in Mississauga, Montreal, Calgary and Edmonton with around 70 employees. We were not a large business but gave a lot of people work and the business afforded us a good lifestyle too. During this time, we also moved to a new building and the name of the company was changed to Leavens Aviation Inc.” Leavens Aviation was a good place to work and the employees enjoyed their time with the business. Many stayed for years and when the business eventually closed, a number of the staff leaving had worked for the company for over 40 years, something that Heather felt a certain responsibility for. “Our staff were part of the family really, an extension of who we are. They spent a long time with the company and it was sad that as well as the family closing the business, for many of the staff it was also the end of an era for them too,” continues Heather. For many, working towards a known outcome, the closure of the family business, is something that is planned a long time in advance. Not so for Leavens Aviation which at the time of the decision being taken was still predominantly owned by Heather’s Uncle, who at this time was approaching eighty years of age. “His daughter worked for the family business and it was obvious that the two of them had discussed the future of the business and come to a decision prior to us knowing anything about it” continues Heather. “In fact, my Uncle came into the office in the Christmas of 2010 and just told us that he was closing the business. It really did come as a shock to all of us, especially the three other family members working in the business that had no idea it was coming. We were all aware that there was no apparent fourth generation coming through to take the business on and that it was likely that it would have to be sold in the future, but we were all approaching our fifties and expecting to work towards building a nest-egg for our retirement through the business. Instead, we were suddenly confronted with a life-changing situation that we had simply not envisaged.” The next six months were not an easy time for the family as the assets were sold off and disposed of and eventually Heather found herself sitting in the car park on the last remaining chair waiting for the final customer to come to collect their goods. “At this time, I was not really sure what was going to happen” continues Heather, “I had no idea what I was going to do but I guess in the six months preparing for the closure I had time to think about the past and collect some of my thoughts, sorting out the papers and getting the practical things in order. What nobody can prepare you for is the last time that you close the door on a business that has been in the hands of your Father and your Grandfather, and for which you cannot help but having a feeling of responsibility for.” “Sadly, my Uncle had made his decision and we had to abide by it, he was the majority shareholder and we did not have the funds, nor the desire to take on any personal debt, to buy the business from him.” Hindsight is a powerful tool and Heather is now coming to terms with the reality of the situation. “I do get sad sometimes when I think of my Father and then the link to the business that is no longer ours, but am not naiive to think that running the business did not come at a cost. My father dedicated a lot of time to the business and as such had less time to spend with us as a family. However, the money has come in handy for the family and ultimately are well positioned and in a way, fortunate, to be able to take stock of our lives.” “Having said that, our building is now used as a furniture store and since opening, I have not driven past it once nor had any desire to go into the building to look around, it is all still a little raw and something that I just cannot bring myself to do,” continues Heather. Like other family business owners that have been involved with the closure of a multi-generational business, Heather is not alone in her feelings. However, she is aware more than many that life is short and that we have to make the most of things. “The day I left the building for the last time I went straight to the hospital to spend time at the bedside of a close school friend who was ill with terminal cancer and passed away nine days later. This was a tough time but helped to put things in perspective for me” she explains. Since the business closing, Heather sees herself as having been fortunate enough to take stock of her life, spend a year travelling and catching up with friends and is now about to embark on the next chapter of her life, life without the “burden of the family business.” Heather has always liked marketing, people and customer service and is keen to find a role that offers these opportunities to her. “In hindsight, we spent the last few years in the business trying to diversify and increase revenue, reduce costs and fight the recession, like many other businesses, but we were facing an uphill battle and maybe closing the business was actually the right thing to do. We had all become embedded in what we were doing, week in week out, and now we can stand back and consider the options before it is too late.” For Heather, it has been a difficult emotional road to go down but at least now she is able to look back and focus on the positives. “The burden of responsibility towards the family and the wider family, the employees and the community, has been removed and if I had to give any words of advice to others in a similar position, I would strongly suggest they consider their options, but closure or selling the family business is an option that may be necessary.” For Leavens Bros the outcome would probably have been the same in fifteen to twenty years time, an outcome that the third generation were quietly working towards without any thought of anything different, and then the ‘rug was pulled out’ and the family business came to an abrupt end. At the request of her Father, Heather gave up her own career to start in the family business and sacrificed a lot personally to manage the business for many years with her cousins. It has taken a toll, but Heather does have fond memories of the business, recognises the sacrifices that were made along the way, and although closing the business was probably the biggest sacrifice of all, is embracing all of the opportunities that it has also created for her now so that she can move forward and embrace life to the full.

The Company was formed in 1889 and the Wright family have been involved in the making of quality ladies hats for over 300 years, making Philip Wright one of the oldest “blood line” hat manufacturers in the world. What does your family business do? The Company was formed in 1889 by Walter and Minnie-Susan Wright in Albion Road, Luton and our family have been involved in the making of quality ladies hats for over 300 years, making us one of the oldest “blood line” hat manufacturers in the world. In 1982, I joined the family business. As a result of the combination of the long experience of previous generations and his training under Madame Marie O’ Regan, at the London College of fashion, I have been able to bring the family’ firm into the 21st Century. How did you get involved? I was invited to learn about the value of pocket money by my Father, bless him, by working in the factory during the school holidays from the age of about 7 but my love and appreciation for the theatre of hats really started in a cafe in Greenwich when I was about 19. How I actually ended up in the business is quite an interesting story too – I was working in London and was pretty bored with my job and I used to play ‘chicken’ with lorries on my motorbike and one day I lost and was involved in an accident. After discharging myself from Hackney Hospital I had to return to my family to mend as I was unable to walk much, and whilst mending I pottered around the factory designing and making a hat for a National Young Designers Competition. My entry did rather well and I really enjoyed the creativity so I left my job in London and started as a junior blocker at the factory in 1982. I learnt Model Millinery at the London College of Fashion and eventually bought out my father in 1999. What did you want to be when you grew up? You could say that I am still growing up today!! When I was at school I did not know what I wanted to do. I liked acting and entertaining so I guess I’ve landed the perfect job! What pressure does a 120+ year old family business place on you? Now, none! It did take me ages to break the pattern of my predecessor, my Father, the way things were done and the attitude which hindered my ability to fully embrace my talents and evolve into a very different market. I also associated the factory as a place of work and not of fun and creativity so again that hindered my real enjoyment and development. In hindsight, what I did was right at the time and I am still here… How do you embrace the heritage of the business and move into the modern era? BIG TIME!! I am proud of what we do and embrace the importance of that by not trying to change but to evolve. The past of selling vast quantities of quality hats to the High Street for me is over – if the department stores want to turn themselves into warehouses without any sales advisers then we do not want to be part of it – hats are not the same as socks and sell far more effectively with a knowledgeable member of staff to advise them on what hat to choose and how to wear it. As the big stores cut staff, and cut the hat departments too, there is an opportunity for us and I am ‘taking the hat direct to the people!’ What marketing activities do you do and how do you engage with new markets? These are important activities so I meet lots of people, I give lectures to various organisations such as the Womens Institute and we hold Open Studio sessions for past clients and their friends to help them ‘discover our world.’ We have also created numerous YouTube videos to demonstrate the diversity and range of what we do an I have even given a five minute cabaret act too!! Our business is all about profile, word of mouth and recommendations rather than expensive advertising campaigns that are forgotten the moment they stop running. Is there a next generation waiting in the wings? Maybe! When I arrived on the scene I made my contribution as the next generation so who knows… My daughter is learning the skills and maybe if and when she is ready she will join me, if the time is right and that is really what she wants to do too. Do you enjoy what you do? Yes, I love it! Words of wisdom – If you could change one thing what would it be? Not a great deal because everything that has happened in the past has brought me to this point today, which I am truly happy about. Nothing radical to change but maybe I should have hung around more fashionable bars and clubs in my earlier days, the extravagance and creativity would have been great inspiration and I may have influenced a celebrity or two to wear one of my hats and helped with my public awareness too. I do not beat myself up with hindsight although I’d love to meet Mary Portas! Today my heart is full and my suitcase is light!!

Oxfords Bakery was established by Frank Oxford in 1911 at Alweston, near Sherborne in Dorset. Today, fourth generation Steven is at the helm, a far cry from the DJ lifestyle in Ibiza he did before! What does your family business do? Oxfords Bakery is a 4th generation bakers, still making Traditional English bread and cakes using the same methods (and ovens) as Great Grandfather Frank Oxford in 1911. How did you get involved? I was always expected to join the family business, not by my family, but by all of our customers, suppliers and friends! Naturally this deterred me even more. I turned from music loving teenager in to a professional Nightclub and event DJ and, by my early 20’s had even established a name as an agent for other music acts. During a tour of New Zealand and, actually, right in the middle of a set I was playing during a street festival for Red Bull at the ‘Americas Cup’ yacht race in Auckland, I made up my mind that I wanted to not just work for the family business, but to develop it and make it in to what I believe it should be – the most popular bakery in our county, Dorset. So next time you see a ‘DJ’ at work, wondering what’s on his or her mind, it may not be quite what you’d expect!! What did you want to be when you grew up? An exact replica of my father! What are your first memories of the family business? The first memory of the family business for me was being allowed behind ‘the table’ to mould cottage rolls with my Dad at the Royal Bath and West Show when I was about 5 years old, and then while he was pre-occupied, one of the bakers lifting me up and out of the way to sit on the flour sacks as I was probably slowing up the works. This was the first feeling of burning desire to show what I could do for the business. Needless to say, next year as a great big six year old I was very visibly shadowing my father and helping bake whilst wearing a rather fetching t shirt my mum had provided saying :Get fresh with your local baker’ on it! The other memory that my brother and sister share with me though is the smell and clatter of the tins as we walked into the bake house when we would stay there with our grandparents. Its still the same sounds sights and smells today, but you don’t appreciate them until you’ve been away from baking for a couple of weeks. Good excuse for a holiday I suppose!! What values are important in your family/family business? Our motto has always been ‘quality and tradition’ I think if we maintain these two things then the actual boring business side of things are much the same as most other businesses. It is those two things that keep us unique. There are a few good bakeries I can think of that only have one of these attributes, and no matter how hard our competition try, it is impossible to emulate what we do. (Unless you also have an original Victorian/Edwardian bakery to work from!) What is the best thing about being a family business? The support framework when things get , inevitably, tight or don’t go as planned. We don’t set ourselves many targets for success as a family business, we do , however, know how to celebrate our achievements though. An invite to ‘Oxfest’ would prove that to anyone!! And the worst? Imagine putting in the best financial year in 100 years, exceeding all expectations, growing and developing at a faster rate than you could ever have expected… and then find a post it note with a complaint from your own Mum because you’ve lost a petrol receipt or because your office looks a bit messy! For me, that is about as bad as it gets though – I’m afraid, there are no horror stories here! What is the best thing about your working day? Seeing somebody walking down the street clearly enjoying a product from an ‘Oxford bag’. Also, hearing a tale from a customer who says that one of your products is their ‘favourite food’. I only need to hear that once a year to get me out of bed in the mornings. A real pleasure. What is your proudest family business achievement? Our centenary year has to be up there. Shared by all of us proudly, as you can imagine. My father decide that he wanted to take the business to 100 years, come hell or high water. This doesn’t sound like a great ambition until you realise he decided that 51 years ago!! I had the good fortune to meet Richard Branson last year and even he said: “ now that is a real achievement” You can’t argue with that really! Is there a next generation waiting in the wings to take over? Ha Ha, there is now but only just as they have only just been born but there is absolutely no way on earth that I would ever pressure or even suggest my children be involved in the business though. Look forward to teaching the values of hard work, finance and reward, but they are way down the list after things like messing about, laughing, running around with your arms out like an aeroplane for 3 hours solid etc as life is there to be enjoyed first and foremost. What do you see as the biggest challenge facing family businesses? Copy cat businesses is a real threat to our sector as there isn’t much legislation as to what real bread actually is. Despite the Real Bread Campaign doing a good job of promoting small and honest bakery businesses, they are dwindling. In fact, there were approximately 20,000 small bakeries in the UK 25 years ago and there are now only about 3,000 left. Supermarkets can use words like ‘fresh,’ ‘craft’ and ‘wholesome’ at will! We have some local competition that even has a sign in the window saying ‘traditional artisan breads’ yet they are made on a plant/production line!! It does grate a bit when you have given up nearly every Friday night of your life to actually do it properly! Rant over! What words do you associate with family businesses? Passion. Values. Ethics. Tradition. Words Of wisdom – What piece of advice would you pass on to someone thinking about joining the family business? DADS ARE ALWAYS RIGHT!!! Knowing when they are not, and being able to make subtle changes, is the key to success.

Make sure you plan so your estate ends up in the right hands. Penny Lovell shares her thoughts. Have you prepared a will? Have you made sure to plan your assets so that your estate will end up in the hands of the right people should anything happen to you? These may be personal questions but they are important ones that more of us need to ask our loved ones. Talking about death is uncomfortable, particularly with those we care about. However, making sure that your estate is in order could save a lot of money and heartache in the long run. New research from Foresters Friendly Society and ICM has revealed that almost two thirds (61 per cent) of us don’t have a will. On top of this one in ten of those who do have a will have told no-one else where it is. If you’re in either of these groups, and there’s a good chance that you are, you may find your money and possessions may not end up in the right hands after your death. All too often there are headlines about people who have died without a will, and sadly, while in many cases they would have preferred to have left their affairs in order, the result is far from ideal. A very good example of this is Stieg Larsson, author of the Millennium Trilogy books, who died intestate. As a result, his entire estate went to his father instead of his long term partner, who in turn has not benefitted at all from the worldwide success of his books and the subsequent films. Without a will or effective estate planning you don’t get to control where your assets go. Your estate will be divided amongst your relatives in accordance with government regulation and could even end up with the Crown. You may be under the impression that wills don’t matter if you are married with children and plan to leave everything to your spouse. However, your husband or wife will only receive the first £250,000 of your estate. After that they have a right to an income, but not the capital, from the remaining estate. This is the default position and one very few people would actively choose. If you fail to update a will post a break-up, despite being in a subsequent relationship, your estate might end up going to the wrong person entirely and cause great upheaval amongst your loved ones. Bob Marley died in 1981 without a will and, 30 years later, disputes are still raging with new claimants still appearing out of the woodwork. In addition, if you leave dependent children under 18 behind when you die then you may not have control of who looks after them. Instead, the courts may decide who is appointed as their guardians. This alone should be enough to encourage anyone to make a will. Worryingly the Foresters report also showed that more than three-quarters (77 per cent) of parents with children under the age of five have not made a will with nearly half those who have (46 per cent) not reviewing it in the last five years. This means that they have not appointed guardians or ensured their children’s inheritance is secured. Again, a famous example of this is what happened to Heath Ledger, whose will was not updated to include his daughter Matilda. Of course the older we get the more important a will is. Despite this nearly half (46 per cent) of those aged between 55 and 64 have not made a will with more than a fifth (22 per cent) having never thought about making one. One in eight (13 per cent) rely on self-written wills, the validity of which is more likely to be challenged upon death. March is ‘free wills month’, an initiative that brings together a group of well-respected charities to offer members of the public aged 55 and over the opportunity to have their wills written or updated free of charge. This is done using participating solicitors in selected locations around England and Wales. Whatever your background or situation it is important to have effective estate planning and a current will in place. This will ensure that you have control over your assets and make sure that your wishes are carried out if you aren’t here to control the situation. Making a will can also provide an opportunity for you to think through whether your beneficiaries require financial education. There are so many stories about people who inherit wealth without any financial training and therefore struggle to protect the assets for their own lifetime and for future generations. Financial training can help prevent this potentially challenging and unhappy outcome. Finally, there are many of us who wish to leave assets to charity and making a will is a great opportunity to explore the best way of structuring your gift.