Family businesses ‘boost economy by billions’ - Palmers Solicitors

Family businesses ‘boost economy by billions’

First generation family-owned businesses are set to contribute more than £200 billion a year to the UK economy by 2018, according to new research.

A Barclays Bank report published in April said that first generation, family-owned small and medium-sized enterprises (SMEs) currently contribute £180 billion to the UK, a figure set to rise by 21 per cent to £218 billion in 2018. Revenues were on course to rise by a similar amount (22 per cent) from £540 billion a year to £661 billion by 2018.

Barclays said the current £180 billion value of family businesses was currently greater than that of the overall manufacturing and wholesale or retail sectors, underlining their importance to the UK as a whole.

Rebecca McNeil, director of business lending and enterprise at Barclays Business said: “Family SMEs play a powerful role in the UK economy and one that is set to increase if they have the right access to support and funding.”

The report, titled Family Affair: Spotlight on UK Family SMEs, found that there were currently 2.42 million first generation family SMEs in the UK – the highest number since 2008, when the figure stood at 2.45 million. The number of family SMEs has increased over the past three years, up from 2.32 million in 2011, which would rise to 2.65 million by 2018, the report said.

There are currently 5.5 million jobs provided by family SMEs in the UK, which Barclays predict will increase by nine per cent to six million by 2018.

Ms McNeil added: “One in five of our business customers are family SMEs and we have seen a real increase over the last twelve months in the number of family businesses coming to us for support, mainly to help expand and achieve growth. We believe the end of the recession is paving the way for dynamic family firms who want to run businesses they are passionate about.”

At Palmers, we are experienced in working with family businesses and can provide expert advice to support their development and growth, on issues including succession planning, shareholder and partnership agreements and family dispute resolution. For more information, please visit our website or contact BJ Chong.