Family firms across the UK are setting their sights on expansion following another hugely successful year for the sector.
New research by Oxford Economics for the Institute for Family Business (IFB) Research Foundation reveals the vast contribution family firms make to the UK economy – employing over 11.9 million people and making up 87 percent of all private sector firms in the UK.
There are now more than 800,000 family firms in the construction sector, making up almost one in five of all businesses in the industry. Family businesses also account for 94 per cent of all private sector firms in the construction sector – one of the highest concentrations in the UK.
Kate Woods, a spokeswoman from construction family business, Osborne, added: “Osborne echos the amazing and timely achievements of family businesses and this year we are excited to celebrate our 50th anniversary. We rebranded to a vibrant magenta in 2014 and we are committed to finding customer led solutions, listening to our customers and working in collaboration with their needs.”
Since 2013 family businesses have increased employment by six per cent and turnover has also seen a strong rise, increasing by two per cent to reach £1.3 trillion. In addition, family firms paid £125 billion in taxes and contributed over a quarter (26%) of the UK’s entire GDP.
Speaking about the new findings, Peter Armitage, Chairman of the IFB, said “The report sheds light on the sheer size and scale of the family business community. It’s an important reminder of how vital family-run firms are to the UK – serving as the backbone of our economy, with family firms making a phenomenal contribution across all sectors, industries and regions.
“Family businesses have always been at the very heart of the UK economy and based on the steady rise in their recruitment and turnover, it is clear they are here to stay. It’s encouraging to see family firms with such a buoyant attitude towards their future expansion – almost half of family SMEs expect to grow over the next two to three years.”
Growth and expansion is a top priority for many SME family firms with just under half (49%) stating they aim to grow over the next twelve months.
Looking to how they will turn this ambition into reality just under a half of firms (43%) say they will invest in improving the skills of their workforce to support growth, with a third (33%) planning to boost productivity through investing in new machinery and premises.
Looking beyond their traditional activities to diversify their business and customer base, 42% of family firms are planning to move into new markets and 37% are developing and launching new products and services.