FAMILY-RUN BUSINESSES FACE CHALLENGES AMID RISING COSTS - BUT SAY ONE THING IS KEY TO SURVIVAL

Family-run businesses say they need four relatives on average – across different age groups – to thrive and survive. A poll of nearly 1,200 family business owners found 82% believe intergenerational collaboration is key to growth. They reported loyalty (49%), trust (49%), and emotional support (34%) as being benefits of working with family members.

Those polled believe the most common essential qualities older generations bring to their businesses are work ethic (48%), industry knowledge (47%), and mentoring skills (44%). Whilst the younger generations are most relied on to contribute social media and digital marketing expertise (49%), tech-savviness (45%) and innovation (44%).

However, challenges persist, with 51% saying energy costs are the biggest financial challenge they face, followed by rising running costs and 39% are contending with the rising cost of living. Over a third face increasing supplier costs, and 18% cite more competition in their market and 85% highlight long hours and lack of time to get everything done.

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Entrepreneur and Dragons’ Den investor Deborah Meaden, who has partnered with Smart Energy GB which commissioned the research, said: “Family-run businesses have always been the backbone of the UK economy, providing stability, innovation, and a sense of community across generations.

She added: “However, increased costs are a challenge, be it supplier costs or running costs such as energy. Something owners can do to help them to manage their energy usage and costs is to get a smart meter installed which can also help them identify where they might make some cost savings.

“These types of business have stood the test of time, and I believe they will continue to thrive in the future, adapting to new challenges while staying rooted in their family values.”

When it comes to the future of their businesses, 26% of family business owners say they are already dedicating a lot of time to succession planning. With 85% confident their businesses will remain in the family. Eight in 10 (82%) hope their younger family members will step up to take the reins, and only 7% foresee their businesses closing or being sold outside the family.

Gianluca Capilungo, co-owner of Capilungo café, London, said: “We learnt a lot from our uncle in Italy about how to run a successful business which has been invaluable especially as, like many businesses, we have experienced a lot of challenges since we opened.

“Rising costs have been an issue as pretty much everything has gone up, from produce to energy. Getting a smart meter was an easy thing for us to do, as it has helped us to manage our energy use and budget.

“We are invested in the business’s long-term success and making it financially secure, so we can leave it to the next generation and ensure a piece of our family heritage stays in the local community.”

The research, conducted by OnePoll, also found 85% agree that sustainable practices must be integrated into their business operations. A third of these business owners prioritise recycling, with 29% focusing on energy management.

One in four (26%) are working to reduce packaging waste, whilst 22% are investing in more energy-efficient equipment, and 21% are prioritising local suppliers.

Victoria Bacon, a Director at Smart Energy GB, said: “We know from our research that business owners are dealing with financial strain, with running costs, including energy, high up that list.

“A smart meter measures energy usage in near real-time, which means you only pay for the energy you use and no longer receive estimated bills, which can help a business with managing its cashflow."

2025-04-23T13:31:46Z