Family businesses can be some of the most successful companies in the world. Just look at Nike whose founder Phil Knight recently stepped down as chairman as his son Travis Knight took a seat on the board in 2016. Walmart is still a family business and L'Oreal is still controlled by the founder's daughter.
In the UK, there are about two million family-owned businesses and Barclay's research suggests they are some of the fastest growing of all enterprises. However, it has long been known that family businesses can often fail at the point of succession from one generation to another. As someone who took over a family business, this is my story and lessons I've learnt.
Our parents ran a successful bakery and made traditional mochi for the past 30 years for the Asian grocery market and were close to retirement. There was never any pressure on us to take the business over but we had always wanted to start our own businesses having been inspired by our entrepreneurial parents.
As a new generation, we understood that traditional mochi filled with red bean azuki paste would be a little bit out of the comfort zone for the average consumer, so we decided to innovate by combining indulgent flavours of delicious gelato spheres made from British dairy and wrapping them with sweet, soft mochi dough. We also knew the importance of marketing and branding, which our parents were less familiar with.
Initially, whilst there was some scepticism of our approach, our parents trusted us to follow our chosen path for the business. Five years on, we have quadrupled the size of the business but we are still on a journey of discovery and learning. Here are my top 5 tips when it comes to running a successful family business.
1. Take over the family business because you want to, not because you need to
We chose to go into the family business because it excited us and we saw a way to grow and evolve the business. Whatever you do, must excite you. If it doesn't inspire you and you can't see a way of making changes then you should follow your own path.
2. Work somewhere else first
Know what it is like to be managed by someone other than your family member. Learn good and bad management traits. Learn how that company is organised and run so you have something fresh to bring to the table. Being a business owner requires discipline and a great level of professionalism, which is often learnt in a larger corporation.
3. Consider having a partner and hiring people outside of the family
Running a business alone can be quite isolating so consider having a business partner. My business partner is my brother. We grew up together and get along well and I trust him implicitly. It has been wonderful to be able to share the ups and downs. We have complementary skills so it is handy being able to bounce ideas off each other for different perspectives.
Remember to also hire from outside the family as it is important bring in skills that the business requires. Hire people that are smarter than you and trust them to do their job.
4. Nurture family relationships
Remember not to take your family business partner for granted. Often we can be harder on family members and treat them with less respect than we would a non-family member. Running a business together will inevitably mean you end up talking about business all the time but try to take time out and do fun family things too.
Setting boundaries is also important, there was a time I lived and worked with my brother.... Needless to say it was a bit of a disaster.
5. Maintaining family values
Family firms tend to take a longer-term view of the business and run it more prudently but entrepreneurially. It is not about short term gains or cutting corners to make a quick buck. The integrity of the product and the family name is on the line so there is more to lose than just money. We look upon all our employees as part of the Little Moons family. Many of them have been with us for years and they've been on the journey with us.