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'Vital' family owned SMEs urged to seek business support. Pearson May News Update - Monday 27 February
Pearson May news blog
'Vital' family owned SMEs urged to seek business support
Greater business management and support is vital for family owned small and medium enterprises (SMEs), a sector that is crucial to the recovering UK economy, the Forum of Private Business (FPB) has said.
In a statement, the FPB acknowledged that the UK's economic future was increasingly reliant on family owned small businesses, which make up nearly two thirds of the UK's 4.6 million SMEs.
According to the FPB, most family firms with more than 250 employees - it estimates there are just over 1,000 in the UK - are sold long before they reach their full potential because they 'lack the experience within the family to take the business forward.'
Calling family owned SMEs the 'backbone' of economic recovery as drivers of enterprise, entrepreneurship, and commerce, the FPB is encouraging firms to seek help and advice to ensure future success and diversification.
The FPB's statement comes after the Confederation of British Industry (CBI) also supported family owned businesses as key in transforming UK economic growth. The CBI's Future Champions Report said that small businesses, as well as facing difficulties accessing finance, often lacked the right capabilities to exploit a growth strategy. It also advised that many needed to acquire new management skills in order to expand and urged them to seek support.
The Forum's Chief Executive, Phil Orford, said that the importance of family run firms should not be 'underestimated' and that they were 'intrinsically linked to the future health of the UK economy.'
He said: "With such a huge number of small firms acting as the muscle for the UK economy, it's in everyone's best interest for these businesses to grow, flourish, and be able to trade to the best of their ability.
"If even a small percentage of family firms were able to carry on trading as opposed to either being sold or simply being wound up once the first or second generation retires, it could make a world of difference to the UK economy."
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