DOES the ownership of a company matter to the people who buy its goods and services?

According to a major survey published this week, the answer is emphatically "yes".

Family businesses were rated as the most trustworthy by 23.5% of the Scottish public in research commissioned by the Institute for Family Business (IFB), and produced by Censuswide, on the eve of a major conference in Glasgow. It put family ownership ahead of employee-owned firms, which 17% of Scottish people said were the most trustworthy, followed by venture capital backed businesses (10%), public limited companies (8%), and private equity ownership (5%).

The survey found Scots believe family-owned firms look after their employees most, compared with other types of businesses, with 30% rating them top on this measure. And more than one-fifth of respondents across Scotland associate family companies with the phrase “have great customer service”.

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For people au fait with the major themes in Scottish business, the findings will not come as a huge surprise.

Family-owned firms have for decades been the backbone of the Scottish economy, a point underlined by the IFB report, which took the pulse of 2,000 respondents in May. It found there are more than 280,000 family businesses in Scotland, accounting for 84% of all companies north of the Border and employing around 874,000 people in total.

Often these firms are long-established, meaning that in certain instances they have provided jobs for several generations of families, and are located in rural or remote areas where the employment they provide is crucial. Examples include the historic Walker’s Shortbread, which employs around 1,200 people in Aberlour, and fellow Speyside business Baxters Food Group, an even older company and employer of around 1,100 people in production roles in Fochabers.

To this list you can add a whole host of Scottish family firms that have been linchpins of the communities they are based in for many decades, from biscuit maker Tunnock’s in Uddingtston to Scotch whisky producers William Grant & Sons and Ian Macleod, which are constantly investing in infrastructure to prepare for the future.

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Ian Macleod recently submitted plans to Stirling Council for a huge whisky warehouse at Bandeath Industrial Estate, Throsk.

Crieff Hydro is another example of a family company that is forever planning for the future. Its profits are routinely reinvested by the Leckie family to develop the range of facilities and leisure activities offered at the properties owned and managed by the Perthshire-based hotel group.

Companies like these have demonstrated over the years a willingness and determination to make decisions that are designed to safeguard their businesses for the long term, which often requires major investment.

While it is impossible to tell how important family ownership is to consumers when they are weighing up purchasing decisions, the research from the IFB reinforces the impression that it is a significant factor at the very least.

But even long-established family firms which have prospered over generations are battling for survival right now. Steep rises in the cost of energy, labour, food, and drink over the last year or so, allied to rampant consumer prices inflation and rising interest rates, represent not just a risk to their ability to invest, but an existential threat to businesses of all kinds, including those which have been owned by families for many years.

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Given that backdrop, it may well be that some family firms find themselves in the crosshairs of predators, which might sense an opportunity to acquire businesses that could be vulnerable because of current trading conditions.

Over recent years a host of major Scottish companies, several listed on the stock market, have fallen to opportunistic takeover bids. And while it is by no means inevitable, such changes of ownership do not always work out for the best, with the arrival of private equity or venture capital owners often leading to cost-cutting, job losses, and headquarters moving outside the country.

Of course, takeovers can work out well. Matthew Algie, the Glasgow coffee firm founded more than 150 years ago, unveiled plans last month for a multi-million-pound investment at its production headquarters, allowing the company to roast more than 2,500 tonnes of coffee each year for customers and create 38 jobs.

Interestingly, the plans have come seven years after the business was acquired by Tchibo of Germany in a deal likely to have been worth tens of millions of pounds. This perhaps suggests that the change of hands has been a positive experience. Staff numbers at Matthew Algie have grown from around 220 at the time of the deal to the current headcount of 250.

It would be wrong, however, to believe that all takeovers have outcomes like the Matthew Algie experience. Takeovers all over the world are more commonly associated with uncertainty and ultimately, in many cases, a loss of employment as new owners look to make savings, which is often the driver of a deal in the first place.

Scotland’s finest family-owned firms have been incredibly adept at seeing off major challenges over the last 100 years, from world wars and recessions to a global financial crisis and the pandemic. But that does not mean that they would not benefit from the right strategic and policy support.

The IFB declared this week that a thriving family business sector is essential to a prosperous society, adding that family firms pursure sustainable and responsible models that others can learn from.

In comments issued shortly before the IFB held its three-day National Family Business Conference in Glasgow this week, the first time the event had been held in the city, chief executive Neil Davy said: “For too long, political, industry and business decision-making has taken a restricted approach to investment decisions that responds to priorities of non-family business PLCs, whose priority is to meet shareholder demands for short-term returns on investments.

“The UK needs to formulate a growth strategy that encourages and incentivises businesses to focus on longer-term investment opportunities and returns for stakeholders, the environment, and the UK’s role and place in the wider world.”

It is a sentiment that is hard to disagree with.