Born and raised to take the reins

FAMILY businesses have been judged the most trustworthy by 23.5% of the Scottish public.

As revealed in The Herald, research commissioned by the Institute for Family Business (IFB), placed family ownership above employee-owned companies, venture capital backed businesses, public limited companies and private equity proprietorship.

The survey also revealed Scots believe family-owned companies take best care of employees, with 30% of respondents rating them top. More than one-fifth also associate family firms with “great customer service”.

All of this is, of course, a welcome validation of the successful business model and corporate ethos we’ve enjoyed for many years at McGhee’s Family Bakery.

Founded in 1936 by Dugald McGhee in Maryhill in Glasgow, our bakery has thrived across Scotland thanks to the unwavering commitment of four generations and the dedication of our workforce.

In the 1950s and 1960s sons Jim, Calder, Douglas and Gavin joined the firm, while in the 1990s third generation Gordon, Stuart and Ian became directors. The fourth generation – Russell, Grant and myself – came onboard in 2018.

My own route into Scotland’s bakery sector came from a Chartered Accountant background at KPMG. There was a role available in McGhee’s as a Management Accountant so I joined aged 28.

As well as becoming financial controller, I’ve moved into lots of other financial and commercial roles within the company so my remit is very broad.

This diversity is what I especially like about a family business: the variety of roles and responsibilities was one of the reasons I wanted to join. You get to experience the business as a whole rather than being just a number beavering away.

Often family firms such as ours are long-established, providing jobs for several generations of employees and acting as vital hub for the community. It’s certainly true there has always been a family presence at McGhee’s, especially in the factory.

My dad or my uncle or my cousin . . . one of them will always be there. They’re not Directors who sit up in their ivory tower – they’re hands-on to the point they’re still working six days a week. They absolutely love it! Our team appreciate this brings a personal and engaged dynamic to the work environment. 

There are very few disadvantages to family ownership and management but one challenge is the new generation proposing change. 

This can be extra-challenging when something’s always been done the way it’s been done, but at the same time, we do respect the methods and practices of the senior generation – we aren’t just trying to get rid of the dinosaurs! 

Thankfully, as a company already much larger than most other family businesses in Scotland,  innovation is ‘baked in’ to our growth strategy. This means we treat ourselves like a large corporation in the way we’re doing things, especially in terms of internal systems, evolving technology and reporting. 

As the fourth generation, we’re fully committed to Scotland’s bakery sector and our own company’s journey. Russell is focused on production while, among other things, I’m looking at commercial finance. 

He’s pushing innovation and efficiency in the factory – we spend more than £1 million in capex annually (this year it will be over £2 million) upgrading to state-of-the-art equipment to fulfil orders and satisfy customers – and I’m doing likewise in the back office. 

In truth, this focus on continually striving to be the best is a commitment shared among the entire Scottish bakery community, a sector that has always proved to be an extended family in many respects, being incredibly supportive of one another.

At McGhee’s we’re making sure the next generation is ready to take on the mantle of leadership, with the senior generation having a solid plan in place for when they take a step back. 

Not that it’s imminent! My grandpa was still coming in each day until he was 85!

I remember my dad saying to me: ‘I’m going have to tell your grandparents to stay up in the office.’ I was thinking to myself: ‘I’m going be having the exact same conversation with you one day’.

A key thing with succession planning is the role of non-family and our Finance Director Bill Blacoe has been instrumental in successfully managing our strategy. It is incredibly beneficial to have him as an independent body to focus, mediate and keep things moving. 

He helps us focus on where the senior generation sees the ownership of the business going: we certainly want to remain family owned.

Recent polling by Censuswide in Scotland showed people would rather work for a family business than any other and we have more than 400 employees across the country, many with long and loyal service.

Recognising the importance of keeping highly skilled and dedicated employees, from January this year we increased wages by 8% with a further 2.5% in April. 

Currently, we’re looking at how we attract new people, presenting a package that addresses the question ‘As well as a great salary, what else can we offer?’. 

There’s a general perception only the largest corporations provide extra benefits to employees but, as a family business, McGhee’s is very proactive in this area.

The IFB has also stated a thriving family business sector is essential to a prosperous society, adding that family firms often pursue sustainable and responsible models others can learn from.

This responsibility as role model cannot be taken lightly and McGhee’s Bakery have no intention of resting on our laurels. As well as embracing greener, more sustainable production methods, we’re looking at how our produce can attract a younger demographic by pioneering products that have that sought-after craft element but are created on high-volume production lines.

To maintain our position as industry leaders we’ve always reinvested, ploughing our money back into the business. In the past 10 years we’ve invested more than £20 million on leasehold improvements and ever-more efficient plant and machinery.

To ensure high-quality and profitability, all bakery businesses need to make such financial commitments.

Above all, we keep on top of the latest innovations in order to take the next steps in our evolution. Not all businesses are so forward thinking . . . but, then again, not all businesses are family.

www.mcgheesbakery.co.uk

• This article was brought to you in association with McGhee's bakery