The analysis
Since Lehman Brothers filed for bankruptcy at the tail end of 2008, the economy has been teetering on the edge of a cliff. A woeful 24,368 companies had to shut up shop last year. Public debt soared to £844.5bn – the equivalent of 60.2 per cent of GDP. And the financial crisis threw every region of the UK back to the jobless levels of 1999, with 1.6 million people claiming job seeker’s allowance.
Keeping it in the family
From digital pioneers, we move to family firms. Next to the fledgling online companies on our Hot 100 list, these companies are comparative dinosaurs – but with no signs of becoming extinct. Many have been around for generations, surviving countless economic blows by constantly tweaking and updating their business models. Whoever said you can’t teach old dogs new tricks was wrong.
No other company shows this better than Bibby Line Group (75). This family firm, founded 200 years ago in Liverpool, is the oldest business in this year’s Hot 100. Now run by the sixth-generation Sir Michael Bibby, it’s also the biggest, with a whopping £1.03bn in annual sales.
Bibby tends to be viewed as a shipping company, with vessels in every sector from liquefied petroleum gas and chemical tankers to dry-bulk and containers. But, after a difficult spell in the eighties, Sir Michael’s father (Sir Derek) diversified, creating a complex conglomerate ranging from subsea construction and private equity to cash-flow services and warehousing (Bibby is one of the UK’s largest logistics firms). In 2007, the company took another bold step, buying a 51 per cent controlling stake in convenience store chain Costcutter. And last year, Bibby attempted to take over Nisa-Today’s supermarket buying group, but the offer was rejected.
Sir Michael joined the family firm in 1992 as financial director, before rising to the top job in 2000. Oxford- educated, with an estimated personal fortune of £133m, he is regarded as one of the most energetic bosses in the company’s history. Some of his decisions, such as the move into woodland burials, have baffled some financial commentators who query the ability of the group to operate such a wide range
of businesses, but the company’s astonishing growth (it has grown an average 53 per cent every year since 2006) has silenced the critics.
Leeds-based Troy Foods, at number three in our list, is another example of a dynamic family firm. It started life in the thirties as a fruit and vegetable wholesaler, became a potato-processor in the early seventies, then, a few years later, turned its hand to supplying ingredients for ready-meals. Today, its customers range from national brewery chains to blue-chip manufacturers, who use Troy’s products in everything from pizza toppings to samosas. The company, which pulled in sales of £21m last year, claims to have introduced 25 new products in the past 18 months alone and says it has a “bank” of 85 recipes in various stages of trial. How’s that for innovative?
“I’m not surprised by the number of family businesses in this year’s list,” comments Guy Rigby, director and head of entrepreneurs at accounting firm Smith & Williamson, our Hot 100 co-sponsor. “Family firms aren’t get-rich-quick merchants. They have a long-term vision for their business and a stable management structure, which makes them well placed to battle through any downturns.”
LDC’s Brooks: “Family firms take a different approach to business. They’re not about immediate profitability, they’re about longevity. They keep the family silver safe by continually investing in new products and markets, and making sure they’re competitive. And if they’ve been doing that for 100 years, you can bet they’ll be doing it for the next 100 years.”