Are family firms a study in strain?

New research has revealed that the vast majority of Dundee’s family business owners say running the firm is putting a strain on family relationships.

The survey, conducted by law firm Aberdein Considine, showed that nearly three quarters (73%) of those in Dundee feel being in a family firm causes additional strain on their families and personal relationships. This compares to 78% in Scotland and just over 63% for the rest of the UK.

More than eight out of 10 owners (85%) in Scotland said they found it difficult to separate business and family life, with 75% unable to switch off after work. In Dundee 73% found it challenging to keep their business and private lives separate, compared to only 48% in Edinburgh and 43% in Aberdeen.

Family businesses in Scotland account for around 50% of all private sector employment and are responsible for roughly half the GDP created by private enterprise.

The high level of stress among owners suggests that the blurring of the lines between their entrepreneurial ambitions and their private lives could be having a negative impact, which could ultimately affect both their businesses and their families.

Whilst almost three quarters (74%) of owners cite debt in the family business as one of the main factors which affect relationships, eight out of 10 (80%) of those questioned in Dundee and the surrounding area said this was a major issue.

Among the main pitfalls of being part of a family business, 73% of those surveyed in Scotland said it was too close to home, with just over a third (35%) suggesting they take things too personally. Around one in five (22%) highlighted the challenge of managing family members as one of the toughest factors.

Across the UK, the survey also revealed the significant differences in views between those in large family businesses and those who were part of smaller enterprises. In larger businesses of 250 or more staff, 91% said there was additional strain whereas in smaller firms this figure was 46%.

Furthermore, 82% of those in larger companies found it difficult to keep work and family life separate, compared to just over half (51%) in smaller businesses.

Naeema Sajid, Family Law Partner, Aberdein Considine, said: “Running and owning a family business can bring great freedom, flexibility and significant financial rewards but it also comes with certain unique pressures, not least the blurring of the lines between business and private lives.

“Running a business will always require sacrifices, whether it’s a start-up or well established, and recognising and managing these pressures is vital and could well have significant benefits for both the business and families.

“Involving family members in discussions or taking advice at an early stage can go a long way to reducing stressful and complex situations and it can also lead to better and more efficient decision making.

“It can also prevent unnecessary misunderstandings which can sometimes result in a longer-term negative impact on the business.”