A SENIOR leader at a historic Scottish timber company has declared that the long-term strategies favoured by some family businesses will be an asset as firms look to trade through and rebound from the coronavirus crisis.
Michael Donaldson, deputy chairman of James Donaldson & Sons, said the tendency of family firms to take a “conservative” approach will have held them in good stead as they dealt with the lockdown and will be helpful now as the economy slowly reopens.
The comments from Mr Donaldson come as The Herald reveals details of its first online Scottish Family Business Breakfast event, which takes place on September 1.
The event, which is supported by Business Gateway, Clydesdale Bank, TL Dallas, Strathclyde Business School, and Family Business Solutions Ltd, will provide an opportunity for family-owned firms to examine how the sector can recover from the devastation caused by the pandemic. Mr Donaldson will be the keynote speaker and will be joined on the panel by Peter Facenna, managing director of Allied Vehicles, Giovanna Eusebi, cook and co-owner of Eusebi’s Deli in Glasgow, Lyndsay McGonigle, managing director of Top Drawer UK, and Iain Stirling, owner of Arbikie Farm Distillery.
Speaking to The Herald, Mr Donaldson said the Covid-19 crisis had struck as James Donaldson & Sons had been going from strength to strength, having experienced “record year after record year” over the previous six years.
Mr Donaldson, who is due to become chairman of the family business in August, said that strength had been helpful to the company when it was suddenly faced with temporary closure because of the crisis.
“That put us in a position where we have been able to weather the storm over the last few months,” he said. “[We have a] good bank position, good cash position, really strong management team, and we have been in this industry for some time now and I’d like to think we know what we are doing.
“Now there will be other family businesses which weren’t in as strong a position as us. But I think, over the piece, family businesses tend to be a little more conservative than larger public businesses, or younger, first-generation start-ups as at either end of the scale they are under pressure for growth.
“Generally, family businesses tend to be a little bit more conservative, [and] have a longer term view, and that tends to put them in a slightly stronger position.”
James Donaldson & Sons, which began life as a small timber merchant in Tayport in 1860, supplies a range of manufacturing materials to the housebuilding sector, as well as to the home improvement market.
The company put 95 per cent of its 1,020 staff on to the furlough scheme after it was launched early in the lockdown. But now around 75% of its staff are back on board, with the company gradually resuming operations in line with the easing of lockdown measures as that has occurred on both sides of the Border.
The company, which celebrates its 160th anniversary this year, has been able to reopen its locations more quickly in England, where the process of exiting lockdown has been running ahead of Scotland due to the approaches taken by the different governments.
Mr Donaldson added: “We are benefiting from the industry we are in, as the government tends to look at construction as a way to get the economy moving again, because there are just so many people employed in it. From that perspective, we are lucky we are at the front of the queue, I suppose, in one of the industries they are looking to try and get back as soon as they can.”
Hugh Lightbody, Chief Officer, Business Gateway said, “Local, family-run businesses play a vital role in the Scottish economy and are facing unparalleled challenges due to COVID-19, with many forced to make significant changes in order to survive the crisis.
“However, despite the extremely difficult economic circumstances, Scottish businesses have shown incredible adaptability, with the creation of innovative solutions across every sector that should be recognised and shared. The Herald Family Business Breakfast offers such an opportunity and in doing so, acknowledges the breadth and depth of the skills and expertise within the Scottish business community that will be vitally important as the country moves forward.”
David Henderson, Regional Manager Business Banking, West of Scotland said: “We are delighted to be sponsoring The Herald Family Business Breakfast for the third time – an event which recognises the importance of the nation’s family firms and their contribution to our economy. The Lockdown imposed due to the COVID-19 pandemic has hit Scottish SMEs hard and the majority of these are family businesses. Events like this, even in the virtual world, are integral to bring businesses together to discuss and debate the key challenges we face in these unprecedented times, as well as helping businesses foster closer ties to one another, which is vital in this uncertain economic environment. As a Bank, we remain committed to supporting Scottish family businesses, helping them to grasp opportunities and navigate these difficult times.”
John Anderson, Head of SME Engagement said: “Strathclyde Business School is delighted to continue its support for The Herald’s family business initiatives and we are looking forward to the 2020 Family Business Breakfast in its new format – which has the potential to engage an even larger number of family businesses at this critical time.
Scotland’s family businesses represent the cornerstone for much of the Scottish economy and are vital to communities everywhere, supporting employment and supply chain partners. We are well aware of the sectors that are currently experiencing hardship and the Family Business Breakfast gives us the perfect opportunity to come together to learn from and support each other as we recover from this crisis.”
Bernard Dunn, client director at T L Dallas, said: “As a 101 Year Old family business, T L Dallas is delighted to continue our support of The Herald Family Business Breakfast. Despite the huge challenges facing family owned companies at this time, their can-do philosophy of “THE SHOW MUST GO ON – SOMEHOW” is an example to all of us.
The Heralds initiative to take the Business Breakfast online, is keeping that positive mindset going , and we have a true family business leader as keynote speaker in James Donaldson, plus a terrific panel for the Q&A session.
I recommend any family business member and their advisers to register for the event – it will be a fascinating insight into how family businesses are responding to adversity. “
For information, visit https://newsquestscotlandevents.com/events/fambizbreakfast-2020/