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Mathieson’s Bakers
George Stevenson, Managing Director
Mathiesons is a 4th/5th generation family owned bakery and restaurant business based in Falkirk. Two years after I married the younger daughter of the majority shareholder, I was invited to give up my career as a Marine Geophysicist and join the family firm. Two years later I was Managing Director. That sort of thing happens in Family Businesses.
During the 90s, the public’s burgeoning love affair with the supermarkets in general and the growth of in-store bakeries in particular put the traditional craft bakery under enormous pressure. Mathiesons were not coping well with the rapidly changing market place. In August 1999, I received a call from our finance manager to tell me that the latest results indicated that losses were starting to spiral out of control.
Our Bank, Accounts and Lawyers showed various levels of sympathy but the same lack of understanding of family businesses and gloomy outlook for the company. I tried all my traditional sources of advice – either there was no advice on offer or the advice had simply made things worse than they were before.
I stumbled across an article written in 1995 to highlight the launch of the Centre for Family Enterprise that gave some answers to the conundrum of why the survival rate of family businesses is so low beyond the first generation. At this point, the penny dropped. The poor performance of the management was a symptom, not the root cause. The cancer that was crippling the company lay deep within the complex family dynamics that grow and develop as a family company matures through successive generations. Critically, none of us involved at the time – advisors, family, owners or management – possessed the knowledge to even identify it, let alone cure it.
The author of the article (a solicitor who had retrained as specialist adviser to family businesses) was in my office the following day and from that moment onward my life, and the fortunes of the business, were transformed. The family and the owners were now the client, not me. Lines of communication were opened up and operating structures between the family, the owners and the business were established. Everyone started to learn about governance, ownership, family constitutions and family councils. And, crucially, a non family, non-executive chairman was appointed to the Board.
Within 3 months, the Board was giving clear direction and the family management was delivering what it does best – passion and commitment. Within 12 months the company was back in profit and today is still going from strength to strength.
If I hadn’t kept that article, Mathiesons would be history. We learned the hard way. Family business issues were stumbled upon rather than planned for.
I don’t want other family businesses to go down the same route. I want family businesses to be aware of the best practices for their organisation and to be able acquire the appropriate specialist knowledge to provide the advice they need. That’s why the Scottish Family Business Association is so crucial to this very important sector.
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