The importance of family owned businesses to the Irish economy was highlighted in the Family Business Network Ireland submission to the Commission on Taxation and Welfare in January of 2022. It noted that 173,000 family owned businesses employed approximately one million people at the time.
“Around 70 per cent of Irish businesses are family owned,” says AIB’s finance and leasing sales representative in the South East and former Waterford hurler Michael Walsh. “They can be found in every town, village and community in Ireland and are crucial to local economies. At AIB, we respond to the needs of each customer individually depending on the sector and structure of the family business. We offer guidance to ensure clear and consistent communication to all members of the family and to help identify and agree a long-term vision for the business on issues like next-generation involvement, traditions and values and implementing a strong and steady management team.”
He points out that AIB sponsors the DCU National Centre for Family Business which supports the sector by providing research on family businesses.
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Walsh notes some of the particular issues facing family owned enterprises including interpersonal relationships. “Formal structures can help you avoid conflict as your business grows and develops and it can help ensure there is a focus on growth and opportunity. You should communicate with family members in the same way that you would any other employee.”
Planning for a smooth transition to the next generation is also important. “It will help to make sure that the business you’ve created becomes a legacy,” says Walsh. “Family business owners should talk to a tax specialist, solicitor, their bank and accountant in relation to this. At AIB we are focused on providing support to grow and sustain the business beyond a single generation through expert financial planning.”
One AIB customer which has successfully navigated an often choppy business environment over many years is the Cantec Group. The technology provider was established in Waterford in 1994 as a photocopier dealership by the parents of executive chairwoman Eadaoin Carrick and chief executive Greg Tuohy. The business has grown both organically and through strategic acquisitions over the years to become an industry leader in technology solutions.
Speaking about what makes running a family business unique, Tuohy says: “For me it comes down to ultimate trust – blood is thicker than water. I know no matter how tough things get, I can always trust that Eadaoin and I will do the right thing by each other. We have weathered a pandemic and recessions together, there is a lot of risk in the decisions you make along the way so having that maximum trust is important.”
“Succession is key too,” Carrick adds. “Greg and I have been running the business for so long, it’s easy for us to forget that we have all the information, and maybe other people in the business don’t know as much. It’s important to go down that path and explore the options to make sure the business can go on to the next generation.”
Printing less
Cantec is focused firmly on the future and growth after making two acquisitions during Covid in response to changes in the printing industry. “We had to pivot to buy two software companies because print as a practice is becoming outdated, so we had to diversify,” Tuohy explains. “It’s really important that we have alternatives as customers look to print less and do things electronically. We want to guide them through their digital journey. There is still an important role for our traditional printing business, particularly for certain sectors like teaching so we have embraced this through the government tender process, and this is working well for us.”
They both agree that communication with banks is critical for family businesses, especially when times are tough. “Cash flow was a major issue for many businesses during Covid because the business wasn’t there suddenly, but your fixed costs remained,” Carrick points out. “Being able to talk to our relationship manager in AIB to make sure everything was still being paid and to avail of supports was vital. Anytime we see anything worrying on the horizon, we go straight to our relationship manager in AIB.”