UK’s family businesses go digital, but 'Succession'-style power struggles holding them backJuly 12, 2023 | London, UK
The UK’s family-run businesses are more prepared to succeed in the digital economy, but power struggles and personal relationships could be holding them back, according to new research from Mastercard.
Family businesses are 30% more likely to want to transform their business through technology than non-family businesses. They use more digital tools since the pandemic (91% vs 76%) and say they want to expand the ways they accept payments, improve their social media presence and join an online marketplace.
But going digital isn’t simple for family businesses, with almost a third (29%) saying a ‘closed mindset’ and ‘adapting to the times’ were issues in their business.
Why it pays to keep it in the family
The research shows the benefits of running a business with parents, children, siblings, and extended family. Family businesses feel more resilient, with two in five saying that being family-run makes a business more resilient and adaptable, while six in ten (61%) agreed that being a family business had helped them to build closer relationships with customers.
But power struggles and disagreements can get in the way
There are emotional factors at play for family businesses that may be affecting growth, including a Succession-style power struggle. One in five (18%) respondents say there’s conflict over who’ll take over the family business, and a quarter (23%) say personal relationships are one of the biggest challenges. And generational differences can slow things down: respondents said the older generation were not seen as being open to try new things, like bringing in new technology, systems or processes.
Two in five family businesses say they want more education, training, and mentoring. And more than a third (37%) feel they would benefit from business mentorship and guidance – this compares to just a fifth (21%) for non-family run companies.
Mastercard is using its infrastructure, technology and partnerships to support SMEs in the UK. Mastercard’s Strive UK programme helps small businesses to access free training and advice to tackle business challenges, like setting up an online shop, managing cashflow and creating a social media strategy. Businesses also have access to experienced entrepreneurs and boards to help them grow their business and strengthen their resilience. Strive UK has reached more than half a million businesses to date and works with Enterprise Nation, Digital Boost and Be the Business to provide support. As part of its Get Britain Growing series, Mastercard has brought together some of the country's best innovators and thinkers to make recommendations that will help small businesses thrive and boost growth.
About Mastercard (UK)
Mastercard is a global technology company in the payments industry. Our mission is to connect and power an inclusive, digital economy that benefits everyone, everywhere by making transactions safe, simple, smart and accessible. Using secure data and networks, partnerships and passion, our innovations and solutions help individuals, financial institutions, governments and businesses realize their greatest potential. With connections across more than 210 countries and territories, we are building a sustainable world that unlocks priceless possibilities for all.