Founded in 1930 Merrythought is the UK’s oldest remaining manufacturer of handmade teddy bears. Although originally a mill in Yorkshire spinning mohair yarn the founder W Gordon Holmes sought to diversify by turning his mohair into a much more desirable and profitable product - teddy bears.
Over 50 years later, Gordon’s grandson Oliver Holmes and his sister inherited the company from their father. Oliver was forced to buy his sister’s shares when she expressed no interest in working in the company. The difficult move gave sole ownership to Oliver’s immediate family, including daughters Hannah, Sarah and Sophie, who continue to work in the business today.
The family were involved in decision making from an early age. “I have vivid memories as a small child of walking the factory floor with my father and being introduced to all the factory staff,” Hannah says. “There were teddy bear and soft toy parts as far as the eye could see. I loved seeing the rows of rocking horses ready to be dispatched.”
Sadly Oliver passed away unexpectedly in early 2011, which saw Hannah and Sarah taking on managerial roles earlier than anticipated. “I had always intended to be involved in the family business but wanted to carve out my own career and gain business experience outside the company beforehand,” Hannah says. “I’m a qualified chartered surveyor and was working in commercial property in London before I joined he family company. We never could have prepared for the loss of our father at such an early age, which has meant I have ended up joining much sooner than I intended and with no handover as such. But when dad passed away there was no question over whether or not I would become fully involved.”
Key family values such as “pride in ones work” and “maintaining the highest quality through attention to detail” have been instrumental in the longevity of the business. Hannah also feels that her father’s approach to investment and risk has maintained the company’s independence. “One thing that dad always resonated was to never owe anybody anything. Everything that has been invested in the company has come from business revenue,” she says. “My father was a calculated risk taker who saw money as a tool and was therefore not afraid to re-invest in new areas of the business for potential long-term benefits. This has ensured that the company has remained independent with only a very small number of family-only shareholders.”
Historically, the biggest challenges for Merrythought and its competitors have been cheaper imports and changes in consumerism. Hannah and her sister Sarah, who now manage production and product development respectively, face the challenge of bringing the business in line with the times while maintaining its quintessentially-British charm. Their vision is to strengthen the brand in the UK so that when people think of teddy bears they think of Merrythought. “We would like to increase our domestic business as well as looking into getting back into the North American market which was very big for us in the ’80s and ’90s,” she says.
The personal and emotional challenges of the last year have made it more difficult for the sisters to adapt to the business. There is also the concern that they have not earned their positions in the company. “It is hard commanding respect from employees who have been with the business for decades under the management of my father who was a larger-than-life character,” Hannah says. “We are also the first women to head up the company, and amongst the youngest who work for Merrythought, so we do feel we have to prove our worth a little bit. Being a family business means you definitely take things a little more personally.” It can also be hard to balance work and home life. “We have to make a conscious effort not to turn Sunday lunches into working lunches.”
At present, the governance structures are simple as there are only four shareholders in the company; the three sisters and their mother. “The strength of our structure is that everyone has similar values and levels of sentiment towards the business so we are all trying to achieve the same goal, which is to build the company up for a stable future for the family. We are not in it for a quick buck,” Hannah says. “The challenges with three sisters are to maintain a fair and balanced relationship between them all and not to let any family issues cloud the professionalism of running the business.” This dynamic will obviously change when the sisters look to having their own families, but feel they can tackle this when it happens.
Hannah relishes being so closely involved in the business and considers it a privileged position to see her ideas put into practice. But there are less-favourable aspects of working in a family business. “The worst thing is juggling an infinite number of plates. You can be meeting a big customer for tea in Mayfair one minute and sorting out a leaking factory roof the next.”
The key to a successful family business Hannah feels, is to not let sentiment get in the way of practical business decisions. “It is about keeping sight of what your business is - your products, your image, your brand and your values. You need good management structures in place to ensure that the business comes first but not to the detriment of family relationships,” she says. “Try to avoid having too many fingers in the pie. If this is unavoidable then make sure that everyone is giving as much as they are taking.”
For more information please visit www.merrythought.co.uk