Brewing Up A Success At JW Lees

The JW Lees brewing business goes back as far as 1828, when John Lees started up a brewery as – in effect – a hobby business, after a lifetime as a cotton mill owner in Oldham and Manchester. In the 190 years since then, the business has grown, diversified, reorganised, and weathered wars, both inside and out.

As William Lees-Jones, its current MD says, “by the time my father joined in 1958 the firm was struggling – like lots of post-war family businesses, it had nearly been sold, was short of cash, and my grandfather and his brother had been at loggerheads since 1906 when third generation family owner John Willie Lees had died.”

“But in 1955 JW Lees was back under single family ownership – since my grandfather had finally bought out all of the rest of the family – and so the business was ready to rejuvenate itself. The family pulled together and then set about rebuilding the business, with my father running the beer business, and my uncle running the pub business, and then in the 1970’s we acquired Willoughby’s which is the wine and spirits side of the business.”

“At one point we had probably gone too far in terms of diversification with pubs in France, a hotel in Wales, off-licences and cash and carrys. You see that a lot in family firms – they often grow by expanding into a range of closely related segments, all of which seem to make sense at the time but sometimes it’s hard to keep all the plates spinning at the same time.”

“I became joint managing director in 2000 and then sole managing director in 2003, and spent the next ten years focusing us again on our core activities, which are running pubs and brewing beer. That said, we’ve also sold lots of pubs that were no longer fit for purpose, which means we currently have a war-chest which has been specifically built up for growing our pub estate. In fact we’ve bought six new pubs in the last two months which is good to see.”

These days, three of the sixth generation of the family work full-time in the business, and sit on [both] the executive committee and the Board, alongside other directors who have been hired in from outside to fill key roles like Finance Director, Operations Director, People Director and Sales Director. Two more sixth generation family members are non-execs and sit on the Board along with two members of the fifth generation. “We also have external advisers, who are very important to us in terms of challenging our strategy and offering their own expertise. But the business is still very much family-led. In fact, my personal view is that family firms should always have a family CEO or Chair, and if they don’t they should really sell the business because they could probably invest their money better elsewhere.”

William began his career in advertising in London, and joined the firm seven years later as a marketing manager, then moved to sales and after that the commercial side, before taking on the role of joint managing director. “And the ‘joint’ aspect of it was very important – it was a key part of our succession thinking. We built in an extended handover period as part of the plan, and it was over two years in the end. That type of long-term planning is so crucial in family firms. If you talk to people in the family business sector and ask them what’s the biggest issue they always say ‘succession’.”

“Getting the timing right, ensuring you have the right skills coming through, and that the next generation are properly prepared. We have a rule that family members have to work for at least five years somewhere else before they join. My elder son, for example, is studying for a degree in Hospitality and Hotel Management at the Ecole Hoteliere de Lausanne and spent two weeks with us on a fairly rigorous programme this summer, so he could experience the business at first hand and then, when he comes to decide whether he wants to join the family business, he’ll be making an informed decision which will be good for him and good for the business. When he graduates I think he’ll probably go and work for one of the big international hotel groups overseas – that sort of outside experience is invaluable. Also, I do not think that rushing family members into family businesses is a good idea.”

Another challenge is combining the values and stability of the family firm with the need to look to the future and embrace change. “In the family business sector, there’s always going to be a challenge attracting talent and there’s always going to be a challenge in terms of innovation. You can’t afford to be too paternalistic and over-controlled – you have to give the people the freedom and ability to achieve. That means being a progressive business, and finding a way to balance the experience of older family members with the enthusiasm of the younger generation as well as listening to and engaging with the professional managers that are working in the business.”

What does the future hold for JW Lees? “The thing that keeps me awake at night is how we can continue to build a really great business. The family firms who are really good at that are in markets like Germany – there’s a lot we can learn from their approach in terms of building long-term businesses and attracting talent. In the next few years we think the real growth in the UK leisure and hospitality sector will be in food pubs and hotel bedrooms, rather than city-centre bars, and we’re shaping our business accordingly. We’re keeping our business structure simple so that it can support that growth, and investing in the infrastructure and resources we need. Our biggest challenge is to get people to physically leave their homes and come into our pubs and pub restaurants, and to do that we have to exploit all the resources technology now gives us. We just doubled our digital marketing budget, and that’s just the start.”

This piece was featured as part of the PwC Family Business Survey.

It has been reproduced with their permission. Find out more here.