Historical Notes: United family of Benetton
Wednesday 24 March 1999
In Britain and other countries, many such businesses survived world wars and recessions only to be destroyed by the imposition of centralised controls over wage bargaining, staffing and management during the 1970s. Those which survived to the 1980s were often fatally weakened and vulnerable in a "free" market where predators masqueraded as capitalist heroes. Now, on the edge of the new millennium, the Government is preaching the virtues of both family and the return to work; and perhaps it is time we looked again at the family business.
The real-life rags-to-riches story of the Benettons is a case study in point. Just over 30 years ago, the four Benetton siblings started out with a locally proven idea and an ambition which no bank would lend them money to fulfil. Today they supply 8,000 clothing shops in 120 countries.
What makes such a successful family business? As was the case in pre- Welfare State Britain, it took a dose of straitened circumstance for every measure of hard work. The lack of a safety net, even near-anarchy, would seem to be a prerequisite for the rise of such a phenomenon. Nowhere are family and the family business more proverbially the rocks of society than in Italy, in whose postwar ruins the Benettons grew up, and amidst whose political chaos they remain happily centred today.
This is a circumstance-based recipe for success, and it includes a hefty dose of fate of the kind against which you cannot legislate. Luciano Benetton was only 14 years old when his father died after a debilitating illness and a business failure, forcing the son to leave school and become the family breadwinner. Had his father lived, it would have been a different story. "I am convinced," he has said, "we would not be here today."
The most successful family businesses are also the most flexible. In a move which most likely would have been impossible in a business in thrall to institutional shareholders and market analysts, they have hedged their bets by building a separate and parallel empire based on motorway and airport services, restaurants and hotels. This may be a mountain with one of the best-known names in the retail world, yet the summit is not named Benetton, but Edizione: an all-powerful holding company, the 16th biggest in Italy, yet owned by a mere five members of the family.
This ability to preserve the interests of family while introducing new blood, be it human or in the form of information technology, is disastrous in its absence. When a family business goes wrong, it goes very wrong indeed, and excessive or misdirected exercise of family control is usually to blame.
The successful family business, like the successful family, brings returns for workers and worker-owners. In the case of Benetton, success has also brought legalised xenophobia in the form of American protectionism, and schadenfreude on the part of envious advertising agencies when the brand strategy backfired and the advertising went out of control. It has brought the sharp side of the tongue from the chattering classes, whose residual contempt for "trade" belies the fact that their own prosperity is founded on the same.
What is the moral of such a family saga? It may not be possible to clone such a phenomenon, but it is possible to learn from it. It may be possible, but not desirable, to be a retail giant that feels it has to be a cultural icon in order to keep it in the family. Either way, if a family keeps a well-managed business, the business will keep the family, if not always together, at least functioning through the inevitable hazards of death, depreciation and divorce, all of which and more it has done in the case of Benetton, to the next generation.
Jonathan Mantle is the author of `Benetton' (Little, Brown, pounds 17.99)
Grace Dent on TV The Secret Life of the Pub is sexist, ageist and a breath of fresh air
Art Megumi Igarashi criticises Japan's 'backwards' attitude to women's sexual expression
tv Singer could become the most unlikely star of Westeros
Arts & Ents blogs
- 1 I've been called an abusive and dangerous parent, when all I did was listen to my transgender child
- 2 Migrant crisis: Greek soldier saved 20 people singlehandedly off Rhodes beach
- 3 Sofyen Belamouadden murder: The inside story of a crime that horrified Britain
- 4 Company breaks open Apple Watch to discover what it says is 'planned obsolescence'
- 5 Ian Brady: Moors murderer announces his support for Ukip and the SNP
Poldark episode 8, review: How a costume drama became a Sunday night swoon-fest
Al Pacino admits he was nearly fired from The Godfather and it's still his most 'difficult role'
Warner Music owner Len Blavatnik tops Sunday Times Rich List
The day I starred in Only Fools and Horses
Peter Kay’s Car Share, TV review: The perfect vehicle for Kay’s comic talents
General Election 2015: Chuka Umunna on the benefits of immigration, humility – and his leader Ed Miliband
The sickening truth about food banks that the Tories don't want you to know
Migrant boat disaster: Ukip candidate mocks victims in sickening Twitter post
Nigel Farage wants the BBC to stop making programmes like Doctor Who, Strictly Come Dancing, and Top Gear
Global warming: Scientists say temperatures could rise by 6C by 2100 and call for action ahead of UN meeting in Paris
General Election 2015: Britain would become a 'communist dictatorship' under Ed Miliband and Nicola Sturgeon, claims wife of Michael Gove