Family businesses don’t always have a golden ticket for enduring success.
Early years of growth can sometimes be replaced with times of difficulty, even failure. Having the right people in place and making the correct decisions at key times is, of course, very important.
James Latham, a ninth-generation family business founded in 1757, has been going longer than most in the timber industry.
Its chairman Nick Latham, who took up the position last year, is keenly aware that past glories are no guarantee of a successful future.
He became aware of this at a young age when he wrote a dissertation on family businesses at university.
“The first generation have the drive to make a family business successful, the second generation are very proud of what their dads have done and carry on the momentum but things can go wrong with the third generation. Too many family members go into the business.”
As a result, competent non-family members don’t stay because there is no chance of their progression within the company.
Nick explained that the Latham family has always been determined not to fall into this category and do what is right for the businesses, shown by the fact that non-family member Chris Sutton is managing director, while future MD Andrew Wright (who takes over in April) is also outside the family.
The rule is to have no more than three family members of the same generation at the company at the same time.
Other members of the Latham family currently in the business are Piers Latham – an eighth generation family member and a second cousin to Nick – and 29-year-old Edward Latham, who is ninth generation and based in the Hemel Hempstead sales office.
People assume Piers and Nick have known each other all their life because they are in the same family but that’s not strictly true.
“The Lathams family is very widely spread and I probably would never have met Piers but for the company,” said Nick.
Early years
Nick’s own journey into the timber sector started when he was 18.
“I was always proud of what my father [David Latham] had done. He was always talking about timber.”
At the time Nick didn’t know what he wanted to do beyond university, but he did want to travel.
This thirst for adventure saw his father set him up with a job in the US timber industry at Northland Forest Products.
“I realised I was going to be working with some pretty interesting characters. I was given a bike and a flat in the village next to the mill. It was minus 10C on the first day, with snow on the ground and I was on a bicycle.
“There was nothing glamorous about it, I worked in the grading mill. It was a baptism of fire and that was my introduction to the industry.”
Nick worked at Northland for three months and then toured the US for six months, before heading back to university in the UK.
It was not a foregone conclusion that he would go into the timber trade because of his family connections. In fact, he eschewed the silver spoon mentality.
“I wanted to have independence and prove I had the capability to do what I wanted to do,” he said.
He studied Business Studies and Employment Law at university and during summer months he worked at Lathams on specific projects, sometimes helping struggling parts of the business.
When Nick decided to apply for a job at James Latham, Peter Latham interviewed him, asking him how his degree would help the company.
“I had to justify myself, they were not just going to let me into the business,” Nick remembers.
That was October, 1991 and he embarked on an 18-month training programme, starting in the hardwood business, picking orders, in the sales office and yard before moving onto softwood and panel products.
“There was no different treatment of me because I was a Latham. I had to get my jeans on and do the same training as everybody else.”
Kent and north-west London were his first sales areas for two and-a-half years.
“I really enjoyed it and I think it was an important time. Being a Latham, your customers have high expectations of you.”
In all he spent five years on the road with the company.
Game-changer
He spent two years supporting John May in the hardwood sales office and as sales manager was responsible for all reps at the Clapton depot, which was the head office at the time. It was a sprawling 12-acre site on prime land and although representing a third of the company’s turnover it was not generating a significant profit compared to the value of the land.
In addition, local authority restrictions on lorry movements proved a real problem.
The business was also set up as a pack distribution business rather than a picked “just-in-time” operation and it was clear that the industry was moving towards this new model. Nick realised that things needed to change.
“Due to the infrastructure and operational constraints on the site, we were struggling to offer a “just-in-time” delivery service.
There were companies coming into the industry on the panel side who were doing a much better job than us in providing a next day service.”
“The seventh generation did not want to make the change but I could see we needed to do something.”
At the time, in addition to the Clapton site, Lathams had three regional depots.
Nick set up a regional panel distribution depot in Eastleigh in 1998 as a test for a new distribution model.
“It was a game changer for me and the business. We proved we could do it and the model worked. We had got pigeon-holed as a sleepy family business.”
The company now has 10 sites covering 487,000ft2.
Another major moment came in 2000 when Nick set up the Hemel Hempstead branch as the first of a new type of Lathams warehousing, with high racking and multidirectional forklifts.
He ran the site for 10 years, joining the Lathams Ltd’s board in 2007 and then the plc board in 2009. He took over as timber director for two years to broaden his experience and was then appointed chairman to succeed Peter Latham in August, 2017.
Fit-for-purpose products
“We are very well respected by our customers and suppliers, but also our competitors. Our TTJ Awards success says a lot for our business and how we are perceived in the industry.”
“Something that really sets us apart is the quality of products we bring into the business and we continue working towards stocking products exclusively originating from sustainable and correctly managed forests, in particular FSC and PEFC-certified products.”
“We work really hard to supply fit-forpurpose products. It’s always important for the industry that people are supplying fit-for-purpose products that will perform for the long term.
“The timber industry is in a really good space at the moment. People are talking about wood. It’s a good story and we all have a responsibility to continue that story.”
Every year Lathams seeks to grow its proportion of certified products. The company also engages with architects and specifiers, with two design showrooms in London and Manchester.
“The most important thing for me as chairman is I want to leave this company in a better position than when I took it over and grow it profitably.”
“It’s very easy to sit on your hands and think you’ve made it but you have to keep developing the business.
“If we want to maintain our position as market leader we have to keep developing and innovating and staying ahead of the competition. My desire is to make sure we do stay ahead of the competition.”
And Nick says his role in helping make that happen is to be a very visible chairman.
“I get up at 5.30am and no two days are the same. I want to be a chairman that is seen by the business and by the customers.”
He visits all 10 depots four times a year and on two of those depot days he meets customers.
“I go to see people as “Nick” – that’s how everyone knows me. I always look around the depot and talk to people.”
Brexit
With the size of Lathams – turnover was £215m in 2017/2018 – and due to the fact that many of its products are imported from Europe, Brexit is of course on the company’s radar.
Nick is sanguine about it, reasoning that whatever happens will happen to everybody in the trade.
“My concern is the effect of uncertainty on the wider economy. People may spend less money and that will affect our industry. It might be a kitchen or joinery in your house.
“The movement of stock is going to be a problem as stock may get stuck in the ports. We have the widest timber product range in the country with 10 depots.
“You can do some things to manage it but if you sit and dwell over it and hope it’s going to go away you are going to go nowhere.”
When he’s not working, Nick likes to spend time with his family – he has two daughters aged 11 and 12.
“It’s really important I invest my time with them and share their experiences.”
His biggest pastime is fishing, especially extreme fly fishing, while he also enjoys walking his dogs, playing tennis and windsurfing.
And not many people may know this, but he was also a crack rifle shot in his younger days – winning a national competition at the age of 16 for best shot with a .22 rifle.
