Christodoulos Theophanous never intended to leave accountancy. His parents, who ran a small concern called Semio Bakeries, encouraged their children to pursue professional careers, not wanting them to get stuck in the family business. Theophanous qualified as a chartered accountant and ended up working at PwC Cyprus, staying there for seven years.

Then his mother made a heartfelt appeal. She believed that Semio Bakeries could seriously grow, with the right leadership. She wanted Theophanous to come in and fill that role. 

“Her trust and confidence gave me both a sense of duty and the belief that we could build something meaningful together,” he explains. “At the same time, there was a clear alternative: if I wasn’t interested, the business could be sold or wound down.”

So Theophanous had to choose: stick with accountancy, or take the opportunity to carry on his family’s legacy. He had the experience to be able to set the foundations for a successful scale-up, so he took the leap. “While I cannot say with absolute certainty whether this will prove to have been the ‘right’ choice in the long run, I know it was the right decision at this point in my life: to take ownership, apply my skills, and lead the next chapter of the family business.”

Theophanous is passionate enough about the value of his business – and that of many other small enterprises – to the Cyprus economy that he has been engaging with the Cypriot government on the role of small and micro entities as a foundation for economic growth. He recently attended a discussion chaired by fellow ICAEW member Vassilios Vrachimis and involving PwC Cyprus, financiers and the Cyprus Chamber of Commerce.

“The biggest continuous challenge in our sector is the increase in the cost of inputs, particularly raw materials and labour,” he explains. “Complexity in regulations, compliance issues, and labour willing to accept physically demanding production and distribution jobs add stress on a daily operating basis.”

Small enterprises are still navigating the economic aftershocks of both the COVID-19 pandemic and the war in Ukraine. These disrupted supply of critical commodities such as flour and sunflower oil, a particular issue for Theophanous’s business. More recently, the Red Sea attacks have affected logistics and trade routes, adding another layer of unpredictability to an already dynamic environment.

Theophanous responded by building resilience into his family’s business – buying in bulk, adopting tighter cost controls and injecting more flexibility into operations. 

Despite the pressures, he has identified opportunities for his business to pursue. There is significant demand for authentic, locally made products, and retailers are more open to working with smaller suppliers. Tech is also helping smaller businesses compete on bigger stages.

When it comes to government support, Theophanous would like to see more joined-up thinking. “Governments often proclaim that small and family-run businesses are the ‘backbone of the economy’, but this recognition does not always translate into sustained, practical support. In Cyprus, while there is an established long-term strategic vision, the processes in place are frequently complex, fragmented, and reactive. When it comes to demonstrating the economic importance of small businesses, support is usually delivered through financial aid schemes and programmes.”

European Union and national funding initiatives play an important role in helping small businesses modernise and grow, and Semio Bakeries has benefited from programmes such as the Cohesion Policy Programme THALIA 2021–2027. “Such initiatives have supported us in upgrading equipment, optimising operations, and investing in ESG and broader sustainability goals. Programmes like these show how meaningful financial and structural support can drive growth, build resilience, and support the long-term growth of small businesses.”

That said, Theophanous believes there is significant room for improvement. “Small businesses do not only need financial aid, they need an enabling environment with streamlined and simplified procedures, reliable systems, and targeted support,” he says. 

Governments can turn from regulators into genuine partners if they address these priorities, working alongside small businesses to foster innovation, enhance competitiveness, and power sustainable economic growth, Theophanous believes.

Michelle Lestas, Executive Chair of MENTupLEADup, published author on small business, business columnist and international business consultant, recently addressed an audience of key Cypriot family businesses. Based in Belfast, Lestas explains that both Northern Ireland and Cyprus are “family business economies” – 87% of Northern Irish businesses and just over 90% of Cypriot companies. In both nations those businesses have a “mediocre” survival rate from first to second generation, and on this point, Lestas had a number of key messages for businesses such as Semio Bakeries that are making that generational transition.

She says that in cases such as Theophanous’s, where the next generation is coming into a family business, they need to navigate an established structure, culture, customer and supplier base. It’s a business that has very different needs to one where someone has started a retail business at their kitchen table or set up a professional services firm, but governments and advisers tend to treat them all in the same way, offering them the same support mechanisms. 

“If you put a lifestyle strategy into a blue sky business, it is not going to work. If you put a blue sky strategy into a hobbyist business, it's not going to work. We need to recognise in the business support industry that we are actually dealing with different types of small business leaders and different types of strategies.”

Lestas is bringing her MENTupLEADup movement for change to the business leader community and those who support them, the business support experts who play a vital role in assisting business leaders to secure that success. 

When it comes to government support for small businesses, Lestas wants to see more targeted and well-financed support, with governments providing proper investment into the business support sector to increase its influence on the wider business ecosystem: “Our business support industry makes a huge contribution to the economy, and it needs recognition, funds, support and development.” 

Michelle Lestas is running her second annual conference in Belfast next month to champion the significant contribution the business support industry makes to the economy. Government officials attended her 2024 conference, demonstrating its reach across the UK and Ireland.