18 minute read
The Challenges and Benefits of Owning a Family Business
BY RICH ADAMS
Family-owned enterprises are the backbone of the American economy.
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Studies have shown about 35% of Fortune 500 companies are family controlled and represent the full spectrum of American companies from small business to major corporation, according to the Conway Center for Family Business.
There are approximately 156,000 familyowned businesses in Michigan, according to data extrapolated from the U.S. census.
The decision alone to start a family-owned business involves a great deal of faith, both in the overall economy and in how marketable the product or service will be.
“WHILE THERE ARE MANY CHALLENGES THAT WILL FACE THOSE BRAVE ENOUGH TO VENTURE FORTH AND RISK IT ALL BY GOING INTO BUSINESS, THERE ARE SOME MAJOR HURDLES THAT ARE COMMON TO ALL FAMILY-OWNED BUSINESSES,” SAID CHARLES OWENS, MICHIGAN STATE DIRECTOR FOR THE NATIONAL FEDERATION OF INDEPENDENT BUSINESS.
play. More than 30% of all family-owned businesses make the transition into the second generation, according to the Family Business Alliance. Just 12% will still be viable into the third generation, with only 3% of all family businesses operating at the fourth-generation level and beyond.
A succession plan has to be in place even before the first customer walks through the door.
“Family dynamics, including lack of a formal succession plan, have been attributed by numerous studies as the primary reason why most family-owned businesses fail or are sold before the second generation,” Owens explained.
venture forth and risk it all by going into business, there are some major hurdles that are common to all familyowned businesses,” said Charles Owens, Michigan state director for the National Federation of Independent Business.
“The first is the idea. Is the dream real in terms of a market for a good or service? It sounds simple, but often an idea does not survive the rough and tumble realities of the market and free enterprise,” said Owens, who has more than 30 years of experience dealing with small and family-owned businesses
Those who have the dream and decide to take the dive into a family-owned enterprise often do so for the ability to make choices on their own, without having to go through layers of oversight.
“Most small- and family-owned business owners make the move to go into business for themselves because it gives them the independence and freedom to make their own decisions,” Owens explained. “They also know that this makes them totally responsible for the success or failure of their endeavor, and this is a risk they are willing to take.”
Owens said entrepreneurs need to do more than set up an office and hope profits materialize.
“The second (requirement) is a solid financial plan and capitalization. If everything is checked off on the ‘to do’ list of going into business except this one, success is unlikely,” he said.
“The third is the family dynamic. Working together as an effective team is challenging enough for any business,” Owens noted. “When you add the unique nature of family relationships in the mix it often gets more complicated.”
No. 4 is having a grasp of the regulatory requirements for the business, which Owens explained is more of an issue today than it has ever been. “Ignoring or violating local, state and federal regulations on small and family-owned businesses can make or break the company,” he said. “It is not uncommon for many entrepreneurs to reconsider a specific idea or proposed venture when the legal and regulatory obstacles are thoroughly examined.”
Not only does the owner of a family business have to consider the here and now, the future of the business after the owner is no longer involved has to come into Another consideration is a mix of family and non-family employees, and the need to define the job description of each employee to avoid the appearance of nepotism.
“Much has been written on this subject,” Owens said. “The most concise answer to the question is that the expectations and roles of family and non-family members should be made clear up front to all concerned. If circumstances warrant a change in these roles and expectations, it must be communicated quickly and clearly to everyone involved in the enterprise.”
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ALL IN THE FAMILY
Greater Lansing Area family businesses share their secrets to success
COMPILED BY THE STAFF OF GLBM AND WRITTEN BY MARY GAJDA
Family-owned businesses are a tried and true part of Greater Lansing, but sustaining the legacy is demanding. It takes strong values, commitment, vison and focus. The most fruitful family businesses are well-founded and equally as well-run, playing a significant role in the cities in which they serve.
We honor the myriad family-based entrepreneurs that make up the region. We can’t imagine life in Lansing without them.
GLBM spoke to representatives of several family-owned businesses in the area for their perspectives on success and working with family.
UNCLE JOHN'S CIDER MILL
Uncle John’s Cider Mill was originally a wholesale fruit and vegetable farm and was founded after John and Carolyn Beck purchased the family farm from John’s parents in the early 1970s. The Becks needed to find a more innovative approach to keep John Heystek, Ella Heystek, Josie Heystek, Kathy Heystek, Dede Beck, Mike Beck and Lauren Beck.
the farm operating when the idea of making apple cider and doughnuts came to them. The business has since boomed and now has added a cidery and winery and is active with community events for the entire family.
Dede Meister Beck, Owner of Uncle John’s, spoke to us about the business.
You should ask my mother-in-law! It’s all about listening to our customer base. It’s always about building an experience. At Uncle John’s, we try to give each of our customers a memory they can hold on to. They don’t just spend minutes at Uncle John’s, they can spend an entire day having fun and building memories. The return customers we have assures us that we have a great formula for success.
One thing I love about working with family is I always have a built-in “friend” and a confidant. There is always someone who knows how you are feeling and working as hard as you are.
TWO MEN AND A TRUCK
TWO MEN AND A TRUCK® started over 30 years ago as a way for two brothers to make extra money while they were in high school with an old 1966 Ford pickup truck. With the support of their mother, founder Mary Ellen Sheets, the company flourished. Since that time, the company has grown to over 350 franchise locations through North America and Europe and performs over 500,000 moves each year.
Randy Shacka – president of TWO MEN AND A TRUCK®, is not a member of the founding family, but has worked with the family business for several years.
At TWO MEN AND A TRUCK® it starts with our people. We have always looked at ourselves as being a customer service company that happens to provide moving services, but ultimately, we serve people every day. It’s our people (both at our corporate headquarters in Michigan as well as the thousands of people that work for TWO MEN AND A TRUCK® across North America and abroad) that continue to push our brand forward. … We truly live by the mindset that we’ll never make it in business if we are complacent, which continues to push us to evolve.
The thing I love most working as part of a family-owned company is the core values we hold true have remained the same throughout all of our growth and success. They welcomed me as an intern 18 years ago as if I was a family member, and that has had such a positive impact on me personally. I love the
TWO MEN AND A TRUCK® values but also love the fact that the family that started this company is still involved and yet gives the teams autonomy to continue working to make TWO MEN AND A TRUCK® even better. I love the fact that we get to build something special into the future.
EYDE CO.
George and Louis Eyde founded what is now known as the Eyde Co. in June 1958. George Eyde passed away in 2017, but the company’s legacy continues. The family business regards all of its employees as an extension of the family.
GLBM spoke with Evemarie Eyde, Partner at the Eyde Co.
Our team is made up of excellent, loyal employees who share a passion for the business.
We love to work collaboratively. When the team is strong, hardworking and smart, success is achieved through strategic collaboration. Ultimately, we’re focused on continuing our father’s legacy and promoting growth in the Lansing community. George Eyde
HEDLUND PLUMBING
Hedlund Plumbing was started here in Lansing in 1939 by Einer Hedlund. Eighty years later, it is owned and operated by his grandsons, Bob and Tom Hedlund. Hedlund Plumbing was owned and operated by Dave and Howard Hedlund for about 40 of those years.
We asked Bob Hedlund, co-owner of Hedlund Plumbing, to tell us a little about their success as a family business.
Never losing sight on taking care of our team. Without a strong family and team atmosphere, we wouldn’t be able to serve the Lansing community. Also reinvesting into the company for decades to make sure we are cutting edge in our people and equipment.
The pride of carrying on our family tradition in the plumbing industry with pride and the abilities to service our community.
Bob Hedlund, Howard Hedlund, Dave Hedlund and Tom Hedlund.
BOJI GROUP
Ron Boji, president of Boji Group worked with his father on multiple projects for many years prior to the purchase of the Michigan National Tower, now Boji Tower, in 1998. The family has been in the business of development, construction management and property management for well over 20 years.
The foundation of our organization is the people we work with every day. It’s amazing to see employees who have been with Boji Group since day one continue to thrive, while we also embrace our new team members as the company grows. Hard work and dedication to our craft with love and respect to our people is the cornerstone of Boji Group.
Learning so much from my father, Louie, about the business side of things was outstanding, but what I really loved learning from him was how to treat people: staff, partners, vendors. Treating people with respect and fairness is
priority No. 1. The business will come and go but treating people right will have a lasting mark.
Ron Boji and Louie Boji
DEAN TRANSPORTATION
Dean Transportation, formerly Special Transportation, was established by transporting students with polio to Lansing schools. Today Dean Transportation celebrates 50 years with 47 offices across Michigan.
Patrick Dean, vice president of Dean Transportation, tells us more about working with his father, Kellie Dean, and brother, Christopher Dean.
TO WHAT DO YOU ATTRIBUTE YOUR BUSINESS SUCCESS?
Trust and responsibility. Our mission is to serve our communities with caring and reliable transportation. Most of our transportation services provide access to education, jobs and medical appointments every day. We take our responsibilities seriously and understand the trust our customers and employees place in us. We also understand that business can be a force for good, and it is our responsibility to lead through action. This is why our organization is community centered. Investing our company’s time and resources in building our communities through education and not-for-profit organizations has a net positive benefit to business.
Communication. I am humbled to work with my father, Kellie Dean, who is a trained COVER STORY
Patrick, Kellie and Christopher Dean
special education teacher and public school administrator, and my brother, Christopher Dean, who is a trained civil engineer. My background is business finance. Due to our trainings, we approach problems with vastly different skills but a common vision and goal. This results in trusted and proactive communication. At times passionate, we all want our organization to get better each day, which is why we love working together.
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THE MERIDIAN CO.
The Meridian Co. was founded by Jim Phillipich in 1984 and is headquartered in East Lansing. In 2007, the company expanded their operation to include heating, cooling and airconditioning repair and replacement.
Project manager, and son of Jim Phillipich, Craig Phillipich, spoke with GLBM.
TO WHAT DO YOU ATTRIBUTE YOUR SUCCESS?
Success in business starts with a plan or idea. In short, most entrepreneurs take that idea and they want to be the best at it. To achieve that you need to first hire, build and maintain a great team and take care of that team. The team in turn will take great care of your customers resulting in the customers taking great care of the business. Our success over the years is largely based on that model.
From a regional perspective (like a lot of local businesses), it goes without saying that operating in a capital city with a Big Ten university, expanding health care facilities, etc. offers a diverse professional customer base to offer our services. Jim Phillipich, Marty Phillipich, Mike Farhat and Craig Pillipich
Working with family surely has its advantages. for our business, it’s the trust factor it brings. With four family
members active in our day-to-day operations, someone’s always got your back. Having said that, I have to admit, we’re all one big family at Meridian.
GRANGER WASTE SERVICES
Granger Waste Services CEO Keith Granger tells GLBM that Granger is a third generation of family businesses. The company started as a construction business in the late 1950s, and in 1966 began hauling their own waste. Shortly after that, the Grangers started hauling waste for other construction companies followed by residential customers and other businesses. In 1991, the construction and waste components of Granger were separated into two distinct companies.
Its humble beginning with one truck and one driver in Lansing has evolved to the Granger Waste Services of today with a fleet of more than 100 trucks and nearly 300 associates.
TO WHAT DO YOU ATTRIBUTE YOUR SUCCESS?
I believe Granger Waste Services has been successful in large part due to the strong relationships we’ve built with our customers and the communities we service. Our company was founded on the Golden Rule, treating others the way we want to be treated, and we’ve continued to live by that philosophy for more than 50 years.
WHAT DO YOU LOVE ABOUT WORKING WITH FAMILY?
Working with family means there is a solid base of love and respect in our dealings with one another, as well as shared values. It has also allowed us to cultivate that feeling
The Granger Family circa 1992
of family throughout the company and develop a culture of associates who really care for each other and our customers.
SHAHEEN AUTOMOTIVE GROUP
Shaheen Automotive Group, comprised of Shaheen Chevrolet Inc., Team One Chevrolet Buick GMC, Shaheen Parts Warehouse Freeland, Shaheen Cadillac, was founded by Michael Shaheen in August 1970.
Ralph Shaheen, now president of Shaheen Chevrolet, started selling vehicles in the summer of 1969 and became a fulltime employee upon graduation from Michigan State University in 1972.
Our success is attributed to our great team. We have been able to establish a culture that attracts the very best people to promote a culture where we treat every customer as we would a guest in our home. We live it every day. Every associate carries with them a domino to remind them that everything we say and do sooner or later ends up in front of our guests. Our culture is more important than any one individual.
I am partners with my two brothers, and the most enjoyable part of doing that is that we are able to share our father’s dream of a growing a prosperous business with our family.
We also have associates that have other family members who work together as well. Father and daughter, brother and brother, and a mother and son. We promote an open
door policy and work hard to make sure everyone knows their contribution counts. The Shaheen Dealership showroom
First National Bank of Michigan seeds
landscaper’s continued success.
Pictured left: Jennifer Marsh, FNBM Pictured right: Brian Stiles, owner, Stiles Landscape
-Brian Stiles, Owner Stiles Landscape
To read the full story, please visit: www.fnbmichigan.com/ stiles-landscape
F.D. HAYES ELECTRIC CO.
Megan Doherty, Teresa Reno, Patrick Hayes, Claire Doherty, Liz Reno-Hayes, Connor Doherty, Charlie Doherty and Ryan Hoffman
Megan Doherty, president of F.D. Hayes Electric Co., tells GLBM the company has been in business since 1923, but she took ownership of the family business in 2016, continuing to work with her father, Patrick Hayes, who was the president and owner of the company for over 30 years, and her husband, Charlie Doherty.
TO WHAT DO YOU ATTRIBUTE YOUR BUSINESS SUCCESS?
I attribute our innovative approach with much of our business success. My greatgrandfather, who founded the business in 1923, was an inventor and an engineer, so
LAFONTAINE AUTOMOTIVE GROUP
Michael LaFontaine started selling Volkswagens in 1966 alongside his wife, Maureen LaFontaine. Together, the two founded LaFontaine Automotive Group in 1980. The LaFontaine matriarch and co-founder passed away at the age of 73 in October 2019, leaving sons Ryan and Mike Jr, daughters Kelley and Christie, and 15 grandchildren to carry on her legacy. each sales and service experience and in turn, hope to have a customer for life.
It’s hard to nail down just one thing because working alongside my family innovation is deeply rooted in our business story. We have a few of his patents from the 1920s framed in our conference room. Statistically, very few family-owned-andoperated construction firms experience the longevity we have. Without embracing change and new ideas, we never could have survived … To our customers, being innovative means we are creative problem solvers. They know that we are always learning about new products and installations that will ultimately give them a quality finished product for the best value.
There is an implicit level of trust when you are dealing with family. I know that our goals and values are well aligned. We really like each other and have a lot of fun together outside of the business, which really helps also.
is a true blessing. We are able to build off our individual strengths and create a work environment that is welcoming and empowering. We put such a focus on family and know that our employees can see our actions, not just our words, on what family truly means.
Ryan LaFontaine, chief operating officer for LaFontaine Automotive Group tells us more about the family business, also known as the home of “The Family Deal.”
Our success can be attributed to our dedicated and passionate team of 1,400 individuals and our corporate culture. Our mission statement is “Build lifelong relationships that connect families, strengthen communities and personalize the automotive experience.” We truly run the business like a family and strongly believe our employees are our greatest asset. Our LaFontaine associates treat our customers like family too – making sure we personalize
JOIN GREATER LANSING BUSINESS MONTHLY as they present the 26th Annual Entrepreneurial Awards Ceremony
WEDNESDAY, APRIL 1, 2020 Cocktail hour 5 p.m. - 6 p.m. Awards program at 6:30 p.m. Lansing Center, 333 E Michigan Ave., Lansing MI 48933
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