The Heightened Checks and Balances of Family Business

SOC Chamber-Hosted Forum Explores ‘Success Stories’
By MARIA SCANDALE | Sep 20, 2017
Photo by: Maria Scandale

Good seasons are shared, but challenges can be deeply rooted and the emotional stakes high when families work together in business.

The Founded in Family Forum covered the pluses and minuses candidly at the Southern Ocean County Chamber of Commerce meeting Sept. 13 at The Holiday Inn-Mainland, Manahawkin.

The panel contained first-, second- and third-generation businesspeople: Stafford Township Councilman David Taylor of Taylor Made Cabinets, Toby Sweeney of the Terrace Tavern and Delaware Avenue Oyster House, and Elizabeth Barlow Giglio of Barlow Auto Group.

The moderator was Professor John Boyle of Stockton University’s School of Business, who is also a certified public accountant. Boyle started the topic off by listing some daunting statistics.

Only 30 percent of all family businesses survive to the next generation. Twelve percent survive to the third generation, and 3 percent make it to the fourth generation.

“Fortunately, we have some terrific success stories here today,” Boyle said, adding, “family businesses have a better return on their investment than large corporations that are not run by family.”

Why do businesses fail during transitions? Sixty percent is due to communications and trust issues, and 25 percent due to a lack of preparation for the next generation, sources say.

Success comes from planning, passion, cooperation and hard work, including “grueling” 15-hour days, noted the three local panelists.

But adversity knocks in forms that business owners can’t control: the economy, the weather, the crush of a condensed summer season.

How they overcame can be instructional for others. The forum goal was “to allow family businesses to advance in planning stages, encourage new businesses and create a platform where the family legacy can be shared with consumers and visitors,” said Lori Pepenella, chief executive officer of the Long Beach Island Region Destination Marketing Organization of the chamber.

Taylor is a first-generation entrepreneur who during the course of 33 years grew his Stafford Township business from a two-man shop to a 20-person operation through many changes and adaptations.

Sweeney owns and operates the Terrance Tavern and Delaware Avenue Oyster House in Beach Haven Terrace along with her husband. The couple recently bought the 31-year-old business from her father. Sweeney brings a blend of traditional and new concepts to the establishments as a second-generation owner.

Giglio is general manager of Barlow Buick GMC Chevrolet in Manahawkin. The Barlow Auto Group originated in 1971 with a Chevrolet store in Delran that was opened by Elizabeth’s grandfather, Edward Barlow Sr. Since then, the dealer group has grown to three locations serving southern New Jersey.

The Bad With the Good:

Economy a Powerful Force

Taylor first worked for another cabinet shop. One of 10 siblings, he started Taylor Made Cabinets with a loan.

“But I knew what I loved to do,” he said. “If you don’t have that vision of what you want to do, you can’t do it. When I go to work, I like to go to work; I could do it all day long.”

With that passion comes the satisfaction of jobs well done, and of respect gained. “I’m really good at this. I can walk into a house and see the kitchen done in 3D in color in my head. I’m like Rain Man,” Taylor said with a smile. The moderator’s question had been about family dynamics on a job, including with younger employees. “When they hit a stumbling block, they come to me. It’s my business. I live it and breathe it and eat it. This is what I do.”

Brother Chris is a business partner, and several other family members are part of the business. His nephews and all of he and his wife’s own kids have worked there, “which I made them do to understand what hard work it is. Every kitchen goes to the third floor; it’s not fun delivering cabinets to the third floor. It was good incentive for them to go to college.”

Taylor touched on the ideal of treating employees well. “I treat everybody really good. I won’t ask you to do anything I wouldn’t do,” Taylor said. “When it’s hard, I do it myself. Work is work and money is money; unfortunately, you have to get through both.”

The topics of hard work and a tough economy merged in one memory.

“We did a kitchen when the economy was at its lowest,” he began as he alluded to a particularly unsanitary work environment where cats and dogs had made themselves too much at home in the kitchen. “The guys that tore it out literally threw their clothes away. ... You have to sometimes take the jobs you don’t want when the economy is at its lowest, to keep everybody employed.”

The economic downturn of 2008-2009 came up again dramatically at the end of the forum.

“There’s a downside that we haven’t touched on yet, of being the main owner,” Taylor said, in a sober tone that soon turned choked-up.

“Most of you remember our recession of 2007-2008-2009. Building didn’t slow down, it stopped.

“When it stops, that means no kitchens. ... We had a very difficult time,” he said, emotion halting his voice. “I had to lay off my own brother and sister. It’s very hard. Your own brother is 55 and you say, ‘I’ve gotta let you go.’ It’s hard.”

Business a ‘Living Thing’

And Community Support Key 

Sweeney interjected  in support.“Yeah, family business is no joke. It’s very emotional, and it’s an absolutely living, breathing thing and everybody’s blood is kind of pumping through it.”

She herself was fired by her father in her younger years, when sparks flew, she had said. But it turned out to be “the best hard thing that could happen.” Much later, she came back when the opportunity presented itself, bought the business and runs it with her husband on her own terms, working 15-hour days. And her father is still around as a mentor whose experience provides solutions at trying moments.

“The transition this first season was amazing. I’m so blessed we were able to get through what can only be described as a massive volume of business,” Sweeney said. “Fifty thousand oysters from Memorial Day to Labor Day, just at the Oyster House.”

Family dynamics aside, a seasonal business at the shore faces forces it can’t control, she pointed out.

“This is why I’m such a huge advocate for the chamber and I’m involved to make each other stronger.

“There are so many variables that we can’t control. I mean, the weather. The number one issue is ‘are we going to need two extra guys in the kitchen on Saturday? Probably not, because it’s going to pour. Well, we’re not going to make enough money because it’s going to rain. And when it rains for years, you’re having to literally think about closing your business down because development has slowed,” Sweeney said of a past time.

“This is why we have to work together. At the end of it, we’re all family; this whole community is a family business.

“We have to support each other, spend money in each other’s businesses, and work to strengthen each other’s businesses.”

The moderator had prompted Sweeney to share how the transition from father to daughter, first to second generation, took place. Her memories were relatable to anyone who recalls working in a restaurant from the ground up.

“I worked for my dad my whole life pretty much, summers, weekends. My twin sister and I would wash dishes for $2.50 an hour standing on crates. I wish I could get some kids coming in now to work like that.”

They both went to college; she taught, and worked in enterprise sales, taking a broad professional journey.

“But the Terrace was always the backbone. It felt like the restaurant was almost like another sibling; it was always there.”

“I worked for my dad in a very serious way as a general manager for five years and then he fired me; legitimately, ‘you’re fired; that’s it.’ Because, we could not get along,” she said, “and it was all about money. My ego sort of clashed with his ... so that led me around a few other career paths.

“Finally when the opportunity came – I didn’t expect I would ever walk back into that restaurant as an employee or as an owner – but I’m a businesswoman and there was a great opportunity on the table, so I put it together,” she said.

Here was a part of the forum that would-be entrepreneurs could take a tip from.

“I got a huge SBA (Small Business Association) loan,” Sweeney related. “The first person I called when it was first possible to buy it was Lori (Pepenella.) “I said, ‘how do I do this? I have $17 in the bank.’

“She said, ‘we know somebody who works at the SBA; that would be a good start.’ I got almost a hundred percent financing. I just pulled every card possible.”

Sweeney insisted on having the business in her own name, she said, “one hundred percent mine.” She re-branded both restaurants, but was fortunate to see only several things that she wanted to “tighten up” or synergize. “I didn’t have to start from scratch. What an awesome situation for somebody.” The sale went through in April, and her first season started right away.

“The way that it worked out was perfect because I get my dad as a mentor. There were employee situations this summer that I never could have imagined having any experience in handling. I could ask, ‘what in the world am I supposed to do here?’ He was like, ‘all right, here’s what you do.’”

Or I could say, ‘could you just roll by real quick, make sure I’m doing this right?’ He was like, ‘no problem. You’re being tested; you will get through this.’”

An audience member asked whether she felt she could leave her business between Memorial Day and Labor Day. Sweeney said, “I think the sign of a good manager is you can leave. If things fall apart when I did not physically watch them do it, then I did not train my staff correctly.”

However, the caveat is that she did want to be there.

“I really find it enjoyable to watch the process of opening up and getting busy, and I like to be there watching the food come through the paths every single day,” she said. “I like to watch and help everything be consistent.”

Her view for the future, though, differs from the intensity of the first year.

“I look forward to continue to add layers of management so I could back off a little bit more, because it’s grueling at times being there for 15 hours a day.”

Three Generations

‘Finding Their Part in the Wheel’

Giglio’s story is one of a three-generation family working well together because all have specific skills at which they can focus toward a shared goal.

Her grandfather started the company in 1971. “He kind of ended up in the car business by luck, if you will,” she began. “He was a pilot in the war and he finished his time and was taking the summer off before working for a commercial airline in the fall as a pilot.

His brother was selling cars and said, ‘why don’t you sell cars with me” for the summer. “He did and ended up falling in love with the business, and it kind of snowballed from there. He never went to work for a commercial airline. He ended up working in different companies as management, and finally he and my grandmother purchased their own Chevrolet dealership.

“It’s kind of fun to look back and see how that one decision, selling cars for a summer, affected all of us.”

Her father is president of the company. Three cousins runs the Buick GMC store in Woodbury. She runs the Manahawkin location and a brother started working a couple of years ago at the Delran location. An aunt is one of the company owners.

“I think the consistent thing that we all feel as far as the vision of the company is just continuing it. We want it to continue,” Giglio concluded.

The family tie to the business is strong and shared.

“I can’t say I work harder than my brother; you don’t have that animosity toward each other.”

The moderator posed the question, how is it different when your name is directly associated with the business? Giglio answered, “I think that for us, that’s the reason why I do it.

“I never thought I would be in the car business growing up. I shocked myself. I saw the opportunity. I said, let me give it two years and see how it goes.

“The passion that I developed for the company was centered around working with family and continuing what my grandfather did.”

She added that at first, it was “so different” working with her dad and seeing him in that dynamic rather than in the role of dad as parent.

“For me, the fact that it’s our family’s company is the root of my passion for it and why I do it every day and why I love it so much,” Giglio reinforced, adding, “I have a ton of employees who I think carry that passion. Their name isn’t on the sign, but they feel it and carry it and we’re so lucky to have employees who care as much as we care.”

The panel was asked whether they had any other advice for the chamber audience on starting or maintaining a healthy family business.

The Barlow Auto Group family member spoke up right away about “finding your certain part in the wheel.”

“One of the most important things that I learned in dealing with the different dynamics is recognizing what your family members are good at,” Giglio noted, “and letting them do that.

“We’re not all the same ... whether it’s numbers, sales, detail-oriented, we all bring something different to the table, and it doesn’t mean we all to have to be in charge or clash that way.

“I think a lot of times what happens in a family business is you have that power struggle – ‘you answer to me and you answer to me’ – and it can be destructive. You do what you’re good at, finding your certain part in the wheel.”  

mariascandale@thesandpaper.net

 

 

 

 

 

Comments (0)
If you wish to comment, please login.