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All in the Family: Running a Successful Family Business

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Today the most commonly accepted meaning is that blood-related familymembers are to be considered more important than non-family members.

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Withfew exceptions, that seems to be the mantra for tire dealers who havestarted or inherited a family-owned business. While the “blood” happensto be a common bond, most involved agree that running the business withfamily has more advantages than disadvantages – and add that “family”can mean non-blood related, or the proverbial “extended family.”

However,most of them say that the successful family-run dealerships –regardless of the kinship – are the ones that can operate withselective thinking, listening, speaking, acting and, maybe, agreeing todisagree.

“First and foremost, you must have a unity ofpurpose,” says Paul Sullivan, vice president of marketing for Norwell,Mass.-based Sullivan Tire. “You always have to keep in mind that youare perpetuating a family member who took great risks as the founder ofthe business.”

In Sullivan’s case it was his father, RobertSullivan Sr. (a.k.a. Bob), who not only took great risks, but also wentagainst all odds by starting a business with 10 children at home. Hesoon discovered that his family was indeed his biggest competitiveadvantage.

Sullivan Tire
SullivanTire is one of the more storied family-owned tire dealerships. In 1955,at age 38, Bob Sr. opened his first store in Rockland, Mass., about 25miles south of Boston. “He rented the garage from a Mrs. Washburn, whohad just lost her husband, and she was looking for ways to supplementher income,” says Paul.

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Bob Sr. died in 1992, but he left asolid organization to his family. Two brothers passed away, Richard in2002 and David in 2006, but all seven brothers – and even, for a briefperiod of time, the three sisters – contributed at one time or anotherto the Sullivan Tire business.

“We toiled as laborers,changing tires outside of the original garage,” Paul says. Four of thefive remaining brothers – Bob Jr., Paul, Bill and Joe – continue tohold down positions within the business. Bob Jr. is the president; Paulhandles the marketing and is a spokesman for the company; Bill is aretail superintendent and Joe works in the public relations department.

“Weare fortunate because we have a lot of respect for one another and takean interest in what each is doing, but we try not to suffocate anyone,”Paul says. “Everyone fails along the decision making route, but whenpeople learn from it, it makes you a strong company.”

At age 88,Mary, the matriarch of the Sullivan clan, has been the centerpiece ofthe unique, successful business-family marriage. “Our father alwayssaid he could not have done it without her,” says Paul. And Mary added,“When Bob started the business, all I asked of him was, ‘Can you dothis and still afford shoes for the children?’”

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Fifty-five yearslater, the company constantly answers Mary’s question to her husbandwith a resounding “Yes.” It is not only a successful family-owned tiredealership, but also among the top tire dealerships in North America.Sullivan Tire boasts of nearly 800 employees with more than 47 retailstores, 15 commercial truck locations, two retread manufacturingplants, and three wholesale locations throughout New England.

Kauffman Tire
WhileSullivan Tire is a giant in the Northeast, there is another well-knownfamily-owned tire dealership that is a prominent player in fourMidwestern and Southern states.

Founded in 1936 in the Midwesttown of Wooster, Ohio, by Harry and Eva Kauffman, Kauffman Tire hasgrown from a single service station to one of the nation’s largestindependent tire dealers with 50 retail stores, 11 wholesaledistribution centers, four commercial tire centers, one Bandagretreading facility and the e-commerce site Treadepot.com. The companyhas locations in Georgia, Ohio, Florida and Texas and employs more than700.

In 1960, the Kauffmans brought their son, John, into thebusiness, and in 1968, he oversaw the company’s first major operationalexpansion when Kauffman Tire opened its first wholesale division. Ayear later, Harry retired and John became the new president.

“Ithas been a great personal satisfaction for me [to operate thefamily-owned business],” says John. “It’s not for everybody, though.We’ve succeeded, I think, because we have been able to keep businessand family separate. When we are in social situations, we don’t talkabout the business, and vice versa. We keep them separate. You have tohave that balance between the two.”

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John handed the president’shat to his son, Mark, in 1984 – the third generation of Kauffmans atKauffman Tire. In 1992, John’s son-in-law, Tom Money, joined thecompany and is now executive vice president and chief operationsofficer. John remains active in the business, serving as an advisor andhandling real estate functions.

But he has always enjoyed hisposition in the company. “People like to deal with other people andthey like longevity,” John says. “A family-owned business seems to giveyou a more personal touch with the customer, because the customer wantsto be treated as more than a number.”

While John has relishedhis family business and the advantages it brings both personally andprofessionally, he notes that, like any business, there could be a bumpor two in the road to success.

“There could be a downside riskif the second or third generation doesn’t have the same level ofcommitment as the first generation,” he says. “Some [family-owned]businesses fail because the succeeding generations think there is aninherited entitlement. In those cases, the generation who takes over isnot willing – or is unable – to put in the long, hard hours or doesn’thave the desire.”

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Kauffman was quick to point out that such isnot the case with his company. “My son and son-in-law run the businessand I’m in the office every day, but we spend the winters in PalmDesert, Calif.”

Plaza Tire Service
Thenthere’s the story about Vernon “Pee Wee” Rhodes, who established PlazaCar Wash in 1963, then turned it into Plaza Tire Service.

PeeWee started the tire business by selling and changing tires along thesidewalk on William Street in Cape Girardeau, Mo., until cityregulations forced him to renovate the car wash so he could accommodatetire customers inside. On Labor Day in 1968, Pee Wee made the officialchangeover to strictly tires.

Pee Wee’s oldest son, Mark, beganworking for his father in 1984. Then, in 2005, Mark and his brother,Scott, bought the business from their dad. “Scott started working forour dad around 1996,” says Mark. “We both loved what we were doing anddecided that we’d want to do this together for a long time.”

Markis now the president of Plaza Tire and Scott is the vice president. PeeWee retired when he sold the business to his sons. “But we see himevery day,” Mark says of his father.

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Through the 1970s, PlazaTire established operations in Columbia and Springfield, Mo., andSpringfield, Ill., which primarily consist of wholesale activities.Since 1980, the company has expanded and now has over 50 full-serviceretail stores located in Southeast Missouri, Southern Illinois, WesternKentucky and Northeast Arkansas.

“The upside of working in abusiness with your family is that you are always on the same page,”says Mark. “You have common goals and typically think long-term oneverything. My brother and I get along great, so working with him is aplus.”

What about the minus or the downside? “Working with my brother,” he laughs.

Gatto’s Tire & Auto Service
WhileMark and Scott had designs of someday running their father’s Missouribusiness, Pam Gatto had other thoughts when her father Mike asked herto help him out just for a couple of weeks at his Gatto’s Tire &Auto Service store in Melbourne, Fla.

“Thirty-seven years later, I’m still here,” Pam says.

Pamwas married at the time and had three children – the youngest beingjust a few weeks old – when she went to help her dad. But when Mikeasked her to help out, she didn’t hesitate. “My dad had been withGoodyear for 22 years and wanted a store on his own. In 1972 he boughta company-owned store from Goodyear and in August 1973, I went to workwith him.”

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For Pam it was the proverbial blessing in disguise.“Growing up, my dad traveled every week and we didn’t have a lot oftime to spend together. So when the opportunity to be with him in thebusiness presented itself, I said ‘yes.’ It was a great thrill for megetting to work with him – for us to work together, see each otherevery day, talk to each other and build something together. We had acommon purpose. It has been one of the best experiences of my life.”

Today,Gatto is president of the company, a title she has held since 1994. Andit has been her drive that has led Gatto’s Tire & Auto Service toits greatest growth, now spanning seven retail stores and onecommercial tire center. Gatto’s Tire was the winner of the 2007 TireReview Top Shop Award.

Mike retired a few years ago, but Pamintroduced the third generation into the business when her sons Mikeand Scott McHenry joined mom and grandpa. In addition, son-in-law MikeNevin, a New Zealander, manages the Melbourne store.

However,she, too, admits that there are some downsides to a family-ownedbusiness. “You put all your eggs into one basket, so to speak,” shesays. “But I wouldn’t have it any other way. I’d do the same thing allover again.”

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Mountain View Tire
ChrisMitsos of Southern California-based Mountain View Tire knows aboutfamily, too. He is the grandson of Greek immigrants and his father,Nick, raised their family on Long Island, not too far from Ellis Islandwhere his grandfather met the New World in 1930.

“The greatestadvantage in running a family-owned business is unconditional trust,”says Chris. “Then, you get to control your own destiny and you makedecisions by committee – we huddle before decisions are made, pick eachother’s brains and then make the decision. We may have differentperspectives, but we all have the same goal.”

Chris says his66-year-old father, Nick, who founded the company in 1987, is stillactive in the business. “He comes in every day, Monday throughSaturday, and usually works until 11 a.m. each day.” In addition, Chrisis assisted by his brothers, Michael and Paul.

“My mother’ssister, Aunt Maddy, is office manager (17 years); Dad’s sister AuntIrene works with accounts payable (14 years); and Maddy’s husband UncleTony has worked with us for 19 years.” Chris also boasted of seven setsof brothers who work in the business.

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“We are very close, bothin the business and outside of it,” says Chris. “You can always dependon family. The family will never betray you.”

Black’s Tire Service
Black’s Tire Service in Whiteville, N.C., has a slightly different business genealogy – one involving two families.

Black’swas founded in 1929 when William Crowell Black opened what was thencalled Black’s Service Station, located on South Madison Street inWhiteville. He lived in a garage apartment behind the station. Thebusiness was successful during the hard times of the Great Depressionas Black’s was the only designated tire dealer (per the U.S. RationingBoard) in the region.

In 1954, Black tore down the old servicestation and opened a retail tire business on the property, naming itBlack’s Tire Service. The business continued to operate on this singleproperty until the early 1980s, when Ricky Benton, who had been inbusiness with Black in another location took over the duties of Black’sTire Service.

“My wife, Diane, did the books for me,” saysBenton. “She’s still doing the books. We’re a family business, andwe’ve enjoyed it for a long time. We also race on the weekendstogether, and everyone in the crew works in the business.”

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Inaddition to his wife, Benton’s son, Ricky Jr., literally cut his teethin the tire business. “I started when I was about 5 or 6 years old,”Junior brags. “But I didn’t start full-time until 1996 – after college.”

BrotherRyan also is in the company. “We have cousins in the business,” Juniorsaid. “If it wasn’t for family, we wouldn’t be in the business.”

Science & Counseling
Thereis no mold for running a family-owned tire dealership – or any businessfor that matter. There is no right way or wrong way. And even thoughfamily-owned businesses have been around from the beginning ofcommercial trades, it has only been in the last decade or so that a fewprofessional organizations materialized to deal with such entities.

“Workingwith a family business has a different bend to it,” says Carol Ryan,vice president of Family Business Consulting Group, a Marietta,Ga.-based firm that has helped family-owned businesses succeed for thepast 15 years. “For one, there is a history of relationships. We oftenask, ‘are you still fighting about that Chatty Cathy doll?’ and soforth.

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“The point is, everyone involved has to look at thingswith eyes wide open. You must draw boundaries. You have to be flexibleand there has to be credibility and mutual respect. If you work foryour father and he walks into a conference room for a business meeting,you must view him as the CEO and not your father. He’s the head of thecompany.”

And that kind of attitude can be especially hard onall family members. Still, as hard as it is, family after family makeit work every day. And as you can see, some of this country’s mostsuccessful independent dealers are run by close-knit families.

Adding it All Up
Regardingthe generation issue inherent in a business, Ryan says, “There’s afamous adage that says in a family-owned business, the first generationis the shirt-sleeve generation. The second generation builds it and thethird destroys it.
With that in mind, Ryan offered five suggestions on making a family business successful:

1.For all the generations after the first, family members who areinterested in becoming a part of the business should work in a companyor organization outside of that business first.

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2. Conduct periodic “family” meetings.

3.Work on communication and focus on the family vs. the business.Concentrate on being a family and not talking about business all thetime.

4. Determine what’s appropriate and what’s not. (e.g., don’t talk about business around the Thanksgiving table)

5. On a sibling/cousin/relative level, have lunches, etc., on a regular basis and discuss things that aren’t business related.

Ryan doesn’t suggest that you should forget all about business and develop more “warm fuzzies.”

“It’sabout the long-term mission of each entity,” she says. “Families needan overall sense of direction and continuity. They need to outline bothbusiness and personal goals. But no one said it’s easy. Keeping afamily together as a working ownership group requires investment,management and hard work. They must recognize and then address complexissues that often arise from a mix of personal and professionalbehaviors and aspirations.

“The goal should be to build strongfamily leadership teams within each generation to carry on establishedfamily business traditions and develop new ones to meet changing timesand markets.”

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