For more insights into the dynamics of running a family-owned business, check out my Nuclear Family Business podcast.
I need a hypothetical business for this chapter and since I’m a Texan who loves some great barbecue, let’s make yours truly the founder and purveyor of Raging Ray’s Barbecue Sauce. Happily sold in around 100 retail locations throughout Texas and Oklahoma, Raging Ray’s is some serious sauce. Since 1999, that business has provided a comfortable living and more for my daughters, who grew up on the stuff and helped with the bottling, shipping, and other odd jobs that family businesses need done when they’re getting started and growing.
Sounds great, right? Mostly. But there’s trouble up ahead.
Daughter A was happy to help label and taste test for us as a youngin’, but with a degree in marketing and a taste for high-end fashion and luxury brands she’s got no appetite for being a sauce boss. Daughter B is a coin flip but is still a decade away from knowing what turns her life is going to take, and Daughter C is at an age where her biggest priority is finding new episodes of Dora The Explorer.
The dilemma Raging Ray is facing probably seems familiar to most people reading this, since any successful family business owner will have to deal with the question of what happens to the business when it’s time to retire. Family businesses are already a balancing act to begin with, and the building blocks of a business are, in some ways, the complete opposite of the basic ingredients for a happy family life.
Families emphasize equality, while businesses are based on merit. Love is the fuel for families, but money makes the engine run in a business. While reason is valued in the business place, during family time it’s all about emotions.
Navigating the space between those wildly different value sets is the daily dance of small business entrepreneurs, and it escalates when the next generation becomes a key player in running things as they grow. The good thing there is obvious: a son or daughter who wants to continue the business means the founder doesn’t have to hunt for a successor, take on a partner, or try to sell the business when it’s time to step away.
Of course, that also means the business is going to change, in small part because time and the changing marketplace demand it but also because businesses, big and especially small, are an enlarged projection of the people who own and run them.
That’ll inevitably lead to some friction and hard talks in the transition. But here’s where the polar opposite forces actually support each other because a strong business that has people who love and trust each other and can show their emotions comfortably are going to be able to work through their difficulties and keep growing.
For Raging Ray, that means keeping Daughters B and C close to the day-to-day of the sauce world and letting them see what’s possible. And if that means one or both of them want to stay on board, being comfortable with the company’s profile and flavor changing with them.