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Effingham Magazine

Family Owned Businesses are a Labor of Love

Family Owned Businesses are a Labor of Love

Story by Cindy Reid


A family owned business can be the ideal work/life situation or a fractured family nightmare. The same rules of business apply but there is an added overlay of family expectations, tensions, and history that may or may not work in your favor.

Have you seen “Yellowstone?” “Succession?” Or how about “The Crown?” Family businesses are grist for the drama mill because they have it all—booms and busts, alliances, and feuds. Of course, in real life things are usually a lot calmer and most family businesses run just fine.

They certainly are popular. There are 5.5 million family owned businesses (FOB) in the United States, which account for 57% of America’s gross domestic product and 63% of our workforce. (US Chamber of Commerce).

Although they are responsible for over 70% of new job growth, only 30% of these businesses survive into the second generation and just 12% carry over to the third. (

You can have the greatest family in the world but evidently that doesn’t guarantee a great FOB. Business experts agree that the key to any successful family business is using basic good business practices such as clear communication, sound financial planning, and employee accountability. Within a FOB these issues can be difficult to navigate due to history, emotional baggage, a fear of disagreements, and lack of business experience.

Family Owned Business Tips

The number one best practice is to COMMUNICATE. Say it clearly, say it often and say it again. Just because you are related doesn’t make you mind readers. Especially if it is hard, say what needs to be said to the appropriate person. Without clear and constant communication, it is guaranteed problems will grow and resentment will build. And don’t rely on texts. Have regular meetings to air out issues and celebrate accomplishments.

Set EXPECTATIONS. Guidelines regarding roles and responsibilities need to be made, written down and followed up on. Don’t make the mistake of assuming people will somehow just know what to do. They won’t. This applies for both family and employees who aren’t related. When roles are defined, you can now hold each other accountable.

Give each other SPACE. Be careful not to micromanage. There’s a line between supervision and interfering. Just because you are Mom, Dad or Uncle doesn’t mean you get to aggravate.

Hire by ABILITY, not obligation. Not every family member is CEO material. Being in a FOB is a stepping stone for some, for others it’s a dream come true. Look past traditional gender roles. Pushing family members to work in positions they don’t want will only lead to problems, both for the business and as a family.

Be PROFESSIONAL. Leave work at work and home at home. This is a difficult one. You may need to make a family vow to enjoy time outside of work without actually talking about work. You don’t want business issues to become personal issues. The same applies in reverse. Leave the home stuff at home. No one at work wants to hear your family arguments or disagreements.

Embrace your STRENGTHS as a family. There is a reason you work together. There is a deep level of love, trust and values that you share that cannot be duplicated. Unite as one behind your common goal and together you will be unstoppable.

Starting a Small Business as a Family

Some FOBs are couples in business together as a unit of two. For them the idea of working together side by side is very attractive because they get to have a job they love and share it with the person they love. Working towards their common goals is very satisfying. As good as this can be, there are definitely pros and cons:


•          More time together

•          Understand each other’s professional life

•          Ability to control your schedules

•          Share child and elder care


•          All you do is talk about work

•          No personal space

•          Financial predicament if your industry is badly affected.

•          You will take your work home

Open an Airbnb, a restaurant, a retail store, or work together in your chosen field and you will soon see if this is for you. Some couples thrive and others realize it’s not for them.

Providing a ready-made job and income for their offspring is also attractive to many parents. Trades such as plumbers, electricians, and building contractors traditionally bring the next generation into the original businesses. But there are other options that don’t require such a high skill set or certified training that can also become a successful family business.

Sometimes the adult runs the day to day, hiring their teenage or young adult children as labor, and sometimes it is a genuine partnership. Good examples of small businesses that can be run as a family include residential and commercial cleaning, auto detailing (mobile and stationary), child care, online sales, elder care, personal concierge service, and petting sitting. Some just need a cell phone and transportation to get started, making it an ideal way to test out the FOB concept without a huge financial commitment.

You’re much more likely to succeed in a business with a partner than without one. Entrepreneurs who have succeeded by pooling their strengths far outnumber those romantic figures—the lone entrepreneurs who have triumphed over all odds. Inc. Magazine’s annual list of the hundred fastest-growing companies typically shows that partners founded about two-thirds of them.

Every year, partnerships likewise dominate Entrepreneur’s annual list of the “hottest” companies. The vast majority of high-performance companies are started by people with partners. (David Gage, The Partnership Charter)

Success Stories

Many famous companies are in fact a FOB. A few may surprise you…

Bigelow Tea: Ruth Bigelow started brewing and selling her own specialty tea in 1945. Bigelow Tea now has an annual revenue of $200 million and remains a privately held company. Granddaughter Cindi Bigelow is president and CEO.

Chick-fil-A: Founded by S. Truett Cathy in 1946, the company is currently the third-largest fast food chain in the U.S. The company has remained within the family’s control with Truett’s sons serving as the CEO and executive vice president.

Ford Motor Company: Started by Henry Ford in 1903, the company is the second largest automaker in the U.S. and the fifth largest in the world. In 2019, the company brought in an annual revenue of $156 billion. The Ford family owns a 40% stake in the company and is still actively involved in the business.

Walmart: Sam Walton opened the first Walmart store in 1962 in Bentonville, Arkansas and today it is the largest family business company in the world, with sales of more than $500 billion. The Walton family continues to run the company.

Other successful family owned businesses in the United States are Berkshire Hathaway, Cargill, Dell Technologies, Oracle, Mars, Tyson Foods, Viacom CBS, Virgin Group, The Gap, The Estee Lauder Companies, Las Vegas Sands Corp., and the Hearst Corp.

So obviously it can be done and done very successfully. Like most things, you won’t know until you try so if that is what you really want, make a plan and go for it. It just might end up being the best decision of your life!