Commitment to family values, good employees and great customers make a family business thrive, leaders of local multi-generational companies say.
Officials with Charlottesville’s S.L. Williamson Co. Inc., an asphalt maker and paving firm, and city-based construction company Martin Horn Inc. credit their staffs and the businesses’ long-term commitment to customers for being able to survive economic downturns and to thrive in good times.
“For us, it’s been about taking care of your people that are out there working for you. They’re the ones who make your reputation,” said Blair K. Williamson, the third-generation leader of S.L. Williamson, founded 70 years ago.
“We try to have really good customer service and do a really good job so people will hire us again,” she said. “Asphalt doesn’t last forever, and we want that return business.”
“There are a lot of good people in our organization and many of the construction people have been here 10 years or longer, plus we have long-time business office employees,” said Jack Horn Jr., second-generation president of the family-owned Martin Horn.
“It’s important to do things right and take care of your customers. My father often made adjustments to bills because he considered customers as friends and didn’t want to lose a friend,” Horn said.
U.S. Small Business Administration studies show that only one of four businesses will survive 15 years, but several other area family-owned companies also have beat the odds and thrived for decades.
Better Living, a building supply company in Albemarle County, was founded as Charlottesville Lumber in 1893. It is still headed by members of the family that founded it.
Construction company R.E. Lee and Son is marking its 80th anniversary this year and continues under family leadership. W.A. Lynch Roofing, in Charlottesville, also was founded in 1939 and continues under the family’s leadership. So does Faulconer Construction, which was locally established in 1946.
Luck Stone, a gravel and aggregate firm founded in 1923 in Albemarle County, is still family-owned and -operated. Tuel Jewelers, on Charlottesville’s Downtown Mall, was founded in 1945.
The survival statistics are stacked in the “against” column for small businesses, according to the SBA. About a third of businesses that open will falter in two years. Half will have failed by the end of five years and two-thirds will fall by the end of their first decade.
The daunting statistics for startups and family pressure are exacerbated by the current business climate in which large corporations buy out small businesses, resulting in consolidation in a variety of industries.
“My grandfather started the business in 1949 with a typewriter, a station wagon and a dump truck,” Williamson said. “Now, we do [Virginia Department of Transportation] work, municipal work and some residential work. We also make asphalt and sell that to other paving companies.”
“There used to be around 40 or 50 paving companies in the state that were doing highway work and they were all family owned and we’d compete with them for business,” she said. “Now there are only a handful of small paving companies and most of the others out there are foreign-owned by Spanish or French companies.”
Williamson said the company has been approached by corporations interested in buying them out but her family is more interested in keeping the business running.
“We have an advantage because we can stay nimble being small,” she said. “The size of our market has helped. Our capacity is greater than the market here. There are lots of companies around that do paving, but we’re the only one making asphalt, so we sell to them.”
Keeping loyal employees is important, local business leaders say. Williamson has worked to create a health clinic for employees and to keep health insurance costs low.
Martin Horn utilizes apprenticeship programs and career ladders and recently raised its minimum pay rate to $15 an hour.
“Your people represent you. They are important to the company because they make your reputation,” Horn said.
For family firms, keeping siblings and family members united and supportive is another issue, according to Harvard Business School studies.
At Martin Horn, Horn serves as president, brother Doug Horn is executive vice president and brother Ted Horn is the chief executive officer.
“That’s one thing that has worked to our advantage — we’re a family that’s been able to get along,” said Jack Horn Sr., who founded the company with the late Warren Martin 40 years ago. Horn Sr. has stepped away from daily duties in the company but keeps tabs on the operation, family said.
“Because my sons get along, they haven’t had the typical problems of someone thinking that some family member did something wrong and then wants out,” Horn Sr. said. “That hasn’t happened. They’re very different but they’ve worked together to get along.”
Reacting to market forces, including changing a firm’s direction, can be difficult in a family-owned company because it may go against the founding member’s tradition, studies show.
“When you run a small business, you have to find what you’re good at,” Williamson said. “During the recession, things were pretty tough and we started up a company with a Swiss firm to make a product called Aquaphalt. Now we’ve opened a manufacturing plant in Orange and we have a hard time keeping up with sales. When things are tough, you have to be open to suggestions.”
Luck Stone also has expanded over the years with forays into recreational facility materials and real estate.
Keeping money in the business rather than taking bonuses makes a big difference, according to studies. The Horns agree.
“One reason we survived this long is we didn’t buy any airplanes,” Horn Sr. said with a laugh.
“When we were having some good years in the 1990s and the 2000s, I wanted to bonus some of it out, but Dad insisted we keep it in the business,” Horn Jr. said. “When the lean years of the recession came, we lived off of that money. It’s important to keep money in the business.”
For those interested in creating a family business that will last decades, the answer is people and values, studies show.
“If you ask, ‘what would you tell someone who wanted to start a business that would be around for 70 years,’ I’d say it’s good people and hard work,” Williamson said.
“It matters to people when you do the right thing,” Horn Jr. said. “Doing the right thing matters more to us when it matters less to others.”