How Lafayette's family businesses have survived despite the odds
THICKER than WATER
How Lafayette's family businesses have survived despite the odds
By Luke Darby Photos
Photos by Robin May
|HUB CITY FORD: Front row, left to right, are Scott Citron, Andy Citron, Ashlyn Fortier with a photo of founder Brown Fortier, Macie Zoble with a photo of Jarvis and Mickey Fortier, and Grant Citron with an image of Marcelle Citron; second row, from left, are Billy Fortier, Mike Citron, Richard Fortier, Ruston Citron and Todd Citron holding a photo of Elroy Citron|
In 1921, Brown Fortier was used to business being a family affair. His family owned a sugar cane plantation in Jeanerette and had already been working in the area for generations. That year, as part of a deal with the federal government, Fortier and his new wife moved to Honduras to teach farmers about sugar cane cultivation. He didn't have time to share much with the Hondurans though.
Before long the country's mounting violence and frequent drive-by shootings became too much for the couple and they fled by boat back to Louisiana.
As they floated upriver, Fortier saw smoke rising from the horizon and asked the captain where it was coming from. "The Ford Motor Company," the captain replied, "outside of New Orleans; they have an assembly plant there." Fortier knew he couldn't return home without a job or money, so he disembarked and headed to the plant. He looked for any work and started sweeping floors.
Fortier may not have been working for his family anymore, but that didn't stop him from excelling. By the time World War II began, after promotion on top of promotion, he owned his own Ford franchise. Today his Hub City Ford is still around, and Fortier's descendants are still running it.
There are around 5.5 million family-run businesses in the United States now, making up about 57 percent of the country's gross domestic product and more than a third of Fortune 500 companies, according to the University of Vermont's School of Business. All together they employ 63 percent of the U.S. workforce. Despite this, the numbers are bleak for anyone looking to start a business and keep it in their family. The Family Business Institute, a professional service firm dedicated to family-run and closely held businesses, predicts that 70 percent don't survive past the founder's generation. Eighty-eight percent fail to make it to a third generation.
"Family businesses that fail give the benefit of the doubt to the family member. We give it to the [non-family] employee. If you do it the other way around you're going to lose people."
- Todd Citron, Hub City Ford
Still, these are slightly better odds than those for other companies. Running a business with family has its advantages. Owners and managers are much more longevity-focused when the well-being of their company is tied to their family legacy. The commitment to the business is more pronounced and personal.
Surviving to the third generation is a sign of determination. It isn't a simple matter of playing the odds and being a statistical anomaly - it means that the family running the business has put effort and planning into the structure and succession of the company.
To get a better understanding of what makes a family business successful, and what unique pitfalls they face, The IND spoke to companies all over Lafayette that have survived to at least that elusive and golden third generation of family ownership. We wanted to see what traits they shared and what individual quirks set them apart.
If every unhappy family is unhappy in its own way then every thriving family business is thriving in its own way, too. The stories of success are as varied as the industries the companies represent, but in spite of this there are themes and practices that show up in most of these families.
|SCHILLING DISTRIBUTING: Charles "Buddy" Schilling, left, and Herbert Schilling II|
Some factors are difficult to plan for. Local family business adviser Barry Berthelot points out that the number of family members versus the number of jobs available is one thing to consider. If there are too many open positions and not enough family members willing to fill them then outside interests can gain a foothold in the company. Too few positions can create strife, with relatives feeling jilted and bitter.
Hub City Ford has been lucky with those proportions. Fourteen employees are family members, including General Manager Todd Citron, whose mother was Brown Fortier's only daughter.
"What's unique about Hub City is we have 145 employees, so we have a very large company and we have a very large family," says Citron. "We have the ability to employ a lot of these people."
From the beginning, Brown Fortier intended that Hub City Ford would stay in his family, and he meticulously made plans to avoid causes for dispute and keep the company together. He designed the ownership of the company so that in order to sell out you have to offer your shares to someone in the family first. This allows family to remain in control without competing with outside interests.
"My father did not want me to be in the beer business, but we were in a heated competition with Schlitz, who had 71 percent share of the market, and I wasn't going to leave with them dominating the beer market."
- Herbert Schilling II, Schilling Distributing Company Inc.
Not all companies have such solid family planning at their inception, but the ability to adapt and change plans as problems appear is another sign of success.
Unlike Hub City, Herbert Schilling never intended Schilling Distributing Company Inc. to stay in the family when he founded it. In the late 1940s when Anheuser-Busch decided to divide the state into regional wholesalers rather than deal with one grocery distributor out of New Orleans, Schilling met August Busch, son of the founder of the beer company. The two bonded over baseball talk and on Jan. 1, 1950 Schilling Distributing started operating in Lafayette.
|JB MOUTON: Popie Billeaud, left, and Stuart Billeaud|
"My father did not want me to be in the beer business," says Herbert Schilling II. Prohibition was still in living memory, and there was a stigma against anyone involved in the production or selling of booze. The junior Schilling even had to stop dating a girl when her father proclaimed he would never allow his daughter to date the son of a beer distributor. "But we were in a heated competition with Schlitz, who had 71 percent share of the market, and I wasn't going to leave with them dominating the beer market," Schilling recalls.
His father's colon cancer diagnosis forced Schilling to take over the company in 1978, at 29 years old.
"There's a lot of homework that goes into this. We've spent countless time and money consulting with attorneys [and financial planners] to find out how to financially achieve this," he says. "Improper financial planning doesn't allow your children [to inherit] what you have created."
Schilling II adds that improper training for the next generation can also doom the business. The company is in the process of changing hands to its third generation of management. Schilling II's son, Charles "Buddy" Schilling, works as the general manager and vice president now, and says that managing a workforce that spans several generations is also a challenge: "This company has been here a long time," he says. "The hardest thing for me right now is working with three generations. I've got baby boomers, Gen X-ers and millennials, and managing those mindsets is a challenge."
A large workforce can create its own set of problems. Doug Ashy Building Materials, according to Steve Ashy, vice president of business development, started as a tiny mom-n-pop lumber operation that grew very quickly. The struggle was adapting to keep up with that growth as the business became more complex. Having family coworkers to rely on can add stability while everything else is tilting.
In Doug Ashy's case building community ties helped to solidify a safety net very early on. In 1962, just two years after opening, the company's one store burned to the ground, and by all counts the business should have ended then and there. But friends and customers appeared in the aftermath to help the Ashys rebuild, and even competing lumber businesses chipped in to get them back on their feet.
Passion is a recurring theme when people talk about the criteria for a successful family business. "If you're not 100 percent into the business you're going to fail," says Schilling II. "Buddy can't take over the family business just because he wants to keep the family business going, he's got to like the industry and like what he's doing."
And does he like it?
"Oh, I love it," Buddy Schilling says. "We're a competitive family, and this industry allows you to be competitive. It keeps you young."
"The easy thing to do is to sell," says Dwight Andrus III, CEO of Andrus Insurance and grandson of founder Dwight Andrus. While he doesn't discuss family issues as a matter of policy, Andrus attests that their success comes from always standing together. Even with minimal success, the possibility of selling, or somehow bailing out of running the company, is always dangling overhead, which is why energizing the younger generation, the ones who will inevitably take over, is so important.
|FRANK'S INTERNATIONAL: From left are Bryn Mosing, Erich Mosing, Donald Mosing, Keith Mosing, Kirk Mosing and Vohn Mosing|
The same knowledge that has long served advertisers hawking snack cakes, cigarettes or electronics also works for family owners grooming their successors: Get them while they're young. Many members of the up-and-coming generations for all of these businesses began working when they were very young, often starting with summer jobs in cleaning, secretarial work or restocking.
As a child, Stuart Billeaud was excited about J.B. Mouton LLC, which was founded by his great-great-grandfather in 1915. When the family business is building buildings - big, tangible, recognizable things - it's easy for a kid to wrap his head around the job. (All the spare, mismatched lumber from the construction sites made for some pretty great tree houses, too.) "When I was 13, I decided I wanted to go into the family business," recalls Billeaud. "I worked here in the summers in high school and college. It's where I always wanted to be."
When she was growing up, Ashlyn Fortier always heard stories about her great-grandfather arriving in that Ford plant and working the assembly line, though in her mind he was more like Lucille Ball than Henry Ford. She also started working at Hub City Ford in her teens, cleaning windows, working reception and stocking parts. Now in her thirties, she works as a finance assistant.
The elder Ashy, Billeaud, Fortier and Andrus all decided at a young age they would go into their families' business, even if they briefly toyed with the idea of working elsewhere.
|DWIGHT ANDRUS REAL ESTATE/INSURANCE: From left are Dwight Andrus IV, David Andrus, Lynsey Andrus Braniff, Dwight Andrus III, Adam Andrus, Reed Andrus and Ashley Andrus Babin|
None of the companies The IND spoke to are staffed exclusively by family members though. Each business needs employees who come from the outside. It's hard to avoid accusations of nepotism when the people running and owning the business are all related to each other, so if you're in the family you have to prove to your coworkers that you're not coasting. Being able to say you've worked there since your teens helps, but that's not enough on its own.
Like Schilling, Frank's International, a worldwide oil services company that started in Lafayette, also has a workforce spanning several generations. For those employees, work is also a family affair. Keith Mosing, the company's CEO and chairman of the board, says that at Frank's the Mosings have tried to spread the feeling of intimacy and community to all of their workers.
"When I was 13, I decided I wanted to go into the family business. I worked here in the summers in high school and college. It's where I always wanted to be."
- Stuart Billeaud, J.B. Mouton LLC
"Our employees feel like they're part of the family," he says. "If a father has a son on board then the father teaches him better. We've tried to eliminate sacred cows, the friends of.' A family member of someone who works here is not a problem but a friend of someone is a problem." Mosing is the third generation of his family leading Frank's, and members of the fourth generation are already working there.
|DOUG ASHY BUILDING MATERIALS: Front row, from left, are Steve Ashy, Claire Ashy, Doug Ashy and Ken Ashy; second row are Cullan Ashy and Doug Ashy III; back row are Michael Ashy, Steven Ashy Jr. and Doug Ashy Jr.|
The Fortier family at Hub City Ford stresses the need for humility with coworkers. According to Citron, family members starting at the company are told they need to work twice as hard and expect half the credit, but that's the price of being able to say they didn't just get where they are because of their name.
"Family businesses that fail give the benefit of the doubt to the family member," says Citron. "We give it to the [non-family] employee. If you do it the other way around you're going to lose people."
Of course working with family also makes living with family more complicated. Fights and arguments are inevitable, but what's key is learning from those fights and knowing how to keep personal and professional affairs separate. Again, all of this varies from company to company. In some of the businesses The IND spoke to, people are in and out of the office so much that they rarely deal with their family members in day-to-day affairs. Others see each other so often that holidays like Christmas are a chance to take off work and not spend time with anyone related to you.
There's no guaranteed guide to running any business, family-based or otherwise, but Lafayette businesses are making a strong showing. Whether their work is buildings or beer they've managed to capitalize on the advantages of running with family while avoiding the downfalls that close countless companies each year. The one thing they all have in common is constantly planning for the future.
Ashlyn Fortier, for one, is already taking her baby son for tours around the Hub City office. It's never too early to start learning.