Keeping a business in the family isn't easy

More are closed or sold than are passed on to the next generation

December 07, 2003|By ORLANDO SENTINEL

After 19 years of running and owning a franchised barbecue restaurant, Bob Hudgins talks in impersonal terms about the hopes of small-business owners, but you know he's talking about himself.

"So many people work so hard to start a business," Hudgins said. "You hate to see it go by the wayside."

"I'm 71 years old, so I'm going to have to get out of it one of these days," he said. "So, either I have someone take over or I have to sell it."

That's where his younger daughter, Tiffany, 22, might come in. She is a recent college graduate with a degree in business and has a firm sense of practicality.

Her father would like her to join him and his wife in the business - two Sonny's Real Pit Bar-B-Q restaurants in Lakeland, Fla. - to begin learning the ropes with an eye to eventually taking over.

Tiffany Hudgins' mother, Jean, who has worked in the business for five years and has taken on more responsibility as health problems have hampered her husband, feels the same.

"I'd love for her to do that," Jean Hudgins said.

Even so, both parents would rather see their daughter do something else than work for them against her will.

Tiffany Hudgins is undecided. Still, she is taking a serious look. She recently moved into her parents' home and is prepared to help out any way she can while her father faces surgery.

The Hudginses are examples of a fact of hometown capitalism: Family businesses pass only with very great difficulty from parents to children. Far more businesses are sold or closed than survive into second- and third-generation ownership.

Tiffany Hudgins is certain that she is too young and inexperienced to take over the business yet. But she is also probably better equipped to survive and thrive in a family business than most young people faced with similar options would be.

That's because she spent much of her undergraduate career at Stetson University in DeLand, Fla., focusing on the problems of family businesses, in which she minored and in which Stetson plans a major starting in the spring.

Not only did Tiffany Hudgins take courses on family-business issues, but she also was also required to write a career plan and did an internship with another family business.

Also, there were seminars during which her parents and those of other students offered their perspectives. Her father said that gave Tiffany a format in which to explore questions that she otherwise would not have asked her parents.

The director of the family-business center at the university, Greg McCann, said the specialty is sorely needed and likely to grow across the country.

About 30 years ago, the study of entrepreneurship in colleges and universities was in its infancy, about where the study of family business is now, McCann said. As many as 300 programs teach entrepreneurship.

"I would like to believe that in 20 years almost every business school will have some type of program" designed to serve family businesses, he said.

Mainly, McCann said, an academic program can teach students "how family involvement changes the business."

Most people interested in the topic agree that the effect of family dynamics is enormous.

James Olan Hutcheson, former head of a family-owned company and now a Dallas-based writer and consultant on family business, said that although family businesses involve many issues, "succession and leadership are typically at the heart of it."

An enthusiastic backer of the Stetson program, university trustee Mark C. Hollis comes to the program from his years at Publix Super Markets, from which he retired as chief operating officer and vice chairman.

Hollis likens Publix - a huge, Lakeland-based supermarket chain with 120,000 employees in five Southern states - to a family business, in part because many employees own shares in the company, which is not publicly traded.

Also, members of the Hollis family and that of the founder, George Jenkins, still own substantial amounts of stock and work in the company. Small business is the backbone of America, Hollis said, adding, "and how many small businesses are not family businesses?"

Preparing someone from the next generation to make a valuable contribution to a family-owned company can be a tough sell.

"It's a blessing to have the opportunity," Tiffany Hudgins said of the chance to someday take over her parents' two restaurants. But after exposure to the Stetson family-business program, she said, she and her parents "found it's more important that we have our family than that we have the family business."

The Orlando Sentinel is a Tribune Publishing newspaper.

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