Up In Your Business: #1 Tip for Running a Family-Owned Business


Running a family-owned business successfully can be a challenge. After 84 years in business, experience has taught the Sashco family how to do it well! We sat down with Sashco President, Les Burch and asked him, “Les, if you could only give one piece of advice to someone running a family-owned business, what would it be?” Here’s what he had to say.

“We have made mistakes over the years for sure, but we have done at least one thing right and it was intentional: family members should never be hired solely because they are family. This is the one of the most common mistakes family businesses make. It’s a natural mistake because inherent in the concept of ‘family business’ is the fact that several family members work in the business, through many generations.”

“Nothing can hold a family business back more than a family member, especially in a key position, who is not suited well for their job. They cause discouragement among other employees and sometimes the loss of good ones.”

“Before you ever hire your first family member, set clear ground rules. Here’s the speech — ‘Because you are family, we’d love to have you work here but we aren’t pressuring you to do so. In fact, we will only hire you if you fit the job. That is, like anyone else, you must have the talent and skills needed to fulfill the position. You will go through our standard interview and decision process. If you get this job you will know that we would hire you even if you weren’t a family member. We won’t put you in a job just because you are family and rob you of knowing that you are a respected contributor on our team. You will be paid our normal market wage and you will start in our scale commensurate with your experience and performance. You will be on the same bonus and incentive programs as any of our other company members. Because you may someday also be a part-owner of this company, we want you to clearly understand that ownership and job duties are entirely separate concepts with very separate reasons for income. Owners get distributions and employees get wages — don’t confuse them. If you are an owner and we declare a distribution, you will get that whether you are employed here or not. If you get a distribution and you are also an employee, it won’t subtract anything from your regular wages or bonus.’

“Family businesses are often put in a bind because family members expect to get awarded positions and income just because they are family. This hurts the enterprise and ultimately all the family members, as well. When profits decline and opportunities are missed, everyone in the business suffers.

“Be fair. Be intentional. Be a business at work and a family at home. This advice will help protect your business and your relationships.”