As a child of first-generation immigrants who ran a successful jewelry manufacturing and distribution business, I was quite literally born into the family business. That gave me a firsthand perspective on the needs and goals of small business owners.
But my experience wasn’t entirely unique. It applies to family businesses in industries that have nothing to do with jewelry manufacturing and distribution — and to entrepreneurs thinking about starting businesses that they can pass down to their children and children’s children.
There’s no sugar-coating it: starting a family business is a formidable task. It’s a long road to success, and most founders don’t make it. At the same time, the benefits are clear. Let’s look at how and why family businesses matter to the communities they serve and the people who make them possible.
They Prepare Young People for Real-World Careers
For many young people, the family business offers a natural introduction to the grown-up economy.
That was certainly the case for me. By the time I left home at age 16, I’d done (or at least observed) just about every job in my family’s jewelry company. I like to think I would have been just as successful without that experience, but that’s impossible to know for sure. Working alongside me, my parents taught me many valuable business — and life — lessons that benefit me to this day.
They Teach the Value of Money and Hard Work
These were two of the most fundamental things I learned in the family business. I doubt I’m alone in this regard.
Anyone with experience in any small business (family-owned or otherwise) knows that successful entrepreneurs always watch every penny. They have to. Even in industries with more forgiving margins, it doesn’t take much to turn a profitable month into one dripping with red ink.
Likewise, anyone who’s seen them up close knows how hard successful small business owners have to work just to stay afloat, let alone grow. Many entrepreneurs put in years of backbreaking work with little to show for it. Often, their kids see what they go through and think, “Not for me,” which is totally understandable. Others fall in love with the life of a business-builder.
Either way, it’s a valuable experience that no high school or college case can possibly replicate.
They’re Integral to Their Communities
Family-owned businesses are the lifeblood of their communities. The classic example is the small-town car dealership that supports local high school sports teams, hosts fundraisers for local charities, and serves as the cornerstone sponsor for public works projects. But for every car dealership, there are 20 lower-profile businesses providing valuable dollars and person-hours to improve their communities.
Don’t get me wrong. Big businesses can play crucial roles in the communities they serve too. They may have deeper pockets too. But more often than not, the people responsible for making these decisions — and certainly their bosses — don’t live or work in the community. Their relationship with local stakeholders is more transactional and less productive.
They’re Built on Lasting Relationships
Not just with the communities they serve, but with individual employees, employees’ family members, and long-time (or first-time) vendors and customers.
The value of long-term business relationships was one of the most important lessons I learned working in the family business. My parents went the extra mile for every repeat customer, every supplier, and every employee, and over time, their efforts paid off. Big businesses might talk a big game about relationships, but as with community support, they tend to be more transactional in their dealings. Family businesses don’t have that luxury — and that’s a good thing.