Growth | April 2011 | By Sam Oches

A New Kind of Mom and Pop

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“You have to like them. If you don’t like them, don’t work with them,” he says. “The worst part about family business is if it goes bad, you’ll never know your children’s children. … And what you do, besides hurting family relationships, is you ruin the value of the business without knowing it, because everybody is watching your soap opera, and the ones that are laughing and smiling about it are your competitors.”

Ron and Michelle Rye are two quick-serve franchisees who know that the strength of a family business relies heavily on the strength of the family’s personal ties. The husband-wife duo own two TCBY and one Stevi B’s units in Arkansas.

Ron says he and Michelle balance each other in the business; he takes care of big-picture, “beyond-the-four-walls” matters, while Michelle takes care of “the daily operations and grind.” Despite their divided tasks, Ron says he and his wife always make sure to be the cohesive core at the center of their business.

“If you go into a business without a strong marriage, it could kill it—not just the business, but the marriage, too,” he says. “I think it’s very important that if husband-and-wife teams get involved, they need to have a check on how strong their marriage is. There are times when I completely disagree with what she’s saying, and there are times when she’s got that with me.”

The Ryes say there are two factors of business that are especially important for family members to be on the same page with when going into business together: money and time. All participants in the family business must understand “what a lot of money is,” Ron says, and just how much time they’re willing to commit to the business.

“Sometimes you have that rough day and things are going kind of odd, and he could say, ‘I don’t want to talk about business, I’m going to watch football,’ and I still need to talk about it because there are things that need to be resolved before a certain time period,” Michelle says. “That’s the only bad thing; it doesn’t leave you, it’s always with you. You can’t really escape from it. It becomes like a child to you, like another member of your family.”

Other members of the family, especially those who are younger, are certainly something to consider when running a family business, Colin says. He says all children should be involved in the company from a young age, but that each should earn his keep.

“Any kid with an entitlement mentality—if any relative has an entitlement mentality—pass on them,” he says. “An entitlement mentality is not fixable. The only way you can fix the entitlement mentality is if the person goes into the real world and gets beaten up in the real world.”

‘From the Time He Got Up Until the Time He Went to Bed’

In an industry as old as quick service, successful businesses that have been passed down through several generations are common. In fact, that’s how Tommy Haddock, the second-largest Bojangles’ franchisee, became a critical part of the chicken-and-biscuit concept’s success—kind of. Haddock married into the Bojangles’ business, wedding the daughter of Jack Fulk, one of the brand’s founders. He and his wife, Donna, own 44 Bojangles’ units in North Carolina and Virginia through their company Tri-Arc Food Systems.

And the family’s Bojangles’ blood continues: Tommy and Donna’s son, Justin Haddock, has been a Bojangles’ franchisee for five years, introducing the brand into the Alabama market.

Tommy says he and his wife never forced their kids to participate in the family business, allowing them instead to “blaze their own trail rather than have to follow in our footsteps.”

“The biggest thing is growing up in the household, since my wife and I both work in the company, he heard Bojangles’ [news] from the time he got up in the morning until the time he went to bed at night,” he says.

Indeed, a life of constant Bojangles’ talk made an impression on Justin; when the youngest of the Haddocks’ two sons went to business school at Appalachian State University in Boone, North Carolina, he learned business principles in class and then “naturally related in my mind how they apply to the restaurant business,” Justin says.

After running a sub shop in Boone for three years, Justin decided to work odd jobs in Bojangles’ units his dad did not own before becoming a franchisee for the brand. Although Tommy offers support to Justin whenever necessary, he says he works hard to make sure everyone in the system knows Justin’s company is not an extension of his own.

Justin, meanwhile, takes advantage of the wealth of knowledge only a phone call away.

“The biggest advantage is having a direct line to him, being able to pick up the phone and say, ‘Hey, this is an issue I’m having,’ or get his opinion, and always have that 30 years of experience to draw from,” Justin says. “There weren’t many things that came up that they had not dealt with in the past.”

Justin’s following in his parent’s footsteps to become a Bojangles’ franchisee is something one expert says the franchise industry will see much less of in the coming years. Karen Spencer, CEO of franchise consultant Fran Systems LLC, says more franchise units are being sold off today than ever before as “franchise kids” trade in units they inherited from their parents.

“The reason why there’s the biggest change ever that’s about to occur is because the second generation followed what their parents did,” Spencer says. “This generation coming along is not going to follow their families.”

Spencer says many “franchise kids” are choosing to get involved with newer, more fashionable franchise brands than the stalwarts their parents and grandparents worked in. And the experience and knowledge they possess from growing up within a quick-serve system, Spencer says, is something brands shouldn’t overlook.

“I believe that the … franchise kids are shining stars, and there are other college kids that I truly believe these franchise companies and the franchise industry are underestimating,” she says.

Colin says family ties in quick-service businesses could be just the thing to drive the industry out of the downturn that’s been plaguing it for the last few years. According to the NPD Group, the U.S. had 5,551 fewer restaurants in fall 2010 than in fall 2009, including 2,122 fewer quick serves.

“I think there will be more family businesses than less family businesses because people know they can’t count on corporate America,” Colin says. “The only way to do it is to let the family join, sweat together, and work together toward the goal of building a business and a salary.”

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