The Mom & Pop shop has always meant something small. Family-owned businesses account for more than half of the US gross domestic product.
You might be surprised at how many of those businesses fail. News on Six business reporter Steve Berg tells us about a program at the University of Tulsa that tries to reverse that trend.
When Justin Meade takes over Anchor Paint from his dad, Chip, he'll be the third generation of his family to run the Tulsa-based company. Statistically, 7 out of 8 people in his position fail. Talk about pressure. "Every once in a while, I think it kind of hits me, but by the same token, it's kind of exciting."
Passion is generally not the problem with a family business. For the Meades, paint is in their blood. When he walks around the Anchor factory, Chip says he see his parentâ€™s work ethic everywhere he looks. "Tremendous amount of pride. Just being able to carry that on generation after generation is heartwarming.â€
The number one problem for a family owned business, according to Pat Frishkoff, is communication. She led a family business seminar Tuesday at TU. You might think families would talk, but she says sometimes they have trouble facing facts. "They don't want to talk about death, they don't really want to talk about money kinds of issues. Some of the things they have to grapple with are just pretty sensitive." She says many family companies don't plan well for succession. And they're sometimes so devoted to tradition, they don't adapt to changing markets.
Chip says his family learned a lot when he took over. And he thinks it will make it easier for Justin, who, according to studies anyway, will be battling the odds. "It's hard sometimes, but most of the time, it's kind of fun."
Studies also show family-owned businesses give back more to their communities. They also make up a third of the Fortune 500 companies.