Customer Wise: Finesse for a family business’s longevity
In the latest installment of our “Customer Wise” Q&A series with business owners who are also customers, we have some valuable insights about manufacturing and generational transitions for family-owned businesses.
Ricardo and Rene Robles grew up working summers and holidays in their family’s food manufacturing business their father started in 1958. Eventually the brothers and their siblings became second-generation owners of Anita’s Mexican Foods Corp., in Southern California. After the Small Business Administration named Ricardo, Rene and their sister Jackie California’s Small Business Persons of the Year and runners up for the SBA’s national award, we asked Ricardo and Rene for advice for others who are starting out in business.Q: Is there anything you wish someone had told you before you got into the business?
Rene: We’re a family-run business, and somewhere 15 years ago we got involved with a business consultant who helps with first-generation to second-generation transitions. I think if we had that kind of transition planning advice earlier as a family business, that would have been good, smart advice. You know the business problems you have running day-to-day operations, those are handled objectively; but when it comes to family it has to be handled with a little more finesse.Based on your experience running a business, what advice would you give to someone starting a business?
Rene: For me it’s that old advice that you’ve probably heard a million times: Make sure you have a lot of capital in reserves. Whatever you think, multiply it by three.
Ricardo: You probably can’t plan enough. A lot of us think we have these concepts in our mind about how we are going to execute this plan to grow the business. You plan it out as best you can with your numbers people and advisors, and maybe you have an attorney, and you have it all planned so everything is buttoned up. But being entrepreneurial, that’s a little more individualistic. The entrepreneurial spirit comes in to say, “OK, I’ve planned this as best I could, I believe in this, and I’m taking that plunge.”
Rene: Whatever your business plan is and your reserves to fund this project are, it would be good to find someone you respect who will give you honest feedback and give you an idea of whether it seems solid and foolproof. We meet a lot of entrepreneurs and “wantrepreneurs.” The wantrepreneur is the one who says, “I have a good idea,” and it’s all razzle-dazzle and, “Everyone’s going to want this!”
Be true to yourself and ask, are you really ready for it? Besides just having the dream, there’s got to be some business plan behind it, and I think talking to a successful business person to see if your ideas are solid – that would be my suggestion.Were there things you were unprepared for?
Ricardo: It was such a growing process. As a kid it appeared really daunting, so there were a lot of things I was unprepared for. Coming in literally in my teens, a lot of it had to do with just growing into these experiences – you can’t put enough weight on having experience. You know I feel more confident now in how to address very difficult situations. We’ve been able to survive – labor issues, debt issues, growth issues, machinery issues, you name it. Part of that is experience, that I just grew up in the business.
Rene: As a manufacturer – a manufacturer of foods – there are two things that drive costs: your raw material costs and your labor. I think I’ve tried to educate myself and get involved a lot more and understand a lot more how commodities work. It takes time and dedication and daily involvement in terms of what’s happening.
We buy flour and corn and oils, for example, and what happens around the world has an effect in terms of prices. So you really have to be in touch and in tune with what’s happening in the world in order to understand what affects your operations – fuel costs, is there a war happening, is there a drought in Argentina, is Russia buying more wheat – there are a lot of things on a worldwide basis; I wasn’t prepared for that. If you are on top of all that, you will have an advantage over your competitors.What are you most proud of?
Rene: The heritage we have, contributing to the community. People have different expectations of results for why they are in business. Some people do it for ego, some people do it for money, or both. We like what we are doing and the results that it brings not just for us but for others as well. It’s nice to see our employee base and our community, and know that we have an impact.
Ricardo: It’s a humbling feeling to know there is a lot of respect for us as individuals and as a company. Our ethics, the way we do business, people trust us. We do a lot of co-packing and private label business so we keep a lot of secrets. Our customers know that if they come to us we honor those secrets, and if someone has an idea or a project, we fully develop that for them and it’s only for them and exclusively for them. And that has helped us out a lot in terms of our longevity, and that began with our dad.