Thick and Thin: What one father/daughter duo learned after jumping into business together

Successful business owners know they need the flexibility of an Olympic gymnast, the strength of bulletproof glass and the resilience of a rubber band to make it through the daily challenges of operating a business. It’s the entrepreneur who can bounce back from a crisis that succeeds.

Father/daughter duo Doug Hatch and Emily Howard learned some valuable lessons about flexibility, communication, patience and focus when they started working together in March 2014.

Howard had worked as a customer service and sales rep for a Unishippers franchise for 18 months when the opportunity to own her own franchise came available. She knew her father would be the perfect business partner and couldn’t wait to invite him to join her. “I knew we could work together. All those fears you hear about working with family? I didn’t have those concerns about working with my father.”

Hatch had worked in the corporate world for nearly 30 years, selling construction materials, but he had no qualms leaving his well-paying job to work with his daughter at the Unishippers franchise. He knew Howard loved the company and that she was having great success as a sales rep. Even though he would be his daughter’s employee and a minority investor in the company, Hatch was eager to sign the franchise deal.

Immediately, the partnership hit a speed bump. The same week the deal was finalized, Howard discovered she was pregnant. She and her husband, Roland, had discussed having a baby, but were planning to wait until the business was a little more settled. This happy (although unexpected) twist created an abrupt change in day-to-day operations, especially as Howard’s energy level dropped significantly.

Roles were revised, shared and expanded as the family created a flexible schedule to keep Howard involved with running the business. Tasks shifted to Hatch who spent time drumming up new clients while Howard got more involved in customer care and preparing for a new baby. Once she gave birth to her son, the stress increased. He was colicky, crying for hours at a time for the first four months, trying everyone’s patience.

“I underestimated starting a business and having a baby. I was so tired. I was just exhausted. We had to learn how to communicate effectively and quickly,” Howard says. “All three of us had to learn to work around a crying baby. As a business owner, regardless of a crying baby, I still had to get things done. But everyone was extremely patient, loving and kind.”

In the red

It wasn’t only the new baby causing trouble for the family business. During the first six months of their Unishippers endeavor, Howard and Hatch made a mistake that could have sunk the entire company.

Both Howard and her father sold shipping accounts to timber companies, but the first company quickly racked up a $5,000 bill that was never paid. Then the second company also acquired $5,000 in debt, leaving the new business floundering with no cash coming in.

“As a sales rep, when people didn’t pay the bill it didn’t affect me much. But now I was almost in tears,” she says. “We had to find new customers fast. We knocked on doors relentlessly, looking for a way to make up the money we had lost. As a small business, every dollar makes a difference.”

The experience taught them several valuable lessons. First, they realized they’d ignored numerous red flags and allowed both clients to quickly accumulate debt. Second, they hadn’t required customers to fill out a credit application before doing business with them. And third, they hadn’t trusted their gut instincts when things began to go south.

Now Howard always checks out a company’s payment history and credit background, and she won’t let late payments slide; services are stopped if payment is not received. She also set credit limits for her customers and stays on top of collections. Her husband does the accounting and always knows what’s coming in and going out.

“It’s been rough,” Hatch says. “You really don’t understand unless you go through this. It’s a massive cultural shift and mind shift. I went from having a high income to no income. Act with caution. Cover your bases. Get details about companies before issuing a line of credit. More than anything, that was reality settling in for someone like me coming from the corporate world. Before, if customers didn’t pay, it didn’t come out of my hide. It came out of the company. Now it comes out of my pocket.”

Back to basics

To recover from such a financial blow, Howard knew they had to be twice as responsive to their remaining clients to stay afloat. Basic communication skills were a must. She made sure phone calls were answered or returned; prompt responses were made to emails and inquiries. Building trust and establishing relationships with customers were paramount.

Financial difficulty can put a strain on any business partnership (and small problems can quickly escalate) but with family it can be devastating. Luckily, Howard and her father had worked out all money aspects from the beginning, deciding on incomes, buy-out costs and commission percentages.

“If you don’t get along, if there are cracks in the relationship, these are true warning signals,” Hatch says. “Emily and I have always been on the same page. We’ve always gotten along really well and we know how each other’s minds work. We had to know the business couldn’t divide us.”