Family Business

COVER STORY

FAMILY BUSINESS

A different value system

Continuity, family pride and hard work prove that togetherness can be a commercial success. Kate Contos looks at Stanton Bros of Hastings and Napier.

Each time a story appears in Hawke’s Bay newspapers about a local business celebrating its 100th anniversary, one wonders what management techniques are being applied to survive in an area of terrific economic ups-and-downs – currently very much down.

To see a photo of Barry Bros Ltd, the Napier trucking family, enjoying their centenary, or an advertisement by Bon Marche recalling their store in Napier 100 years ago, is reassuring. The stability of a century allays somewhat the distress of a decade of big business takeovers and closures, removals of headquarters to Wellington or Auckland, endless bankruptcies and continuing redundancies.

It almost restores one’s faith in business to see headlines about founder’s grandson Tony Bone of 102-year-old F.L. Bone, Hastings, running a computer carrying what is thought to be the world’s first in hardware supply programmes. “Old” does not have to mean old-fashioned.

Then there are great-grandsons Richard and Lawrie Anderson growing things better than ever at Anderson’s Nurseries, Napier, founded 1889 and now of national repute. They must be doing something right.

One thing they have in common is that they are all family businesses. This automatically conjures up visions of endless hours of hard work, low pay, profits ploughed back into the business, but there’s more to it than that. It’s a whole different value system.

There’s the slow steady growth rather than risky quantum leaps, managing by shrewdness and common sense rather than by imported management gimmicks. That is, never getting so big that owners don’t know employees’ names, protection against takeover from outside, building a good reputation in the community through fair trading, and being satisfied with prosperity rather than wealth for the family.

Conspicuous by absence is the objective of justifying any action in order to enrich shareholders without considering the human cost.

16 / MANAGEMENT/ DECEMBER 1987

Family independence

An example of business that has provided a good living for family and staff for many years, without ever making anyone redundant, is Stanton Bros (HB) Limited, Hastings and Napier Stationers and printers. They are breakaways from the national firm of Stanton Bros Limited, but are still friendly with their uncles, aunts and cousins.

Bernard Stanton, managing director at Hastings, proudly speaks of five generations of printers beginning with his great-grandfather John Shepherd, a printer, who came from England in 1862. Today Bernard’s son Craig is a printer in the Hastings shop.

L.O. Stanton & Co, stationery, was founded in Dunedin in 1918 by Lorenzo and Constance (nee Shepherd) Stanton. Their 13 children all became involved in the business, and eventually the eight sons bought out their father.

One son, Percy, considered the rate at which his brothers and sisters were reproducing themselves, calculated future division of profits, took his 1/8 share and went off on his own, settling in Havelock North.

Starting with $10,000 capital, Percy opened Stanton Bros (HB) in June 1955 in a small shop job a few doors from today’s headquarters on Karamu Road North, Hastings. He put daughter Constance, untrained in charge of the shop and went off selling for days at a time, sleeping in his van to save money.

“We followed what our father taught us: to work things out together, to get on with the job.”

In 1956 sales were $20,000. By 1980 they totalled $3 million, and this year “more millions.” Growth has been steady over the years with only one nasty 15% dip in August last year, since recovered.

Following the footsteps

At 82 Percy is now retired, and his five children – Constance, Bernard, Neville, Carol and David – are all actively involved in the business, along with some of their children and a spouse or two. Reminiscing about early days, Connie, Bernard and David all say, “At home we talked about nothing but stationery for breakfast, dinner and tea!”

Bernard recalls, “We worked most nights of the week and Saturday. On Friday nights Neville and I would take typewriters home for overhaul, bathe them in the shed, deliver on Monday morning. We fixed stapling machines overnight. Our garage was our bulk store. At night we loaded the vans for Napier and Hastings.”

However, this overtime “ground to a halt” when several of them married, and in 1958 they hired their first outsider. Today they have 40 staff.

Bernard, David and Connie left school at 15. Bernard failed the Stationers Guild Exam. “We worked on application, not education,” he says. “But we have travelled around the world several times, mainly to see how stationery is manufactured and marketed. We study world trends.”

In 1972 they added the printing department. Bernard says, “We couldn’t get delivery of printed stationery from manufacturers so we decided to print our own. I looked through catalogues, ordered a Heidelberg press and decided to run it myself, without training. After several disasters, we hired a tradesman.”

Today they employ six printers. A major part of the business is Speed Print, an instant printing system which Bernard saw demonstrated and was so impressed with that he bought the demonstration equipment and began operations immediately.

In 1979 Stanton’s opened another Hastings branch at Stortford Lodge, choosing the site because “an area served by five banks can’t be wrong.” The new branch recovered costs within a few months instead of the expected year or two.

18 / MANAGEMENT/ DECEMBER 1987

Working together

What management techniques have they evolved over the years? Connie says, “We followed what our father taught us: to work things out together, to get on with the job. We don’t muck around. We say what we feel. We’re too busy to stand and argue.”

David, who says he came into the business after the hard years were over, agrees: “We’ve worked tremendously well together. I can’t recall any fights.”

This closeness and constant communication carries over into staff relationships. “To get the best out of staff, we work with them, sweep the floor, stock the shelves, make the deliveries,” says Bernard.

“We don’t need staff meetings because we discuss problems with everybody all the time. We take our smokos together with the staff, except the printers who are on a different schedule. We don’t worry about rules if somebody wants their holiday early. The staff are paid award wages plus profit sharing.”

Connie adds, “Employees who leave come back with their families to visit. Staff who quit have come back to work for us again.”

There’s the slow steady growth rather than risky quantum leaps, managing by shrewdness and common sense rather than by imported management gimmicks.

How about customer relations? “Profit comes from selling to people in such a way that you can sell to them again. We have some difficult customers demanding a lot of service for small orders; we will go a certain distance then ask for bigger orders,” says Bernard.

The competition is stiff but “we never try to do the dirty on anyone,” he continues. “If somebody tries it on us, we feel sorry for them. We will carry on as though nothing has happened.”

As for the financial side, “We have never paid dividends to family shareholders. No rakeoffs for anyone. We did borrow from the company to buy our houses, but we all work on salaries. Shares may not be sold outside the company. Every dollar of profit has gone back into the business. I could have made more money investing at 3 per cent, but no money has gone into the share-market. We want control of our money.”

How do they cope with the stress and strain of today’s economic uncertainties? “We don’t worry,” answers David. “We go home and forget about it. We don’t keep a record of errors. We don’t hold grudges.”

Where more hardnosed mangers would say, “Oh the hell with it!” the Stantons say, “We leave it to Jesus,” for they are a religious family, of varying creeds. They see their business methods not as management techniques but as Christian principles.

Asked about the difference between Stanton Bros Limited, who have branches from Auckland to Dunedin, and Stanton Bros (HB) Limited, Bernard says with a laugh, “They’ve made twice as much money but we’ve had more fun!”

19 / MANAGEMENT/ DECEMBER 1987