Family Values

For family-owned food retailers, having blood ties to the company's founders doesn't always guarantee a ticket to the corner office.

In fact, family members from some family-owned companies told SN, a key element of their success is that family members who ascend to top management positions at their companies earn their way to those posts.

“We want the right people running the company,” said Bob Harmon, a vice president at Harmons, Salt Lake City, who is a third-generation owner of the business, where many of the top posts are held by non-family executives. “If the family gives them the support to lead and grow the company and do the job right, then exceptional things happen.”

While the industry is filled with stories of third- and fourth-generation owners who choose to exit the food-retailing business, many of the largest companies in the industry are currently run by relatives of the chain's founders or owners. Publix Super Markets, H.E. Butt Grocery Co., Raley's, Giant Eagle, Wegmans Food Markets, Price Chopper, Demoulas Market Basket and Schnuck Markets are among the larger chains that have remained successful through multi-generation changes in family leadership.

Many companies, including Sunbury, Pa.-based Weis Markets, have gone outside the family for leadership, even though they remain majority-owned by the family. (Weis is publicly owned but 74% family-controlled.)

Last year Weis tapped David Hepfinger, a longtime Price Chopper veteran, to be its president and chief executive officer, succeeding Norman Rich and becoming only the fourth CEO in the company's history.

“David brings us a set of fresh eyes and comes from a slightly different perspective, which I think will be good for us,” Jonathan Weis, vice chairman of Weis, told SN at the time. “I think we can benefit from some of his great ideas, tempered by his experience.”

And earlier this year, Michael J. Teel, the grandson of Raley's founders, returned to the company as chairman and CEO after eight years away, in an effort to revitalize the banner.

Many times family members, having grown up working in the business, bring the right skill set to the table.

Cincinnati-based Kroger Co. has fared well under the direction of David Dillon, chairman and CEO, who is a scion of his family's Dillon banner, now part of Kroger, but worked his way up through the ranks of the publicly traded Kroger.

Many independents follow a similar pattern — seeking to elevate family to top management positions only after they have proven their value in the company.

At Quincy, Ill.-based Niemann Foods, for example, Rich Niemann Jr., president and CEO and a third-generation owner, has helped grow the operator from about a dozen locations when he joined the firm as a general manager right out of college in 1977 to about 90 locations today.

“There is no entitlement in our organization,” he told SN. “Family members are afforded the opportunity to have a job, but a career is up to the performance of that individual.”

Similarly, at Festival Foods in Onalaska, Wis., owned by the Skogen family, Mark Skogen, president and CEO, was active in helping to grow the business from a young age and gained a wide range of experience within the company before he took over from his father, Dave Skogen, as president and CEO.

“I've seen a lot of second- and third-generation people go to work in the family business because nothing else worked for them, but that's not the case with Mark,” the elder Skogen told SN. “Mark is a visionary and as talented a retailer as you will find.”