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Paper Trail Out, Digital In as Next Generation Reshapes Home Improvement Companies

Open-mindedness, training, and commitment are keys to successful generational transfer

May 08, 2015
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Road sign reads "Next Generation ahead."

It’s tough to sell a home improvement company. How do you value a business for which the inventory is a project that has yet to materialize? It’s far easier to transition out if you have someone waiting in the wings to take over management, and eventually ownership, of the company. That could be employees, or it could be the next generation of family members.

Imagine Yourself as Owner

What makes that family management-to-ownership transition work, say owners who’ve done it or are doing it, is preparation and commitment. Usually it’s the idea of business ownership, not the glamour of tearing off a roof or caulking windows, that makes the business attractive to a young person. And if the parents love it, kids typically mirror that attitude.

“He’s seen the passion we have for it,” says Maggie Schmotzer, co-owner, with her husband, John, of Metropolitan Windows, a Pittsburgh company they founded more than 35 years ago.

Their son Justin, youngest of four, joined Metropolitan Windows three years ago, leading to many changes. One big difference is that now there’s a clear idea about who will take the reins when John and Maggie Schmotzer retire. But there’s also been a significant effect on their business practices. Justin felt that Metropolitan Windows should go paperless. “My goal is to fine-tune things,” the younger Schmotzer says, “make them more efficient, and to eliminate duplicate processes.” When he joined, the company was using CRM system MarketSharp to about 10 percent of its capability. Now, “we’re using about 90 percent,” Juston says.

Chemistry & Connection

John Schmotzer did what owners often do: He told Justin that he’d need to acquire some solid experience before coming to work at the family business. So Justin got a job working in the oil and gas industry, negotiating with landowners for gas drilling rights. Two-and-a-half years later, he told his father that he was ready to commit to Metropolitan Windows.

The 20-somethings who aspire to own Dad’s home improvement company don’t always start out with that intention. “Nobody ever dreams of going into roofing,” says Ariel Istueta, 26, director of marketing for Istueta Roofing, in Miami, founded in 1988 by his father, Frank. Ariel worked at the roofing company on and off through his teens doing chores. His career ambitions involved not flashing and roof tiles but physical therapy. In his early 20s he was interning at the office of a physical therapist, while also working in administration and managing the marketing at his father’s company to make extra money. A trip to a marketing conference sponsored by the Dan Kennedy organization changed his ambitions, as well as his relationshipto the family business.

“It felt like I had found a home, and it clicked,” Ariel Istueta says. He subsequently overhauled the Istueta Roofing website, ramping up SEO with more than 100 installation videos on YouTube and, by doing so, turned the site into a major lead source. He set out, he says, to create the public perception of Istueta Roofing as a customer-driven, high-service operation. Frank Istueta, supportive of any course his son wanted to take, expresses both pleasure and surprise. “I needed someone to do the marketing,” Frank Istueta says, “and he liked it. Now he loves it.”

All in the Preparation

Before he became boss, Jeff Moeslein, 39, president and owner of Legacy Remodeling, a specialty contractor in Pittsburgh, spent 17 years working side-by-side with his parents, Linda and Ken. His first career ambition was law, not the family business. “I told my dad 10 or 15 times that I had no interest in the business,” Jeff says.

At some point, though, Jeff started working the company booth at home shows. Then, he says, “My dad gave me the opportunity to run leads,” which led to a full-time sales job. After a year, his father suggested that Jeff needed additional business credentials—an MBA—to be ready to run the company.

What made him want it, Moeslein says, is that he considered how competitive and time-consuming a career in law would be and “how my dad made a nice living, and had always been available for my wrestling matches and Boy Scout camping trips.”

Increasing levels of responsibility—leading to company president—made Jeff Moeslein, himself a parent, ready to run a $5 million business as its owner, which he is today. “I’ve got a Little League game tonight at 6,” he says, “and I will be there.”

Watch What We Do

Justin Schmotzer knew sales from his days in the oil and gas industry, but quickly realized that it’s not the same as presenting fiberglass replacement windows across the kitchen table. So Justin began accompanying his father on sales appointments. He soon suggested to his parents that the company put its presentation on a laptop. Today, in addition to being a sales associate, he’s learning to manage payroll, administration, and other parts of the business. To make that learning curve as short as it can be, Justin “shadows” his parents: father and son share an office; their desks are feet apart.

Openness by parents to suggestions helps to make any future family transition to general management and ownership a smoother one. Two years ago Ariel Istueta suggested that Istueta Roofing replace its CRM system with Infusionsoft, a customizable program that strengthened efficiencies all the way from lead acquisition to customer aftercare. With his father’s approval, he oversaw that change.

At Metropolitan Window, the suggestions that Justin Schmotzer made have the company phasing out paper and digitalizing up and down the line.

“He sees a great opportunity to continue what my wife and I have created,” John Schmotzer says. “He wants to double and triple the size of the business. I told him to be careful what you wish for.”

But when Justin wanted to take down the whiteboard on the office wall—where leads, appointments, and sales are posted daily in marker pen—he at last met resistance. It remains up. “There’s nothing like a whiteboard to see what happened,” Maggie Schmotzer says. “When they write the word ‘sold,’ it looks so good.” PR

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