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VOL. 8 | NO. 6 | Saturday, January 31, 2015

Lasting Legacies

Memphis’ multigenerational businesses share plenty of struggles – and lessons learned along the way

By Andy Meek

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A FedEx commercial that never made it past the storyboard stage portrayed company founder, chairman and CEO Fred Smith as a child filling out an order form in the back of a comic book for a batch of Sea-Monkeys, sending it off and waiting for the delivery.

And waiting. And waiting.

The delay seems interminable, and when the package finally arrives, Smith is greeted at the door by an unpleasant-looking man in a brown uniform (brown, the color of FedEx rival UPS’ uniforms).

“What took you so long?” the young Smith asks. The deliveryman suggests the wait couldn’t be helped – indeed, that this is as good as it gets.

“No sir, it’s not,” Smith replies. “It can be better.”

Later during that would-be spot, Smith’s fictitious parents find a drawing under his pillow: the plan for a package delivery company that, of course, would go on to change Memphis and the world.

The thing that ended up dooming the spot was its focus on Smith. Smith’s son Richard, also a FedEx executive, recently heard the story of that spot recounted at a meeting of the Economic Club of Memphis, and even though he thought it sounded like it could have made for a great commercial about the company, then, as now, the elder Smith disliked marketing materials to focus on him. So the spot was scrapped.

Despite ending up on the cutting room floor, though, the story that commercial told encapsulates both the lasting legacy of Smith’s game-changing idea for overnight package delivery anywhere in the world and the creation of one of Memphis’ most storied corporate brands.

Spanning generations

Besides FedEx, Memphis is home to a robust collection of businesses that could present a version of their own story in a similar way.

Like Smith’s, they may have started with a basic idea that resulted in many cases in ventures that span generations – that still stand, still thrive and serve to highlight both the city’s entrepreneurial heartbeat and the hardiness of many of its entrepreneurs.

Often, the businesses that see younger generations step up and become involved are a result of a venture so personal and valuable to the founder they want a family member to help them see it through and preserve its longevity.

These businesses span almost every sector and time horizon – some younger, some much older, and everything in between.

Some of the older companies in Memphis include Orgill Brothers, founded in 1847 and often cited as the oldest business in Memphis; First Tennessee Bank, which just celebrated its 150th anniversary in 2014; D. Canale Beverages, founded in 1866; Baker Donelson law firm, which traces its roots back to 1867; Marx & Bensdorf, a real estate firm founded in 1868; Cargill Cotton, which can trace its heritage to Hohenberg Brothers, founded in 1879; or even the parent company of the publication you are reading now – The Daily News, founded in 1886 as the Daily Abstract of Transfers.

Campbell Clinic

Others include Dinstuhl’s Fine Candy Co. Inc., which started in 1902, and local medical industry stalwart Campbell Clinic, founded in 1909 by Dr. Willis Campbell, who also started the Department of Orthopaedic Surgery at the University of Tennessee.

And, of course, the cotton industry spawned its share of legacies, including Dunavant Enterprises, now into its eighth decade. The company has lasted through the ups and downs of events such as the Great Depression and World War II.

In 1972, the company made the first sale of U.S.-grown cotton to China. In 2010, the company expanded its established logistics model beyond commodities to industries like chemical, retail, and paper and packaging.

Retail and real estate

Many retailers have a long legacy in Memphis, including Royal Furniture, founded in 1946 by James Bach with a single Memphis storefront Downtown; and Lansky Bros., founded as an army surplus store and later becoming fashion central to famous musicians like B.B. King, Isaac Hayes, Carl Perkins, David Porter and, of course, Elvis Presley.

The store now has two locations, the original Beale Street address and inside The Peabody, a historic property that was resurrected by another pioneering Memphis company: Belz Enterprises.

Belz was founded by family patriarch Philip Belz in the early 1940s. Its first project was construction of several of the city’s first large industrial buildings, and today the company is one of the largest commercial and industrial real estate developers in the South.

Another famous hotel pioneer from Memphis is Kemmons Wilson, who once supported his widowed mother by selling newspapers for a nickel. He went on to pursue business ventures that ranged from selling popcorn outside the local movie theater to peddling pinball machines and jukeboxes.

When he took an interest in homebuilding, he founded Kemmons Wilson Cos. in 1948. Later, a family vacation to Washington, D.C., made Wilson frustrated by the experience he found in roadside motels of the day. So he decided to start his own hotel brand – and one year later, in 1952, Holiday Inn was born.

Holiday Inns multiplied around the world, of course, and younger members of the Wilson clan have continued to shape and lead Kemmons Wilson Cos., expanding it into other industries.

Movie-going evolution

Anyone who goes to the movies in Memphis likely does so at Malco Theatres, the Memphis-based business that’s fourth-generation family-owned and operated and which celebrates its 100th anniversary this year.

Malco Theaters

That kind of longevity doesn’t come by accident, something Malco executive vice president Jimmy Tashie takes care to underscore. Moviegoers today, he explains, have more options than ever, one reason why Malco continues trying different things “to keep them happy.”

And even “them” is a word that must be precisely defined. Younger moviegoers have certain expectations, which may or may not align with those of middle-aged or older moviegoers, all of whom Malco must nevertheless satisfy.

Tashie points to the company’s Ridgeway cinema in East Memphis as an example of that effort. It’s more of a boutique theater, generally showing around four films at a time, far fewer than the usual lineup at the company’s Paradiso cinema just down the road on Poplar Avenue. There’s also a menu of prepared, higher-quality food over and above the standard cinema fare of things like popcorn and candy, plus alcohol, which gives the experience a premium feel.

“You give people a big, wide chair and the opportunity to eat dinner there and have wine and beer and the opportunity to enjoy a good movie – you don’t see a lot of texting and talking on the phone at theaters like that,” Tashie said.

Legacy restaurants

Arcade Restaurant

Memphis is also home to numerous restaurants with lasting legacies, including maybe the most well-known: the Arcade, founded by Speros Zepatos in 1919.

Zepatos bought the Paris Café just after World War I at the corner of Main and Calhoun, then surrounded by railroads and the growing industries of the South, and tore it down to build what’s now the Arcade, Memphis’ oldest restaurant.

Late last year, the restaurant – a few years shy of its centennial – announced some tweaks to its operation, including extending its lunch hour as well as opening up at night.

Sisters Lauren Boggs McHugh (left) and Ashley Boggs Robilio stand behind the bar at Huey's, the restaurant their father bought in 1976.

Another well-known restaurant was founded by the late Thomas Boggs, whose family is still carrying on his legacy at Huey’s. And they continue to be inspired by his ideas about what makes for a quality restaurant experience some seven years after his death, and 45 years after the establishment of the business that Boggs bought into in 1976.

During his life, Boggs was a leader many people turned to for business advice, something for which he was asked so often that he kept copies of a list of questions he wanted the prospective owners to consider carefully.

Huey’s president Lauren McHugh, Boggs’ daughter, still fondly recalls working at the restaurant as a teenager, doing things like making salads and onion rings. As she got older, the work evolved to waiting tables.

“There’s so many things we miss about him,” McHugh said. “He was fun. That’s No. 1. He was so spontaneous. It was such an honor and privilege to work with him every day, but he’d also listen to our ideas. He was open-minded.”

As a young adult, McHugh at first took a job in banking, working for National Bank of Commerce at the start of what would have been a career in finance. Turns out, she wasn’t passionate about the work, and Boggs gave her an invitation to take a new job instead.

“He was very influential in my decision to work for Huey’s,” McHugh said. “He said, ‘We want to grow the company, and I want you to be a part of it.’ I was ready for a change, and the timing was perfect.

“He really helped frame our culture. He always used to say, ‘Don’t forget to smile.’ If a customer smiled at you as they walked by and you didn’t smile at them, he’d grab you by the arm and say, ‘Hey, that customer smiled at you.’ Even though he’s been gone for several years now, his legacy still carries on.”

Family lessons

Talk to other businessmen and businesswomen like McHugh who work in family operations, and many likewise cite the benefits of learning from an older family member who laid the groundwork for the business and is in a position to pass on valuable advice.

Justin Byrd, chief financial officer for Bank of Bartlett, falls in that category.

Bank of Bartlett is a family-owned bank founded in 1980 whose mortgage division alone has financed tens of thousands of homes in the metro area.

“Working as a second-generation member of a family-owned business presents some pretty unique challenges and opportunities,” Byrd said. “While the occasional disagreement occurs, the ability to ask questions and learn from individuals who have been in the business for a long time has been extremely helpful for me.

“That access to industry and institutional knowledge has accelerated my learning curve tremendously.”

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