YUTA Suzuki was studying finance with the goal of becoming an investment banker. Then his father called.
“He came to me with a serious face and said, ‘I heard you’re good at math,’” Suzuki, 37, said. “We have a small problem. We need your help.”
His father, Toshio Suzuki, was the chef and coowner of the restaurant Sushi Zen, which had been a New York City institution for more than 30 years. And his problem wasn’t so small.
“When I looked at the books, it wasn’t healthy,” his son said.
But the son wanted to help.
“I thought it was a great opportunity to try out what I could do,” he said. “I stared at everything, from auditing, to regular food purchases, to how consistently everyone was cutting the fish.”
And, in the process, he found himself working in a sushi restaurant. Five years later, Sushi Zen is closed, but father and son are continuing the family business in a new venture called Suzuki. There, the tables are turned, with the son running the business so his father can just make sushi.
“When I was operating Sushi Zen, it was my duty solely to keep the business afloat and keep the guests happy,” the elder Suzuki, 71, said through a translator. “In the new place, financing and management are covered by my son. I wanted to focus on training and bringing up my younger staff.”
Conversations about family-business succession are as complicated as families themselves, but since the businesses are usually the primary driver of wealth in the family, it is essential to have such discussions, uncomfortable or not. That doesn’t mean they go smoothly, or even happen when they should.
“The business and the family are usually so intertwined,” said Karen Reynolds Sharkey, national business-owner strategist at US Trust, the banking company. “The business is really another member of the family as they grow up.”
The Suzuki family transition has been smooth so far. A younger brother has not expressed interest in the business, but advisers say that when transitions go smoothly, there has been a lot of planning, a bit of luck or both.
“The challenges are, oftentimes, the kid doesn’t know anything about the business,” said Carl Genberg, national director of business transition planning for Wells Fargo Private Bank. “Does the kid want to work in the business? To what extent is the kid humoring the parents about wanting to work in the business?”
Jose Der emigrated from Cuba nearly 60 years ago and set up Der Dau, his custom boot-making business, in New York. It counts celebrities and fashion-conscious urbanites as clients.
His son Joseph, 44, said he had been groomed since age 8 to take over the business.
“I grew up becoming a cobbler and learned all the trades from him,” he added.
His two sisters, by contrast, were not interested in the boot-making business, which made the succession decision easier.
Still, taking something that his father created and making it his own wasn’t easy at first.
“He’s very old school, very traditional,” Joseph said of his father. “I like fashion. I brought out a lot of funny colors, and it took off.”
Der said that early on, when he wanted to make the family’s boots less traditional and more fashionable to attract clients like Madonna, he clashed with his father.
When his father, who is in his 90s, let him do that, he said he learned a valuable lesson: “If two people work together and they can kind of compromise with each other, they can work as a great team.”
For a family business to be passed on to a son or daughter, the critical factor is the desire of the child to be involved.
“At the end of the day, it starts with what the second generation wants,” Genberg said. “You’re going to make something work that doesn’t work?”
Liza Towell Boyd, a top equestrian, had success riding other people’s horses since age 10. Her father, Jack Towell, said the family joked that her nickname was “cash machine”.
“People would send me horses, and she’d ride them and make them famous, and I’d sell them,” said Towell, who owns Finally Farm in Camden, South Carolina. “She couldn’t get paid, but I could.”
While Boyd, now in her late 30s, continues to compete on the national hunter-jumper circuit, she has taken on more responsibilities with the family business, from training horses to teaching children and up-and-coming riders.
“He’s my biggest cheerleader in competitions, but also on the business side, too,” she said. “You need someone there to teach you the ropes, and to be honest and to work really hard and be dedicated.”
Married with children of her own, Boyd added collaborating with a parent is a life’s work.
“The toughest part is it never ends,” she said. “My phone is ringing over and over and over again for a question” from her father.
“When I married my husband I said, ‘You’re marrying my father too,’” Boyd recalled. “He’s the first person to call in the morning and the last person I talk to at night.”
Dennis Shah started working in his father’s high-end wallpaper business, Chambord Prints, in Hoboken, New Jersey, straight out of business school in the 1980s. He had a good 20-year run before he realized he needed to take it in a different direction.
“We were a factory, and business started to die out,” Shah, 52, said “Wallpaper was going out of style by 2005. I still had faith in the product.”
So he contracted with several artists to create custom wallpaper, to reinvigorate the company’s product line.
“One of the big things is my father’s way of being able to trust me and being able to delegate and to think strategically,” Shah added.
His father, now 86, said he appreciated his son’s ability to inject a modern perspective.
“Working together, we get ideas from each other,” HK Shah said. “I’m a 16th- century person. He’s a 21st-century person. It helps us get better and better.”
In some instances, the child needs to push back. Yuta Suzuki said his father’s vision for their new restaurant was to have a 10-seat sushi bar where he used only the best 30 percent of a fish and served it to be eaten immediately. His son pointed out this was probably not the best way to turn a profit.
So they compromised. The elder Suzuki controls the sushi bar, but there are two other restaurants within the space—traditional kaiseki dining and a sit-down sushi space—to offer different dining experiences and bigger margins.
Daisy Medici, a managing director at GenSpring, a wealth-management firm, said she encourages families that run businesses to develop voluntary governance policies.
“They need to put policies in place with how they’re going to work together,” she added. “We have risk-management policies, a code of [and] conduct, trust-distribution policies, vacation-home policies.”
“It’s not a legal document,” Medici said. “It’s a morally binding document.”
The likelihood of friction is high, but so is the opportunity to grow closer. The younger Suzuki, for instance, said that going into the restaurant business helped him understand what his father had been doing all those years.
“I never experienced that father-son relationship because he worked six days a week, and then on Sunday he slept because he was so exhausted,” he said. “I got to experience the day with him and the chefs.”
Now that he is overseeing Suzuki restaurant, he added, he feels the pride of running something that helps his whole family. Where he struggles is calling himself his father’s boss.
“I never pictured that I’d be hiring my father,” he said. “I try not to think of that.”