Before Gary Steinhafel joined his family's furniture business, he worked for 14 years at other companies to learn the industry and make mistakes.
He says this is a rule that has worked for Steinhafels Furniture, a 78-year-old family-operated business now run by the third generation.
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"The lessons I learned outside the family business were important. Just because your name is on the front of the store does not qualify you to run the business successfully," he said.
Steinhafel, the company's CEO, spoke at a recent chamber Fall Business Stampede that took place at his year-old Vernon Hills store, the first to open in Illinois. The furniture and mattress company is headquartered on a 60-acre campus in Waukesha, Wis.
Participants at the chamber event were comfortable as they sat on leather sofas and recliners as the business leader told stories about growing up in the business and offering tips at the store, formerly a Home Depot Expo that saw a more than $6 million renovation before it reopened as Steinhafels.
Steinhafel talked about how the company made it through the recession in a highly stressed industry. "Furniture was one of the first industries to feel it (recession)," he said. In 2006, Steinhafels was a $118 million company. That number dropped to $93 million in two years.
"We are tied to housing. Furniture is a want, not a need," he said. But things are looking up as the company has seen between 2.2 and 3.6 percent growth each year over the past three years and expects to finish 2012 at $120 million. They also expanded the mattress division.
He watched as dozens of furniture stores closed. "There are few family furniture businesses that have survived," said Steinhafel, who runs the business with cousin Mark and younger sister, Ellen. His brother, Greg, is the CEO of Target.
Steinhafel pointed to a few key factors that he believes have helped the family furniture business thrive and grow from one store to 18.
• Family dynamics are important. "The family has to get along. And we do." He added that privately owned businesses tend to be more interested in long term success than public companies that often make decisions to inflate short-term figures.
• Reputation may be most important. "Word-of-mouth advertising is the best." The company also hires its own delivery drivers as they are the last people to see the customer and they are trained on how to interact with them.
• Culture is key. "Be open and honest. Don't hide things. Be transparent," Steinhafel said. "We work hard and play hard. It has served us well," he said.
• You have to have a strategy. He said taking risks is part of the goal.
"We want customers to shop us first," Steinhafel said. "Denial is not a strategy," he added.
The company wants to expand in "Chicagoland," but will take its time in doing so, Steinhafel said at the B2B event held by the Grayslake, Wheeling, Prospect Heights and GLMV chambers.
He told the audience that the business never keeps him up at night. He joked that his sister worries enough for both of them. What does trouble him is the desire to spend more time with his family. "I worry about how I can be in two places at one time," he said. His wife enjoys spending time at their second home. "I need a jet," he said with a laugh.