healthier choices latino family-owned business

Pros and cons of building a Latino family business

A Latino family business is an opportunity to build wealth for your family but also it can bring a lot of headaches. Here are some recommendations and tips on how successful Latino family-owned businesses have made it through the decades.

latino family-owned business

A wide variety of snacks, mostly candy, on display at a bodega in Park Slope, Brooklyn. It should be noted that the variety displayed is a bit larger than the norm offered by your local bodega: the shop is two blocks from a school. By Jeffrey O. Gustafson at the English language Wikipedia.

Since the late 1880s to the 21st century, Latino immigrants have shown their entrepreneurial spirit, a trend that continues today. They started Cuban cigar stores in Tampa, Mexican almacenes (food stores) in Chicago and Puerto Rican bodegas in New York and New Jersey.

They also opened dance halls, theaters, and movie houses in Los Angeles and print shops and Spanish newspapers in San Antonio. Latino businesses have been at the forefront of the American economy. Today, they still are.

Many –if not most– of these businesses started as a Latino family-owned business to provide for the everyday needs of the family group. Some continued for generations, expanding into larger corporations –such as Goya Foods Inc. or La Preferida– while others faded and disappeared.

What are the secrets to building a successful and thriving family business?

Pros and cons of a family owned business

Latino family business

A study from MassMutual that conveys the best way to build and succeed with a family business.

Family owned businesses face the challenges and enjoy the rewards of working together as a family. Some are started by husband and wife, and carried on by the next generation. Others are multiple-generational businesses that also involve relatives and extended-family.

According to FamilyPreneurship–a MassMutual study that interviewed over 500 family business owners around the country– successful companies keep certain components in line. They practice open communication, trust other family members’ decisions, keep a balance between work and family life, and do overall planning for running the business and for the unexpected.

But some of these good practices might be tinted with cultural aspects of the Latino family interaction, such as familismo, gender roles, and the perception of work value, success and leadership.

  • Aquí mando yo (Here, I’m the boss)

In order to make decisions, most successful family businesses discuss issues at least among two or more members and stakeholders. However, as Latino families might be a hierarchical, male oriented structure, so might be their businesses, leaving decisions to the dominant male, a practice that might not always be the right one for the company.

While familismo is an important cultural value that derives from a collective worldview in which the group is more important than the individual, the family might impose sacrifices on themselves or their younger members for the good of the business.

Children might not have a personal or professional interest in their parents’ business but are demanded to be part of it against their will for the sake of the family. In the long run, this imposition might create frictions and tension both at work and at home.

Loving the business you’re in and having understanding of children’s needs are two ways of showing them that although you would like them to share your passion, it is them that have to make that decision for themselves.

latino family business

Radhames Rodriguez came to the United States from the Dominican Republic in 1985. He and his two brothers now own 12 bodegas. “I love a bodega because, first of all, I make money,” said Radhames. “And second of all, I like to be with people.”
His 19-year old daughter, Diana, is taking Bio and Pre-Med, and hopes to go to medical school. But, she says, business runs in her blood, and she would like a bodega of her own.
“When you walk into a bodega, you feel like you’re at home,” Diana said. She would know: since she was a child, she lived above a bodega, and started working at one at the age of six. CREDIT: David Katzenstein published on

  • We all know each other very well

As some Hispanic families are male dominant in the decision-making process, they might put their spouses and daughters in charge of the menial or less important jobs or just keep them as nominal board members with no real decision power. Clearly defined roles and responsibilities should be based on capacities and abilities, not on gender or age differences.

Whomever is better qualified for a certain position should be trusted to make the important decisions a family run business requires –usually with very little margin for failure. Also, micromanaging or over-controlling the work of others might take away the precious gift of trust, a valuable component of this type of enterprise.

  • Work hard, play hard


    Original store of La Preferida in Chicago

Most family business owners find very challenging to balance their work and personal lives. Bickering at work about family “stuff” and about work during family dinners is not a great way to balance work/family life.

Most family owned businesses find that leaving emotions out of the equation is a great solution for solving conflicts and making decisions. However, emotions can run high in Latino families. Finding the time and the strategy to deal with personalities and temperamental behavior might be a healthy way to resolve business AND family issues. Although roles might be interchangeable among members of the family, someone has to keep a “cold head” around these times.

Giving the family a good time to relax, and bonding in other aspects of their relationship –such as sharing sports, dancing or recreational activities– are also important and beneficial behaviors for all members, including “the boss.”

You might be interested:  Refreshing Peruvian beverage Inka Cola growing popularity in the USA

  • Divorce and disease not included

As hard as it is to start and manage a business, unforeseen life events affect many family run businesses the most. A spouse needs to leave for a family emergency for a few months, someone gets gravely ill, or spouses face death, divorce, domestic violence, addiction or any other illness that causes a big impact on the life of their business. Who will take over? Would it survive?

Although divorce rates are lower among Latinos than non- Latino whites or African-Americans, conflict might still be present in the family and affecting business. A careful planning of a business exit strategy –selling, transferring, acquisition or liquidation– and buying appropriate insurance options might protect the rest of the family members against those unfortunate events.

Latino family businesses are increasing their revenue contribution to the economy at a staggering rate, representing up to 20 percent of the businesses in states such as New Mexico, Florida, California, Texas, New York and New Jersey. However, many are doomed to fail–depending on the study, as many as 50 percent might close doors in the first year in business. Following simple guidelines to interact with your partners in business and life might be a good way to avoid conflict and cruise smoothly into a successful business.

Family business succession is a family business

mother daughter business by Hispanic Chamber of E-Commerce team

Do you wish to see your family business remain a family business? Many business owners truly do care about seeing their company stay in the family, which is perfectly natural—but it won’t happen without some careful and deliberate planning. If you want your children to one day assume control, this should be done well in advance, long before you actually plan on stepping down.

This is partly to ensure that your children are ready for this responsibility, that they feel confident in their abilities to run the company—and that you feel confident in them, as well. Additionally—and at the risk of being morbid—you frankly don’t know how long you have to conduct this training; should something unexpected happen to you, it’s important for the business that your kids are able to step up and assume control.

  •  Succession planning matters

This isn’t just a matter of training and mentoring, of course, but of actual, formal, legal planning. That’s the first step we recommend in this process: Meet with an attorney to set up a succession plan now, clarifying who you want to take over control of the business when you retire, or should you pass away.

  • Communication is key

Communication is another important concept—and here, we remind you that it really is a two-way street. Start the conversation now by inquiring as to whether your children even want to take over control of the business. If they don’t, well, that may be disappointing to you—but it’s likely going to be more trouble than it’s worth trying to talk them into taking over the company if they don’t really want to.

Also, be open in communicating with your kids what running the business is like. Share with them the joys and the frustrations of it—your biggest sources of satisfaction, your biggest obstacles, and something of your daily routine. Help them get a feel for what running the business is like.

  •  Train and mentor

Of course, you’ll want to train and mentor your children on-the-job, which will look different for different family businesses. One thing we would recommend to everyone, though, is that you give your children exposure to all aspects of running and working in the business; train them in every single department, from customer service to bookkeeping. They do not have to master everything, but they do need to have a basic familiarity with everything.

Start them young, too. Cultivate interest from a reasonably early age—and set them on a path toward true success running the family business.