Rick Harrison's pawnshop business is being tested like never before. He founded the Las Vegas Gold and Silver Pawnshop together with his father, Richard, in 1988, after his dad lost $1 million in real estate and was forced to find a new "hustle" to feed his family.
Known for considering anything from routine watches and jewelry to rare American Civil War weaponry and Native American totems, the father and son drew the attention of The History Channel for a new reality show that's part "Antiques Roadshow," and part "American Chopper," called "Pawn Stars." Now, with the popularity of the show, Richard and Rick, along with Rick's son and eventual successor, Corey, are experiencing some growing pains. "I've gone from 15 employees to 27," says Rick Harrison. "I'm trying to get everybody to understand how everything flows here because this isn't your average business."
“We've seen reality shows, we know what they do to families, and we made sure from the get-go that that's not going to happen to us.”
Unlike at most retail shops, which receive the same merchandise on a regular basis in multiples of 50, when Rick Harrison gets 1,000 items in his pawnshop, every single one of them is different. He also has to consider carefully what he pays for merchandise because there's no set price for much of what he buys. Combine that with the potential stresses of doing business before the cameras, and things are the busiest they've been in the store's history.
"We did make some ground rules before we started. We explained to the film company that my wife's not going to be in it, my mother's not going to be in it, my son's wife's not going to be in it (and) I have a 6-year-old son, and he's not going to be in it," says Rick Harrison. "We've seen reality shows, we know what they do to families, and we made sure from the get-go that that's not going to happen to us."
The Harrisons have managed to work together for 22 years, and their business is still standing. But with only 30 percent of family businesses making it to the second generation and that percentage dwindling for each successive generation, how can you replicate their brand of success without tearing each other apart?
Formalize communication
According to the Family Business Institute in Atlanta, those family operations that succeed to the second generation and beyond have been able to streamline their communication."They learn to be more 'planful.' Their management style changes to where they're running the business using information and management systems rather than just opening up the door and hollering down the hall to get things done," says the institute's founder, Don Schwerzler, who has advised families in business since 1967.