Lessons in longevity

What we can learn from venerable firms that have survived recessionary times

The TV show Survivor boasts a motto for our times. “Outwit, outplay, outlast"—that’s how the strongest survive in a stark environment where rules change, fortunes shift, ethics are relative and competitors go to surprising lengths to gain any advantage.

This is the reality on television, anyway. What about in the real world? In order to survive, do businesses have to adopt a strategy that reeks of corporate ruthlessness?

The recession of 2008-09 certainly has created dog-eat-dog conditions, but they’re nothing new. Local firms that have been around 25, 40, 60 years have seen a series of downturns and ridden them out. These survivors come from every sector: agriculture, manufacturing, retail, housing, dining, professional and financial services.

To find out what’s kept them going, the CN&R spoke to people whose businesses have persevered through the hard times. Each story is unique, yet common threads emerge—secrets to survival that lay out an affirmative strategy for outwitting, outplaying and outlasting.

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POLICY SCION<br>John Dahlmeier is a third-generation insurance broker whose family agency has offices in both Oroville, the city of its founding, and Chico, where it expanded in 1991.

Photo By Evan Tuchinsky

Dahlmeier Insurance Agency
Est. 1948, Oroville

There’s no place like home. That’s what John Dahlmeier figured out, like his father and uncle before him, when he spent time away from Butte County as a young man.

Hal and Ed Dahlmeier left Oroville for military service in World War II. Their father, Gus, owned a real-estate business at the corner of Myers and High streets. He’d sold some insurance policies, too, and in 1948 his sons branched off in that direction.

John (Hal’s son) went from Oroville High to American River College to Cal State Northridge, where he earned a tennis scholarship, then his degree in business. He took a job with Travelers Insurance in Orange County, but when Uncle Ed retired in 1986, he succumbed to the lure of home.

“That timing worked out pretty good,” said John, who 12 years later succeeded his father in heading up the Dahlmeier Insurance Agency. First, though, the family firm expanded to Chico, merging in 1991 with Glenn, Gilzean, and Dumbroski, which coincidentally opened at nearly the same time as Dahlmeier. Longfellow Avenue has been the central location for more than a decade, but the agency still has its office in Oroville, down the street from the original.

“What helps us is people know our reputation,” John Dahlmeier said. “We’ve been around 60 years; we’re part of the community—we’re not going anywhere. We have no reason to move or to think we’re going to move, so people know they are going to get the service and the pricing they need.”

The agency remains independent, selling a range of policies—residential, commercial, automotive, health, life, etc.—from a variety of companies. Insurance is relatively recession-proof, John says: “Usually there’s something you’ll always have coverage for.”

Though there isn’t another Dahlmeier waiting in the wings to take over the business, John and his relatives have created an agency family of long-time employees. Their credo: “Honesty, integrity and looking out for the well-being of everyone involved, from employees to clients to even the insurance companies.”

Continued John: “One thing I do know is change is not a bad thing and change is always inevitable. We’ve changed quite a bit over the years. My dad started with paper files … and I remember thinking, ‘He’ll never use a fax machine.’ Now we have the PC, printer and fax all in one, and e-mail on your cell phone.

“Even though there’re the same core values as when I grew up, the way we deliver them has changed.”

FASHION TEMPLATE<br>Linda Hein was hardly a fashionista when she and her husband bought a newly opened clothing store. Nearly four decades later, Paradisians still take cues from Buttons & Bows.

Photo By Evan Tuchinsky

Buttons & Bows
Est. 1971, Paradise

Linda Hein remembers when she and her husband, Ralph, moved to Paradise almost 40 years ago. They’d come from San Francisco to Chico, where Ralph re-enrolled in college, and found a one-acre place they could afford on the Ridge. It was quite a switch, going from the big city to a town with no stoplights, but friends who visited soon understood the reason for the move.

While checking with their real-estate agent about homes for friends, they learned of a business for sale: a clothing store called Buttons & Bows, which had opened just six months earlier. “We were young, had no responsibilities,” Linda explained. “We said, ‘Let’s give it a try.’ “

The shop has moved twice (from Skyway to Almond Street in 1974, then to Clark Road 12 years later) and faced competition from myriad rivals (department stores, shopping centers, other boutiques) yet survives, even thrives, thanks to its owners’ instincts for knowing what to preserve and what to remake over time.

“It’s never been about, ‘Ooh, I like clothes—I’ll buy clothes that I like,’ “ said Linda, who’d worked as a stewardess and a secretary but never in fashion before Buttons & Bows. “We constantly try to provide clothes our customers want, and you can’t just provide one thing over and over. Fortunately I was able to pick out the right things, though you never pick them all out correct.

“That’s where my husband comes in, keeping us in line with the budget. We’ve been very conservative; we’ve never worked on credit. I think that can really hurt—look at what’s happening now with all the people who have gone out on a limb.”

Business isn’t booming now the way it has previously. In fact, Linda said, the Heins were thinking about retiring, “but with the economy, forget it.” Still, they have a loyal base, perhaps because of their clear strategy.

“Our customer target has always been baby boomers,” she said. “We find new things that don’t cost too much but cost enough—perceived value is what it is. But the main thing now is the help and service we provide for people.

“A lot of women come in because they like someone to help them put something together. It saves a lot of time, too. When you mall-shop, it can take a lot of time. We really strive to help customers get what they want and be pleased with it.”

CHICO CPA<br>Craig Duncan joined the Matson & Isom accounting firm in 1979. Since then, he has seen the firm embrace technology but also take a step back from it.

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Matson & Isom
Est. 1955, Chico

Craig Duncan was an accountant in San Jose when he decided to make a quality-of-life move. Chico caught his eye, as did Matson & Isom Certified Public Accountants. “My wife could come down with our baby daughter and eat lunch in the park,” he recalled. So, in 1979, after five years with the megafirm Price Waterhouse, the CPA with a degree from Sacramento State headed back across the state to a small office on Vallombrosa.

Matson & Isom now inhabits a building near the Chico airport, with branches in Colusa and Redding. There’s no longer a Matson or an Isom running the show (the managing director is Jim Holt). Much has stayed the same over the past 30 years—qualities from the previous 24 that brought Duncan here in the first place.

“Our firm values integrity above everything, which is really good,” Duncan said. “We’re big enough that we don’t let the tail wag the dog—we’re not so concentrated on one client or industry that we have to compromise our values.”

The counterpoint, he explained, is an accountant like Bernie Madoff’s, who traveled from upstate New York to Manhattan for this single client “so substantial to his business.” Matson & Isom serves farmers, ag processors, construction companies, realtors, medical offices, even school districts.

The firm began in 1955. Howard Isom joined with Bob Matson in 1962, and they attracted accountants (like Duncan) from national firms who liked the lifestyle in Chico. Many of the newer associates hail from Chico State and get in-house training on Matson & Isom methodology.

Technically, there are two Matson & Isoms nowadays. Matson & Isom Technology Consulting began in the 1980s as a computer-services arm of the accounting firm. The operations divided in 2000, and MITC became a separate, employee-owned company in 2006.

“Initially, when computers were primarily a tool for bookkeeping, we got into that business as a complement to the accounting business,” Duncan said. “When computers became part of whole business, whole life, we found delivering that service was different enough from accounting services we focus on….

“We practice what we preach,” Duncan continued. “Howard strongly emphasized billing and collecting and operating very conservatively. As far as being a survivor, that’s one of the main attributes.”

SERVICE FIRST<br>Parts manager Scott Eggleston and manufacturing director Terry Allread attribute the longevity of ag-machine maker Weiss McNair to direct interaction with customers.

Photo By Evan Tuchinsky

Weiss McNair
Est. 1966, Chico

Scott Eggleston has worked at Weiss McNair for 30 of its 43 years. He’s seen a lot of changes, from the company’s output to technology to products, but one component has never changed.

“The most successful thing is the service.”

Eggleston may be a bit biased. After all, he is the parts manager; his job depends on customer relations. But Terry Allread, the director of manufacturing at the Chico-based manufacturer of agricultural machinery, says exactly the same thing, and he oversees a factory.

“All the management has a pretty like-mindset of what we need to do for the customer to keep him going in the field,” Eggleston said. “[For] any farmer/grower who has to respond to a growing cycle, the window for harvest is narrow, and any downtime can make or break a year. We’ll even take a part off a new machine to keep a customer going.

“It’s totally a customer-centered business.”

Weiss McNair makes nut-harvesting equipment: sweepers, blowers and harvesters. Twenty-two dealers in California sell its machines, and the company has customers as far away as Australia, Italy and Israel. Headquarters is located on Country Drive, off East Park Avenue and Highway 99.

Its roots go back to 1966, when Gary Weiss built two dozen of his Orchard Sweepers and brought them to the Colusa Farm Show. “He sold ’em all and said, ‘Hmm, there’s a business here,’ “ Allread relayed.

Two years later, Dan McNair started producing a harvester called the Getzumall (from customers who would say, “Yup, it gets ’em all!"). The Gould Paper Co., which bought Weiss Orchard Sweepers in 1974, merged the Weiss and McNair companies in 1983, and in 1996 absorbed the Ramacher Co. from Linden, Calif.

“One of the keys to our longevity is we have units in the field that are 20, 25, 30 years old,” Allread said. Indeed, Eggleston elaborated, “I had [parts] orders last year for late-'60s/early-'70s machines.” And employee-wise, “there’s not a lot of turnover,” Eggleston added. “After you get familiar with the product, there’s a lot of pride in your work.”

And a strong connection to it. “From the earliest days,” Allread said, “we’ve had people who’ve had their own orchards, so we have people who continue to be directly involved with ag, so they comprehend what our customers are dealing with.”

Ah, that word customer again.

“Most people are willing to go someplace new or entertain a new product if it looks like it’ll meet their needs,” Allread said. “It’s that second-level conversation, when they come back with a problem—customer satisfaction. That’s the Weiss/McNair story.”

VALUES-BASED BUSINESSMAN<br>Doug Hignell has put his own stamp on the Hignell Companies without straying from the fundamentals passed down by his father.

Photo By Evan Tuchinsky

Hignell Companies
Est. 1948, Chico

Values matter to Doug Hignell. Printed right under the logo for the Hignell Companies is a three-word mission statement: “Creating caring communities.” Hignell’s is a “spirit-led and -empowered company” whose guiding principles are “living in His presence, resting in His provision, demonstrating His kingdom.”

Hignell readily confesses that “I’d like to see people have a relationship with God,” though he quickly adds, “I don’t go around pounding people with that. You don’t hammer somebody—you love somebody.” Still, no one will last long on his 180-member workforce if not in tune with the core beliefs that permeate each division of the property-development and -management firm.

The Hignell Companies began as a home-construction partnership between Fred Hignell Jr. (Doug’s father) and Floyd Strange. For nearly 20 years, starting in 1948, Hignell & Strange built around 1,000 houses in 25 Chico tracts. When the market slowed in the mid-1960s, Hignell focused on developing lots on property he owned and selling them off to other developers.

The son joined his father in 1970. Hignell & Hignell adopted a different business model: putting together groups of investors to develop residential buildings. The Hignells started out remodeling existing apartments, then built their own complexes, managing the properties as well.

“One of the secrets is to have a long-term view; our long-term view is we provide excellent long-term investments for people,” Hignell said. “We gave out about $2.5 million to investors last year, because a lot of these investments we own free and clear. There are no mortgages. We don’t over-leverage.

“We build with the idea that we’re going to hold [onto] it, so we don’t want it to fall apart in five years. We build it to last; we’re not trying to get the maximum cash out of a project.”

Cash flow is an interesting subject for Hignell. His father was a child of the Great Depression, so frugality got instilled at an early age. Yet, the company tithes to charitable organizations, spends time and resources on employee development, and only recently recouped the overhead of a management team Hignell hired so he could devote himself to realizing the mission.

“Profits in a company are like blood in your body or mine—you need it, but if you live for your blood, you’re missing the point,” he said. “A company needs profit to survive, but if that’s your No. 1 goal, you end up with Enron and the Wall Street guys.

“I live, eat and breathe our purpose statement. I come to work every day because I believe in relationships—my vertical relationship with God, but also with people; they’re connected. I truly exist for the creation of caring communities.”

BON APPETIT!<br>Amanda Leveroni branched out from ravioli-making to creating meals for special events, and Bacio Catering now has a carry-out counter, too.

Photo By Evan Tuchinsky

Bacio Catering
Est. 1984, Chico

There is no Mr. or Mrs. Bacio behind Bacio Catering. “Bacio” means kiss in Italian, and when Amanda Leveroni opened a ravioli-making business 25 years ago, that seemed the perfect way to brand her pasta confections shaped like lips.

Kissing also is associated with weddings, and Bacio caters plenty of those, through its exclusive contract at Lakeside Pavilion in California Park as well as at other venues across the North State. It’s only natural, too, that on Valentine’s Day, hundreds of Chicoans turn to Bacio for romantic dinners at home.

Fittingly, Leveroni sees a secret to success as “working from your heart and doing something you’re passionate about. Have a good time, and when you’re bored, look for the next thing to do.”

Leveroni was pregnant with her second child when she started Bacio Ravioli Co. Her then-husband’s father had started a pasta business in San Francisco. Duly inspired, she rented kitchen space and brought her fare to food expos.

Her first customer was the Kramore Inn, and it was in a kitchen behind Dave Guzzetti’s place where her wholesale venture took off. The Raley’s and Safeway supermarket chains picked up her line, and by the late 1980s Bacio had distribution from Los Angeles to Portland.

Soon, though, Leveroni was ready to do something else. With an employee as a partner, she branched out into preparing meals for events.

“It came to be that we were catering more than making ravioli,” she said, “and it’s a more creative, interesting business than pasta.”

Last summer, Bacio Catering expanded its scope once more. In the Park Avenue building that used to house the Kramore, Leveroni opened a carry-out counter and kitchen. She serves a few of the inn’s signature dishes—Hungarian mushroom soup and Thai chicken salad—along with Bacio’s own Asian BBQ sandwich, Guilt Free Mac ‘n’ Cheese, polenta lasagna, chicken dishes and, of course, pasta and sauce.

Expansion during a recession is counterintuitive; Leveroni understands this. “Don’t succumb to fear of failure,” she replied. “I find myself turning off the TV and radio and focusing on what we do.”

We being the operative word.

“I’m always letting my crew know how much they’re appreciated,” Leveroni said. “We’re going to have prosperity parties this year to keep our heads up. There seems to be a full circle of positiveness.

“I expanded [at a time] when some people would say, ‘Are you crazy?’ For me, it was a natural, and it’s been exciting.”

• • •

So, what are the takeaways from our six survivors? Well, first off, the inevitability of change—and its benefits. As Hignell said, “Five years from now, if we’re still doing things the way we are doing them now, we won’t be successful.”

But there are common threads of constancy:

• Creating a strategy that’s flexible yet focused.

• Staying fiscally conservative, particularly with credit.

• Responding to customers’ needs.

• Adhering to values—honesty and integrity foremost.

• Understanding technology.

• Fostering a feeling of family among the people on your team.

And, perhaps the most significant reflection:

• Remembering why you got into the business in the first place.