Family business isn't just a family affair! Third-generation heirs of 'Anuban-Oyster-Mae Pranom' reveal strategies for passing the baton. Is a fourth generation still necessary?
Lessons learned from the family business! From the 3 third-generation heirs of 'Mae Pranom Thai Chili Paste - Grape Soybean Oil - Oyster Fish Sauce', they share secrets for passing on family businesses to grow and flourish while maintaining a stable family relationship. They are also ready to break the curse of "3-generation businesses" and pass on family businesses to the 4th-generation heirs, a new generation model. The Stock Exchange is the answer if the 4th generation brings in outsiders to manage the business.
Family businesses that have been passed down from generation to generation are not just about inheriting the business, but about passing on the burden and dreams that are full of challenges, especially in today's rapidly changing world. When the third generation heirs of three famous businesses such as “Grape Brand Soybean Oil” “Oyster Brand Fish Sauce” “Mae Pranom Brand Thai Chili Paste” They must step up to become leaders and face the conflict of ideas between the old and new eras, as well as adapt to the changing market and consumer behavior.
Passing down a family business from generation to generation is therefore full of challenges. The heirs, underestimated by the belief that the business would not survive until the fourth generation, must resort to new strategies and ideas to prevent the legacy they have established from being disrupted, while also managing family relationships to move forward alongside the business.
Grape Brand Soybean Oil: 10 years of proving ourselves and building trust among everyone in the family.
Pachai Chanpitak, 3rd generation heir of Thai Vegetable Oil Public Company Limited He shared stories and ideas about managing a family business that have been accumulated for over 57 years at the seminar "Opening a new chapter of GEN3, continuing sustainable business" organized by the Banking and Finance Journal under the topic The Successor: Business Heirs with Challenges and Opportunities. The origins of the Thai vegetable oil empire came from my grandfather, who immigrated from China. He started various businesses, including a rice mill, a dyeing factory, and a vegetable oil business he co-operated with a friend. The brand "Angun" has a Chinese name, "Phu Tao," which sounds similar to the word for "grow and flourish."
In its early days, the business faced many challenges. It wasn't until 2520 that it began to move forward in earnest, and has become a stable brand that it remains today. Pachai is the third-generation heir of the family's eighth child (the mother is the second-generation heir).
Relatives in the same generation all have their own businesses because in large families, there is no compulsion for children to take over. After graduating, they go outside to gain experience for 1-2 years before returning to help out at the family business headquarters.
However, managing a family business with many relatives and differing opinions isn't easy. Pachai says it requires a great deal of effort to understand each person's preferences and aptitudes. The most important thing is hard work to build trust. Pachai spent over 10 years learning the business closely, attending board meetings, and always preparing comprehensive information. This allowed him to promptly answer questions and ultimately gain their trust.
Pachai also mentioned the differences between family members of different generations, with their different needs and hopes. Managing the overall picture is therefore difficult. It is necessary to divide the target groups according to each age group and use different communication methods to ensure everyone understands. If there are disagreements, use the following methods: “Throw a stone to ask for directions” Survey your opinions before bringing them to the meeting, as everyone hates surprises, whether they're about a problem or a new idea.
Working concepts and management principles Pachai believes that “Work is work, work is hard.” and said "If it's fun, it's a hobby. Work that others find difficult or laborious is fun for me. Since I started working, I've had complete management freedom. And because of our status as a publicly traded company, the transfer of leadership isn't limited to family members. It must also involve professionals with capabilities and perspectives aligned with the company's vision, ensuring continued growth."
Pachai himself was selected by an external board of directors, a process Pachai believes should continue to find the most suitable person to manage the business. Being a publicly traded company, having good governance from the start means that every position has a clear job description. Therefore, those who take on positions must meet the required qualifications, not just family members.
“In passing on my family’s wealth, "share" If anyone wants more, go buy more.” Pachai emphasized that the company's growth depends on the capabilities and investments of each individual, and in the end, Pachai gave the key principles for the business to survive and grow sustainably, namely: “You must maintain a strong financial balance and not spend more than you can afford.”
Oyster Brand Fish Sauce: U-turn to continue the business with "heart" and "passion" without pressure from the 4th generation to take over.
while "Phanchana Rattanaprasit", Managing Director of Nam Pla Pichai Co., Ltd., the manufacturer and distributor of authentic fish sauce under the Oyster brand. Revealing the background of the family business management that has stood for more than 80 years, from the grandfather's generation, the founder, until it is passed on to the current 4th generation, that the brand “Oyster Brand Fish Sauce” It was born from the fish sauce business of my grandfather under the original name. "Special" Before my father, the second generation heir, came in and changed the brand to “Oysters” This name was patented by my grandfather, and with the image of oysters being a very expensive item at that time, the brand was positioned as a premium product.
For the second generation heir, the father, the youngest son, unexpectedly took over the business after a corruption problem occurred within the business. This led the grandfather to call the father, the only one of his siblings to study in the United States, back to continue the business, with a policy of having the other siblings go their separate ways to start their own businesses to prevent future conflicts.
As a third-generation heir, Panchana has been helping out at the factory since he was a child. However, because he enjoyed creative work more than his regular job, he decided to venture out into his own real estate business for a while before having to return to take over the business, as there was no one to carry on.
“I’m good at sales, setting up sales systems, and developing new products, including packaging. However, I disagree with my father, who prioritizes investing in machinery over spending on marketing to build a brand.” Panchana talked about the challenges during his initial management period, which made him feel unhappy with his work because he was always having his ideas stopped.
However, a turning point occurred 10 years ago after developing a highly successful chili fish sauce package. This renewed his passion and clear goals for his work. Panchana explained that despite differing opinions with his father, the small family size allowed for smooth management. He often consulted with his mother, who then relayed her ideas to his father, thus preventing any serious conflicts.
“The biggest problem was that whenever I wanted to try something new, my father would put me on the spot and discourage me. So I secretly ventured out to start a restaurant, condo, and Bangsaen fish market. It was so successful that my parents worried I wouldn't return to the family business. Lately, my parents have been giving me more opportunities to showcase my talents and new ideas.”
From this experience, Panchana has some thoughts for family businesses with heirs: “If your child or successor has an idea they'd like to pursue, they can pursue it alongside the family business. We don't need to oversee every department ourselves, but rather take the lead. So, don't put pressure on your child's ideas. Give them the opportunity to try while we still provide oversight and guidance.”
Panchana concluded by discussing the principle of dividing the inherited property from his grandfather's generation, whereby the sons will each manage their own businesses, while the daughters will receive the assets, money, or land instead, to prevent future conflicts.
“My family has a policy of not allowing other relatives to work because it is difficult to manage and could cause problems in the future. My grandfather set this up from the beginning, so only my grandchildren and children of the family are allowed to take care of the company.
I have three sons. I've started letting them help with the business and study it, but I'm not pressuring them to take over. I'll use the same model as my grandfather, managing separate companies. However, if my sons don't want to take over in the future, I'll list the business on the stock exchange and pass on the shares to my sons. To succeed in a business, management must be truly capable.
Along with leaving some thoughts about the family business: “For family businesses with heirs, when they are young, give them the opportunity to start their own businesses if they want to, as this will allow them to gain experience and learn.” He said, “On the other hand, the next generation of successors should realize that there are many people who would like to have the same opportunities as us. Setting up your own business isn't easy.”
Mae Pranom Thai Chili Paste: Continuing the family business towards sustainability with “professionalism and honesty”
Maepranom Thai Chili Paste Company Limited One of the long-standing Thai kitchen brands is entering an era of change under the management of the 3rd generation led by Thanaporn Phasaprasert, Chairman of the Marketing and Sales Group Committed to continuing the family business with professional principles while preserving the brand's original values.
Thanaporn tells the story of the brand's beginnings: “The Mae Pranom brand was founded by my grandparents. Their first product was Thai chili paste in a glass bottle, which was considered innovative for its time. In the past, consumers often bought chili paste in cups or bags. My grandparents saw an opportunity to create convenience by packaging it in a glass bottle for long-lasting storage.”
Having absorbed the work of the previous generation since childhood, when it was time to take on full-time management, he adopted professional working principles.
“When working with family members, especially siblings, we emphasize using data and facts in decision-making, whether in meetings or outside work. Everything must be based on clear, evidence-based information.”
For working with your parents' generation Thanaporn said that we must also work professionally, but acknowledge the generation gap and the greater experience of Mr. Thanaporn. Therefore, we must listen. But as the world changes and new technologies emerge, we must present clear information to create understanding and keep up with current consumer behavior.
In terms of management, we adhere to the principles of working that emphasize systems and standards, with a clear division of responsibilities. “We want to build a company operating system that meets the standards of a public limited company. Regarding coordination, we believe face-to-face meetings will yield better results than online communication. Face-to-face conversations allow us to see gestures and emotions, which are crucial for understanding each other.”
Thanaporn also emphasized the importance of being open to new ideas. “When there are disagreements, everything must be based on factual information. We must be prepared to explain the background of our actions. When the entire team is open to listening to each other, we gain new perspectives, new market segments, and enable us to develop products in a better direction.”
For ideas on business expansion Thanaporn revealed that “We should do what we love and love what we do. Because when we are committed, any obstacle we encounter immediately becomes an opportunity.” She thinks that A family business that starts with love will motivate the next generation to continue the business.
“Work and personal life must be balanced. When working, we give it our all, but when we return home, we must also fulfill our duties as a family member.”
“Most importantly, we don't insist that the next generation must be exclusively family members. Instead, we prioritize maintaining the sustainability of the Mae Pranom brand, ensuring its longevity in the market. This is the foundation our predecessors have built.”
Thanaporn concluded by saying, “No matter what business you're in, the most important thing is honesty and sincerity. We must be honest with both our business partners and customers, and never seek to take advantage of anyone.”
As you can see, every Mae Pranom product still adheres to the original policy of no added colors, no preservatives, and no MSG, in order to deliver quality products and sincerity to consumers.
Mae Pranom, now in its third generation, remains committed to continuous development and growth, operating under the principles of professionalism and honesty, which are the core values that have enabled the brand to endure and grow steadily to this day.
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