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Episode 59: Business Transition & The Trust Factor

In this episode of "The Family Business Show," host Michael Palumbos welcomes Jon Spacher from Fee Brothers, a fifth-generation family-owned business in Rochester, New York. They delve into the fascinating history of Fee Brothers, which dates back to 1864, originally starting as a sandwich shop before transitioning into a winery and distillery. The conversation highlights the company's adaptability during prohibition and its evolution into a renowned producer of bitters, mixes, and other cocktail ingredients.

Jon Spacher shares his personal journey from aspiring astrophysicist to a successful career in insurance, eventually leading him to take over the family business with his brother, Ben. He recounts the pivotal moment when his aunt, facing the potential loss of her brother and business partner, reached out to Jon and Ben to consider joining the business. This transition marked the start of the fifth generation's stewardship of Fee Brothers.

The discussion also touches on the challenges and opportunities of running a family business, including navigating family dynamics, maintaining a balance between honoring tradition and embracing innovation, and the importance of clear communication and setting expectations.

Jon emphasizes the importance of valuing employees and customers, sharing how Fee Brothers introduced a profit-sharing plan to ensure that the company's success is shared with those who contribute to it. He also highlights the company's growth and how they manage increasing demand and supply chain challenges.

The episode offers valuable insights into the complexities of family business management, the significance of adaptability and forward-thinking, and the rewarding aspects of carrying on a family legacy.

Episode 59 Transcript


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In here.

 

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Michael Palumbos: A welcome everybody to the family business show I am your host Michael Columbus with family wealth and legacy in Rochester New York.

 

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Michael Palumbos: And we've got a treat for you today hang on to your seats, we are with Jonathan speaker at a fee brothers and just.

 

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Michael Palumbos: wicked you know, there are Rochester family owned business, if I remember correctly, and I apologize, I think your fifth generation now yeah and goes way back and lots of incredible history so we're really excited welcome.

 

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Jon Spacher: Thank thanks Michael and I know your show has been taken off well like wildfire so i'm very flattered to be here, thank you.

 

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Michael Palumbos: we're we're humbled by the REACH that that this has had over the last two years, you know as a lot of us have said, you know lots of bad things came out of coven but some really good things to this one wouldn't be here if it wasn't for coven so.

 

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Jon Spacher: Pretty excited that's on your success.

 

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Michael Palumbos: Thanks um so we have a you know kind of a way that we kick the show off.

 

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Michael Palumbos: Everybody seems to make their journey into the family business a little differently so you know one introduce yourself, give us some background tell us you know your story, how did you get to where you are today and.

 

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Michael Palumbos: You know what do you see in the future of you know, the company and then we'll we'll dive into history and all those things but let's start off with.

 

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Michael Palumbos: Introduce yourself if you don't mind.

 

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Jon Spacher: Sure, thanks, so when I when I went off to college, I thought I wanted to be an astrophysicist, and so I got accepted to penn state for astrophysics and then after I got there realized that I needed to be with people more sociable.

 

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Jon Spacher: So no offense to the astrophysicists to are listening, and so I switched my major to business and ended up graduating with a degree in insurance which I then proceeded to chase a wonderful career in insurance for 24 years and only retired from that career, about a year ago.

 

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Jon Spacher: I never expected to get into the family business, although I was always around it my grandparents for my whole life lived upstairs from the factory.

 

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Jon Spacher: And so, every time we came to visit grandma and grandpa all the adults would have.

 

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Jon Spacher: Coffee and cake upstairs and all the grandkids cousins would be playing hide and go seek in the factory, so we got to know pretty well, but you know I always had an interest in it, and I was very close with my aunt and uncle my it's the sister and brother of my mother.

 

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Jon Spacher: and spend a lot of time with them and talked about the business, a great deal, as did my brother who's my business partner now and.

 

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Jon Spacher: through all of that always had an interest in it, but very much loved my aunt and uncle as my aunt and uncle and was not looking to necessarily have them or they have me either as a business partner, so we all maintained our individual careers.

 

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Jon Spacher: And one day as my uncle was not doing so well in the hospital my aunt called and said hey.

 

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Jon Spacher: Things aren't going so well for Joe and would you consider helping me through the business side of this if we should lose him, of course, and unfortunately we did lose Joe and I always said rather have an uncle than a business, but here we are so.

 

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Jon Spacher: As as we knew that we were going to lose them, I came into the brothers and started working with my aunt.

 

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Jon Spacher: And Ellen fee on.

 

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Jon Spacher: You know how, what do we need to just keep moving forward from a business perspective, she handled all the manufacturing and ingredients.

 

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Jon Spacher: All things like that and we started digging into it and, one day, maybe three weeks into this we're sitting down with the accountant for fee brothers.

 

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Jon Spacher: And he said I don't understand why the fifth generation isn't coming into the business and she said well because they're not interested.

 

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Jon Spacher: And in that moment, I said well wait a second we weren't interested, because you and Joe were running with this and you were doing so well and.

 

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Jon Spacher: it's not something that we ever thought that we ourselves would get into because you guys have it, but Joe isn't here anymore and.

 

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Jon Spacher: you're talking about someday retiring if you want to talk about that now we will talk about it with you, and she said, oh okay well that's a new story so.

 

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Jon Spacher: You know, fast forward we brought actually well i'll share this because it speaks to the family, part of the business.

 

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Jon Spacher: She said, would it be just you or would you bring somebody else from the family into the business, and I said, well, I bring somebody else in I bring Ben in my brother.

 

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Jon Spacher: i'm very 40,000 foot mach five view kind of guy and Ben is very process oriented so between the two of us we attend to a great many things my my weaknesses are his strengths and.

 

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Jon Spacher: So she said Okay, and she said no, are you going to bring him into me as an employee or as a business partner, and I said as a partner and she goes right answer Okay, we can talk and so that's how this all came to be and from there Ben and I came in and said we would be interested in.

 

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Jon Spacher: The transition of the business from from you and our uncle's a state to us, we are going to need some room to update some things and she said Okay, and we updated them, and it was 15 months ago now.

 

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Jon Spacher: took over as the fifth generation stewards of the brothers.

 

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Michael Palumbos: I love that word it's my favorite word it's not your business.

 

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Michael Palumbos: It is not always it's the customers, we are just stewards of all his knowledge and you know and things so I love that you said that um.

 

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Michael Palumbos: Give me just there's a lot going through my head, right now, because there's so many pieces and places to go and I may not go through it my my agenda, exactly as I said how old are your aunt and uncle when this is, you know happening.

 

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Jon Spacher: So my aunt is turning 65 this year.

 

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Jon Spacher: Okay, so she was 6063 when this was all happening, and she already.

 

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Jon Spacher: Excuse me, she already had the prospect of retirement on the horizon.

 

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Jon Spacher: But didn't really know.

 

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Michael Palumbos: Is continuity plan in place and they thought of something okay.

 

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Jon Spacher: No, and part of that was because my grandfather their father lived to be well into his 90s.

 

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Jon Spacher: And God rest his soul didn't necessarily release his iron grip on the business until much later in life so now you have you know aunt Ellen and uncle Joe brother and sister who have learned everything.

 

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Jon Spacher: about the business internally from their father, who was from Kodak and was thrust into the business when his father unexpectedly passed away.

 

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Jon Spacher: wow and so he designed so many of the different systems and procedures and things that happened here, out of necessity.

 

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Jon Spacher: And then taught it to the fourth generation and the fourth generation as they went through the years of course learned other things as well that they would like to implement and bring the business up to you know their generation but because he held on for so long.

 

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Jon Spacher: It did not allow them to make all the decisions that they wanted to make until.

 

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Jon Spacher: All the shares had passed to them, which was before he passed away, but it was it was later in life than I think most people are accustomed to.

 

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yeah.

 

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Michael Palumbos: um i'm gonna i'll come back to that, but just kind of think about it in your head, you know how did that transition work, and you know it sounded like there was some things over time i'm going to come back to that in a second.

 

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Michael Palumbos: john your brother Ben what was his background before this.

 

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Jon Spacher: yeah Ben went to us, we go and graduated with a degree in technology, intended to be a tech teacher and an educator.

 

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Jon Spacher: Okay um.

 

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Jon Spacher: He found out that he liked the tech piece a little bit more than the education piece of it and so he got into it and IT security and worked for a local.

 

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Jon Spacher: company that was growing very quickly and then, when he was doing very well there but, like me, we both had careers that we loved we had never thought of.

 

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Jon Spacher: Entering the family business because Joe and Alan have it, it was only when Joe passed away and I.

 

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Jon Spacher: You know, took them out to dinner one night, and I said hey listen I just had this conversation with Ellen and I think we're the right to people for it, and she thinks were the right to people for it, you want to take a shot with me and thank God, he said yes.

 

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Michael Palumbos: that's so cool I love the fact that you knew each other well enough to to say this is going to be a good fit for the tool boss as we're doing these things very long yeah alright so walk us through the business yeah I mean.

 

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Jon Spacher: I mean short.

 

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Michael Palumbos: generations is gigantic and I, you know I say this on the show all the time, I just want to reiterate.

 

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Michael Palumbos: I don't feel I don't believe that like if if you guys were to build this up and then sell it that's not failing, you know what I mean.

 

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Michael Palumbos: it's so many people it's like Oh well, it's your job to get it to the sixth generation, no, it is your job to be a steward of the business, just like you said, if that so happens to be.

 

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Michael Palumbos: The we find somebody internally within the family, to continue, and they want to be a steward of it fine, but if they're not you know, so I think it's.

 

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Michael Palumbos: A little bit of luck and but from the sounds of it just you know a lot of luck in some cases where your grandfather stepped in when you know, there was you know is you got it.

 

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Jon Spacher: So absolutely and just on that on that point, like a I think it's worth sharing.

 

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Jon Spacher: As we were getting into this, we trust our and very much and we're lucky that she trusts us very much and Ben and I trust each other very much and I think part of all of that is very open communication so before we ever agreed to do this, we had to ask a bunch of very.

 

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Jon Spacher: open questions to Ellen because the one thing that we don't want to do is is gained a business but losing and.

 

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Jon Spacher: yeah, and so one of the things.

 

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Michael Palumbos: i'm sharing some of those questions down yeah that would be helpful for people.

 

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Jon Spacher: This this was one of the biggest questions, well, we asked two questions two big questions, from my perspective, one of them was less facetious than the other, and that was.

 

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Jon Spacher: Ellen let's say we buy this business and five years from now, we decide that the right thing to do is selling.

 

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Jon Spacher: What happens then with our relationship.

 

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Jon Spacher: And she said well.

 

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Jon Spacher: I look at it like this, it means that the business lasted in our family five years longer than it would have anyway number one which I thought well that's very gracious of you, and she said number two you get to be the one to disappoint our ancestors not me.

 

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Jon Spacher: And I thought okay.

 

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Jon Spacher: There we go.

 

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Michael Palumbos: Now.

 

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Jon Spacher: That being said, Ben and I have had an absolute blast since we've gotten here we have absolutely no intent on selling the business and.

 

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Jon Spacher: Every day we we show up to work and laugh a lot and kick a lot of button have a great time so there's no plan on doing that, but it was a question that I.

 

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Jon Spacher: am so glad that I asked before we got into the discussion of actually buying the business because it fairly set everybody's expectation and it was just a lot of honest communication, the other one that I asked was.

 

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Jon Spacher: I was doing very well for myself in my insurance career and because of the luck that I had had there.

 

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Jon Spacher: My wife and I love to sail, and so we had just decided that we were going to get another sailboat and I said now Ellen.

 

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Jon Spacher: I said before we move forward another question, you know the Jen and I just decided to to get the sailboat.

 

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Jon Spacher: But I understand that we're undertaking a financial obligation here and I want to understand your true opinion of us moving forward with both.

 

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Jon Spacher: And she goes get the sailboat you're going to need it, so I just thought, all the way around it was there were a lot of open questions that were asked, and they were answered very honestly and it led to a very good place of.

 

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Jon Spacher: Fair expectations, I think people are disappointed when one of two things happens either expectations aren't met.

 

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Jon Spacher: You know.

 

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Jon Spacher: Either your your expectations aren't fair and you need to change your expectations or you need to change your reality.

 

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Jon Spacher: And, and those are the two times when people aren't happy with what's happening, and so, if we get into everything with a fair vision of our expectations and a fair estimation of what reality is and luckily, we did, and it went very well yeah.

 

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Michael Palumbos: it's super wise I, so I became a part of an organization called the purposeful planning Institute and what you just did was very purposeful.

 

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Michael Palumbos: Questions to make sure that the fan of what was more important to you that the family could sit down at the thanksgiving dinner table together, then you know, then, to do that, then then to buy the business and.

 

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Michael Palumbos: Back to that.

 

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Michael Palumbos: lot of respect for that um how many employees are there.

 

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Jon Spacher: Right now, we have 28, but when we bought the business 15 months ago it was 14.

 

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Jon Spacher: So wow we've more than doubled the number of employees, by the end of this year, which will have been two years now, this is a at the time we bought it was.

 

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Jon Spacher: It was just coming up on our hundred and 57 year anniversary.

 

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Jon Spacher: Okay, from the time we bought the business until two years after we bought it.

 

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Jon Spacher: We are going to come really close to of doubling the revenue and I can't I don't say that to pat ourselves on the back.

 

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Jon Spacher: We just showed up and made sure that we kept taking steps forward, but the momentum that we have.

 

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Jon Spacher: Is thanks to our analysts and uncle Joe all the work that he did flying all over the world, we don't market we don't have sales people.

 

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Jon Spacher: So this is all just organic growth from the district distribution network that we have in the momentum that was already built before we got here, which again we're very lucky.

 

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Michael Palumbos: let's be honest coven happened people started drinking more they needed your product yeah.

 

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Jon Spacher: No, I would agree with that and the cool thing is i've had a number of friends across the country, who have taken those masters classes.

 

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Jon Spacher: And because everybody was stuck at home wanting to learn something and a number of them have taken masters classes on mythology or making their own drinks.

 

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Jon Spacher: And i'll get pictures from them and they'll say i'm taking a mythology master's class tonight you'll never guess what i'm using and they'll text me a picture of the brothers this are few brothers that.

 

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Jon Spacher: But the neat thing is, is that even before coven the business was growing double digit year over year for the five years leading up to coven, so I would love to blame it.

 

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Jon Spacher: On Kobe i'm sure it had something.

 

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Michael Palumbos: To do with that just i'm just teasing, but I think.

 

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Jon Spacher: Well there's going to switch affair common but i'm being the top drink.

 

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Michael Palumbos: To you know whiskey is starting to come back up, and so you know you blend better I gotta believe, though, I don't know whether you would use the brothers in a band could drink or not, I think there's probably like a dirty Martini you.

 

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Michael Palumbos: know some of the things that you create yeah so whether it's our mixes.

 

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Jon Spacher: syrup's brian's betters botanical waters will mix with pretty much anything.

 

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Jon Spacher: But you know I just I wanted to say that because I think.

 

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Jon Spacher: it's a very fair comment to make, and I think there are a number of businesses through coven that have been hurt, I think there are a number of businesses through coven that have been helped and the frustrating part to me as a.

 

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Jon Spacher: Numbers guy is I can't delineate between what part of our success is due to an aberration, in the space time continuum that we refer to as covert.

 

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Jon Spacher: And that's frustrating, I want to isolate that and say, well, this is because of that, and this part is because of this, but i'm never going to be able to do that, so I gotta let go.

 

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Michael Palumbos: yeah I just enjoy the ride, and as long as the numbers and the orders keep coming in it's it's a okay.

 

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Michael Palumbos: amen we had.

 

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Michael Palumbos: A couple episodes ago large cast iron was on and and that was fun because they're another you know multi generation business and just a product.

 

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Michael Palumbos: That everybody would know you know, and I was it was like laughing because I started using a large cast iron years ago, but I never really used it.

 

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Michael Palumbos: And then I googled how to you know clean the pan and take care of it and do that stuff and it became like this.

 

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Michael Palumbos: cultish thing like I would get all excited about it and teach people how to you know did season, the pan and do all those things, I think you know with the making of a drink it's a lot of the same thing you know my my brother in law's a mixologist works for mo at Hennessy.

 

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Michael Palumbos: And he he right i'll have to talk to him next time about what's happening in the La market when it comes to bitters and all the thing you know the feet if he's familiar with the brothers i'm sure he is.

 

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Michael Palumbos: But i'll then i'll tell him to you know.

 

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Michael Palumbos: To just tell them that it, you know more had Hennessy just it mixes better with you know with fee brothers than other bidders out that are out there.

 

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Jon Spacher: Well, thank you it's it's the it's the mixologist out there it's the bartenders out there, that are the important people in in this chain of how things work.

 

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Jon Spacher: their customers individual customers, not a distributor so we call our customers, but there are individual customers out there who will call us up or email us and say I need a recipe for this.

 

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Jon Spacher: yeah and our answer is always the same listen.

 

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Jon Spacher: We think we're great at making products but we're not going to tell you that we're the best at what to do with them.

 

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Jon Spacher: it's it's all the mixologist and the bartenders out there that are attending to their craft that just use us as a tool they're the ones that make us shine and we're fortunate to have a good crowd.

 

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Michael Palumbos: love it um let's talk about the history real quick um.

 

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Michael Palumbos: So.

 

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Jon Spacher: 18 1964 1864 1864 James fee opens up a sandwich shop.

 

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Jon Spacher: With his mother and his mother she and her husband had come over from Ireland by way of Montreal down to Rochester.

 

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Jon Spacher: And so, James fee is the oldest of four fee brothers and one sister.

 

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Jon Spacher: And he and his mother open up a sandwich shop, which then turns into over time, a winery and distillery making whiskey and wine.

 

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Jon Spacher: And that went very well for quite some time.

 

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Jon Spacher: and was then passed down to one of james's nephews by way of his brother.

 

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Jon Spacher: Who would be my great grandfather.

 

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Jon Spacher: And so my great grandfather and great grandmother are now running fee brothers and prohibition comes along.

 

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Jon Spacher: So the whiskey stops, but the wine continues for two reasons, one churches were buying up more and more wine.

 

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Jon Spacher: And I can't imagine that the priests were the one who were drinking all of the records that we show I don't know the numbers off the top my head, but the records that we show where the wine sales to churches went through the roof during prohibition.

 

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Jon Spacher: wow the thing yeah.

 

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Michael Palumbos: Little history piece.

 

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Jon Spacher: The other thing that happened was it was legal to make wine in your home up to 200 gallons a year, which is still the rule today.

 

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Jon Spacher: And, but nobody knew how to do it so fever others would go to people's homes and we still have the logbook of who we serviced in Rochester.

 

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Jon Spacher: And they would go into people's homes and they would make wine, and then they believe and then they'd come back and they'd racket and bottle it and cork it and then they'd leave, and that was legal because it was being done in your home for your own personal consumption.

 

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Jon Spacher: But.

 

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Jon Spacher: Excuse me The other thing that was happening was we had a bottle of malted liquid called bruin had a picture of a bear on it and it said it's a bear meaning it's a beer and on the back, it said, do not add this much used to it, or else this will turn into an illegal substance.

 

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Jon Spacher: So of course you can only imagine what everybody was doing with it, and at the same time.

 

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Jon Spacher: People were coming to my great grandfather saying i've got this awful tasting bathtub whatever that I made.

 

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Jon Spacher: What do I, how do I make this tastes better and he'd say well put a little bit of this in it and a little bit of that a little bit of this.

 

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Jon Spacher: And, of course, these are all stories passed down through the generations and, over time, what came to him was the idea of Why am I, giving them all these different little things why don't I mix this up and sell them a drink mix.

 

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Jon Spacher: And that is the basis of what fee brothers has become now my great grandfather unexpectedly passed away.

 

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Jon Spacher: My grandfather back from the war he was over in the Pacific.

 

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Jon Spacher: He was a chemist at Kodak.

 

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Jon Spacher: Okay, and so his mom my great grandmother starts taking over the business and seeing what she can do to keep things moving forward and he starts working in the factory at nights except my great grandfather had written everything and such.

 

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Jon Spacher: undecipherable code that nobody knew how to make the products.

 

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Jon Spacher: And my grandfather being a chemist said hey i'll figure this out well he only figured out five of the 30.

 

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Jon Spacher: products that were being made at the time.

 

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Jon Spacher: And so, he had all these ingredients and he had all these finished products that he knew they eventually created and so he started recreating.

 

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Jon Spacher: The breath of products that has led to what we are today and then my aunt Ellen took over and created the other half of them that we have today, but there was a time there were you know, is it was a very tenuous situation and.

 

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Jon Spacher: I couldn't not everybody knew that it was going to survive.

 

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Michael Palumbos: wow yeah I mean when you go out to your website, you know it's we think of fee brothers, I do at least, and he think of the bitters.

 

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Michael Palumbos: But then, you know you start looking at here it's botanical waters and brian's like you said, which I didn't even know you know there's.

 

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Michael Palumbos: there's a bar in Rochester that does a cheeseburger shot, and I would think that those that that dill pickle brine.

 

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Michael Palumbos: is perfect, for it cordial mixes cocktail mixes syrup's coffee flavored cordial and you know again that's a lot.

 

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Michael Palumbos: And so what you're saying is out of all these different products that were made to the years there was only a handful of the recipes that they were able to do until that your your grandfather went through and then your aunt deciphered at all.

 

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Michael Palumbos: And figured out.

 

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Jon Spacher: Well, they they read they really re recreated products, so he was able, he was able to to figure out five of the original products and then everything else that we have that kind of made up as they went, and you know we we did a lot of listening over the years to what the industry wanted.

 

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Jon Spacher: From a drink manufacturer.

 

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Michael Palumbos: Unbelievable that's a pretty cool story, you know I mean because, like you said it could have gone South if you didn't you know if somebody wasn't able to figure that stuff out I think it's you have to have.

 

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Michael Palumbos: Enough product in enough different arenas because, especially when you're dealing with the alcohol market.

 

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Michael Palumbos: You know this, you know bad because in today well great what goes well with that well okay great now tequilas coming around great well and we'll have more Margarita mix, but you know you it probably changes over time.

 

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Jon Spacher: It does and bitters we're not our big seller not not too long ago, I mean you know 20 years ago bitters was not the big seller.

 

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Jon Spacher: I think 1984 prior to Ben and I taking over the business 1984 was our largest production year ever and a lot of that was you know everything from whiskey sour mixed opinion colada to daiquiri Margarita and we still have those products.

 

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Jon Spacher: But this was.

 

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Jon Spacher: By gallon edge, because people bought a lot of it so buy a gallon edge That was our biggest year ever until 2021.

 

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Jon Spacher: Which over took that gallon edge and now we're going from selling quartz and gallon sized bottles of daiquiri and pina colada mix to five ounce bottles of bitter and yet still exceeding what the volume was and we're very fortunate in that way, I need to say.

 

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Jon Spacher: Because we don't have any one distributor that is a majority share of where business goes we're very fortunate that.

 

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Jon Spacher: we've got a number of different products so as mixes might wane, a little bit.

 

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Jon Spacher: bitters are doing well, our fee foam is taking off 6,900% in the last four years i've never seen anything like this in any business case study i've ever done.

 

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Jon Spacher: You know our international sales are growing, so if if the floor falls out from under US in one area or with one product we're Okay, because we're insulated from that having an adverse effect across the entire company.

 

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Michael Palumbos: Great um I think that's a pretty darn big obstacle that you guys were able able to overcome, and it also sounds like from you know you've hinted towards some of these transitions didn't.

 

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Michael Palumbos: It wasn't like they were planned hey we're gonna you know, do the succession plan we're going to start five years early get everybody in lined up for this stuff they just kind of happened along the way.

 

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Jon Spacher: yeah it's.

 

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Jon Spacher: really good now going from my grandfather to my aunt and uncle my aunt and uncle put in a tremendous amount of sweat equity they probably bought this company four times over, with their sweat equity but.

 

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Jon Spacher: outside of that there it wasn't always a smooth planned transition.

 

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Okay.

 

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Michael Palumbos: um to do anything else in the family or the business history that other family businesses might benefit from from hearing.

 

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Jon Spacher: i'm.

 

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Jon Spacher: we're very fortunate that we have a tremendous amount of trust in our.

 

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Jon Spacher: In our family.

 

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Jon Spacher: We even if we disagree with each other, which we do.

 

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Jon Spacher: We still have a tremendous amount of trust and there's a lot of communication.

 

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Jon Spacher: Because we we all talk to each other, so you know here Ben and I are now partners in owning fee brothers.

 

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Jon Spacher: yeah i'll say that we've hired our mother to come in and help roll labels on bitters she she comes in part time a few hours a week LM s still on call she's still on retainer for a little while in case we joke with her we call her up and we say hey we can't find the O rings.

 

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Jon Spacher: But outside of that there's nobody in the family, currently, who is part of the business but they all still have a vested interest in it, because it's it's all part of their their namesake.

 

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Jon Spacher: yeah and so and, and this is where a lot of them grew up.

 

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Jon Spacher: The generation previous To me, this was their home, so when when we come to work we're not just coming to work we're we're also coming to the family house yeah so you know there's a lot of communication and there's a lot of trust.

 

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Michael Palumbos: There it's interesting that you talk about that so yeah I mentioned before, that you know the lodge family had come on Jay and Lisa Daniels and one of the things that they did is they had a lot of people family members that had ownership.

 

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Michael Palumbos: But no involvement.

 

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Michael Palumbos: Like five people were at the company over 50 family members own the company.

 

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Michael Palumbos: I can talk about that because it's on the podcast.

 

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Michael Palumbos: um but what's you know, one of the things that they needed to do is start connecting people.

 

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Michael Palumbos: With the business, so that there wasn't you know the business could still run doing what it's supposed to be doing I bring it up, because I think in your position, how many family members, how big is the is the family, overall, when you look across I mean 23 family members, I don't know.

 

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Jon Spacher: Oh well.

 

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Michael Palumbos: He ended family today.

 

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Jon Spacher: i'd have to add it all up but let's say we've got.

 

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Jon Spacher: Seven is six aunts and uncles.

 

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Jon Spacher: And we've got you know a number of cousins at at my in my generation there's only two owners of the business and it's been to myself.

 

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Jon Spacher: If we were a bigger business, maybe there would be more.

 

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Jon Spacher: pie, to cut.

 

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Michael Palumbos: know you well all's I was gonna say is to your point one of the things that I have found and i'm just sharing this with people can catch.

 

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Michael Palumbos: or capture this what you said is there's a vested interest because their name, because they grew up.

 

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Michael Palumbos: Because they put that together, and so I highly recommend that families one time, a year.

 

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Michael Palumbos: At least you know share with family members, we don't need to go into detail, they don't have any voting rights or anything like that, but just here's what's happening in the business, so that you know because I know if somebody asks you about hey how's the brothers doing they get asked.

 

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Michael Palumbos: And so it's yeah.

 

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Jon Spacher: yeah despite I see what you're saying, despite there being no ownership interest or people not being employed here there's tremendous amount of pride.

 

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Michael Palumbos: In my business and that there's a.

 

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Jon Spacher: tie to fee brothers.

 

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Jon Spacher: And, and so.

 

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Jon Spacher: You know, like I said there's a lot of trust and a lot of communication with everybody whether.

 

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Jon Spacher: They have any interest legal interest in fee brothers or not and and we respect that and and we appreciate it because we view it as support.

 

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Michael Palumbos: 100% so yeah it can different families do it different ways, one does a family meeting.

 

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Michael Palumbos: You know they get they get one weekend the whole family gets together and in the morning, they talked about the business and they teach the next generation.

 

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Michael Palumbos: Whether they're you know they're they could be kids just so that everybody knows, because their great grandparents started this thing in that town everybody knows their name and and so yeah you know they just try to do that.

 

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Jon Spacher: I love it.

 

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Michael Palumbos: yeah so I just an idea for you um.

 

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Michael Palumbos: What is tough about being in a family business, you know, for you.

 

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Jon Spacher: Well i'm.

 

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Jon Spacher: i'm very like I said i'm very fortunate to have the family that I have because I could see how quickly things could go sideways.

 

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Jon Spacher: I think there's a constant.

 

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Jon Spacher: i'm always cognizant of how do we advance the business, while.

 

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Jon Spacher: being true to the good things that got us here yeah and there's there's a spectrum to that and and if we.

 

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Jon Spacher: stayed with how things always had been and never grew or learned or allowed outside thought to enter our minds we'd have a beautiful ECHO chamber and we die.

 

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Jon Spacher: And if we started running through the minefield of advancing as quickly as we possibly could, without giving any consideration to what brought us here we die and so there's there's a there's a balance and i've tread very carefully.

 

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Jon Spacher: Trying to learn as much as I can, before making a decision, but not being frozen and unable to make a decision, either and you're going to mess it up.

 

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Jon Spacher: there's there's no way to do that 100% right 100% of the time.

 

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Jon Spacher: you're going to mess something up hopefully it's not a big thing.

 

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Jon Spacher: And you just you just keep taking you know, putting one foot in front of the other and trying to be as thoughtful as possible, thoughtful to the history, thoughtful to the things that got you here.

 

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Jon Spacher: Certainly, thoughtful to the employees, because they're the ones that are doing the work they're they're, the ones who are actually getting the job done.

 

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Jon Spacher: i'm just here to to help paint a picture of what the future could look like and hopefully.

 

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Jon Spacher: assemble their talents in a way that help us get there and and you know pay attention to the good things that did get us here, even if some of them over time, just like at one point in time we're making one and whiskey and we no longer are.

 

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Jon Spacher: We.

 

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Jon Spacher: have to reinvent yourself, and I think that's The one thing that keeps me up.

 

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Jon Spacher: At night if there were anything is how do we, what is the next thing that we have to do to reinvent ourselves right now, things are going great sales are through the roof.

 

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Jon Spacher: But I don't want to be fooled into thinking that that means forever right.

 

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Michael Palumbos: So far, a very smart it's you know.

 

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Michael Palumbos: A lot of people as i've gone through speaking with other family businesses, they say, you know I don't have an MBA but I definitely earned one and it's mostly came from the mistakes that I made.

 

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Michael Palumbos: along the way.

 

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Michael Palumbos: or thinking that I had it all figured out and realizing that I wasn't even close and then we pivoted and we and we and we're still here and that's you know how you do it so.

 

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Jon Spacher: I used to when I when I first got into my insurance career, I think I was a bit of a punk if something went my way i'd I wouldn't shy away from taking full credit for it and.

 

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Jon Spacher: You know, over over the years you, you get smacked around a little bit and start to understand things don't necessarily work that way and i'm very grateful that I got smacked around a bit before coming to fee brothers, because I would not have want to have learned those lessons.

 

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Jon Spacher: Here yeah.

 

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Jon Spacher: yeah and you know, one of my most favorite sayings is good judgment comes from experience and experience comes from bad judgment.

 

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Jon Spacher: And so i'm very fortunate, and you know, Joe and Ellen didn't have that opportunity they really came here right out of the gate and and had to learn as they went, but Ben and i've been fortunate that we got to figure a few things out first.

 

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Michael Palumbos: Great so you've talked about basically to obstacles or mean what keeps you up at night, what are the things one is you know what is our next what's the next you know gig where what do we what's the future look like for us.

 

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Michael Palumbos: The other one is you know, and we had talked about it in a pre show call, but it was just.

 

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Michael Palumbos: we're growing so fast, how do we keep up with all the other, you know things that are going on, how are you finding for you for your industry for the things you're doing supply chain and those issues that other people are you know talking about are you okay there.

 

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Jon Spacher: yeah we're very fortunate with our Labor we have with what i've seen in my entire life is the best benefits package anywhere, we We take good care of our people.

 

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Jon Spacher: So and we've got great people, so I think they all like working with each other, which helps.

 

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Jon Spacher: So we're very fortunate with Labor we're very fortunate, with a great many things.

 

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Jon Spacher: And like you said, our demand right now is through the roof we've never seen anything like this before we are currently filling orders within three months we'd like to be filling orders within a week or two three months is insane we're very fortunate to have.

 

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Jon Spacher: distributors who understand this and change their ordering habits to fulfill what they need to keep their pipeline full.

 

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Jon Spacher: Now that being said, I finally put up signs around our office I put four of them up one on each wall and it says we don't have a production problem we have a demand problem.

 

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Jon Spacher: Because I could hear it in the voices of people as they were speaking on the phone you could almost hear the the apology of gee i'm really sorry it's going to take us three months, you know what.

 

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Jon Spacher: yeah because we can't make it just because.

 

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Michael Palumbos: You guys want more of this stuff than we've ever had.

 

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Jon Spacher: Our production is up 75% over the prior year What more can we possibly and of course that's going to increase as well, but when it comes to supply chain, our Labor has been good our.

 

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Jon Spacher: Our ingredients for the most part, have been good, except for to our pickle Brian and are all of Ryan, we because of all the supply chain issues got put on hold, we are reinventing those products, we hope to have them out in the next hopefully three months.

 

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Jon Spacher: very excited about that.

 

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Jon Spacher: And two things have happened one glass is a little bit harder to come by then, it has but we order so much of it.

 

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Jon Spacher: That we are luckily, one of the squeaky wheels that get attention and two, and this is more recently, for us, is transportation.

 

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Jon Spacher: Not only the availability of transportation, but also the cost of transportation, so if our glasses being made somewhere overseas and there's a number of different plants that make these.

 

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Jon Spacher: You know how do we, how do we get it here, even if they can make it.

 

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Jon Spacher: And of course the ideal situation would be to move to a domestic manufacturer of of glass, but so far we have not been able to source anybody domestically for for what we need gotcha.

 

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Michael Palumbos: um well, you and your brother talk obviously yours go owners in the business, so I would imagine that you've maybe set a few goals for yourself.

 

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Michael Palumbos: And the business.

 

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Michael Palumbos: Do you mind sharing you know what do you see for fee brothers right now five or 10 years old.

 

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Jon Spacher: yeah um.

 

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Jon Spacher: we're very fortunate that and I compare this to the past in the 24 years of my life that led up to this.

 

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Jon Spacher: You had to have a goal, because you had to be shooting for something.

 

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Jon Spacher: yeah and how do we grow, how do we get more profitable, how do we grow our distribution there's a lot of different ways to set goals, one of the frustrations that.

 

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Jon Spacher: i've had over the years is.

 

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Jon Spacher: When we pass.

 

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Jon Spacher: A finish line.

 

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Jon Spacher: let's take a minute and pat ourselves on the back.

 

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Jon Spacher: let's not say well okay great you did this now what's next and, of course.

 

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Jon Spacher: The idea of what are we going to do that different this year and then the next year, what are we going to do, different this year and fooling ourselves into thinking that we're smart enough to invent 40 different ways to do our business.

 

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Jon Spacher: Once you understand what you're doing there's not that many different ways to to to your business and and I think that when Ben and I came into fi brothers.

 

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Jon Spacher: We were incredibly lucky we're not looking to try to climb a hill we're already at the top of the hill.

 

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Jon Spacher: Where the number four ranked international bitters in the world if we were number one where would we have to go.

 

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Jon Spacher: Right so we're just we're so fortunate that the way that we view it is we're already at the top of the Hill, but this hill is going to continue to grow.

 

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Jon Spacher: And how can we manage this business in a way that we can sleep well at night, and a lot of that has to do with taking care of two different groups of people number one our employees and number two our customers.

 

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Jon Spacher: And if we are taking care of our employees and our customers there's not a whole lot else that matters it's not about hitting a particular revenue number, you have to always be profitable or else, what are you doing here.

 

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Jon Spacher: yeah but there's there's no set growth goal.

 

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Jon Spacher: Because we're in such a great position another thing is over the years of my prior career any decision that was made you amortize out the cost of that decision over 135 years, maybe 10 if you're really if you're really trying to sell it but.

 

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Jon Spacher: Here we are we're 158 year old business and as soon as you amortize out the cost of any decision over 100 years.

 

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Jon Spacher: it soon becomes irrelevant and you're blessed with the opportunity to make decisions about how do we do this right.

 

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Jon Spacher: So long as it is sustainable, not looking for return, it has to be sustainable, or else you're hurting yourself more than you're helping yourself, but you don't need to always do make decisions.

 

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Jon Spacher: Looking for that investment return in a three to five year time frame so we've been very fortunate, and all those things.

 

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Michael Palumbos: No, I love it, I think that is a great goal and it's admirable goal, I think you know a lot of times, people would be wise to sit back and say we don't have to continue growing, for the sake of growing.

 

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Michael Palumbos: What if what if we just worried about getting more profitable and sharing those profits with the people that helped us get here.

 

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Jon Spacher: And that's exactly where we are we actually just this year, the one thing that's bothered us over the first year Ben and I owning fee brothers was the company was growing and was doing well profitably.

 

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Jon Spacher: And that wasn't being directly shared with the employees and so, for this year we rolled out a profit sharing plan that when fee brothers makes a profit.

 

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Jon Spacher: Depending you know there's a scale to it but depending on how profitable feed brothers is the employees who who helped make that happen share in that.

 

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Jon Spacher: And and it's allowed us to open up and have conversations about what's happening there's no we don't have to hide anything anymore, because everybody's part of the benefit.

 

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Jon Spacher: And we've very much enjoyed that and have seen I think i've seen a boost in morale.

 

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Jon Spacher: Since then, so we've been very lucky.

 

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Michael Palumbos: Nice and in coming from the insurance business and having a father that.

 

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Michael Palumbos: Is in that side of the wealth management, you know side of things very, very.

 

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Michael Palumbos: cool that you're weaving those things in and making sure that your employees the people that are helping you to get there are retirement ready and oh and.

 

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Michael Palumbos: What can we do to make sure that you've.

 

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Michael Palumbos: celebrated with us, I have some time offline now i'm going to get back to you, I have some celebration ideas for you, that i'll share with you.

 

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Jon Spacher: A holiday we don't have time for that right.

 

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Michael Palumbos: What about.

 

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Michael Palumbos: A couple ideas.

 

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i'm.

 

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Michael Palumbos: giving advice to you know other family members other family business owners that are getting ready and.

 

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Michael Palumbos: Just because you just you know you just transitioned from your aunt to you what are some of the things that.

 

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Michael Palumbos: advice that you would give books that you would tell people to read things that you know what, what is your best advice for somebody sitting at the bar stool having a drink with bitters in it.

 

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Jon Spacher: Sugar first of all don't drink too much.

 

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Jon Spacher: But enjoy what you do drink.

 

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Jon Spacher: You know.

 

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Jon Spacher: There are there are nagging questions as anybody enters anything and it doesn't matter if it's a business relationship, a new sport what you know, whatever it is there there's.

 

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Jon Spacher: Their nagging questions that your internal monologue is telling you, you have whether you want to listen to it or not.

 

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Jon Spacher: And my advice would be to get them out on the table and to to address them with the people that they need to be addressed with, and I think so often people don't do that because they don't want to offend anyone and they don't want to.

 

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Jon Spacher: They don't want to hurt anybody's feelings, but.

 

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Jon Spacher: My.

 

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Jon Spacher: My contention with that is aren't you hurting somebody's feelings more by not bringing up and somewhere down the line at all coming to a fever pitch where it has to be addressed and now it's after the fact it's a it's reactionary instead of proactive so.

 

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Jon Spacher: You know I I have been accused, maybe, of being a little bit too blunt, sometimes, but I think it's the healthiest way.

 

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Jon Spacher: To do business, and I think it's the healthiest way to maintain good relationships, and so I guess that would be my primary advice that little question that's nagging or that little voice that's nagging they're saying yeah but clear the air and get it out there, and you know.

 

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Jon Spacher: We can tell each other know and still give each other, a hug at the same time.

 

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Michael Palumbos: Right ah, I love it, this is has been a joy I just.

 

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Michael Palumbos: Hope and love when I can you know talk with families that have been around for five generations and there's so much history there and it's never the same story.

 

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Michael Palumbos: Never the same story and that's what makes you know what I do fun.

 

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Michael Palumbos: And then you know I had other ones where it's they just started she you know I spoke with a.

 

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Michael Palumbos: Another family business where she started the business or sell she's now got three or four companies going and she's brought her father and her sister and her kids all work there, and so it's just different, and so they have such a different take.

 

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Michael Palumbos: than.

 

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Michael Palumbos: than you do and it's just fun to see all of the different pieces your advice of communicating getting the questions out on the table is gigantic because it's so incredibly important.

 

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Michael Palumbos: A friend of mine wrote a book called every family's business and Tom dean's book what he says is.

 

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Michael Palumbos: he's a big fan of one each generation buys the business from the other generation, so that you've got skin in the game, and you know you're doing those things number one, but he has a conversation once a year he tells the current generation and the.

 

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Michael Palumbos: rising generation will call that if you're working together at the same time.

 

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Michael Palumbos: To you do a SWOT analysis and they do a SWOT analysis and then compare.

 

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Michael Palumbos: And then, and then, so you can start to you know, say, do you want to sell the business you not want to sell the business where are we at Am I just an employee and it's right to your point.

 

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Michael Palumbos: Of especially like your situations, a little different where it was we came in bought and you know and move down that was a totally different transition but oftentimes go back to your aunt and uncle.

 

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Michael Palumbos: And to have that conversation, am I just an employee right now, when is this transition happening what's going on, how do we move forward and sometimes those you know those frank conversations are helpful.

 

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Michael Palumbos: yeah it worked for them, and it was fine, but I know other families where it is you know drove driven a wedge in between because they're like i'm 50 years old.

 

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Michael Palumbos: I can't wait forever.

 

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Michael Palumbos: To take this business over.

 

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Jon Spacher: I think.

 

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Jon Spacher: Depending on.

 

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Jon Spacher: The family and depending on the personalities there's a right fit for for each transition and just being as blunt as possible to set fair expectations about what that right transition is given those personalities, is the healthiest thing you can do.

 

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Michael Palumbos: I would totally agree so everybody we've been speaking with john space here at the brothers it's fi brothers.com go and check them out there right in Rochester New York Thank you so much for your time today for.

 

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Michael Palumbos: Sharing you know your experience.

 

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Michael Palumbos: This has been the family biz show i'm Michael Columbus with family wealth and legacy, also in Rochester New York, thank you for joining us and we can't wait to have you on future episodes and listening in to the family biz show.

If you’re a family business or a family business consultant and want to be on the show, share your story and help other family businesses, send us an email to producer@thefamilybizshow.com or fill out a contact form here!

*not affiliated with Lincoln Financial Advisors Corp.

Michael Palumbos is a registered representative of Lincoln Financial Advisors Corp. Securities and investment advisory services offered through Lincoln Financial Advisors Corp., a broker/dealer (member SIPC) and registered investment advisor. Insurance offered through Lincoln affiliates and other fine companies. Family Wealth & Legacy, LLC is not an affiliate of Lincoln Financial Advisors Corp. Lincoln Financial Advisors Corp. and its representatives do not provide legal or tax advice. You may want to consult a legal or tax advisor regarding any legal or tax information as it relates to your personal circumstances.

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