Second Generation Brings Modern Ways to Family Firm At Commercial Textiles, Siblings Strive to Rescue Dream of the Father
By KEITH L. ALEXANDER Staff Reporter of THE WALL STREET JOURNAL
HOMESTEAD, Pa. - Not every young manager would give up a career at Twentieth Century Fox and an apartment on a California beach to help run his father's troubled business in this one time flourishing steel community.
But that's what David Frischman, a marketing manager, did when his father died of cancer four years ago. He joined his brother, Les, then a Los Angeles executive recruiter, and his sister, Cindy Frischman-Notkin, who had remained here, in a struggle to save the company. Since then, the siblings have shown how second-generation entrepreneurs using modern methods can often succeed where the founder stumbled.
For years, their father, Milton, had worked for his brother in a linen business. Just 18 months before he died, Milton invested his life's savings to start Commercial Textiles Inc., a small business selling uniforms wholesale to restaurant and hotels.
When he died of lung cancer, the prospects for the business seemed so bleak that the family's accountants and financial advisers urged Mr. Frischman's widow, Rosalyn, and her children to cut their losses and close the company.
But the children vowed to keep the business going. "It was hard giving up Los Angeles, and it was scary coming back, but my mom and sister couldn't handle the business by themselves," says 31-year-old Les, company treasurer.
The family decided that the troubled business had strong prospects nationwide. To reach customers outside western Pennsylvania, where their father had concentrated, they turned to a new marketing strategy.
They invested $30,000 in a computer system that allows them to quickly track inventories and customers. Armed with this system, a toll-free telephone number that attracted customers from across the country and slick advertising brochures, the children have increased the business's clientele to more than 2,000 hotels, restaurants and country clubs-from only 50 clients four year ago.
"The computer gives us information my father would have never dreamed of," says Les. Adds David, who is company president: "My father used the old style of bookkeeping, writing in ledger books and adding by hand. The computer system makes payables and receivables very easy." It also help Commercial Textiles service orders faster than many similar companies, giving the company an important competitive edge, the brothers say.
The first hurdle, however, was scrounging up capital. To get the business on its feet, the Frischmans took out a $40,000 loan. After walking from bank to bank and receiving several "polite no's," they finally got a "yes" from Equimark Corp.'s Equibank in Pittsburgh.
To find customers, the Frischmans ordered telephone directories from major U.S. cities and personally contacted managers at numerous hotels and restaurants.
They also found that customers, such as restaurateur Tell Erhart, responded to care and attention to detail. After one wholesaler messed up his uniform order, Mr. Erhart went to Commercial Textiles. "You can call them up, give them the sizes and they ship it out. Usually at big outlets, you're just a number," says Mr.Erhart, who owns Chef Tell's Grand Old House on the Caribbean Island Grand Cayman.
The Frischmans use uniform manufactures in Philadelphia and Union City, N.J.Unlike some competitors, they will handle special orders involving embroidery or silk screening. And at their recently expanded two-floor office on Homestead's main street, they are shipping about 40 order's a day, David Frischman says.
This year, the company expects earning of about $300,000, up from $190,000 last year, he says. Sales this year, he adds, should exceed $1 million- a marked improvement from the $20,000 of four years ago.
Although the business now includes a secretary and a warehouse supervisor, family members do most everything else, David Frischman is in charge of advertising, Les Frischman oversees computer operations and Mrs. Frischman - Notkin handles marketing. Their mother contacts prospective hotel and restaurant customers by telephone. and when it comes to packing, unpacking and stocking the boxes, they all roll up their sleeves.
Mrs. Frischman - Notkin recalls that when her father started the business, there was never enough money for paychecks. "Every penny we made went back into the business," she says.
While there are paychecks today, none of the Frischmans has yet become wealthy. Les Frischman says he is drawing just $26,000 a year in pay, less then half what he earned in Los Angeles.
And of course, the former Californians now overlook abandoned Homestead steel mills instead of beaches. But they say they'll keep the company here even if it outgrows its premises. "Even the name Homestead sound very quaint," David Frischman says.