Succession Stories: Nelson Coleman Jewelers
Chris Coleman is a 50 percent partner in a family business he once wanted no part of.
â€śMy father was a really good jeweler, but not a great teacher, and I didnâ€™t want any part of it at first,â€ť Chris says. â€śI told him to go to hell and spent almost 20 years working for the gas and electric company and the Baltimore Department of Housing before my brother Mark recruited me to come into the business.â€ť
Chris and Mark represent the fifth generation of a family jewelry business founded in 1856 in Bavaria. Their father, Nelson Coleman, succeeded his father-in-law in 1954 while their mom stayed home to raise six boys. Chris is No. 2 and Mark, No. 6, in birth order.
â€śDad continued the business but changed it to his name,â€ť Chris says. â€śHe was an actor in a local theater and a graphic artist and probably had more name recognition.â€ť
The Baltimore store was in those days a four-story operation downtown with a big trophy trade that also introduced Rolex to Baltimore.
â€śMy father hated watches, hated silver, hated trophies, and so when Grandpa retired, my father kicked Rolex out, got rid of the trophies, and reduced the business to one room. What he loved was estate jewelry and designing jewelry, and so he moved the business to a leased space and concentrated on what he loved.â€ť
Mark joined the business part time at age 16 and full time in 1976 at age 21. Chris got a business degree and went his own way until 1979 when he was 36 and Mark invited him in.
In 1980, an employment agreement incorporated the business and shares were divided between the two sons and their father.
Their mother was bought out using insurance funds when Nelson died in 1991, and the brothers became equal partners, Mark as president and Chris as vice-president. Since then they have grown the business 20 percent and moved to a freestanding location.
In the past 10 years, theyâ€™ve been planning for succession.
Mark is the father of four children, three adults and a teenager; all three adults have decided not to work in the business, while his youngest son may join he business in the future â€” but only as an employee â€” according to the succession plan.
Chris is the father of three and his daughter Amanda, 29, recently promoted to general manager, has been designated as their successor. Chrisâ€™ youngest child, Matt Coleman, was recruited by Harry Winston while attending GIA in California, and he can return to the business in the future in an ownership role.
â€śThese were hard decisions for me because my children chose not to go into the business,â€ť Mark says. â€śIâ€™ll be selling my 50 percent of the business to the person who will carry on the tradition â€” the one who is gifted properly for this. When it comes to brothers who are partners there has to be a death to the ego and you have to put whatâ€™s best for the business on the table. If this becomes a power struggle it could be a death grip.â€ť
â€śFiguring out how to make room for the next generation didnâ€™t come to us right away,â€ť Chris says. â€śMark and I, after trying various family members â€” nieces, nephews, brothers etc. â€” in and out of the business, came to the conclusion that any family member would have to show an interest in the industry first. Weâ€™ve been through this. We want whatâ€™s best for the business and for our family or our children, but job definitions and criteria have to be met. Thereâ€™s room for family we also have to have professionalism.â€ť
Chris will retire in 2013 when he will be 70 and Mark, who is 12 years younger than Chris, will begin selling his shares to Amanda while continuing to work another 15 years.
â€śThe truth is every generation is the first generation,â€ť Mark says. â€śWe want to have a clear picture of the ownership and the future of the business.â€ť
â€śA lot of retailers think the safest, smartest thing is to keep working and stay in the business as long as they possibly can and then give the business to a family member when they pass,â€ť Chris says. â€śThe path we chose was different â€” to start the transition while weâ€™re still healthy and do everything in our power to make sure the business is financially stable. I will work less, I will be paid less, and that amount will be given to my daughter in income who will give it back to me in exchange for shares. Weâ€™re already earning it and we know where that money will come from.â€ť
Like many other retailers, though, Chrisâ€™ retirement doesnâ€™t mean a complete break with the business. â€śI will probably have a retirement event but I will continue to consult,â€ť he says. â€śWe live, eat and breathe this stuff. We love our industry.â€ť