News March 2019

Herr’s potato chips’ future leader talks nepotism, shares advice

As a 16-year-old “golf cart boy” in Georgia, Troy Gunden said, he and his coworkers would see how muddy they could get the carts before washing them and test how long they could drive a cart on just two wheels. He was late to work and focused more on having fun than on doing a good job.

“We were terrible employees,” Gunden, now 41, said Wednesday afternoon during the Saint Joseph’s University’s Family Business Legacy Speaker Series, part of the university’s Initiative for Family Business & Entrepreneurship.

Gunden, an executive vice president and the third generation at his family’s Herr Foods Inc., said his poor work ethic as a teenager should be an example to others that maybe you don’t want your family member entering the business too young. Gunden said he’s been to talks about family businesses and the discussion tends to be about how to pass your company to the younger generation, so he wanted to offer advice on how to be a good descendant and position yourself for success when you rise up the ranks.

”I’m glad my uncles didn’t see what I was doing in Georgia, they didn’t see this side of me,” he said. “If I was working in that family business, think about these employees, they have long memories. And they’re going to remember that 16-year-old kid when you’re 26 or when you’re 36.”

Gunden and his uncle, current Herr CEO Ed Herr, who also spoke at the event, know they are in a lucky position: Just 12 percent of these companies transition to the third generation, compared with more than 30 percent that make it to the second generation, according to the Family Business Alliance. And 3 percent remain active into the fourth generation and beyond.

Ed Herr’s father, James Stauffer Herr, had worked on his father’s farm, watching hens lay eggs. But after seeing an ad in the newspaper, he bought a Lancaster-based potato chip company for $1,750 in 1946, Herr recounted at the event. Back then, Herr said, his parents would leave a three-pound tin of potato chips on doorsteps and if they came back weeks later and the tin was empty with some money in it, they knew to bring more.

That small business, with his parents making about 20 pounds of chips an hour, is now about a $300 million company based in Nottingham, Pa., making five or six tons of chips every hour. The Mid-Atlantic region, which includes Philadelphia, is about 62 percent of Herr’s business.

Read the full story in The Enquirer