THE NEW GILDED AGE (Part 2)
THE NEW GILDED AGE (Part 2)
Posted In: From Issue 810 By: Robert E Martin
21st May, 2015 0
From the months of late April through late September over 3 million visitors migrate from all portions of the globe to visit Michigan’s storied Mackinac Island, replete with all the bucolic natural beauty, faithfully restored and polished architectural history, and romantic ambiance that was perhaps best portrayed 35-years ago in the 1980 film Somewhere in Time.
Given that the only access to Mackinac Island is by boat or small aircraft, the ferry services that transport people from ports in Mackinac City and St. Ignace back-and-forth to the Island form a crucial component to the framework of this international tourist destination.
And it is within this framework that former Saginaw School Superintendent Don Steele and local historian and author Jean Beach have collaborated together on their most recent project entitled Undefeated, which is a chronicle of the family-owned Shepler’s Mackinac Island Ferry Service and how the Shepler family has managed to survive and advance their family owned business through three generations of family members.
The origins of this ambitious project began when Steele, who has served as both a business consultant & lecturer, received a phone call from longtime friends Pat Doyle and Patty Janes. Doyle served as Director of the Center for Leisure Services at CMU and in 1969 created a CMU student internship program that provided summer employment opportunities for CMU students all around the world; while Janes succeeded Pat and continued running the program after Doyle left to become a lobbyist.
“Pat phoned me one day and said that the Shepler family was having difficulties transitioning into a 3rd Generation business,” explains Steele. “Bill Shepler had been talking about retiring for 10 years and his son Chris was ready to take over. His brother Billy is the Fleet Captain of the lines and looks after the boats; and their daughter Patty is the accountant and human resource person, so there was no battle over the duties that each sibling would handle. But the problem was that Bill just wouldn’t retire and pass along the torch, so I was called in to coach the family on how to communicate effectively and deal with any transitions.”
“One day I asked Bill, why don’t you retire? And he said: ‘I think if I retire I’ll die because I don’t know what I’ll do with myself if I quit.’ This is a fairly common problem, especially for those in charge of running family businesses. Bill is such a happy guy and even carries luggage and parks cars and drives the boats – he does anything that needs to be done – so navigating this transition was a delicate balance.”
Shepler Ferry Service was started in 1946 by (who was nicknamed ‘Cap’). He began as a fisherman back in the days when the Straits of Mackinaw were brimming with so many whitefish, trout and walleye that the Indians described the Straits area as “the birthplace of all fishes.”
The company is now in its 70th year, which alone is a remarkable achievement for a family owned business. According to Steele, “While 70 percent of the companies within the United States are family owned, only 10 percent of them make it to the third generation, so this is a very rare success story.”
Looking Back & Transitioning Into the Future
To help with the transitioning, Steele proposed the idea of writing this book about the Shepler family history because it would capture the legacy of the family and also be useful to people coping and dealing with family businesses. Steele says this approach gave Bill a newfound purpose and also the opportunity to exercise his keen memory.
“Bill is 10-miles deep into all these stories that we convey,” continues Steele. “When I went to put this work together I knew that I wanted to capture the family dynamics behind what was going on, so the historical portion would be a big part of it. At that point I called in Jean to help me write it, because she wrote the history of the Saginaw School district the first year I was Superintendent, plus she did one book on the famous people of Saginaw and a third on Saginaw County sports heroes.”
With Jean Beach firmly on board, the duo got started and worked for 18 months on the book. But just as they were nearing completion, a crisis developed that threatened to capsize and submerge the Shepler legacy with an economic tidal wave of game-changing proportions.
Petoskey attorney Jim Wynn had successfully purchased the competing Arnold Ferry line and was threatening a takeover of the family business. He came up with a plan to create a monopoly ferry service by consolidating Arnold Transit, purchasing the Brown Family docks, and negotiating a deal with Star Line and the Mackinac Island City Council.
According to Steele, first he tried to partner up and buy the Sheplers out, but when they refused, he attempted to run them out of business. The ensuing locally based legal battle, which forms a fascinating component of this biography, eventually escalated into a conflict that involved the Governor, the Attorney General’s office, the Senate Majority Leader, the Speaker of the House, major lobbying groups, the President of the Grand Hotel, the Mackinac Island State Park Commission, the Mayor & City Council, and the pivotal involvement of former Saginaw Circuit Judge and attorney Bill Crane and his daughter Ellen Crane.
Although this legal battle and the ensuing outcome postponed release of the book, Steele says that today the family business is stronger than ever, evidenced by the fact they are preparing to put a new $3 million dollar boat in the water this summer.
Life Lessons & The Dynamics of Sustaining
When asked about the most intriguing lesson they learned researching and writing this generational opus, Steele references the durable foundational bonds forged by nourishing and cultivating the strengths within the family unit itself.
“Being able to handle the dual roles of Father and Boss is very difficult,” reflects Steele. “One day you have to step aside, but with the Sheplers, I feel Bill did a great job mixing the benefits of these two different roles. Every summer he would take the family on a long vacation to Disney World and in the process he also branded the Disney culture into what they do with the family business. All their employees are referred to as ‘cast members’ and are trained well.”
“When the family spent those three months in Florida, business roles were tucked away; but you are always going to be presented with certain dynamics in a family situation,” continues Steele.
“Both the Shepler boys left the business at one time or another to try something different because they were frustrated, but both came back. Apart from the competitive environment posed by the two other competing ferry lines, they would either be fighting the weather, or some other type of crisis that would evolve; and whenever a crisis hit the family would come together as a unit and deal with it.”
When construction on the Mackinac Bridge started back on May 7, 1954, the first Ferry line to service the island was the Arnold Line. The bridge was sponsored and supported by Michigan senator Preston Brown, who was a driving force behind the construction; but then another group bought the transit line that the state owned for next to nothing and were running it for awhile, which started the on-going competitive battle between the various ferry lines.
“The Sheplers’ believe in free-enterprise and competition,” notes Steele, “and do not believe that the best interests of the consumer are served by monopolization. When one ferry lowers their prices, the others have to decide whether to follow suit; but their goal is not to run competitors out of business. They want Starline and Arnold to work and believe it best that all ferry providers have the same rules to adhere to and follow.”
“Shepler has always based their advantage on speed. When Cap started running things he saw the need for a faster boat and did all the mechanical work himself. It held maybe 10 people and did 30 knots across the water, which was a lot faster than the 10-12 knot boats of the competitors. He would also run people whenever they needed to go. Today they have six or seven vessels and are putting the Margie in the water this summer, which is the biggest boat they’ll have and also the fastest.”
Today Shepler’s Mackinac Island Ferry service is a $120 million per year business; and as for the next generation, Don says that son Chris brings a lot of technological savvy to the business that his Dad couldn’t handle; but also has absorbed the importance of restoring and maintaining the integrity of the boats that his father instilled within him.
Apart from employing about 60 part-time employees every year, Shepler has a full-time staff of 25 to 30 people working their marina, where they also handle boat restoration on the side.
Co-author Jean Beach has written several books on Saginaw’s history and the people that populated and defined the area, and says from a historical perspective the Shepler project gave her some interesting insights.
“What I find intriguing is that back in 1836 there were actually plans being developed to build a canal from Saginaw to Grand Rapids,” she explains. “It sounds like a crazy idea on the surface, but it isn’t because at one point in the middle of the State of Michigan the tributaries of the Saginaw river join with other pivotal rivers only 3-miles apart, so if it had been developed this would have made Saginaw a major shipping port bigger than Detroit to navigate through the Great Lakes.”
“This project got killed in 1838 when the first big panic hit nationwide,” she continues. “The development money was coming out of New York and they folded, but today there are still signs of where they had started to build a canal, most of them marked by railroad lines. By the time the investors re-grouped the railroads had come into play and the canals started passing, which is another one of the reasons that Saginaw evolved into East & West. The promoter of the canal almost got run out of town and Normal Little went back to New York and got another backer and developed East Saginaw, but the two sides hated each other from day-one.”
What Beach found most fascinating, however, was the family itself. “They truly are an interesting family. Cap’s sister-in-law said that Cap never knew a stranger and never had an enemy, so apparently he was a terrific guy. His wife was the brain of the company and the money-manager, and then Bill came along and went to Ohio Wesleyan. Funny enough, I also attended that school at the same time, but we never knew each other. He was a freshman when I was a senior, but it’s still strange because it wasn’t that big of a school!”
“Son Chris is an interesting figure as well and a terrific sailor,” she continues. “He was in an America’s Cup race, which we also cover in the book. When he did that he missed a lot of work and his Father wasn’t totally behind him. He came back from the race with a glass of wine and nobody drank it with him, which is one of those dynamics that happened within the family. But eventually he came back into the fold and now he is overseeing the family business.”
Steele also notes that a testimonial to the impact that the Shepler’s have infused into the Mackinac region is evidenced best by the degree of love and appreciation that was exhibited when Cap Shepler passed away. “There were 3 boats with a flag and flower petals moving through the water; and all of a sudden the ships from the other ferries lined up behind him, along with a bunch of other boats. So suddenly a big parade of boats formed to commemorate his death, which is something I find incredibly touching.”
When asked what they both feel the biggest challenge each specific generation of the Shepler Family faced while at the helm of the family business, Steele & Beach point to the feat of getting business of any kind with such a small boat as the one they started with.
“Margie started a hamburger shop to sell food at the dock and create ways to get money in the beginning,” explains Jean. “When Bill came into the picture they had a couple of big ferries then, but he had to fight the weather and the politics of Mackinac Island, along with technological challenges such as the Internet coming into play with computer generated sign-ups and ticketing.”
“They had to take a lot of bank loans and borrow money to accumulate dock space to build their boats,” adds Steele, “and when they did build a couple of boats, they blew it with one of them. They built this one boat too high, so they tried to accommodate the weight by taking the top level off and the community started calling it ‘The Shepler Topless’.”
“Today, however, they are financially in good shape,” notes Don. “They hold a lot of property and boats. They also carry debt on the new boats, but have good credit and are in good shape competitively. They’ve fixed their Mackinac Island relationship quite a bit and I think the big challenge they will face in the future is going to be managing their growth, because it has to be controlled growth. But they are extremely customer oriented and tell all of their ‘cast members’ to treat people with respect and dignity.”
“They want a ride on their ferry to be an experience and not a ride,” smiles Steele. “One time Bill apparently got on the boat and was acting like a drunk Don Rickles, staggering around, joking, and starting the boat. People were getting ready to jump off, but then he stopped the funny-man routine and told the passengers not to worry and started talking about the history of the Island.”
“This was a wonderful book to write,” concludes Steele, “ because I learned so much, not only about the Shepler family, but also the State of Michigan. I had not visited Mackinac in awhile, since I moved out West; and had forgotten how beautiful it is and how vital the economy is up there.”
“So often people think of Michigan and associate it with Detroit and the troubles down there, but this is a resilient state with incredibly resilient people.”
“No matter what the difficulty, it always seems to bounce back.”
‘Undefeated: The True Story of How the Family Owned Shepler Mackinac Island Ferry Service Survived and Advanced through Three Generations’ is available at Barnes & Noble and by going online to www.authorhouse.com
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THE NEW GILDED AGE (Part 2)