Generations Of Dedication

Regardless of whether your business is big or small, perhaps the most rewarding legacy you can create is opportunities for your children. That most certainly has been the case with the Tagawa family in Brighton, Colo.

Tagawa Greenhouses just completed one phase of a succession plan involving 26 family members, passing the ownership and management of the business from one generation to the next. The family business was founded in 1967 by Frank and Hazel Tagawa and their six children, Ken, Albert, Dave, George, Jim and Caroline. Frank and Hazel came from the Yuba City area of California and grew vegetables before being sent to a camp at Amache, Colo., during World War II. After the war, Frank worked as a sharecropper and truck farmer until saving up enough money to purchase 120 acres outside of Brighton.

The family grew vegetables and seedlings in a few wooden-frame greenhouses and then diversified into carnations, roses and spring bedding plants. Today, Tagawa Greenhouses is the largest producer of bedding plant plugs in North America through its partnership with Ball Seed. The operation is also a strong producer of retail-ready, finished product for The Home Depot, Costco, supermarkets and other retailers in the region.

Tagawa Greenhouses is actually just one division of the family enterprise, Tagawa Inc., which also includes:

•Â  60 percent ownership in Denver Wholesale Florist, which has 14 wholesale branches across the United States.

•Â  Tagawa Garden Center and Florist, a premier independent garden center in the Denver area.

•Â  Ball Tagawa Growers, a 50/50 partnership with Ball Seed in California.

With $35 million in sales, Tagawa Greenhouses is the second largest of the four divisions and was the first to undergo succession planning. 

A Smooth Transition

Ken’s son, Randy, had the benefit of working closely with his father, uncles, siblings and cousins his entire life before taking over as CEO. Although he graduated from Colorado State University with a degree in hort/business, there was a point in which he almost became a franchise owner of a pizza restaurant 15 years ago. But a much better opportunity came along–managing the new Ball-Tagawa production greenhouses in Arroyo Grande, Calif.

He stayed there for five years and then came back to Colorado to manage Tagawa Greenhouses. At that time, 10 years ago, a more corporate management structure was put in place. Before, each brother ran a section of the company.

“Even though I am the CEO, my dad and uncles are still very active in the company, as well as a total of 15 family members within the Tagawa organization,” Randy says. “Dad helps me oversee the administration and overall business aspects of the company, and George keeps a close watch on production and culture.”

In recent years, Tagawa Greenhouses has been transitioning from a business that is family run to family owned. Outside consultants and long-term employees who are not family members have been a big part of that.

“We at Tagawa have developed an infrastructure that is both vertically and horizontally integrated, from growing, wholesale, distribution, merchandising and retailing, which has provided the flexibility and ability to strategically plan and react to the always-changing business environment we encounter every day,” Ken says. “This has provided numerous opportunities for not only the family, but for the dedicated employees of our companies.”

When asked for advice for other family businesses undergoing succession planning, Ken says, “It does take a dedicated effort over a long period and it’s important to emphasize the process of building relationships, both with family and employees, and to communicate, affect good planning, and where possible, try to engage competent professional third-party consultants.”  

A Plan With Values

The Tagawas retained one of the largest accounting firms in Denver, EKS&H, to help with the estate planning and succession plan. The process began with the family identifying family guiding principles:

•Â  Maintain the family business legacy.

•Â  Shift from a business to support the family to what’s best for the business.

•Â  Provide retirement funding for uncles and aunts.

•Â  Maintain profitability within each business segment.

“We wanted concentrated ownership as the businesses pass from the first generation to the second,” Randy explains. “We felt that in our business, it’s hard to have people who weren’t in the business or interested in the business making decisions for the company.”

Ken adds, “It’s important to note that Tagawa has always emphasized that a career path within the companies is a choice, and in order to be successful, one has to have passion in their job.” 

A Heartfelt Thank You 

“My dad, mom, uncles and aunts are very special and amazing people. They have given everything to the business and their families. Their accomplishments throughout the years are remarkable. The new owners of Tagawa Greenhouses want to thank the Tagawa Family for the opportunity. With much gratitude, thank you.

We would like to thank Anna and all the individuals at Ball Horticultural Co. for the many years of partnering and support. We appreciate working with you through the challenges and opportunities.”–Randy Tagawa

The next step was developing objectives and a plan to meet the principles:

•Â  Organize Tagawa Greenhouses’ ownership for future success.

•Â  Give all cousins the opportunity to become owners of Tagawa Greenhouses. All owners must be dedicated, full-time employees and willing to put all their personal assets on the line for the business.

•Â  Maintain flexibility for uncles and aunts to make decisions regarding individual estates.

•Â  Protect the family enterprise.

Of the 15 cousins and in-laws, six became new owners of Tagawa Greenhouses: Randy Tagawa, Yoshi Tagawa, Aiko and Yuji Kimura, Glenn Tagawa and Cheryl Tagawa. Ownership was also opened up to two long-term managers who are not family members: John Williams, who is production vice president and has been with Tagawa Greenhouses for 22 years, and Bill Kluth, who is in charge of legal and technology and has been with the company 10 years.

“I was very honored to be asked to participate in the future of the company as an owner,” Kluth says. “The Tagawa family values are the company’s values. Their tradition of hard work, dedication to employees and customers and producing high-quality products make it a great place to work and a great opportunity.”

When Williams handed Randy the envelope with his personal assets for the bank, he wrote, “This is everything that we own. We feel that it’s a good investment. We are investing and believing in ourselves, our people and the business.”

Randy couldn’t agree more. “I think that’s what all of us feel in the new organization,” he says. “The next generation of owners will have the same dedication, passion and energy to take the business into the future.”

Yuji Kimura says he was impressed by how fairly things were presented. “Everyone had the opportunity to become part of ownership, and because there was a financial commitment, also to become owners. It truly did feel as if we were starting something new with all the benefits of an established business.”

Leave a Reply

More From Business Management...
Spring Meadow Nursery Fire

January 17, 2017

Two Major Growers Recovering and Rebuilding After Fires

The blazes occurred at Dan Schantz Farm and Greenhouses in Zionsville, PA, and Spring Meadow Nursery in Grand Haven, MI. Both companies say no employees were injured, and they plan to pull together and stay on schedule for the remainder of the year.

Read More

January 10, 2017

5 Can’t-Miss Events and Activities at TPIE

The Florida Nursery, Growers and Landscape Association’s Tropical Plant Industry Exposition (TPIE) is fast approaching. As you plan your trip, here are five can’t-miss highlights from this year’s show.

Read More
sakata-tour-de-fresh-salad-bar-donation

January 8, 2017

Sakata’s Participation in Tour de Fresh Race Results in New Elementary School Salad Bar

On the heels of riding in the Tour de Fresh Race in July, Allen Satterlee of Sakata Seed America celebrated by presenting a new salad bar to Galt Elementary School in California.

Read More
Latest Stories
Spring Meadow Nursery Fire

January 17, 2017

Two Major Growers Recovering and Rebuilding After Fires

The blazes occurred at Dan Schantz Farm and Greenhouses in Zionsville, PA, and Spring Meadow Nursery in Grand Haven, MI. Both companies say no employees were injured, and they plan to pull together and stay on schedule for the remainder of the year.

Read More

January 10, 2017

5 Can’t-Miss Events and Activities at TPIE

The Florida Nursery, Growers and Landscape Association’s Tropical Plant Industry Exposition (TPIE) is fast approaching. As you plan your trip, here are five can’t-miss highlights from this year’s show.

Read More
sakata-tour-de-fresh-salad-bar-donation

January 8, 2017

Sakata’s Participation in Tour de Fresh Race Results in…

On the heels of riding in the Tour de Fresh Race in July, Allen Satterlee of Sakata Seed America celebrated by presenting a new salad bar to Galt Elementary School in California.

Read More
griffin-aurora-colorado-branch

January 6, 2017

Griffin Opening New Hard-Goods-Focused Distribution Cen…

The planned February opening of the 18,500 square-foot facility is part of the company’s continued expansion into the Western U.S.

Read More
gg-january-2017-cover-arizonaeast-feature

January 5, 2017

Why ArizonaEast Is Expanding Its Succulent Production T…

In Greenhouse Grower's January cover story, learn how Brian and Joe Vitale of ArizonaEast saw a chance to expand and diversify their New Jersey-based succulent operation, and why they jumped at the opportunity.

Read More
Moana plant yard

January 4, 2017

Green Industry Poised for Continued Economic Growth in …

Positive economic indicators point to 2017 being a year of modest growth for the green industry, according to economist Charlie Hall.

Read More

January 3, 2017

Growing Optimism for the Horticulture Industry in 2017

With a new administration and a new Congress, AmericanHort's Craig Regelbrugge says the horticulture industry has reason to be cautiously optimistic that regulatory relief could be on the horizon.

Read More
2016-student-competition-award-winners

January 3, 2017

Southern Nursery Association Research Conference Procee…

On the heels of presenting awards to students in the horticulture industry, the Southern Nursery Association has compiled and published its conference research proceedings.

Read More
Farwest Show Floor

December 31, 2016

Farwest Show 2017 Will Feature New Days and Hours

The 2017 Farwest Show will take place Wednesday, Aug. 23 through Friday, Aug. 25, to allow attendees more time to visit local hot spots.

Read More
kelly-norris

December 29, 2016

Kelly Norris: 4 Ways We’re Leaving Growth Opportunities…

Horticulture is a multi-million dollar industry with lots to offer, yet we’re still overlooking several avenues for growth.

Read More
Top 100 Breakfast Panel for 2016

December 27, 2016

You Said It: The Best Quotes From 2016

Some of the industry’s leading growers and educators had strong things to say this year. Here’s a look at some of the most memorable quotes from 2016.

Read More

December 27, 2016

5 Photo Galleries You Didn’t Dare Miss in 2016

Whether it was industry event and trade show highlights or new developments in technology, these images not only spoke more than a thousand words; they drew thousands of clicks, as well.

Read More

December 27, 2016

Check Out the Top 5 Most-Read News Stories on Greenhous…

From pest outbreaks to overtime rule changes, here are the headlines that grabbed your attention in 2016.

Read More
Grow Summit 2016 group shot

December 20, 2016

Less Talk, More Action At Greenhouse Grower’s GRO…

Investing in technology, developing new marketing solutions, and recruiting young growers were just a few of the issues covered at GROW Summit 2016.

Read More
Workers are required to wear uniforms and use tools restricted to the section of the facility where they work, and street clothes are prohibited

December 16, 2016

House Failure To Address H-2B Exemption Could Affect Sp…

Despite efforts by AmericanHort and others in the industry, the House of Representatives failed to renew the Returning Worker Exemption, a policy that helps ensure that small and seasonal businesses have an adequate workforce for the peak spring season.

Read More
americanhort-hort-scholars

December 15, 2016

HortScholars Program Is Open For 2017 Applications

Presented by AmericanHort, the program is open to students in a horticulture-related degree program, and recipients will have exclusive opportunities for in-depth discussions with industry leaders at Cultivate’17.

Read More
North Creek Nurseries Bright Young Talent

December 13, 2016

Emergent Networking Event On Deck At MANTS 2017

Emergent, the collective group of young horticulture professionals who represent the next generation of growing, will host a reception on Wednesday, Jan. 11, after the MANTS tradeshow floor closes.

Read More
bailey-nurseries-veterans-workforce

December 13, 2016

How Bailey Nurseries Navigates The H-2A Program

Joe Bailey, Human Resources Director at Bailey Nurseries says each operation has to analyze their situation and decide for themselves if the H-2A program is right for them.

Read More