Divorced - but still in business together
An estranged couple work to grow their carpet company.
(Fortune Small Busness) -- With its high ceilings, elegant chandelier and display of multihued rugs hung on the walls like paintings, the Manhattan showroom of Carini Lang feels more like an art gallery than a carpet company. The firm, co-owned by Joseph Carini, 47, and Aurelie Lang, 37, sells rugs and tapestries that are handwoven in Nepal using Chinese silk and wool from sheep that graze the Himalayas. Prices typically range from $8,000 to $10,000.
While Carini Lang's retail showroom is open to the public, the firm sells mostly to wholesalers and high-end designers and architects. These professionals have their own distinct visions, which result in many customized orders.
"A client will walk in and say, 'I love it, but I want it with these colors and in wool instead of silk,'" explains Carini, who designs the rugs.
Carpets take four to five months to make and are flown to New York from Nepal. "They want it yesterday," says Lang in slightly accented English. She handles the financial side of the business, which produced annual sales of $2 million in both 2007 and 2008.
"Joseph is the dreamer with the vision, and I bring it down to earth," she adds.
But amid the financial crisis, even Carini Lang's wealthy clients are cutting back. After growing roughly 20% each year since the firm opened in 2000, business has slowed. As of December 2008, orders were down 25% from the previous year, according to Lang.
But the problems run deeper than that. Carini and Lang - he's an artistic New Yorker, and she's a native Parisian with a no-nonsense approach to both business and life - married in 1996 but are going through a divorce (they are legally separated). They live on the same Brooklyn block and share custody of their three children: Celia (8), Leonardo (5) and Gregory (4). Although the breakup was heart-wrenching, the process has been amicable. They recently drew up papers splitting the firm fifty-fifty.
"We're still in business together because we trust and respect each other and bring different skills to the table," says Carini.
Despite their complementary styles, they don't always see eye to eye. Although Carini and Lang agree on their firm's problems, they often disagree on possible solutions. They employ a staff of two laborers, who move and deliver the heavy carpets, and an administrator, who answers phones and tends to customers. A manager and a salesperson have left the firm, and the business partners are unsure whether to replace them.
And while Carini and Lang do not consider themselves strong managers, they share management duties. Both want to expand the business - Carini mentions penetrating foreign markets like Dubai as a long-term goal - but without a system to analyze their sales and inventory, they're not certain where to invest strategically. And, of course, working together while going through a divorce is an emotional minefield.
To help the co-owners tame these challenges, Fortune Small Business enlisted three experts. The first is Marc Cenedella, 38, president of TheLadders.com, a recruiting firm in New York City.
After perusing the carpets in the showroom, Cenedella sits down in Lang's basement office and asks the partners to detail their staffing and management problems. They reveal that, given the economic climate, they're hesitant to hire but need someone to manage the laborers. Lang suggests her administrator, a reliable worker who needs little supervision.
Bad idea, says Cenedella. "That's not her skill-set," he explains. Instead, give the job to one of the laborers - make him a first among equals and pay him more, he suggests. But Lang contends that the current, improvised co-management system will save money.
"It won't work," Cenedella says flatly. One manager means "one neck to grab" when something goes wrong.
Carini agrees and notes that earlier in the day he had to oversee the laborers as they organized the showroom. "If I hadn't been there, it wouldn't have gotten done," says Carini. Cenedella warns that by handling such tasks, Carini turns himself "from a $500-an-hour guy into a $25-an-hour guy."
Time spent on such minutiae distracts the co-owners from the big picture, which includes winning more business, says Cenedella. He believes a salesperson could help by reaching out to the firm's core customers. The business partners worry that their high-end clients require a hands-on approach, which necessitates Carini's personal involvement.
"People come for him," says Lang. "He's the second product of the company." But Lang also worries that Carini, an adept salesman himself, is spread too thin.
Cenedella asks Carini if he enjoys sales. Yes, he says, but not to the exclusion of his creative work.
In that case, Cenedella advises, the partners should hire a salesperson to support Carini and to handle top clients when he's unavailable. Cenedella recommends bringing on a sales specialist who has a service mentality rather than years of experience. With a young and hungry assistant sorting out minor issues, Carini can focus on his design work and meetings with top clients.
The next expert is Jane Zalman, 62, a family business consultant and founder of Zalman Family Business Solutions in New York City. Both Carini and Lang look tense as Zalman sits down.
Zalman immediately gets started. "So, what's it like being divorced and working together?" she asks.
An awkward silence fills the room; more than 10 seconds pass before either responds.
"Most of the time things are fine," Carini finally says. "But sometimes I think, 'We're not getting along. How are we going to work together?' "