Fourth Generation Business

Derek and Stacy Lee are fourth-generation owners of Lee Plumbing and Heating. At the November 3 TREK, they shared the story of their entrepreneurial journey. (Read more about TREK here.)

Introducing the Younger Generation to the Business

Derek started in the business at a young age. “One of my early jobs was to deliver bills to the customers,” he said. “I would take the check in the envelope and deliver it to the different places that owed us money. Whatever the postage would have been for the bills that I hand delivered, was my wage.” Derek followed in the footsteps of his Dad and his aunt who also remember delivering bills and being paid anywhere from 9 cents to 22 cents per bill delivered. “It was big money back then,” Derek laughed.

It was his introduction into the business, and the family’s way of introducing the younger generation to the business.

Over the years, many things have changed. The cost of labor has been one of the biggest changes. In the early days of the business labor was cheap and materials were expensive. That has completely flipped now. “Five hundred dollars of parts doesn’t mean anything when it costs you hours and hours of manpower,” Derek said. Technology and tools have also led to big changes. The tools are more expensive, but they save time and related costs.

“I remember my Grandpa telling stories about digging ditches and paying the workers by the linear foot,” Derek said. “They got to one job and it was hard digging. The workers were getting paid 20 cents per foot and he offered to pay them a penny or two more per foot. They were happy as larks, so things have changed quite a bit in that way.”

A business that’s been in the family for four generations is uncommon. Derek attributes some of that success to a lesson he learned from his grandfather: the customer is always right. “What I’ve learned,” Derek said, “is that if you negotiate with the customer (when there’s a problem) and ask them what’s fair, you hook them for the future and get their return business.”

Derek and Stacy’s Story

The Lees have been married for 24 years and took ownership of the business four years ago. Derek’s great-grandfather started the business in 1905 and his grandfather took over in the 1930’s. “He was given two week to say ‘you can see the world and then it’s time to come back and go to work,'” Derek said. The tradition continued when Derek’s father started working in the business in 1979, eventually going on to buy the business.

After college, Derek and Stacy got married and moved to the Twin Cities. Derek worked in the plumbing, contracting, and building fields for several years. When their kids started getting older, the couple decided to move back to Thief River Falls.

Derek’s parents never pressured him to work in the family business, but something inside him drew him back to his roots and the family plumbing business.

When Derek and Stacy first moved to Thief River Falls, his mother was doing the books for the company. Derek laughingly shared that Stacy said, “I’ll never work for the company because I don’t want to take over for your mom.”

Stacy had worked as a computer programmer in the Twin Cities for about years, but then decided she wanted to be a stay-at-home mom. When the couple moved to Thief River Falls and the last child entered school, Stacy was attracted to the flexibility working in the family business would give her, so she started working in the business, too. She is an integral part of the business, taking care of the payroll, accounts receivable, accounts payable, and reporting to the state on some of the bigger jobs they do.

The business focuses on plumbing and heating and anything plumbing related. They do everything from fixing dripping faucets to commercial jobs, including very large ones at hospitals and schools. “You name it, we’ve done it,” Derek said.

The company has up to 15 full-time employees, with 9-12 people out in the field at any given time. The Lees have a 21 year-old son working with them in the summer right now. “I was never pressured, so I don’t want to pressure him,” Derek said, speaking about the potential of a fifth generation ownership, “but I think he enjoys it, so we’ll see.”

Last year, Lee Plumbing and Heating was recognized with a well-deserved Minnesota Family Business award. (Read more about the award here.)

For more on this uncommon, and outstanding, Thief River Falls business, visit their website.

#ILoveTRF #TRFEntrepreneurs #TrekOn #TRFEntrepreneursRock


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