By: Ilana DeBare, Chronicle Staff Writer

April 2, 2006, San Francisco Chronicle

Don White's lumber company is so old that he occasionally goes to renovate a 90-year-old home and discovers that the original timbers came from his own mill.

John Caito's fish processing business is so old that it has a government security pass allowing entry to the San Francisco waterfront area dating back to World War I.

Gary Guittard's chocolate company is so old that it was listed in the first San Francisco telephone directory in 1878.

White Bros. mill in Oakland, Caito Fisheries in San Francisco, Guittard Chocolate in Burlingame are but three out of dozens of small Bay Area businesses that are more than a century old.

With the 100-year anniversary of the San Francisco earthquake this month, big companies like Wells Fargo Bank and Fireman's Fund will be talking up their long histories in the Bay Area.

But numerous small companies -- many of them family-owned, few of them household names -- are also as old or even older than the quake.

Who are they? What do they have in common? And what does it take for a small business to survive for 100 years?

The stories of these companies -- neighborhood hardware stores, Japanese groceries, a Chinese laundry, Italian and German restaurants, a roofing company and a mattress company, to name just a few -- reflect the ups and downs and changing world of the Bay Area over the past 100 years.

Immigrant roots

Many of the oldest businesses in the Bay Area have immigrant roots -- which is only logical because the Gold Rush years of the 1850s and '60s attracted immigrants from around the world. -- A 22-year-old French chocolate-maker named Etienne Guittard arrived in San Francisco in 1860 and spent three years in Gold Country before starting Guittard Chocolate on Sansome Street. -- Jacob Gundlach came to San Francisco from Bavaria in 1850, and by 1857 had bought land in Sonoma for a vineyard that today is run by his great-great-great-great-grandson as the Gundlach-Bundschu winery. -- Japanese immigrant Tokutaro Takahashi started a market in San Mateo in 1906, when Japanese weren't allowed to own property. He served the local Japanese community as well as Anglo fishermen, taking a horse and buggy on two-day trips to sell bait to fishermen in Pescadero.

Affected by the quake

Like everyone else in the San Francisco area, these businesses felt the effects of the 1906 earthquake.

For many, the quake was an unmitigated disaster. Charles Bundschu, the son of that German brewer/winemaker, saw both his wine store and his home destroyed in the fires that swept through San Francisco after the quake.

Bundschu recounted in a letter that he lost 1 million gallons of wine in oak barrels as his store was reduced to "a steaming, smoldering pile of rubble."

"Our building fell at 5 o'clock on the first day," Bundschu wrote. "When (my son) Carl carried the news to our home my tears flowed incessantly and I shall never forget the thunderbolt of wrath smashing the last hope of my life forever. ... It meant the labor and struggle of two generations and we had just emerged from its many critical confusions and trials apparently victorious and confident of success. Our future was bright for everyone interested. Never held a better assortment of wines -- never a larger stock -- good orders -- efficient salesmen ... and now -- and now? It means despair."

Yet other businesses found opportunities in the post-quake rebuilding.

White Bros., which today sells fine hardwood and molding in Oakland, was the only lumber yard left standing in San Francisco after the fires. "They had huge stockpiles but didn't raise their prices after the earthquake, although believe me, otherwise they would raise prices any chance they got," said Don White, great-grandson of the company's founder.

MG West -- which today is an office furniture company in San Francisco -- was at the time a dealer in vaults and safes. Those vaults were sometimes the only thing left from a burned-out bank office.

"Being one of the only people with keys and combinations to the safes, Monroe West's services became invaluable to clients like Wells Fargo and Crocker banks," said Drew Sullivan, whose family bought the company from the founding West family in 1980. "He made a living going through rubble and rebuilding."

Survival factors

John Ward, a business professor at Northwestern University, has studied what it takes for family-owned business to survive over several generations. He concludes that long-lived small businesses tend to have:

-- A simple ownership structure—one person passes the business on to another person, or maybe two people.
-- A geographic or business niche that is hard for other businesses to enter.
-- A commitment to continuity, not just to profit.
-- Adaptability.
-- Prudence. "They never really take huge risks -- they never bet the farm, never go deeply into debt," Ward said. "They are guardians of their reputation."

Some Bay Area centenarian businesses occupy the kind of protected niches described by Ward.

MG West, the furniture distributor, has survived partly by being in an industry that hasn't been taken over by national chains. And the Oaks Card Club in Emeryville -- founded in the 1890s -- has continued to thrive partly because most cities prohibit cardrooms. "We have been blessed by having a very unique type of business," said John Tibbetts, whose grandfather bought the card club in the 1930s. "It's a real niche business."

Other 100-year-old businesses find themselves the lone survivor in a shrinking industry, like the last person seated in a game of musical chairs.

Ten years ago, there were four companies in San Francisco making manju, a Japanese dessert. Today, the only one is Benkyodo, a Japantown bakery that opened in 1906 and now is run by the grandsons of its founder.

Similarly, there used to be 33 mattress manufacturers in San Francisco. Now, the only one is McRoskey Mattress, founded in 1899, which survived by focusing on a niche market of high-quality, high-priced mattresses.

Adapting to change

Businesses that have managed to last for a century have adapted to big changes in the world around them -- from the Great Depression of the 1930s to wars, technological changes and population shifts.

Wineries had to survive the 13-year hammer of Prohibition. Gundlach-Bundschu, for instance, maintained its vineyards and grape sales but stopped making wine. When the family resumed winemaking in the 1970s, they reinvented themselves as a small estate winery producing 35,000 cases a year rather than the 200,000 they made before Prohibition.

Meanwhile, Takahashi Market responded to changing demographics in the 1960s by expanding to sell all kinds of Asian groceries, not just Japanese items. But the 1980s brought the arrival of large supermarkets that cater to the Asian population like Ranch 99. So Gene Takahashi -- grandson of the founder -- re-honed his focus on the Japanese and Hawaiian communities.

"Because the big markets are able to buy in bulk, they're able to get a lot of things cheaper than us," Takahashi said. "So we've really made an effort to service our Hawaiian clientele. We carry a lot of things that are hard to find, like fresh poi and fresh Kailua pork. It's definitely a challenge."

Fortunate families

Many of the Bay Area's century-old businesses share a survival factor that wasn't mentioned by Ward -- genetic luck.

These family-owned companies were fortunate enough to have children who wanted to carry on the enterprise. Their competitors didn't and vanished.

Martin Durante, whose grandfather started Ratto's delicatessen in Oakland in 1896, happened to be on strike from his job as a car salesman when his father asked him to join the business in the 1950s. A competing Italian deli down the street wasn't as lucky and went out of business. "They didn't have anyone to take over," Durante recalled.

Some owners knew from childhood that they would take over the family business. For others, it came as a midlife revelation.

As a young woman, Robin Azevedo never thought about taking over her family's business, the McRoskey Mattress Co. When her son entered preschool, she looked for a job that would fill two afternoons a week and was hired by her father. "With grown-up eyes, I got engaged in the business and what we did," Azevedo said. "My dad really had no exit strategy. It was that work ethic of, 'You just keep working till you drop dead.' After about 10 years, I approached my dad about taking over the business, and he was ecstatic."

At least one Bay Area centenarian business was sold by its founding family and then repurchased by a later generation.

The Fredericksen family opened a hardware store on Fillmore Street in 1896 and sold it in the 1940s. A half-century later, in 2000, Fredericksen's was bought back by Dennis Drobisch, grandson of the founder. "In the hardware business, we're considered third generation: We just skipped the second," said Dennis' wife, Mary Drobisch.

Does history matter?

Some companies use their long history as a deliberate part of their marketing strategy.

McRoskey Mattress prominently states on its Web site that it has been a "manufacturer of superior mattresses and box springs since 1899."

And Boudin Bakery, which makes sourdough bread, proudly showcases its Gold Rush roots in its visitors center at Fisherman's Wharf.

But other companies say that their longevity doesn't matter much to customers. "Customers don't care about the hundred years, but they do care about the past 20 or 30 years, which is their lifespan at the store," said Stephen Cornell, owner of Brownie's Hardware, which opened in 1905 in San Francisco.

Some business owners even worry that longevity can be a marketing liability. Sullivan of MG West said his company is leery of promoting its 101-year history too aggressively.

"I don't want to have it connote the image that we're petrified," Sullivan said. "We want to promote an image that we are strong and stable, yet current and flexible. It's a fine balance."

Some owners, particularly those of multi-generational family businesses, say the history is always at the back of their minds. Several used the word legacy to describe this feeling.

"When you are talking four or five generations, it's almost like 'You have the watch,' " said Don White. "It's a historic entity, 100-plus years old, so you have to make it work, no options, unless you want the old boys rolling in their graves."

While a long history can inspire owners to persevere through tough times, it can also limit their business options.

Jeff Gundschu, president of the winery and great-great-great-great-grandson of its founder, said the family history rules out some expansion strategies taken by other small wineries, such as seeking outside investors or selling out to a bigger wine business.

"Our estate vineyard is the spiritual center of our family, but also our biggest asset," Gundschu said. "The way we'd choose to leverage that asset is more limited than it would be for a regular business. The traditional bottom line isn't always applicable because these assets have an intrinsic value that is unique to us."

The next century

Having been around for a century, these firms know what it takes to run a successful day-to-day business. But many of them quietly worry about societal changes that could make it hard for them to reach the next century mark.

Each business has unique concerns. John Caito, who runs the oldest fish processing company in San Francisco, worries that his salmon supply will vanish if the state continues diverting Klamath River water to farmers.

Bobby Okamura, owner of the Benkyodo bakery, wonders what will happen to his customer base with the pending sale of the Japan Center mall. "If they turn it into condos, it would hurt the whole area," he said. "There would be no reason for people to come to Japantown."

Meanwhile, White worries that the Bay Area's sky-high land prices will put his lumber mill out of business. Recently, the city of Oakland rezoned the property around his mill for high-density residential use.

"If we've got to move the mill, it would cost me $1 million just to move it," he said. "Should I have to give up my business so some great big company can come in and build high-density housing?"

There is also the perennial roulette wheel of succession. Will the children or proteges of today's owners choose to maintain the history?

Jeff Bundschu is looking toward a day when the eighth generation of his family will run the winery.

"My goal, as crazy as it sounds, is to create something that doesn't necessitate my own kids getting into it, but maybe their kids," he said. "If I can keep it alive so my grandkids have a shot at it, that's my goal."