RETAIL Entrepreneurs of the Year Honoring the Innovators

ntrepreneurs remain the resilient resource behind Anyone who has made an outstanding contribution to the growth of the U.S. and world economy, creat- foster the entrepreneurial spirit or helped entrepreneurs Eing jobs as well as innovative products and serv- become successful is eligible for the Supporter of Entre- ices. In 1986, Ernst & Young perceived the need to rec- preneurship Award. ognize the accomplishments of this relatively obscure Nominations can be made by anyone associated with group and founded the Entrepreneur of the Year (EOY) a successful entrepreneur. This includes spouses, em- program. Now, thousands of entrepreneurs vie for this ployees, bankers, attorneys, public relations managers or prestigious honor each year. entrepreneurs themselves. The idea of the EOY program was conceived by Ernst Entrepreneurs are the backbone of the world econo- & Young’s Emerging Growth Market, which is dedicat- my. While large corporations have been downsizing and ed to accelerating the success of the world’s best entre- leaving millions of Americans jobless, these emerging preneurs. and fast-growing companies have created jobs. The program started in Milwaukee, but has evolved The detailed year-long process commences in January into an international event honoring excellence and out- when nominations are solicited nationwide. Finalists are standing success by dynamic owners of entrepreneurial interviewed to discuss their nomination information. companies. In 2005, the program was held in more than Then a local, independent judging panel of business and 150 locations and in more than 35 nations around the civic leaders selects categories and award recipients. world. In November, past and present Entrepreneur of the Chain Store Age became the exclusive sponsor of the Year award winners from around the world are invited retail award category in 1990. to attend the Ernst & Young Entrepreneur of the Year The award criteria include financial growth, firm his- Awards where current-year winners are inducted into tory, current stage of development, future prospects, the Entrepreneur of the Year Hall of Fame. The program business leadership, team management and community also provides an intellectual forum for discussion and involvement. debate of current issues facing entrepreneurs nationally However, a retailer does not have to be the fastest- and globally. growing, most profitable or largest to qualify for an This year, national award recipients in 11 categories award. The judges take into account an entrepreneur’s were selected by an independent national judging panel vision and motivation, as well as other nonquantifiable and announced at the November Awards Gala in Palm but critical factors. Springs, Calif. A nominee must be an owner/manager primarily To nominate yourself or someone else for the 20th responsible for the recent performance of a privately annual Ernst & Young Entrepreneur of the Year award in held company which is at least two years old. Founders 2006, call (800) 755-AWARD or visit the Entrepreneur of public companies are eligible, provided the founder is of the Year Web site at www.ey.com/us/eoy. Deadline still active in top management. for nominations is March 31, 2006.

CHAIN STORE AGE, DECEMBER 2005 www.chainstoreage.com 39

RETAIL Entrepreneurs of the Year Duty Calls! Advance Auto Parts CEO has diplomacy in his future

fter nearly three decades of lead- er after two years of stewardship. You began seeing things in our store that ership in the retail industry, for- Since then, the company has never had didn’t look like they fit there: pots and Amer Advance Auto Parts CEO an unprofitable year. The biggest chal- pans, gym sets, lawnmowers, whatever and current board member Nicholas lenges came in 1941 when the United we could get our hands on,” Taubman Taubman has set his sights on something States entered World War II. With gaso- said. “We carried toys at Christmastime.” bigger: world politics. Taubman is line rationing imposed by the military, By then, the teenaged Nicholas Taub- President George W. Bush’s nominee to consumers drove less and required fewer man had entered the family business, be the next U.S. Ambassador to replacement auto parts. The military also pitching in during school vacations. He Romania. At presstime, he was awaiting requisitioned most available auto parts, continued to do so through college, until his confirmation hearing and anticipated he joined the Army in 1957. After his beginning his new duties shortly. Nicholas Taubman discharge, he rejoined the family busi- Although Taubman’s political experi- Former CEO and Chairman ness until he was called back to the ence is limited—he served as a Roanoke, Army in 1961. Va., city councilman in 1979—he brings Advance Auto Parts By 1962, he returned home for good plenty of enthusiasm to the job. “What to work in what had become a 45-store Headquarters: Roanoke, Va. we’re seeing in Eastern Europe right now chain. He wore a number of hats, selling Annual sales: $4 billion is a thrill. Romania was a Communist Type of business: Auto parts and merchandise on the sales floor one day, country for over 50 years, and now it is supplies driving a truck the next and stacking car- developing a free-market economy. It Number of stores: 2,829 tons in the DC the has been integrated into NATO and it Areas of operation: Eastern U.S.; day after. By 1969, will probably be admitted into the South; Great Plains he had proven him- European Union in the next two to three self enough for his years,” he said. father to entrust “Eastern Europe is him as president home to some of the and CEO. best friends the U.S. Taubman has,” he added. wasted no time in The auto-parts re- reshaping the company. The gym tailer Taubman led as sets and lawnmowers the company CEO between 1969 had introduced in the 1940s were and 1997 got its start still on the shelves. He could see when his father Arthur that had set the retailer on a colli- purchased three Balti- sion course with the big discount more-area auto-parts retailers that had emerged and flour- stores from his friend, ished during the 1950s and 1960s. Moe Strauss, one of Already the writing was on the wall the founders of Pep that these were retail’s future. It was Boys. He already knew to expect a chal- leaving Advance Auto Parts and its peers time for Advance Auto Parts to return to lenging time in the retail space. A chain out to dry with the barest of inventories. its roots. he and his brother operated across the So they improvised. “The discounters could pile up lawn- mid-Atlantic had tanked two years earli- “We branched out out of necessity. mowers and televisions by the thou-

40 www.chainstoreage.com CHAIN STORE AGE, DECEMBER 2005 Nicholas Taubman got his start in the business when his father bought three auto-parts stores from Moe Strauss, one of The Pep Boys. looking for Palmolive and they’re out of ing a majority stake in Advance Auto it, she might buy Dove instead. If some- Parts to investment firm Freeman sands. I didn’t see how we could compete one walks into my store looking for a Spogli & Co. in 1998, the company con- with that,” Taubman said. “We decided to starter for a 1990 Chevrolet Blazer and I tinued to follow Taubman’s lead, most return to the auto-parts market because it don’t have one in stock or within a few notably with the milestone acquisitions is an inventory-rich, labor-intensive, de- hours’ delivery time, I lose the sale,” of Western Auto Supply and Discount fensible niche that we already knew. Taubman said. Auto Parts in 1998 and 2001, respec- “It had become clear to us that retailers Moreover, because demand for auto tively. would need to specialize in order to last parts is so specific, it’s harder to forecast “I remain very good friends with the in the discount age,” he added. “And we than it is for Wal-Mart to predict how people I sold the company to. That’s the knew that the Wal-Marts and Targets of much Palmolive it will sell. But Advance best evidence I can give that it was a suc- the time had better things to do than to Auto Parts also must stock its stores with cessful merger,” Taubman said. build the skill sets they would need to greater precision than it takes to stock After the deal, Taubman discovered compete in that space.” true commodities, because most auto that he had something in common with So far, Taubman has been right. The parts are slow-moving items. The retailer Freeman Spogli co-founders Ron Spogli retailer stocks nearly 700,000 SKUs doesn’t have the room to stock a few and Brad Freeman: a deep involvement in chainwide and 20,000 SKUs per store. days’ supply of each SKU. Availability Republican politics. Already a supporter And those figures don’t include “crash must be just-in-time. of the Republican party, Taubman be- parts,” the panels, bumpers and other That’s a dynamic likely to unnerve the came more involved after the sale, and parts likely to need replacement in a col- most experienced merchandise planner, frequently attended party functions with lision. Advance Auto Parts sources those but Advance Auto Parts developed the Spogli and Freeman. Sometimes these from scrap yards and aftermarket suppli- necessary skill sets early on. The retailer events took place at the Texas governor’s ers across the country. was one of the earliest adopters of mer- Mansion in Austin, Texas, which at the But the merchandise properties that chandise-planning software, developing time was the home of future President insulate Advance Auto Parts against Wal- and installing its own solution in 1993. George W. Bush. Mart and its ilk also cause the retailer Although Taubman stepped down as Taubman’s leadership and commit- some unique challenges that most retail- CEO in 1997, he remained on the board ment to Republican politics caught the ers never face. At the top of the list is of directors through 2003 and continues attention of President Bush and others, product specificity. to play an influential role in the mer- and landed him on the short list of possi- “If a customer walks into a Wal-Mart chant’s leadership today. Even after sell- ble administration appointees. #

CHAIN STORE AGE, DECEMBER 2005 www.chainstoreage.com 41 RETAIL Entrepreneurs of the Year

Michael Cianciarulo ive years ago, 3 Day Blinds was CEO struggling to stay afloat. Today, Earth Fare F the retailer is growing at a 25% annual clip, it operates stores Headquarters: Asheville, N.C. within Sears Great Indoors locations Annual sales: $100 million and an IPO may be in the offing. Type of business: Organic and The story of the retailer’s natural-foods grocer success is also the story of Number of stores: 13 James Buch’s success. He Areas of operation: Georgia, North Carolina, South Carolina, Tennessee was brought on board as CEO in 2000 to revitalize the seller of custom win- hen Michael Cianciarulo, 57, dow treatments. catered a dinner for his In one respect, Buch Wyoungest son’s college soccer was an unlikely choice: team with natural foods from Earth Fare, His only experience in the the response from the guests was less home-improvement industry than enthusiastic. “They were saying had been when he worked ‘Oh, man, I guess we’ve got to eat this part-time in a hardware store stuff,’” he said. But by the end of the while in college. But that The Disney Home Collection proved a big evening, the food was all gone and the hit for James Buch's 3 Day Blinds guests gave it rave reviews. James Buch Another problem is visualization. All across the , the myth CEO When trying to picture how a particular that healthy food is unsatisfying food is 3 Day Blinds window treatment would look in her falling by the wayside, which explains home, the best aid a customer typically the success of Earth Fare, the Asheville, Headquarters: Anaheim, Calif. can hope for is a colored chip. The retail- N.C.-based natural-foods grocer Cianci- Annual sales: $150 million er answered that challenge by developing Type of business: Custom window an innovative computer application that treatments allows customers to virtually “try on” Number of stores: 190 Areas of operation: Western United different window dressings in her room. States, Midwest Buch, 52, strives for innovation in product, as well. The retailer issued the taught him one of the most valuable keys first celebrity-branded window-dressing to success in the home center industry: “I collection under the Christopher Lowell learned that this is a people business. The brand in 2002. More recently, 3 Day customer is seeking a trusting relation- Blinds partnered with Walt Disney to ship with the store associate. If you can create the Disney Home Collection for give good counsel for home repair, they’ll children’s rooms. The blinds are printed trust you and seek you out,” he said. with a Disney image that can be seen That lesson convinced Buch to hire when the blinds are closed. Michael Cianciarulo, right, with his son Alan, only the best for his stores. The stakes are 3 Day Blinds’ knack for service and believes in the efficacy of natural remedies. high, as custom window treatments are a innovation caught the eye of Sears high-ticket, labor-intensive item. “The Holdings Corp. Last year, Sears invited arulo leads as CEO. The natural- and customer can’t afford to buy it twice, so 3 Day Blinds to open showrooms within organic-foods segment has grown by you’d better get it right the first time,” three of its Great Indoors locations. Buch double-digit percentages each of the last Buch said. The retailer stocks only 3,000 recently began discussions with Sears to seven years, even as other grocers fight SKUs, but there are more than 6.5 billion duplicate the store-within-a-store con- for survival in the ever-growing shadow permutations of dimensions, color and cept at some of Sears’ 3,800 namesake of Wal-Mart. operations, leaving lots of room for error. and Sears Grand locations. # The expansion of the natural foods

42 www.chainstoreage.com CHAIN STORE AGE, DECEMBER 2005 RETAIL Entrepreneurs of the Year

segment has to do with more than has three children) and recharged his bat- taste, Cianciarulo said. “As America teries. In 2001, he returned to Rent-A- ages, more and more people want to Center as chairman and CEO. live healthily. We find our clientele is “I was ready to go back,” Speese said. highly educated on the nutritional “And my wife was ready for me to get value of the foods they buy, which out of the house.” draws them to us.” Although the rent-to-own business has Not all of Earth Fare’s clientele is grown more sophisticated over the years, drawn from the Social Security crowd; it has not fundamentally changed, ac- Cianciarulo finds that natural foods have cording to Speese. Stores offer name- a huge following among the college set. brand products—furniture, electronics, He seeks out college towns to host Earth appliances and computers—through Fare stores. flexible rental/purchase agreements that The natural-foods trend also spills generally allow the customer to buy the over into health care, another product merchandise at the conclusion of the area Earth Fare stocks. “I’ve literally Mark E. Speese agreed-upon rental period. had people come up to me in the store Chairman and CEO “We deal mainly with cash- and cred- and hug me and say, ‘Your natural Rent-A-Center it-constrained consumers,” Speese said. cures saved my life,’” Cianciarulo “We provide a valuable service in that said. Headquarters: Plano, Texas we offer them a way to get goods and Annual sales (2004): $2.3 billion Not long ago, that message struck services they would otherwise do with- Type of business: Rent-to-own stores closer to home. Until recently, Cianci- Number of stores: 2,800 company- out. Traditional retailers won’t finance arulo’s young granddaughter suffered owned stores and 287 franchised the majority of our customers.” from a condition that gave her constant units It’s a much different model than earaches. All the remedies her doctor Areas of operation: United States, most retailers are accustomed to. On recommended had failed, leaving sur- Puerto Rico and average, products are rented three or gery as the only remaining option. Number of employees: 17,000 four times over their life (the average Cianciarulo sent her some natural product is in the Rent-A-Center system eardrops to try first. Two weeks later, her level job with a young and growing com- some 22 months). Returned products earaches were gone and her medical pany,” Speese said. “I enjoyed the busi- are refurbished and put back out for procedure canceled. ness—the service it provided and the rent at a reduced rate or reduced term. “It really lets you sell your product dealings with the public—from the very Cash accounts for nearly all the trans- with an extra conviction when you see beginning.” actions. that happen,” Cianciarulo said. # Speese left Rent-A-Center in 1986 to With 2,800 locations nationwide, start a competing business, which he and Rent-A-Center is still growing, opening his partner grew into several hundred lo- 65 to 80 stores annually. Speese relishes cations. Things came full circle in 1998 the opportunity to expand the company’s ark E. Speese might have got- when Rent-A-Center was put on the sell- reach and appeal. ten into the rent-to-own busi- ing block. Speese’s company, now pub- “I’m very passionate about the busi- Mness by default, but he has cer- lic, was the successful bidder. After help- ness and the service we provide,” he said. tainly done well by it. The 48-year-old ing merge the two firms (under the “It’s always been more than a job for Speese is the chief executive of Rent-A- more-established Rent-A-Center ban- me.” Center, whose revenue topped $2.3 bil- ner), Speese took a hiatus from day-to- As for budding entrepreneurs, Speese lion in 2004. day operations. But he remained on the offers this advice: Speese joined the company in 1979 board. “To start a business and be successful, and worked his way up through the “I was traveling about 45 weeks a year you have to feel a passion for what you ranks. and working 18-hour days,” he said. “I are doing,” he said. “And you have to be “I was in college and having trouble was feeling a little burned out.” willing to make some sacrifices and take making ends meet, so I took an entry- Speese spent time with his family (he some risks. You can’t be afraid to fail.” #

44 www.chainstoreage.com CHAIN STORE AGE, DECEMBER 2005

RETAIL Entrepreneurs of the Year

arry Perzow and Dale Schwartz ise and familiarity with the health-care operations. Schwartz, initially co-CEO, have taken on a daunting task: the industry complemented Perzow’s retail has since stepped down but, as vice Breinvention of the drug store. In know-how. chairman, is very active at the board an industry dominated by a handful of Pharmaca opened its doors in 2000, level. big players, the two upstarts have in Boulder. The stores combine tradition- “We work very close together when it launched a new format, Pharmaca Inte- al prescription services and over-the- comes to capital funding and the like,” grative , that is primarily fo- counter products with homeopathic Perzow said. # cused on disease prevention. remedies, nutritional and botanical di- etary supplements and natural personal- Barry Perzow care products. In addition to pharmacists, Co-founder, president, there are trained naturopaths, herbalists, Mark Tarner CEO and chairman homeopaths and aestheticians on staff. Founder and president Dale Schwartz Notably absent from its shelves are some The South Bend Co-founder and vice chairman standard drug-store categories, such as Chocolate Co. Pharmaca Integrative photofinishing. “Our model is all about taking health Headquarters: South Bend, Ind. Pharmacy care to self care,” Perzow said. “We Annual sales (estimated): $25 million won’t carry non-critical products just for Type of business: Chocolate Headquarters: Boulder, Colo. the sake of margins.” manufacturer, retailer Annual sales (estimated, fiscal The company is adding about 10 loca- Number of stores: 20 2005): $50 million Areas of operation: Illinois, Indiana, Type of business: Drug stores tions annually, but will likely ramp up Michigan, Ohio combining traditional pharmacy and faster in the future. For the time being, it Number of employees: 280 (includes natural-health-care solutions is concentrating on the West, primarily to corporate personnel and franchisee Number of stores: 10 take advantage of cluster markets. But it employees) Areas of operation: California, doesn’t intend to stop there. Colorado, New Mexico, Oregon and “Our full plan is to head east,” oosiers work hard.” That’s the Washington Schwartz said. “We see locations mantra that Indiana native and Number of employees: 250 “ throughout the country.” Hsecond-generation chocolate- Perzow and Schwartz, both of whom maker Mark Tarner, 44, marches to. “During the past 40 years, every seg- own a substantial equity interest in And it’s a mantra dictated directly by ment in retailing has redefined itself Pharmaca, have an easy-going rapport his late father. “My dad had grocery except one: pharmacy,” said Barry Per- with one another. As CEO and presi- stores, he started a candy company, he zow, co-founder, president and CEO, dent, Perzow is active in day-to-day lost and made money—I was raised in Pharmaca, Boulder, Colo. that environment,” said Tarner. “He “We think the time has would tell me things like, ‘Tarners are come for a pharmacy that never hourly.’ And ‘Tarners never take is responsive to changing welfare. Tarners never take breaks.’ I demographics and the had no choice but to be what it is I am.” shift to self-care.” What Tarner is is a hard-working, Perzow, who founded highly visionary manufacturer and re- several other retail busi- tailer. In 1989, he immersed himself in nesses before Pharmaca, his father’s chocolate business and used met Dale Schwartz that experience to launch his own com- through a mutual friend. pany two years later. The earliest begin- Schwartz, 44, came from nings of The South Bend Chocolate Co. a venture capital and fi- were as a strictly wholesale operation, nance background and had held execu- Dale Schwartz, left, and Barry which evolved into a “wildly successful Perzow see a shift to self-care tive positions, including CEO, in several in the pharmacy business. mall kiosk program,” said Tarner, “and, biotech companies. His financial expert- in 1996, a store called The Chocolate

46 www.chainstoreage.com CHAIN STORE AGE, DECEMBER 2005 RETAIL Entrepreneurs of the Year

Café.” The Café is a fusion of choco- ment.’ And, to me, real achievement Mark Talucci lates, ice creams, coffees and gourmet isn’t about money and power, but, CEO and co-founder foods—designed to satisfy what Tarner instead, about making changes, about Todd Elliott describes as the Midwestern “desire to having great employees and about hav- President and co-founder have it all. If you can make it in the ing staying power. I’m very greedy in THE SAK Midwest, where the customer wants it that sense.” # all, from quality to variety to conven- Headquarters: San Francisco Annual sales: $50 million ience, you can make it anywhere,” he Type of business: Handbag said. houldering the responsibility for manufacturer Tarner credits his success, and that building a handbag empire is not Distribution channels: THE SAK is of his concept, to nothing more, or less, burdensome to Mark Talucci, carried in 2,000-plus department S and specialty stores in the United than hard work. “This may not sound 40, and Todd Elliott, 40; it’s fun. What States, in 22 international markets, very impressive, but I think what has began as a stray Super Bowl compli- in catalogs, on TV and on line made us successful is that we practice ment is now a global fashion state- Areas of operation: Products are sold ment—and a start-up story woven in nationwide and in 22 international markets great risk and even greater gain. Number of employees: 100 “Todd and I attended a Super Bowl party in 1988,” said THE SAK CEO In 1994, THE SAK’s signature Tight- and co-founder Mark Talucci, “and weave fabrication was introduced, “repre- Todd’s sister Tracey arrived with a senting a completely new and modern straw and rattan handbag. Every textile,” said Talucci, “and putting us on woman at the party wanted to know the map in the accessories world.” where they could buy the same bag.” Talucci’s road map to success was Tracey had purchased the purse on a written at an early age. “By the time I trip to Indonesia, which sparked an was 10, I had tried several of my own idea: Why not start a company import- businesses—a lemonade stand, a news- ing handbags from Indonesia? paper route, lawn mowing, and collect- Todd traveled to Indonesia, met a ing stamps and cigarette packs and sell- man named Nafsen, who made his liv- ing them.” From those childhood ven- Mark Tarner gives Midwesterners what ing cooking chicken satays on the tures, Talucci learned valuable lessons. they want: quality, variety and convenience. beach, and forged a friendship. Nafsen “Be careful not to fall prey to some of led Todd to local production facilities the weaknesses of entrepreneurialism,” great business fundamentals. I work, and helped him source an unusual tex- he warned. “Be aware of your resources and I work hard,” he said. “Plus, we are tile of antique rattan. In fact, “Nafsen and focus on your core competencies.” fiscally responsible, and we have a now owns and runs his own handbag Most of all? “Love what you do.” # great product and a great mission.” production facility, which servic- Part of Tarner’s mission is to move es THE SAK,” said Talucci. the company from a regional power- The first collection of hand- house to a national force. “But, more bags was launched in 1989 by than that,” he said, “I’d like to create an Talucci and Elliott under the institution, a business that lasts—for name Indonesian Imports, now my community and for my family and the parent company to THE for our industry.” Tarner likens his mis- SAK. “We invested our own sion to that of another Hoosier, basket- finances to get the initial launch ball coaching legend John Wooden. off the ground,” said Talucci, “Coach Wooden said something that “and I actually worked with a I’ve never forgotten,” said Tarner, a for- few new hires out of our garage. mer college player himself. “He said, Todd lived in Indonesia on a Mark Talucci, left, and Todd Elliott launched a handbag empire on a shoestring budget. ‘Never mistake activity for achieve- budget of 25¢ a day.”

48 www.chainstoreage.com CHAIN STORE AGE, DECEMBER 2005

RETAIL Entrepreneurs of the Year

n the summer of 1997, Chad tom of it all is the concept that the Bing Goei DiNenna, a diehard fan of all things world needs watches that speak to the President and CEO Isurf and skate, quit his job as an surfer and skater mentality. Eastern Floral advertising director for a leading surf DiNenna, 34, who surfed his way and skate magazine. Why? through college at the University of Headquarters: Grand Rapids, Mich. Because he had an idea that would California at Long Beach, has always Annual sales: $6.5 million not let go of him. been a watch aficionado. As a high- Number of stores: Five He and Andy Laats founded Nixon, school student, he created watch bands Number of employees: 100 a maker, marketer and on-line retailer with bits and pieces he found in skate Area of operation: Michigan of unconventional watches for uncon- shops. He hatched the idea for a new ventional people. For instance, the kind of watch company when, as a successful advertising man, he started Andy Laats looking around for a watch that said President and CEO something about him. There would be no Nixon today if he had found one. Chad DiNenna Now, their watches are available on Director of marketing line and at 3,500 specialty retailers in Nixon 30 countries. Eyewear and footwear fashion had Headquarters: Encinitas, Calif. successfully crossed into the surf, Annual sales (estimated): $15 million skate and snow subculture. DiNenna’s Type of business: Watch maker, big idea: Why not watches? marketer and on-line retailer After kicking the idea around with Bing Goei says he’s smart enough to Number of employees: 70 Laats, 38, who had an engineering surround himself with good people. background and a freshly printed company recently released its second business degree, the two men finally ing Goei’s success story followed limited collection of one-of-a-kind decided to launch the upstart busi- a long and remarkable path that watches made from the leather jackets, ness. To coax his partner into pulling Btook him from a refugee of politi- pants and guitar straps of famous the trigger on the business, Laats ex- cal upheaval in Indonesia in the 1950s to musicians, snowboarders and skate- plained that DiNenna could get in his current status as an entrepreneurial boarders. early as a founder, or later as an em- West Michigan florist and incoming Officially, Encinitas, Calif.-based ployee. With that sound business chairman of the Grand Rapids Chamber Nixon describes itself as a “premium advice, DiNenna quit his day job. of Commerce. accessories company.” But at the bot- A lot of realists doubted the Nixon As a 6-year old, he and his family fled business model. “People told me: their Jakarta home for the Netherlands. ‘Yeah it sounds rad, but who’s As an 11-year old, he passed through going to buy a watch for that harbor on his way to a new life much money?’” (The product is in West Michigan. typically priced from $75 to In 1972, Goei (pronounced “GO-ee”) $550.) established his own wholesale florist But for DiNenna, there was business in Grand Rapids. From there, a never a doubt. “It’s hard to read combination of hard work, good luck and words in print and get it right, the courage to act on what he saw as a and I don’t want to come off business trend has allowed Goei, 57, to sounding cocky, but did you find his place among successful retail ever feel like you know some- entrepreneurs. thing that no one else knows? It In 1973, he bought out the wholesale Chad DiNenna, left, and Andy Laats put a radical was like that for me from the florist where he used to work. But the spin on fashion watches. very beginning.” # future looked grim.

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Dennis H. Nelson “I began to see that the wholesale flo- President and CEO Kearney’s best-known and wealthiest ral industry was like a dinosaur,” he said. The Buckle businessmen. “The modern transportation system But, for Nelson, it’s not necessarily allowed us to ship all over the world so only about the money. “The Buckle Headquarters: Kearney, Neb. that people can now buy direct, instead would be nowhere near the company it is Annual sales (2004): $470 million of buying from a local wholesaler.” today,” wrote Heacock in his nomination, Type of business: Casual apparel, That realization led to a change in footwear and accessories retailer “if it weren’t for [Nelson’s] leadership course from wholesale to retail. In 1996, Number of stores: 338 and selfless service. … Dennis conducts he bought his first flower shop: Areas of operation: 38 states himself with honesty, integrity and a gen- Plainfield Floral in Grand Rapids. And Number of employees: 6,100 uine interest in the people he works when once- dominant Eastern Floral in (including 300 at its corporate head- with.” # Grand Rapids fell into bankruptcy, Goei quarters) saw it as a big opportunity to expand. Here’s where good fortune enters the son, 55, does. (He declined to be inter- t would not be incorrect to call Spec’s story. One of the deacons of the church viewed for this article.) But his many Wines, Spirits, & Finer Foods a liquor that sponsored his immigration to the accomplishments are well-known, espe- Istore—but that’s an incomplete de- United States just happened to be a past cially among his 28,000 Kearney friends scription. Spec’s is also an upscale, south- owner of Eastern Floral, Frank DeVoss. and neighbors, and his Buckle col- east Texas institution that promises dis- “He was instrumental in getting us leagues. count prices and great service. going,” said Goei, 57. DeVoss, who sold In his written nomination of Nelson as The Houston-based chain on its busiest Eastern Floral when it was still prof- Entrepreneur of the Year, Buckle finance days welcomes anywhere from 12,000 to itable, was eager to join Goei as a con- manager Tom Heacock penned, “Dennis’ 15,000 customers into its biggest stores, sultant to help steer the business back on visionary style of leadership, his genuine according to John Rydman (pronounced course. interest in people and his dedication and REED-man), 55, who runs the company “It’s an old saying, but I’m smart commitment to excellence have been enough to know that I’m dumb,” said vital to the Buckle’s growth and success. John and Lindy Goei. “The key to being successful in The Buckle team is truly blessed to have Rydman difficult economic times is putting good such an outstanding leader.” Owners people around me.” # Nelson hasn’t always led The Buckle. But he has been with the company since Spec’s Wines, Spirits, & the early days of the concept. Initially Finer Foods xit 272 off Interstate 80 in Ne- operating as a men’s clothing store in Headquarters: Houston braska doesn’t herald the presence Kearney in 1948 and run by founder Annual sales: $200 million-plus Eof Kearney-based The Buckle. David Hirschfeld, “Mills Clothing” ex- Type of business: Wines, spirits and But to all people Nebraskan, the retail- panded to two stores in 1967, was fine foods er’s hometown headquarters is almost as renamed “Brass Buckle” and honed its Number of stores: 50 much a source of state focus on denim. Nelson Area of operation: Southwest Texas pride as the University started with the compa- Number of employees: 900 of Nebraska in Lincoln, ny as a part-time college some 165 miles east, student and continued with his wife Lindy, 54. and as gubernatorial full-time after his 1970 It was Lindy’s parents who started candidate and former graduation. Brass Buckle the company back in 1962. The Ryd- football coach Tom changed its name to The mans joined the project in 1972, and Osborne. Buckle in 1991, went took over the entire chain almost 10 Nearby Hastings nat- public in 1992, and years ago. Like many entrepreneurs, ive Osborne does not Nelson took the helm the Rydmans have made their mark on avoid media attention; in 1997. Today, accord- commerce not so much on creating The Buckle’s president Dennis Nelson runs The Buckle ing to The Kearney something new, but on taking an exist- and CEO Dennis Nel- with ‘visionary’ leadership. Hub, Nelson is one of ing idea to places where no business

52 www.chainstoreage.com CHAIN STORE AGE, DECEMBER 2005 RETAIL Entrepreneurs of the Year

has gone before. leana Palacios’ adventures in retail “We can’t take credit for the genius of have been shaped to a large extent Ileana Palacios Spec’s,” said John Rydman. “We just kind of Iby her desire to spend quality time President took things to a new level.” Specifically, the with her daughters. Her family ties Palacios Corp. Rydmans expanded the company from seven and retail acumen have been in bal- to 50 stores, while at the same time experi- ance for a quarter of a century. Headquarters: San Juan, menting with new merchandise categories Her latest ventures is a Palacios Puerto Rico and formats. Today’s largest store, at the furniture store and outlet store in Type of business: Home south edge of downtown Houston, measures San Juan, Puerto Rico. “The key to furnishings 80,000 sq. ft. our success is to keep ahead of the Annual sales: $4.3 million The Rydmans explain that the expansion changes in the design and furniture Number of stores: Two plan was a matter of necessity. And they business,” she said. “We also try not Number of employees: 32 believe the secret to the growth is the simple be recognized as a traditional, con- Area of operation: San Juan, retail maxim: Listen to the customer. temporary or transitional store, but to Puerto Rico “What’s magic about Spec’s is we’ve be considered the most important, done things because customers asked us to trend-setting store in Puerto Rico.” sell, which I did,” she said. Palacios do them,” said John Rydman. Case in It all started 25 years ago, when kept an office in San Juan and pro- her daughters went off to grade vided complete furnishing and inte- school, and she decided she had rior-design services for developers. time for her own business. She cre- “I soon had a staff of eight, but was ated a home-furnishings and furni- able to have control of my time with ture store called Kilims, which soon my family,” she said. earned a reputa- When her chil- tion across the dren finished col- island of Puerto lege, Palacios de- Rico as the place cided to go back to go for import- to retail, and she ed European fab- picked out a small rics and decorat- building in a run- ing necessities. down neighbor- John and Lyndy Rydman took her Her plans were to hood. “Everybody parents’ business to a whole new level. own a small store, thought I was point: The Rydmans expanded the finer and within two crazy,” she said. food sections, added specialty foods and years she had But after remodel- introduced cigars to the merchandise mix. acquired the ing, buying a sec- The Houston real estate industry has taken building, expand- ond building, a notice of the chain’s popularity. John ed it and added third and a fourth, Rydman described a recent phone conversa- her own fram- her original risky tion with a developer eager to recruit Spec’s ing workroom. For 25 years, Ileana Palacios has juggled investment is to- to a new shopping center. The developer’s Within six years, raising a family and owning a business. day the Palacios pitch: 80% of the nearby residents asked for she exported the showroom. “The Spec’s by name. (The Rydmans turned down concept to Miami, where her store run-down avenue became a very the proposal.) opened at the Dadeland Mall. desirable avenue for stores special- “We’re well-known now,” he said, who Then it was time to be with her izing in floors, fabrics and kitchens, added that the company will definitely grow, family again. When her daughters substantially increasing the real but is still formulating its growth plan. “Our were all in high school and prepar- estate value of the area,” Palacios No. 1 goal is customer satisfaction, period. ing for college, Palacios made an said. “I am very proud of my contri- It’s not real estate, it’s how you take care of adjustment. “They needed me home bution to the area.” So are her your customers.” # again and I decided it was time to daughters. #

54 www.chainstoreage.com CHAIN STORE AGE, DECEMBER 2005 RETAIL Entrepreneurs of the Year

J. Kent McNew ichel Coutu, 52, grew up in nameplate. In 1990, Coutu complet- Chairman and founder the drug store business. His ed his first acquisition when he Eastern Petroleum Corp. Mfather Jean Coutu is the co- bought a 16-store regional chain. founder and chairman of Canada’s Today, several major acquisitions Headquarters: Annapolis, Md. leading drug store chain, The Jean later (most notably Brooks Phar- Annual sales: $87 million (est.) Coutu Group. The company’s Can- macy in 1994, and Eckerd Drug from Type of business: Fuel supply, J.C. Penney in 2004), the company convenience store ownership and development Michel Coutu ranks as the fourth-largest drug store Areas of operation: Delaware, President and CEO chain in , with a com- , Virginia The (PJC) bined network 2,172 corporate and USA (a subsidiary of the franchised stores. Jean Coutu Group Inc., Coutu, well-liked in the highly astern Petroleum Corp., Anna- ) competitive drug store industry, has polis, Md., has supplied gaso- Eline stations, convenience stores Headquarters: Warwick, R.I. and marinas in Maryland and Virginia Annual sales: $1.8 billion (2004 since 1969. That’s when J. Kent U.S. sales) Type of business: Drug stores McNew. a former salesman at Hess Number of stores: 1,851 Oil, founded the company with one (U.S. store count) truck and a gas station in Maryland. Areas of operation: East Coast, The company supplemented that Mid-Atlantic and Southeast steady business by selling home-heating Number of employees: 46,000 fuel, and owning a handful of small gas stations. adian operation, however, is dwarfed From those origins, the company in terms of store count by its U.S. today supplies more than 100 million subsidiary, which operates 1,851 gallons of petroleum annually to stores under the Michel Coutu began working in the more than 100 locations in Maryland and Eckerd banners. The driving family business as a teenager. and Virginia. force behind Jean Coutu’s stateside The big idea for J. Kent McNew, operation and its explosive growth is displayed a unique talent over the Eastern Petroleum Corp.’s chairman Coutu, who serves as its president years for managing acquisitions and and founder, came in the form of big and CEO. successfully operating acquired stores. convenience stores. He recognized a Michel started working in the Empowering management and com- while ago that bigger is better in the c- family business as a teenager. His municating with employees are also store business, and the industry was retailing career was temporarily his strong suits (he regularly sits down moving away from the small gas sta- derailed after college while he to breakfast with groups of 30 or so tion. The company adjusted its focus worked as an attorney in store associates). All of his skills are to a 5,000-sq.-ft. format, situated on an (he has accounting and law degrees). being put to the test with the ongoing acre-and-a-half of land, plenty of gas Michel moved to the United States integration and upgrade of the Eck- pumps, with a quick-service restaurant in 1983 to attend University of erd stores. Few doubt he is up to the and, in some cases, ice cream. Rochester’s Simon School of busi- challenge. For the last ingredient, McNew was ness, earning an MBA in 1985. As to the future, the up-and-com- inspired by memories of his youth at The family instinct kicked in ing generation of Coutus seems to Tastee-Freez ice cream stands. Eastern shortly thereafter. In 1986, Coutu be following in the family tradition. Petroleum purchased the franchise founded The Jean Coutu Group Coutu’s oldest son has a pharmacy rights for Tastee-Freez in Maryland, (PJC) USA (he has been chief exec- degree and is currently enrolled in a Delaware and parts of Virginia. The utive since its inception). In 1987, MBA program. His daughter is in company has about a half-dozen full- the fledgling company opened its pharmacy school. His youngest son sized c-stores, and is looking to build first store under the Maxi Drug is a senior in college. # more. #

56 www.chainstoreage.com CHAIN STORE AGE, DECEMBER 2005