30S&D Coffee and the State's Biggest Private Companies Still
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Cover story THE 100 AT 30 S&D coffee anD The STaTe’S Biggest S&D coffee, based privaTe companieS in concord, grew tenfold over 30 still pack a jolT. years, thanks to america’s love affair with coffee. By DAVID milDenBERG 46 Business north Carolina OctOber 2014 47 As seen in the October 2014 issue of BUSINESS NORTH CAROLINA magazine. n the 30 years that BUSINESS NORTH Compiling that first ranking involved CAROLINA has published a list of the 800 hours of work, including time spent state’s 100 largest private compa- encouraging businesspeople unaccustomed nies, coffee has gone from mundane to the limelight to participate. “We converted morning brew to, arguably, Ameri- a ton of business because of the list,” says ca’s most beloved beverage. Its T. Michael Henderson, a former Andersen rising popularity helped Concord- partner who oversaw the project for most of ibased S&D Coffee Inc. percolate from 62nd the 1990s. “The vast majority of companies in 1984, when it did business in 13 states, to enjoyed the publicity. It was the first thing No. 15 this year. It’s now the nation’s largest you’d see when you walked into their custom coffee roaster, supplying McDonald’s lobbies.” The types of companies eligible Corp. and other major chains across the have changed over the years to include country. Focusing on restaurants and offices retailers and those owned by private-equity proved shrewd in the age of Starbucks. The firms. Chicago-based Grant Thornton LLP, family-owned business’ annual sales are 10 the fifth-largest U.S. accounting firm, picked times what they were three decades ago, up the program after Houston-based Enron while its workforce has more than tripled. Inc.’s bankruptcy in 2001 led to the failure “I don’t believe anyone believed that you of Andersen, its auditing firm. A year later, would see a McCafé at McDonald’s,” says Grant Thornton added about 500 Andersen Ron Hinson, who joined the company in employees nationally, including those in the 1979 as a route sales manager and became Charlotte, Greensboro and Raleigh offices. Pharr Yarns LLC is No. 23 on this year’s list. Formed in 1939 by the Stowe and Pharr families, the McAdenville-based CEO in 2000. “It’s remarkable that 30 years later, the list company transitioned from cotton to synthetic fibers and now specializes in manufacturing yarn used in carpets Growing from a regional to national still has staying power and still is something and flame-retardant products such as firefighter jackets. Pharr employs about 1,550 workers, down from 6,000 in company while remaining locally owned we’re very interested in,” says Mike Mc- and operated, S&D is the type of success Guire, the Charlotte CPA who worked on the 1970s. J.M. “Bip” Carstarphen, a son-in-law of co-founder William Pharr, died in May after being CEO since 1981. story envisioned by the Arthur Andersen the project in 1984 and is slated to become accountants who started what’s now the Grant Thornton’s CEO in January. Grant Thornton North Carolina 100 back One of the original missions, former capital, doing an IPO and then going new hiring over the past five years coming when Ronald Reagan and Lionel Richie were Andersen partner Paul Garrett explained in golfing. The idea that you are going to be in Charlotte, Raleigh and Durham, up from all the rage. Participation on the list, which a story that accompanied the inaugural list, amazing in five years — it just doesn’t work about half during the 1990s, according to a is based on revenue, is voluntary, so some was to “ensure that the private businessman that way.” Wells Fargo Securities LLC report. “The major companies are missing. But those on receives his fair share of recognition for his The list mirrors North Carolina’s shift sheer amount of metropolitization that has it have a huge footprint — their combined contributions to the economic growth and from a manufacturing-based economy, with occurred is surprising, and it has really revenue topped $32 billion this year, com- vitality of North Carolina. In the past, the plants and businesses spread throughout changed the culture and politics of our pared with $6.3 billion in 1984. Charlotte- recognition given to private business has not the state, to a more diversified one that’s state,” says John Quinterno, owner of South based Belk Inc., the nation’s largest privately equaled their contributions.” It still doesn’t, concentrated in major metros, especially by North Strategies Ltd., a Durham consul- held department-store chain, ranked first for because many cherish their privacy and the d Charlotte and the Triangle. Star, a Montgom- tancy. The number of Triad-based companies E t the fifth-straight year, trailed by Cary-based press and public are more enamored with no ery County town of fewer than 1,000 resi- on the list has fallen dramatically — nearly se i SAS Institute Inc., the world’s largest privately widely traded public companies and the few W dents, was home to two hosiery-makers 40% — as have the number of mills and r E held software developer, and Madison- private technology upstarts that get billion- th on the initial ranking. Back then, about half factories that once made the region the O based Remington Outdoor Co., one of the dollar bids. “Private companies aren’t cel- of the top private companies were based state’s manufacturing center. NLESS biggest domestic makers of sporting rifles ebrated enough,” says Bob Luddy, owner u outside the state’s three biggest metros, To celebrate the 30th anniversary rank- ES and shotguns. Remington, owned by New of Captive-Aire Systems Inc., No. 32 on i compared with 25% in 2014. Only five ing of North Carolina’s largest private compa- York-based private-equity firm Cerberus the list and the world’s largest manufacturer companies in the textile, hosiery and furni- nies, we’ve expanded the list this year to compan by Capital Management LP, moved to North of restaurant-ventilation systems. “We need d ture industries remain among the 100, down spotlight those that stand out nationally and E Carolina in 1996 but didn’t participate in the to encourage entrepreneurs to run their vid from 30 in 1984. The state’s two biggest globally. And we’ve included charts that O Pr ranking until this year. It and S&D are among businesses for a very long time, because Y metros are home to 60% of its largest private compare the first list with the latest, which is h 15 companies reporting annual sales of that’s how they can make the biggest AP companies — the Triangle has 26, compared still the most comprehensive roll of large, gr O more than $500 million on the list; only five contribution to society and themselves,” t with 11 three decades ago. That tracks the closely held companies that call North O exceeded $200 million in 1984. he says. “It’s the opposite side of venture Ph state’s employment growth, with 70% of Carolina home. 48 Business north Carolina OctOber 2014 49 North Carolina’s tOP 100 Leaders of the private pack Seven companies have been No. 1 over three decades of rankings. Two remain independent. PRIVATE COMPaNIEs McDevitt & Blue Bell Inc. Burlington Cone Mills Corp. Klaussner General Parts Belk Inc. compileD B y g ranT Thorn Ton LLP Street Co. 1985-86 Industries Inc. 1992 Furniture International Inc. 2010-14 Industries Inc. ‘14 ‘13 1984, 1987-1990 Started in 1904 as 1991 The Greensboro- 1997-2009 Dating to 1888, rank rank Company Headquarters CEO Employees Business This Charlotte-based Hudson Overalls Co., Founded in 1923, it based textile 1993-96 Founded in 1961 by the nation’s larg- company, started the Greensboro- moved its headquar- company with Started in Asheboro O. Temple Sloan, then est family-owned $500 MILLION OR MORE IN REVENUE (latest fiscal year) in 1925, was the based apparel-maker ters to Greensboro in roots in the 19th as Stuart Furniture 21, the company department-store 1 1 Belk Inc. Charlotte Tim Belk 24,688 Department stores nation’s fourth-largest was the world’s 1935, went public in century was the Industries in 1963, became the second- chain is run by general contrac- largest manu- 1937 and became the world’s largest it was purchased by largest wholesale grandsons of the nation’s largest privately owned department-store chain knows future success hinges on sales outside its 299 stores in tor when its sole facturer of work world’s largest textile denim manufacturer. German furniture auto-parts distributor, founder William owner, the son of and recreational company. It went It went public in magnate Hans J. operating 1,400 Henry Belk. It has 16 states. the news is promising — internet-based revenue increased 43% in the most recent quarter, and Belk is expanding the founder, died in clothing from the private to thwart a 1951, then private Klaussner in 1979. CarQuest stores. 299 stores in 16 its e-commerce distribution center in Jonesville, S.C., by 50%. in July, company veteran david Zant was named president 1990 at the age of 1940s through the takeover in ’86 before in 1985 to avoid a Under the leadership Roanoke, Va.-based Southern states. and chief merchandising officer, replacing Kathryn Bufano, who became CEO of York, Pa.-based Bon-ton Stores inc. 51. It is now part of 1970s. The maker going public again in hostile takeover of CEO J.B. Davis for Advance Auto Parts Sales totaled $3.5 Australian construc- of Wrangler jeans 1992.