Leaders See the Light
By Don Longo
Altria Group Chairman and CEO Mike Szymancyk got the conference off to a strong start by refuting the death of the tobacco category -- which represents anywhere from 30 percent to more than 50 percent of inside sales at some c-stores.
"Many of the perceived barriers to success in the tobacco category could be viewed as opportunities," said Szymancyk. The CEO acknowledged retailers' worries about rising taxes and how FDA regulation of tobacco could negatively impact the category. But he urged retailers to broaden their view of the category beyond just cigarettes and to see the value of other tobacco products, such as smokeless and cigars.
I thought his comparison to Apple Computers and its Chairman Steve Jobs was very apt for businesses of all types. Apple was struggling in the late '90s until it reinvented itself from a computer company into a company focused on serving the digital lifestyle. With this new thinking, the company created a string of successful products, from the iPod and the iPhone to the iPad.
New thinking about tobacco will lead to similar success. "If all we see when we look at tobacco are new taxes and FDA, we'd be letting a lot of opportunities pass us by," said the CEO of the largest tobacco supplier. Although the cigarette category has been declining 2 percent to 4 percent per year, the smokeless and cigar categories have grown 12 percent per year in average sales per store over the past five years, he contended. Indeed, despite all the taxes and anti-smoking regulations at both the federal and state level, total tobacco poundage sold declined only 1 percent in the past five years, claimed Szymanczyk.
The retailer side was more-than-ably represented by Alain Bouchard, president and CEO of Alimentation Couche-Tard, North America's second-largest convenience store chain. The French-Canadian retailer downplayed his credentials as a visionary. "Actually, we do everything in our power not to guess the future."
Nevertheless, Couche-Tard would never have grown from a single store into a $16 billion, 6,000-plus convenience store retailer without understanding its customers. The retailer views every market as local and invests in sophisticated measurement and analysis in each of its 11 geographic divisions, followed by constant exchange of best practices between divisions.
Like most good leaders, Bouchard also cited the importance of the retailer's people. "We believe in utilizing our human resources. We are highly decentralized, which leads to an extremely motivated and enthusiastic staff."
Bouchard added: "Our vision is one of unlocking the human potential in our people through training and empowering them."
The conference also included thought-provoking sessions on strategy-building and foodservice execution by Dr. Neeli Bendapudi, professor of marketing at Ohio State University, and Ira Blumenthal, who heads the NACS Cafe, the association's foodservice resource for convenience stores.
Also at the conference, NACS unveiled a new internship program honoring Teri Richman, the association's first in-house federal lobbyist who died of pancreatic cancer late last year at the age of 54.
Former NACS chairman and current CEO of Rutter's Scott Hartman gave a touching tribute and noted Richman's interest in mentoring and growing people within the convenience store industry. Rutter's already contributed $2,500 toward the program, along with a matching grant from one of its vendor partners, said Hartman.
Congratulations to NACS for putting on an informative, and at times inspiring, conference.