Associated Wholesale Grocers

Prospering on a Margin of Pennies

If there is any truly “mature” industry in the United States, it is the grocery business. About the only real way for the industry to grow is to grow the population—in numbers, that is, not waist size.

Despite the limitations of the market, Associated Wholesale Grocers, Inc. (AWG), under the experienced helm of CEO Gary Phillips, has increased its sales revenues more than 47 percent over the last three years, and nearly 23 percent last year alone. Now, in fact, AWG is the second-largest grocery wholesale cooperative in the United States with some 1500 retail member stores.

Speaking of mature, Phillips has dedicated 31 years of his life to the cooperative. Before taking over as CEO, he served as CFO and led AWG’s Springfield division.

There are technical reasons for the coop’s growth under Phillips. The most obvious is the fact that AWG added 225 member stores in 2004, but this did not happen by accident. The stores affiliated because they liked what AWG was doing. In particular, they appreciated the cooperative’s increased attention to specialty foods, which enhances retailers’ competitiveness and enables them to increase both sales and profitability. Helpful, too, is the fact that AWG’s member stores are acquiring new stores of their own and adding them to the AWG family.

And “family” finally is what AWG is all about. “Our locally owned independent operators survive competing with the largest retail chains in the world,” says Phillips. “They do so by caring for their customers, their employees and most of all by caring for their communities.”

AWG, in turn, takes care of its customer/owners with the same care that those owners take care of their own customers. Companies that “operate on pennies for margin” have to be attentive to survive. But with AWG, the customer concern derives more from “wanting to” be attentive than “having to,” and that makes all the difference.

Sceptor Industries

One Very Serious Silver Lining

The cloud in question was a frightening one. The anthrax attacks that followed hard on September 11 threw the nation into near panic. As a people we never had had to deal with this kind of phenomenon before. Fortunately, Sceptor Industries, Inc. emerged to step into the breach.

From the beginning, the privately-held Sceptor had a distinct mission. Unlike many companies that do scientific development for the government, Sceptor was designed to create practical solutions and to execute the subsequent contracts in full. Sceptor therefore attracted customers who needed reliable air sampling devices, either to protect against potential terrorism or to monitor the air for naturally occurring pathogens like bacteria and viruses. The company also has attracted inventors whose technologies require commercialization. “We are a technology enabler,” CEO Dick Jarman says.

Sceptor faced an early product development test with profound national consequences. Sceptor was called upon to develop the collection end of the detection system to protect U.S. mail delivery. All of the relevant government testing agencies evaluated the product.

“Once they certified that it worked,” Jarman says, “we knew we had participated in an important first.” The U.S. Postal Service currently is installing these aerosol collection devices on every sorting machine in every sorting center nationwide. To date, more than 500,000 live tests have been run through these devices in our Post Offices without one false positive.

Recently rated the 16th fastest-growing company in America by Entrepreneur magazine, Sceptor has a distinctive work environment. Each “associate” is a proven performer from a larger, more sophisticated enterprise. “Each of us respects the others’ knowledge and abilities,” Jarman says, “and each of us contributes to the company’s growth.”

Bernstein-Rein Advertising

Simple Human Truths

The good folks at Bernstein-Rein Advertising call their specialty “Brand Humanity.” To achieve this seemingly mystical effect, agency associates attempt to boil a brand’s essence down to “a simple human truth,” then translate that truth into a compelling message, then strive to use that message to reach the precise audience when and where they choose to.

Bernstein-Rein makes the whole process sound so simple that you’d think the city would be full of half-billion dollar ad agencies, but it ain’t. There is only one and there has been only one in the city’s history. Under the leadership of Chairman and President Bob Bernstein and Vice Chairman Skip Rein, the firm has grown from an acorn of an agency with just one employee 40 years ago to a sequoia today. Steve “Integration is His Middle Name” Bernstein now serves as Chief Operating Officer of the 300-employee, Plaza-based agency.

You might think that an agency that invented the Happy Meal, launched Blockbuster Video and helped Wal-Mart open practically every one of its 2,700 stores would be content to rest on its distinguished laurels.

But if that’s what you thought, you don’t know B-R. From its inception in 1964, the agency continually has stretched the boundaries of what an agency should do. Over time, the company has added data-base marketing, direct marketing, interactive, digital imagery, research, Yellow Pages and the Brand Relationship Group.

The Bernstein’s are now developing West Edge, a spectacular mixed-used development on the western edge of the Country Club Plaza. Designed by internationally renowned architect Moshe Safdie, the devel-opment, among other uses, will serve as home for Bernstein-Rein for the next 40 years—or until the agency outgrows it! In addition, Bob Bernstein is planning to open an Ad Icon Museum to showcase his impressive collection of the same.

All of Ingram’s Future of Business winners have made substantial contributions to the community, but Bernstein-Rein is the only one to have been named the Corporate Philanthropist of the Year.

UBC Late Stage Group

Recreating Together in Both Senses of the Word

Sean Hart, President of United BioSource Corporation – Late Stage Group, believes that a team that plays well together works well together. So it is not unusual for a group of UBC Late Stage employees to share recreational activities, like running together at lunch time or biking to work. Hart has been known to show up himself in bike shorts.

In another larger sense, however, the employees shared the mission of re-creating their firm. In 1999, when the company was known as B&B Clinical Innovations (BBCI), they looked within themselves to discern the true core competency of their company. They discovered that late-stage research was the service that they did best and that distinguished them from their competition.

At roughly the same time, they began to see the shift in the pharmaceutical industry away from blockbuster drugs and new product sales toward risk management and safety concerns of newly approved products. This shift drew attention to the services in which the company specialized.

In 2003, the company landed its largest single research program to date. This win convinced Hart that the enterprise could succeed as the dominant service provider in late-stage pharmaceutical research. BBCI’s success also attracted the attention of the Bethesda-based United BioSource Corporation, which acquired BBCI in 2004.

Today, from its Kansas City base, UBC Late Stage continues to prosper. Despite the change in corporate identity, employees continue to participate actively in the ongoing re-creation of the firm. Employees who take the initiative in developing new ways to conduct studies or add new services are rewarded. “We expect to work hard together,” says Hart, “and succeed together.” He knows the company is on the right path when his employees ask him, “How do I buy stock in our company?”

Everest Connections

Everest Climbs to the Top

In 2003, if we can persist with the inevitable mountain climbing metaphor, a financial avalanche of sorts sent the employees of Everest Connections scurrying back to base camp. Everest’s majority owner, Aquila, had suffered a serious financial reversal and could no longer fund Everest’s expansion or even its operation. A subsequent restructuring forced Everest to downsize by half.

Undaunted, Everest CEO Phil Spencer and his dedicated staff made the long climb back. The staff went beyond the call of duty—working late nights and weekends, volunteering at customer events and marketing the business every chance they could.

Then again, Everest employees were used to working creatively and hard. After nearly a year in business, and with only 83 customers on the books, Spencer and his staff went on a door-to-door, neighborhood-by-neighborhood marketing campaign with a unique hometown block party sales approach. Prospects responded in large numbers, and sales soared. “That’s when we knew we would succeed,” says Spencer.

Spencer finds it gratifying that his employees wear Everest shirts unbidden. They do this not so much to please the boss but because customers constantly approach them and tell them “how much they love our service.”

“We have a passion for customer service,” Spencer says, “and all of our employees have embraced that philosophy.” In the highly competitive business they are in—the provider of cable, high-speed Internet and phone service—customer service gives Everest its defining edge. It did not hurt, of course, that Everest was the first company in the Kansas City area to bundle all three of those afore-mentioned services into one package.

The combination of fair prices, great product and super service has inspired Everest to nine consecutive cash-flow-positive quarters. Having secured its debt, the company now serves more than 32,000 customers in Johnson County and South Kansas City, and keeps on climbing.

Hoefer Wysocki Architects

Buildings As Good As Their Word

The first four employees who came to work for Hoefer Wysocki Architects, LLC (HWA) still work for the company today. Okay, the company is only nine years old, but nine years at a start-up contemporary architectural firm is “gold watch” time by today’s standard. Principals Mitch Hoefer and David Wysocki attribute this stability to team interaction and creative partnership from top to bottom. “We give respect and get respect in return,” says Hoefer.

While many companies build a portfolio of experience within a few months, it can take several years for most architectural firms to develop a portfolio of completed designs and projects, so potential clients can see that the firm was as good as its word. “We knew then that we would have to be able to translate our successes from our previous careers to HWA,” says Wysocki, “which enabled us to differentiate HWA from other architectural firms serving the same markets.”

Another way HWA distinguishes itself is by encouraging a family atmosphere and focusing on teamwork. They believe in working hard and playing hard, and they also provide a diverse range of opportunities so that employees can advance their careers, get involved in the community, become active in professional organizations and still maintain an active, balanced schedule.

The partners feel the same way about their clients. In the beginning, Hoefer and Wysocki made a decision to develop solid client relationships. In the high-performance world of architecture, the partners realized that relationships only work if the service is exceptional, the designs are innovative and the project management is sound. HWA strives to provide all three components to every client.

The firm’s work in the judicial, healthcare and commercial markets has taken it all across the country. HWA designed the FBI Field Office in Birmingham, Ala.; the Social Security Administration Building in Austin, Texas. Currently, HWA’s designs can be found throughout Kansas City, includ-ing Menorah Medical Park, Kansas City Police and Fire Departments, and office buildings throughout the area.

Houlihan's Restaurants, Inc.

Sedition, Not Tradition, At Restaurant Chain

When Houlihan’s Restaurants, Inc. brought Bob Hartnett to town four years ago, the company did so not to shore up its tradition, but to subvert it, to re-imagine a new one. And re-imagine he has. In fact, the company has spent the last two years on a total brand repositioning.

“We’re lean, nimble, scrappy and not risk-averse,” says the adventurous Hartnett. “We’re extremely trend-oriented and keep our eye on where consumers are heading—that’s probably our biggest strength.”

Hartnett believes that America’s middle-market consumer “is trading up to new luxury.” Houlihan’s has responded to this trend by pushing the edges in casual dining. The restaurants combine high-quality foods—made from scratch in their scratch kitchens—with stylish preparations, presentations and marketing.

Houlihan’s has a relatively small administrative staff, so everyone in the organization is expected to have an opinion. “There’s nowhere for people to hide in a small company,” says Hartnett. Independent thinking and a can-do spirit are encouraged in the company and, in turn, keep Hartnett on his toes.

Hartnett gets a sense of just how well the experiment is working when customers tell him just how much better the dining experience has become at Houlihan’s. “It’s assurance that we have tremendous opportunity ahead of us,” says Hartnett.

The pace of change, however, has not stopped the Houlihan’s staff from remembering those people who make their success possible. Among other philanthropic ventures, Houlihan’s sponsors the 1438 Combat Engineer Unit currently stationed in Iraq. If the staff members ever think that opening a new restaurant is too difficult a task, they need only reflect on the fact that 1438 just built the largest bridge in a combat zone since Vietnam.

Netchemia

Catching K-12 Up With Corporate America

It used to be that special education teachers in high school faced a challenge more daunting than educating their students, and that was filling out forms that were 15 pages long, if not longer. If corporate America had long since moved beyond paper, public schools were still playing catch-up.

Netchemia was founded in 2001 to close that gap. With the passage of No Child Left Behind (NCLB) legislation soon after, and the increased federal reporting that came with it, this privately held company realized that a whole new market niche was opening. And so Netchemia followed its special education reporting software with new Internet-based programs designed for staff development and recruitment management.

“School districts are being forced to make more data-driven decisions,” says Netchemia CEO Carlos Antequera. “This is forcing districts to improve their internal processes and track more information for staff and students.” And fortunately, Netchemia is there to help.

Although only 4 years old, the company already services nearly 100 school districts across the nation, including several major districts in the area. Not surprisingly, given the company’s name, Antequera attributes Netchemia’s success to the “chemistry” of its people. Antequera looks for people with experience in different disciplines and backgrounds.

“The ability to work as a team” has been critical in moving the company forward. Still a relatively small company, Netchemia prides itself on fostering open discussion among employees.

Staff members are open not only to each other but also to their clients. “Netchemia listens!,” the company’s first major client told Antequera, and he and his colleagues have been listening even harder ever since.