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Scott Schnuck
brings energy to his FAMILY, his BUSINESS, and his COMMUNITY
By Pam Droog Jones
Scott Schnuck claims he can't juggle, but don't you believe him
– after all, he’s been juggling business, community
and family responsibilities for years. For starters, as president
and chief operating officer of Schnuck Markets Inc., he helps manage
a $2.2 billion company; as chairman-elect of the RCGA Board of Directors
and recently-elected president of the Missouri Botanical Garden
board, Schnuck provides volunteer leadership and vision; and as
a husband and father of three sons, he heads an active and interesting
family.
A sampling of springtime in the floral department—Scott
Schnuck with Floral Manager Lisa Potts. |
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“I am amazed at how successfully Scott has been able to balance
his family, civic interests and business,” says 30-year friend
Doug Albrecht, president of Centric and Chairman-elect of the Regional
Business Council. “He is a great asset to the St. Louis region.”
Schnuck’s life and Schnuck Markets have always been linked.
The Schnucks chain dates back to 1939 when Schnuck’s grandmother,
Anna Schnuck, entered the retail food business by opening a small
confectionary in North St. Louis. “Two years earlier, my grandfather,
Edwin, had started a meat wholesale business, and that’s how
they had become familiar with the retail business,” Schnuck
says. “That 1,000-square-foot space in [North St. Louis] was
the first Schnuck store.”
Over the years, Edwin Schnuck added more stores to the fledgling
retail operation, including one he purchased for Schnuck’s
father, Donald, upon his return from World War II. Edwin’s
other children, Ed and Annette, also independently operated stores,
but today only the six children of Donald and Doris Schnuck remain
active in the business.
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Behind the scenes (left to right): Warehouseman Cardell
Roy, Scott Schnuck and Senior Vice President of Logistics,
Manufacturing and Information Technology Bob Drury. |
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The true birth of Schnuck Markets came in 1951, when Edwin, Donald
and Ed jointly purchased a 10,000-square-foot store at Manchester
Road and Brentwood Boulevard. “That was the start of the company
we are today,” Schnuck says. Soon after, the ambitious family
built their first stores from the ground up in the cities of Overland,
Dellwood and Florissant. By 1970, the company had grown to 17 stores.
“Our big break came in 1970 when we bought 25 Bettendorf stores,”
Schnuck says. “I was in college at the time, but I remember
that was a bet-the-company transaction.” The bet paid off,
and in 1995 Schnuck and his brothers made their own major acquisition,
adding 57 National stores to a chain of 64 Schnucks. “That
was a gutsy move as well, but nothing in comparison to the risk
my dad and uncle took in 1970 with the Bettendorf acquisition,”
Schnuck says.
Third generation
Like many others in management at Schnucks, Schnuck, 53, started
out bagging groceries. “I was a pretty conservative, straight-laced
kid, and very much into sports,” he remembers. “I played
quarterback and halfback in high school and was fairly heavily recruited
by large college football programs, including the University of
Missouri.” Opting instead to go the Ivy League route, Schnuck
was a two-year starter on Cornell University’s football team,
playing with All-American running back Ed Marinero.
After graduating from Cornell’s food management program in
1972, Schnuck and his wife, Julie, were married, and he accepted
a position at a supermarket in New Jersey. He later enrolled in
the Stanford University Business School. “My dad always encouraged
us to get outside experience and an advanced degree,” he says.
“He told us to prepare ourselves as if the family business
wouldn’t be there.”
After earning his MBA in 1975, Schnuck returned to St. Louis to
stay. First he worked in marketing and sales, then he made stops
in advertising, merchandising and buying, store operations, warehousing,
and manufacturing. When Donald Schnuck died suddenly in 1991, the
company was realigned and more of the third generation stepped to
the forefront. Older brother Craig–who was already CEO at
the time–accepted chairman’s duties, and Scott Schnuck
took on his current office, overseeing the day-to-day operations
of the business.
The rest of the Schnuck siblings also joined the business along
the way. “Somehow my father, in his own way, had a plan that
maybe we didn’t know about,” Schnuck says. “He
knew our strengths, and I believe that helped him identify our roles
in the company. Obviously, Craig and I had an advantage as the oldest,
so we had first shot at the top positions. But, we prepared ourselves
well to assume those responsibilities.”
Schnuck’s brother Terry served as chief legal counsel until
2002, when he left to pursue an interest in musical theater; Mark
is president and CEO of The DESCO Group (an acronym for Don and
Ed Schnuck Company), the family enterprise that builds and manages
a real estate portfolio of more than 13 million square feet; and
Todd is chief financial officer at Schnucks. Nancy, the youngest,
was director of community relations before leaving to raise a family.
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Back at the office (left to right): Bill Bredenkoetter,
senior vice president store operations; Joyce Reese,
vice president of advertising; Randy Wedel, senior
vice president of marketing and Scott Schnuck. |
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Changes and challenges
As Schnuck rose through the ranks he helped institute important
changes, such as category management in the mid-1980s. He explains,
“This approach empowers each category manager and gives them
responsibility for procuring, pricing, promoting and planning an
entire category of products to maximize sales and profits.”
Schnucks was also one of the first grocery chains in the country
to have 100 percent of its stores utilizing the UPC scanning system.
“We had access to better information,” he says. “We
organized our business to take advantage of that, and this allowed
us operate more efficiently and respond more quickly to consumer
demand.”
Schnuck says the 1980s brought even more changes. “As more
of our customers were becoming starved for time, we saw the need
to develop prepared foods,” he says. “Also, the company
aggressively added in-store pharmacies in the 1980s and 1990s.”
Although the combination food and drugstore format dominated the
market for more than 20 years, Schnuck says, “That format
and our whole traditional food industry are being challenged by
Wal-Mart, now the number one food retailer in the country.”
Schnuck believes Wal-Mart’s recent rise has been helped by
the economy’s poor performance over the past three years.
“Price format stores have become more attractive to a broader
segment of the population,” he says. “Wal-Mart represents
a huge threat to traditional food retailers because of its tremendous
scale and buying power. The company’s lower wage and benefit
scale allows for a significant cost advantage over established competition
like Schnucks.”
In order to differentiate Schnucks stores in the marketplace, Schnuck
says, “We will continue to make sure our stores are modern,
competitive and located in strategic positions. Over time, we will
reengineer our network to make sure we remain competitive and efficient.”
He added, “I think customers are always going to value quality
and service, and there will continue to be a place for that in our
market areas.”
Beyond the region
In recent years, Schnucks has grown both organically and through
acquisition. Today there are 63 Schnucks stores in the St. Louis
region, and another 37 in out-state Missouri, Illinois, Indiana,
Wisconsin, Tennessee and Mississippi. This year, the company celebrates
its sixty-fifth anniversary by entering Iowa, its seventh state.
Because Schnucks self-distributes its products, all stores are within
300 miles from the company’s Bridgeton, Mo. warehouse.
Schnuck visits every potential store location to determine its viability,
and says he enjoys that aspect of his job. He also likes getting
immediate feedback on business results. “Every Monday I receive
a sales report that tells me how stores performed the previous week,
and there’s a thrill in that,” he says. He also meets
frequently with key executive team members at Schnucks headquarters
on Lackland Road. “We now have approximately 16,000 associates,”
he says. “It’s hard to get to know everyone, but my
family visits the stores on a regular basis, and we remain accessible.”
Following last October’s 25-day Local 655 work stoppage, Schnuck
says it’s even more important to stay in touch with associates.
“We worked very hard to avoid that work stoppage,” Schnuck
says. “Throughout those four weeks, we were always very concerned
about our customers and how we would manage the emotions of our
associates and managers. Some scars remain, but relationships are
rebounding faster than anticipated–and in some cases, they
are even stronger than before.”
Regional outlook
Scott Schnuck’s skills go far beyond the business world. Indeed,
one glance at his civic responsibilities indicates he devotes huge
amounts of time to the St. Louis community. Schnuck is presently
chairman-elect of the RCGA and will succeed Doug Yaeger as chairman
in January 2005. RCGA board member David Kemper, president of Commerce
Bank and head of Civic Progress, observes, “Scott is coming
in at a challenging time. We’ve got a lot of major issues
with urban revitalization and the airport. But we’re certain
he’ll give strong, focused, strategic leadership.”
Among Schnuck’s goals is to see the revitalization of downtown
St. Louis continue. “There’s a long way to go but we
are making progress,” he says. “We must become faster
at creating housing units to attract more families – families
are the key to bringing downtown back.”
Schnuck says transportation will be another key issue for the region
going forward. “Transportation in our state is under funded.
If both the rural and urban areas can agree on a total transportation
solution and work together, we can potentially get a statewide referendum
on a new funding solution for Missouri. That would greatly enhance
our future economic growth.”
Schnuck also recently became board president of the Missouri Botanical
Garden, which he calls “an unbelievable asset for the region.”
Peter Raven, director of the Garden, says he looks forward to working
with Schnuck. “Scott will make a great leader for our organization,”
Raven says. “With his brothers and sister, he’s supported
the planned Children’s Garden, a two-acre, hands-on facility
that will present a wonderful introduction to the world of plants
and nature for our younger visitors. I warmly welcome the opportunity
to continue working with him on the development of all our programs
in the future.”
His love of sports led Schnuck to accept the position of chair-elect
of the St. Louis Sports Commission and, following in his father’s
footsteps, he is an active member and past chairman of Junior Achievement
of Mississippi Valley Inc.
As if that weren’t enough, 12 years ago Scott and Julie Schnuck
helped establish the Foundation for Special Education, serving children
with special needs in the St. Louis Archdiocese. He currently serves
on its advisory council and on the boards of St. Louis Children’s
Hospital, the Variety Club, Topco Associates Inc., and Bakers Footwear
Group. He also sits on the advisory board of Cornell University’s
Food Industry Management program.
Schnuck laughs, “I would have preferred these board chairmanships
were spaced out more, but they are all such honors that when you’re
asked, you do it. We, Schnucks and my family, have such a vested
interest in St. Louis that it’s worth putting in the time
to help solve some of the issues facing our region.”
Despite their active schedules, the Schnucks spend plenty of family
time with their three sons: Matt, 26, Jason, 24, and Tom, 20. The
family takes regular ski trips to Beaver Creek, Colo. “We’ve
had great times there,” Schnuck says. “Those memories
will keep us together.”
Pedal to the metal
Schnuck has fond memories of growing up in a family that set high
expectations, all of which have been exceeded. “The current
generation of Schnucks has more than doubled the size of our business,”
he says. “We haven’t sat on our hands, and I’m
proud of that.”
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Hallmark Retail Merchandiser Regina Pucel surveys
the card aisle with Scott Schnuck. |
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The company will continue to pursue expansion, but Schnuck anticipates
the business will face significant challenges, including Wal-Mart’s
growth in the region and staying competitive in the aftermath of
the work stoppage. “I see a lot of opportunity as well,”
he says. “We are in a great business that provides an essential
service to the communities in which we’re located. There is
a lot of satisfaction to that.”
Schnuck believes the continued success of his company and the resurgence
of St. Louis as a great region are intertwined. “What’s
good for one will, ultimately, be good for the other,” he
says. “I plan to keep my pedal to the metal for a long time.”
Pam Droog Jones is a freelance writer based in Jefferson City,
Mo. |
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