Fareway leadership is a family affair

For Reynolds Cramer, the most important thing a mentor ever did for him was ignore his lineage.

"Marlon Stearns didn't care about my name. He just gave me an opportunity to try and fail and learn from my mistakes," said Cramer, the new chief executive of the family-owned Boone-based Fareway Stores Inc. He is the fourth CEO of the 76-year-old company and a member of the founding family.

Stearns was manager of the Oelwein Fareway back in 1992 when Cramer, then a recent Luther College graduate, was hired to manage the dairy case and other departments.

"If you would have opened that milk cooler that first week, you'd see you couldn't get any more in there because I had ordered way too much," Cramer said. Stearns counseled his young apprentice in the fine art of buying milk. "And the next week I ran out."

He credits Stearns, who has since retired, with training him in the basics of grocery operations.

"Marlon was a great teacher, a great role model, just a great person," Cramer said.

He has based his management style on the same theory: "It's OK to try something and fail, and then start over and go another direction."

Cramer, 45, was elected in February as the company's CEO, succeeding his uncle, Rick Beckwith, who remains chairman of the privately held company. A divorced father of two, Cramer sees his new job not so much as a duty, but as an opportunity to expand the growing, yet still conservative, no-frills grocery chain.

The company's 108 stores in Iowa, Minnesota, Illinois, Nebraska and South Dakota contribute to Fareway's estimated $1.2 billion in annual sales. It operates 12 stores in the Des Moines metro, including one in Pleasant Hill that opened in January. Other stores have been announced for West Des Moines and Carlisle.

Growth plans include expanding in metro areas where it already has a presence, including Omaha, Sioux Falls, S.D., and the Quad Cities. Wisconsin and Missouri also are possibilities.

"Years ago, generally before 1990, we were a little more nervous about going to a big city. We've proven we can compete like anyone else. Typically, big cities are made up of people from smaller cities, so they know Fareway and are excited to see us," he said. "The sky's the limit as to where we are going."

That being said, Cramer wants to plot and plan growth carefully. Fareway is a company that only five years ago embraced the Internet and social media. A decade ago, the company barely had a website and relied on some television and newspaper advertising to bring in shoppers. The recent transformation and effort to become all-things tech has put the company on Facebook, Twitter and Pinterest.

"Now we're very visible in the community, starting with the graphics on our trucks and our dietitians and our virtual meat counter on our website," he said. "We feel like we are leading when it comes to these areas versus before, when we weren't even following."

Company leaders realized selling groceries wasn't enough, he said.

Longtime family friend and retired Fareway buyer William Curran sees Cramer as the company's future.

"I'd never beat his drum in front of him, but Reynolds is a real pusher and visionary, just like his father, Bob Cramer," said Curran, a 50-year Fareway veteran. "I wouldn't be surprised to see Fareway stores in the suburbs of Chicago. Reynolds is the right age and has the talent to take Fareway anywhere."

It was always expected that Cramer — like his grandfather, father, uncles, aunts and cousins before him — would work for the grocery company founded by his great-grandparents, Paul and MaryEllen Beckwith. The couple's founding business partner, Fred Vitt, also has a son, Frederick Jr., still serving on the board of directors.

Cramer was born in Algona, where his father, Robert Cramer, was manager. He moved to New York when he was age 7 to live with his mother after his parents divorced. Six years later, he moved to Boone where he lived with his father, who eventually served as president and chief operating officer.

Reynolds worked in the warehouse sorting cans, sweeping floors and stacking pallets until he was 16 and could work in a store. "I never felt any pressure to work at Fareway. I think my dad gave gave me opportunities in life to see different things and then it would be my choice in what direction I would like to go," he said.

Cramer went to Luther with the intent of majoring in music, his passion. "I was involved in band, orchestra and choir in high school. What I found out was that taking music theory in college was very difficult. I thought a better fit was business management, so I ended up with a degree in that."

He and his father mapped out the Fareway stores after his graduation to decide where he would start his career.

"At that time we had a number of relatives that were either store managers or store assistant managers, so we tried to figure out which store I would go to that we didn't have a relative in. We try to keep family separated a little bit," Cramer said.

He landed in Oelwein for two years. After that he climbed the ladder, including opening and operating a Des Moines store at Southeast 22nd Street and Park Avenue, before landing in the company's corporate office in Boone as a district supervisor in 2000. He added the real estate committee to his duties, focusing on store expansion.

His previous job was as executive vice president in charge of retail operations. He sees Fareway's success in being rooted in doing what the company is good at and resisting temptations to add services it doesn't know.

"We believe a customer doesn't want to walk the length of a football field to get a gallon of milk, and that is why our stores are 32,000 square feet or less in size," he said.

Fareway will leave multi-purpose stores with pharmacies, dry cleaning, floral departments, banks and restaurants to others. Fareway prides itself on bagging customers' groceries and loading them into their cars, a fresh meat counter and being closed on Sundays.

"Between family and faith, we believe being able give our employees a day off is very important. I like to joke that being closed Sundays gives our competitors a day to try and catch up," he said. Fareway also bought a local television ad during the Super Bowl in February touting its family-friendly policy, which is part of its new marketing plans.

Cramer's work outside Fareway includes a great commitment to Variety — the Children's Charity in Des Moines, of which he will serve as president beginning in May. His daughter, Ashley, 14, is autistic and has medical and special needs, so the charity has become a passion. He also has a son, Zachary, who is 9.

Ric Jurgens, retired Hy-Vee Inc. chairman, said although Fareway and Hy-Vee are fierce competitors, he saw Cramer volunteering at a Hy-Vee Triathlon a couple of years ago as part of his Variety charity work.

"There he was at the finish line in a Hy-Vee T-shirt," Juergens said. "He's got the leadership qualities of being hard working, loyal to his company and his community."

Cramer said that while his job as CEO is time consuming, he leaves a little space for play: snowmobiling in Wyoming and scuba diving in the Cayman Islands. He also needs little coaxing to join a jam session if there's a set of drums available.

He is building a home in Ames with his fiancee, Sheila Baker, and is planning a destination wedding to a romantic island.

But front and center is his job as Fareway chief executive.

"My responsibility is at some point to turn the company over to the next person and have it be a better company than when I took it over," he said. "At the end of the day this business is really simple. It's about selling groceries with a smile on your face and making that customer smile at the same time, knowing they got quality items and they didn't have to pay an arm and a leg for it."

Fareway Stores Inc.

Founded: Boone, 1938.

Corporate headquarters: Boone.

Chairman: Rick Beckwith.

Chief Executive Officer: Reynolds Cramer.

President: Fred Greiner.

Estimated annual sales: $1.2 billion, according to Supermarket News. The publication ranks Fareway the 73rd largest chain by sales.

Number of stores: 108 in five Midwest states

The ups and downs of being a family business

Reynolds Cramer is the fourth chief executive officer and fourth generation to run Fareway Stores Inc. His thoughts on operating a family-owned business:

"Having family on my side is a benefit. However, the negative is that I have family on my side. Which means I will hear from my family. It's always interesting because there are a lot of opinions from my family just like in any family. Most are with good intentions."

The family holds a shareholders meeting once a year.

Reynolds W. Cramer

Chief executive officer, Fareway Stores Inc.

Born: Algona

Age: 45

Education: Boone High School, 1987; Luther College, Decorah, 1991

Family: daughter Ashley, 14, and son Zachary, 9; fiancee Sheila Baker