Power Up!: Batteries Plus Bulbs Chases $1 billion In Sales
Russ Reynolds' leadership has helped Batteries Plus Bulbs push boundaries and create enhancements that not only are keeping the brand relevant, but also are expanding its product and service offerings and creating sustainable growth. Under Reynolds' direction, the brand has seen system revenue more than double in the past five years. It has also maintained double-digit system sales growth and store opening rates during this period. Today Batteries Plus Bulbs is the country's largest battery and light bulb franchise and is looking to expand the $30 billion battery and $17 billion light bulb industries.
Following retail management experience at Target and GNB Technology, a consumer and industrial battery manufacturer, Reynolds arrived at Batteries Plus in 2000, serving as president and COO for two years until he became CEO and put the brand on the fast track.
"We began to think beyond just batteries," he says. "We were thinking about becoming a one-source stop for our retail and commercial customers by providing batteries, light bulbs, and repair service in our stores." The initiative, rolled out in 2011, was a redefining category expansion that included a name change from Batteries Plus to Batteries Plus Bulbs. The stores now offer a wide variety of batteries and light bulbs, as well as basic repair functions on devices such as smartphones and tablets. If a consumer has a cracked smartphone screen, they can make a quick trip to a Batteries Plus Bulbs store and be back in business in no time. Plans are in the works to expand to repair of headphones and laptops as well.
"Our franchisees have loved the changes and the opportunities to offer more products and services to their customers," he says. "It's in our DNA as a brand to be able to fix people's problems."
The brand is experiencing healthy growth and system-wide numbers right now. "We've experienced a 9.5 percent sales growth over the past 7 years, and I expect to see same store sales growth remain at those levels." He says system revenue has doubled in just the last 5 years alone.
Reynolds describes the brand's culture as "a network of family farmers." About half of the franchisees are single-unit operators, but he says there's a place for multi-unit franchisees as well. "We have successful franchisees who started out as single-unit operators, love the model, and want to grow beyond one unit. They do very well."
In the past two years, the company has opened more than 100 new stores and has signed agreements to open nearly 150 more. "We've had significant growth throughout the Midwest and South and are now targeting areas like the Northeast and California," he says. The brand now boasts more than 650 locations, and he projects continued growth of around 45 to 55 new stores annually.
Looking ahead, Reynolds says the brand is continuing to expand its offerings to customers by developing its "omni-channel platform," an online ordering service that allows customers to order exactly what they need online and then pick it up at their local Batteries Plus Bulbs store. "This is in response to consumer demand for easy and timely access to products they need," he says.
Reynolds, who says he's "never met an idea I didn't like," has shown an uncanny ability to turn many of those ideas into success for the brand, its franchisees, and its customers.
Name: Russ Reynolds
Company: Batteries Plus Bulbs
Family: Lisa, spouse of 25 years; 4 children ages 7 to 22, Nicole, Kylie, Matt, and Ty
Years in franchising: 15
Years in current position: 13
What is your role as CEO?
I have three primary roles. First, I carry the torch on strategy for the brand, our stores model, and the company. Second, talent development and building strength and succession in our team is a critical function for the future growth and success of the brand. Third, I spend a fair amount of time challenging and questioning our functional leaders, seeking to improve and refine what we are doing and how we are doing it.
Describe your leadership style.
I would describe myself as a conversational leader. I lead, learn, and adapt by having discussions with our people. Sometimes this is through regular reviews and management meetings, but often it is in the ad hoc conversations that you really discover an opportunity or issue. I also believe in being open about your shortcomings, and poking fun at yourself to make sure the team feels comfortable doing the same.
What has inspired your leadership style?
My dad was a coach and a teacher and was a tremendous role model for me. He worked hard, had uncompromising integrity, and had strong faith. These assets served him well and I attempt to lead using these same fundamentals.
What is your biggest leadership challenge?
I have never met an idea I didn't like. As I have matured, I try to make sure that an idea doesn't become a project without some discernment and thought. Our COO, Tom O'Hare, knows this is a weakness of mine. Since he and I have worked together for more than 20 years, we have become adept at coordinating and filtering these ideas to best determine what is next for our team.
How do you transmit your culture from your office to front-line employees?
In a retail franchise business you absolutely have to keep it simple and leverage your franchise owners to "own" culture development. Our message to our system is pretty simple: our value proposition is built on breadth of assortment, filling immediate needs, and offering high-touch service to our customers. We do this with urgency and consistency.
Where is the best place to prepare for leadership: an MBA school or OTJ?
Without a doubt it's OTJ. I have an MBA and a strong educational foundation, which is very important, but it does not trump life experience. We all are products of our own experiences and most of that occurs in a work environment, not a classroom. That said, being a "business junkie" naturally means that you'll continue to be a student throughout your career.
Are tough decisions best taken by one person? How do you make tough decisions?
It depends on the decision. Whenever possible, you want your leadership team involved and aligned on all key decisions. There are times, however, when the CEO has to step up to make the call and set the course forward.
Do you want to be liked or respected?
Respected. Do the right things by the business and do them the right way and things usually work out fine. I enjoy sustainable relationships as much as anyone but would rather have our franchisees like the result than like me and not like the result.
Advice to CEO wannabes:
Be your own leader. Be Bold. Be willing to admit mistakes. Be focused on developing talent and having it grow with you and past you to make your company better.
Describe your management style:
I would say high on energy and engagement while being pretty low on detail and organization. I let our functional leaders run their areas. I do expect to hear about problems early and often, and I expect them to play nice with others.
What does your management team look like?
We are fortunate to have a group that has grown the business and grown with the business together. We trust each other and push each other to get better. Also, most of our team is made up of Cheeseheads (Packers fans), so Vikings and Bears fans are generally disliked.
How does your management team help you lead?
We try to stay focused on the important things: our value proposition, solid execution, good communication, and quickly dealing with (versus ignoring) problems. All of our key folks are aligned on these attributes.
Favorite management gurus: Do you read management books?
I am biased since I am a coach's kid, but I believe great coaches are great strategists, developers of talent, and adapt well to changing circumstances. People with these skills and strong faith are folks I admire, like Tony Dungy.
What makes you say, "Yes, now that's why I do what I do!"?
I must be easily excited because I say this almost every day.
What time do you like to be at your desk?
About 8 a.m. and work late as needed.
Exercise in the morning? Wine with lunch?
I exercise almost every day and would be grumpy if I didn't. If I drank wine with lunch I would need to come back and take a nap. So no wine with lunch, ever.
Do you socialize with your team after work/outside the office?
We have a number of events and outings our employees do together. I also consider many of my colleagues close friends. That said, between work and our family commitments, we don't see each other socially all that often.
Last two books read:
Visioneering by Andy Stanley; and Three Cups of Deceit (How Greg Mortenson, Humanitarian Hero, Lost His Way) by Jon Krakauer (Mortenson graduated from my high school. Go Ramsey Rams!).
What technology do you take on the road?
iPhone 6 Plus and a MacBook Air.
How do you relax/balance life and work?
I am not much of a relaxer. I am blessed in faith, family, and work. That, and I run several times a week. Life is good.
Favorite vacation destination:
The beach at Ponce Inlet, Florida.
Favorite occasions to send employees notes:
I am not a note writer. I much prefer to stop by someone's desk and thank them personally and/or meet with them for a few minutes to talk.
Favorite company product/service:
We have always had a service segment to our business, building battery packs, for example. In 2014, we added device repair to our service offering and now fix cracked screens, charge ports, etc. on smartphones and tablets. We now have more device repair locations than any other retailer in the country and we definitely have permission to play here. We are seeing rapid growth in this service offering.
What are your long-term goals for the company?
$1 billion in system sales and a nationally recognized brand.
How has the economy changed your goals for your company?
Portable energy and energy-efficient lighting are growing, needs-based industries so we have not changed our game plan because of economic factors.
Where can capital be found these days?
For a solid franchise business, capital is readily available through the private markets. I think the critical factor for franchisors seeking capital is having strong unit economics that are repeatable and sustainable.
How do you measure success?
We focus heavily on improving unit economics and believe that is the foundation for future growth and success.
What has been your greatest success?
Our Ascent supply chain structure has provided our stores substantially improved margins and reduced working capital. As we got Ascent optimized about 10 years ago, our new store and system growth really took off.
Never. You can't change history (but those who don't at least learn from it are doomed to repeat the same mistakes).
What can we expect from your company in the next 12 to 18 months?
We are launching our omni-channel platform this spring, which will dramatically improve our customer experience. This platform will integrate with our stores' POS system and provide customers (business and consumer) the opportunity to do business with us anytime, anywhere, and from any device. We believe this will drive significant additional sales to and through our stores. Additionally, we are launching a complete range of exclusive Duracell-branded batteries that will align well with our retail brand position and that will provide further credibility for our unparalleled offering in batteries and light bulbs.
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