Craig Boyan, president of H-E-B, was the keynote speaker for the annual Salute to Business banquet Tuesday night.
The local business community descended upon the Frank W. Mayborn Civic and Convention Center for the event, sponsored by the Temple Chamber of Commerce.
Boyan offered insight into what makes a successful business after being introduced to the crowd of more than 500 by Temple businessman Drayton McLane Jr.
“It’s really exciting to come here tonight and see us all come out for a common cause to enhance the quality of our city, the way we live and to learn how we can help other people be successful,” McLane said. “I’ve been in the grocery business for most of my business career. There are easier ways to make a living, but it’s fun and it’s exciting. We’re very fortunate to have Craig Boyan here.”
Boyan said H-E-B is the 12th-largest private company in America with $25 billion in sales and 390 stores.
“While $25 billion sounds like a big company, we are a fraction of the size of most of our major competitors,” Boyan said. “However, one important difference at H-E-B is that our $25 billion is in the corner of one state. We are basically between South Dallas and Monterey, Mexico.”
With such a small market area, Boyan said H-E-B strives to create hyper-local stores to suit the needs of each neighborhood.
“People eat and shop very differently — by neighborhood, by income and by lifestyle,” he said. “We change our layout and our merchandising strategy by store. It is our goal to try to make each H-E-B the best store that we can imagine for every community.”
Boyan said the grocery chain’s success stems from its investment in its employees. He said paying better wages leads to better workers.
“It’s our goal to pay as much as we can, not as little as we can. That is not the case of many companies, especially retail. The average grocer makes a little over one penny on a dollar of sales. So it seems logical that, with such an amazing amount of competition and low margins, grocers are always looking to cut costs,” Boyan said. “It’s hard to understand in a razor-thin margin business that those who invest more in their largest cost item — people — can be those that win.”
Boyan challenged those in attendance to avoid complacency.
“Be restlessly dissatisfied. It’s easy to take a breath when things are going well, and that is exactly the time to be most worried,” Boyan said. “Set a very high bar of expectations. If you remember your favorite teacher when you were a kid, do you think of the sweetest one, or do you think of the one who pushed you? I think most would say the latter.”
Boyan said business owners should use challenges as a learning experience.
“Don’t waste a problem. Take a problem and really get inside of it and look at all the angles. How can a deep study of the problems make you and your business better?” Boyan said. “We struggled in one market for many years and we had to really rethink our business model and how to serve that market.”
He said that solving such problems requires inquisitive business leaders.
“You’ve all been successful business leaders because you’re experts in the field and you’re great problem solvers, but in a changing world, there is plenty that we don’t know,” Boyan said. “The best leaders that I have ever seen are constantly curious and seeking to learn more by asking lots of questions from everyone.”