Q & A
Food for Thought With Gregory Calhoun
Gregory Calhoun is president and chief executive of Calhoun Enterprises.
He was recently interviewed by Montgomery Business Journal Managing Editor David Zaslawsky.
Montgomery Business Journal: How do you describe your company?
Calhoun: We’re a unique company because we have a lot of interests. We have different formats that we operate under. One of them is our retail supermarkets, which we started in 1984. We have what we call Calhoun & Associates, which we work with major corporations on diversity issues, dealing with procurement and crisis management. Then we have an insurance company that we call National Benefits Solution. We are one of the largest suppliers of Aflac Insurance in the country and we won the chairman’s cup in Paris about two months ago.
MBJ: How many employees do you have?
MBJ: What were your annual sales in 2008?
Calhoun: We were $100 million-plus.
MBJ: When did you first reach $100 million in annual sales?
Calhoun: It was '89.
MBJ: Because of the economic downturn, did the company experience much of a decline?
Calhoun: We had a minor decline, but the grocery business has been solid. We have seen an increase in that (area) because a lot more people are eating at home instead of eating out. Now people at the supermarket are taking $50 and buying groceries for the week.
MBJ: How many grocery stores do you own?
Calhoun: We have four.
MBJ: Calhoun Enterprises is comprised of five subsidiaries. Would you please give a brief description of each subsidiary? Let’s start with Calhoun Foods. You said you have four stores. Where are they located?
Calhoun: Two are in Montgomery; one in Selma; and one in Tuskegee.
MBJ: Are there plans for additional supermarkets?
Calhoun: We’re looking at Alabama – one inside the River Region and one outside the River Region in White Hall.
MBJ: Calhoun Communication?
Calhoun: That’s a telecommunications company we own, where we sell phone cards to supermarkets on the West Coast.
MBJ: You’ve already mentioned Calhoun & Associates. The Calhoun Foods Distribution Center?
Calhoun: We operate mostly in the prison system, Cuba and sell food to institutions like VictoryLand. We partner with Kelly Food.
MBJ: Are your annual sales equally divided among the five subsidiaries?
Calhoun: It’s spread fairly equally between the five.
MBJ: Are you looking at any expansions or acquisitions besides the Calhoun Foods group?
Calhoun: We have a (partnership) with IMG – that’s a spokes management company in New York. We are looking at being their diversity arm. We just signed Shaquille O’Neal and Judge (Greg) Mathis to that entity. In that entity, we’ll be looking at high-profile athletes to endorse products.
MBJ: You founded the company in 1984 and Calhoun Foods was your first business venture. How were you able to go from bagging groceries to buying your first store and how much did you pay for it?
Calhoun: First of all, I was a bagging clerk and worked my way through management with Super Foods’ Big Bear, which was owned by Hudson and Thompson. They did franchise stores to other owners who had been loyal employees. I was able to convince the owners that I could be an owner and they gave me an opportunity; so I had to borrow $1 million for a loan package to buy my first store.
MBJ: That was scary wasn’t it?
Calhoun: Yes it was.
MBJ: How old were you?
Calhoun: I was 32.
MBJ: That was a lot of money 25 years ago.
Calhoun: Huge amount of money.
MBJ: What is your business philosophy?
Calhoun: My business philosophy is to make sure you satisfy the customer through all means and that you give 150 percent daily.
MBJ: Is that how you were able to work your way up, by giving that 150 percent?
Calhoun: Yes. By working hard, having a good family and my wife allowed me to put the hours in it took to get the job done. And my work was the type of work if I wasn’t at work, you could always tell my work because of the fact that I tried to make sure that I didn’t need to be there for you to see it. When I was stocking groceries, you could walk down the aisle – the owner said, ‘Greg Calhoun worked on this aisle.’ I didn’t have to be there to boost myself. I let my work speak for me. My father taught me that. He was in the brick laying business.
MBJ: What do you attribute your success to in addition to the hard work?
Calhoun: Knowledge of business and making sure that I knew what I was doing. I learned every aspect of the grocery business – I worked in every department so I was knowledgeable. Next, I know how to work with people and get along with people. I learned how to delegate.
MBJ: With all the different type of businesses you have, did you have to bring in experts? Some of the businesses are very different than the others.
Calhoun: If you really look at the businesses, they all target to the core – supermarkets – because my telecommunications company is catering to supermarkets. The insurance company mainly caters to businesses, but my kids all have masters’ degrees in the areas that we do business. My son and my daughter are licensed (for our insurance) along with me.
MBJ: Your bio on the company Web site says you represent “the new minority business profession.” Would you please elaborate what that means to you?
Calhoun: To me that means I don’t do business the old-fashioned way. I use more the heart and feelings.
MBJ: What do you mean the old-fashioned way?
Calhoun: The good-old-boy network. Race is an issue. I’m non-racial. I like all people. I am a true businessman. I’ve been blessed to be in business for 25 years. When I went into business, Linens ‘N Things was here in Montgomery and it’s no longer here. Circuit City is gone now. Winn-Dixie was owned by Mr. Davis and he lived here in Montgomery. Now it’s owned by a Jacksonville, Fla., group. The Bruno’s Family was big and now all their stores are closed. I have seen a lot of changes and I’m still in business – that’s a blessing.
MBJ: Also on the Web site it states: “A dream, a mission, a commitment.” Would you please elaborate what that means to you?
Calhoun: It was always my dream to be in business because my father was in business. It was a commitment that I had to make in order to make this dream come true. I had to give a lot of time and effort and give up a lot of things that I would have liked to do like hang out with the guys, go places and take nice vacations. But I had to be committed to working sometimes 17 hours a day to make sure I achieved the goals that were set in front of me. My mission was to be a national leader in the business world. That’s why I created Calhoun Enterprises and started companies outside the state of Alabama and became a national player, consultant and entered the insurance business, warehousing business and now I’m doing business with Cuba.
MBJ: What type of business with Cuba?
Calhoun: I ship meat products to Cuba; chicken and canned vegetables.
MBJ: Do you get cigars in return?
Calhoun: I don’t smoke. I’ve never had a cigar.
MBJ: The Montgomery Area Chamber of Commerce is holding its Diversity Summit in September. For the second year, Calhoun Enterprises is the presenting sponsor. Why is diversity important to you and in the business world?
Calhoun: I think in order to have a total city you have to have a diverse city. I’ve been a member of the chamber for many years and I’m back on the board (of directors) again. I thought as a minority company it just makes sense for a minority to sponsor the diversity summit.
MBJ: How important is diversity to the business community?
Calhoun: Very, very, very important.
MBJ: Why is it important?
Calhoun: Because you have an African-American president. People now are not looking so much at the color, but looking at people who have the right skills. It’s important to have diverse people at the top – at the forefront making the decisions. Instead of sitting around the table, they need to be able to sit at the table. I always tried to be one of those guys that put myself in the position to be able to sit at the table.
MBJ: Isn’t diversity good business? Doesn’t it improve profits?
Calhoun: It gives you a competitive advantage the more diverse you are. For me, I have to have more than African-Americans. I have to have whites and Hispanics, and my company does. I have to make sure that I think diversity, too. Out of the top 10 people on my staff, three are white.
MBJ: How would you describe the current business climate in the River Region and Alabama overall? Do you think the economy is starting to bounce back or stabilizing?
Calhoun: I think we’ve been fortunate because of the great interests here with Hyundai; Mercedes-Benz right down the road; Kia right over the state line with Georgia; and these are the types of cars that are selling. Years ago when the economy had trouble it would go down and come back up in a V shape. I think this economy will slide a little bit and then it’s going to come back up with a lot of opportunities.
MBJ: Are we in the sliding stage?
Calhoun: I think we’re sliding right now. I think next year is going to bring a great return. I think your 401(k) is going to be a little stronger; people are going to start spending a little money. I think right now people are saving more than they ever have because they are scared to death and they know cash is king.
MBJ: With that in mind, what are your projections for Calhoun Enterprises in 2010?
Calhoun: My goal is to have a 5-percent increase from this year. We put things in place to make that happen. We’re still hiring. We haven’t had a layoff.
MBJ: No layoffs?
Calhoun: We downsized our North Carolina office, but outside of that we’ve been bringing people in on the retail side.
MBJ: If you add two stores, there will be even more hiring. What is the average number of employees per store?
Calhoun: With the new concept, there are 50-80 employees per store.
MBJ: What is the new concept?
Calhoun: We are going to a different format. We won’t be in a 50,000-square-foot store. We are looking at 15,000-20,000 square feet.
MBJ: Will there be fewer departments in the store?
Calhoun: You might not have eight or nine or 10 different types of mayonnaise – you might have three. You still have the pharmacy, you still have the delis; you still have the chop and block. But you won’t have nine or 10 of the same item. You look at technology and see what (sells) and just put in what the people want – not what you want.