Story by Donna Reges Hall
Fleet Feet Inc., the nation’s leading franchisor of specialty running stores, was started in 1976 in Sacramento, California, by Elizabeth Janson and Sally Edwards. Current CEO and Chairman Tom Raynor began with Fleet Feet in 1992, working on store operations and new store development. The following year, he purchased the franchise company along with two California stores, including the original Fleet Feet Inc. location in Sacramento. The rest, as they say, is history.
Today, under Raynor’s passionate leadership, Fleet Feet Inc. has grown to 90 stores in 34 states and the District of Columbia. Their 2010 retail sales surpassed $100M million for the first time in the company’s history and same-store sales have seen double-digit increases annually for the past 10 years.
A unique aspect of Fleet Feet Inc. is that all 90 stores are locally owned and operated franchises. Raynor’s says this was one of his principles from the beginning that continues to uphold.
“A lot of people think that franchises have cookie-cutter formats, and we don’t because we feel like the store has to reflect the community and the personality of the owners and the employees and customers,” he explains. “A lot of people probably don’t know that any decision that we make internally has to meet certain criteria: ‘Is it good for the franchisees? Is it good for the vendors? Is it good for Fleet Feet Inc. and is it good for the customer?’ If it doesn’t pass muster on those four points, we don’t do it.”
Raynor believes it’s difficult to execute a corporate model in any business and points out that some of his competitors like Athletic Attic and Athlete’s Foot are out of business now from a franchising stand point because they’ve always had corporate owned stores.
He also believe strongly in giving a chance to other up and coming business owners.
“I think when you start providing opportunity for people, you find a lot of people,” he says. “We have a lot of great owners who financially could not have opened a store on their own, and we put them in a position where they can be successful. We test them, do a long interview process with them, and then they own their own businesses.”
Raynor surrounds himself with good people and jokes that he’s not busy now because his team is so proficient. Some of these colleagues include Fleet Feet Inc.’s former banker Denise Courey, who is now the general manager of SRDC, (Specialty Retail Development Company, a franchise of Fleet Feet Inc.) and Jeff Phillips who is the president of Fleet Feet, Inc. Phillips has worked with Raynor since 1984, in his first job in the sporting goods industry after college. Raynor says that people always point out how lucky he is to have his wonderful team, but he says there is more to it than that.
“Businesses, actually, don’t really get lucky finding people,” he says. “You have to create a great environment for them to work in. With our franchisees and our employees, everyone says, ‘you’re like a family.’ But we’re actually not, because in families you don’t get to pick your family members, in business you do. We’re all accountable to each other for something. We’re mostly competitive athletes. We set the bar high and we try to put the pedal to the metal in the right way.”
Raynor, an Atlanta native, has been a runner since high school and says athletics have always figured largely into his life.
“Three of the most influential people in my professional career were my high school coach, my college coach, and then when I worked for the governor of Georgia, who happened to be a runner, an outdoorsman. Those three are sort of the foundation of it.”
After Raynor’s work as assistant press secretary to the governor of Georgia, he transitioned into the athletic industry working in various positions for The Athlete’s House, Nike, Brooks Shoe Company and Wilson Sporting Goods. He settled with Fleet Feet Inc. in 1992 and right away began putting his mark on the company.
Raynor says that Fleet Feet Inc. has a broad range of customers of all ages and each store works hard to serve its particular local community. He points out that the Triangle has a strong running scene with very competitive middle school athletic programs and high school programs that are ranked among the best in the nation. He adds that UNC, N.C. State and Duke all have excellent track, field and cross-country programs and calls the post-collegiate running scene in the Triangle phenomenal. It’s important to Raynor however, to meets the needs of those just starting to run as well.
“When I think of the profile of the customer we have to serve, I think of a 59-year-old woman who is a breast cancer survivor who has never been involved in athletics, who is extremely uncomfortable walking into a running store, and how we treat her … or a 40-year-old, or a 35-, 28-, 68-, or a 79-year-old,” he explains. “That’s what I think about. How do we make the customer experience so great that they would never think about going anywhere else? The good thing about it is that the Internet has caused this fire hose of information, it’s everywhere. That fire hose has really created an opportunity for us. The other thing that’s really created an opportunity for us is that most people don’t have a good retail experience, so the bar is very low. So if we’re excellent, we can really, really stand out in the customers’ mind. And we have to do that. We have to consistently do it. We have to do it at an exceptionally high level every day with every customer.”
Raynor says that Fleet Feet Inc. did not experience any significant downturn during the economic crisis and attributes this success in part to the breadth of what his company offers customers.
“The healthy life style universe that we exist in does really well when times are good and does really well when times are bad,” he says. “Because people do make a decision, ‘Hey, do I spend $50 a month for a health club or do I take that fifty bucks and put four months of money together and go start a running program. Do we have a running program they can get involved in?’ We have over 500 running groups in the country, training groups, with over 40,000 participants. That is coach to walk, walk to jog, jog to finish a 5K race. My sister is the perfect example. She was not a runner until she was 53, joined our “No Boundaries” program, sponsored by New Balance. We did the program internally for all of our stores and they participated at a very high level.”
Fleet Feet Inc.’s hassle-free return policy is just one more aspect that makes the customer experience there so satisfying.
“If at any time, you’re not happy with anything you buy at Fleet Feet Inc., bring it back and we will make it right,” says Raynor. “No receipt, no time limit, no packaging, anything. No question. If you want a full refund, we’ll give it you.”
Raynor says this kind of exceptional service is what it takes to stand out and succeed.
“The experienced runner knows what they want, they know where to buy it. You can buy everything we sell in our stores within 10 miles of our store, either through your computer or another retailer somewhere south of suggested retail price. You either have to be the best in the marketplace, or you have to be the cheapest. There’s no other real position in the marketplace. We choose to try to be high service.”
Always seeking to improve, Raynor had Fleet Feet Inc. go through “Net Promoter,” a customer-loyalty metric that has been written about in Harvard Business Review. The Net Promoter score is obtained by asking customers a single question on a 0 to 10 rating scale, where 10 is “extremely likely” and 0 is “not at all likely.”
“How likely is it that you would recommend our company to a friend or colleague?”
Based on their responses, customers are categorized into one of three groups: Promoters (9–10 rating), Passives (7–8 rating), and Detractors (0–6 rating). The percentage of Detractors is then subtracted from the percentage of Promoters to obtain a Net Promoter score.
Fleet Feet Inc.’s Net Promoter score four years ago was 72, a good score by the metrics of retailers. Not satisfied however, Raynor completely revamped the company’s customer service survey, receiving over 10,000 responses. The company made immediate changes to meet their customers’ priorities.
At 60 years old, Raynor is on top of his game, but it’s his fighter spirit that has allowed him to prevail. Only two and half years ago he was treated for a tumor at the base of his tongue and for prostate cancer six years before that. He survived 16 weeks of radiation and chemotherapy and lost 60 pounds.
“I couldn’t walk, couldn’t eat, couldn’t swallow, couldn’t talk. And that’s a good story because I’m still alive,” he says
Raynor displays a stoic attitude regarding his illness and says that he always saw people sicker than himself during his treatment, including small children, and that this observation helped him keep things in perspective. He says being sick also allowed him to reflect and let go of some regrets in is life, as well as accelerate his business decisions.
As for making the Inc. 5000 list, Raynor expresses his characteristic belief in never settling for good enough.
“Making the Inc. list is not a big deal because you can make the Inc. list and not be successful, just be a fast growing company,” he explains. “The big deal is making the Inc. list four years in a row. That’s a big deal. We’ve had double-digit same-store profit growth over the last 10 years, every year. We’ve doubled profit growth, which allows us to have more resources to do more things.”
In May of this year, Raynor was inducted into the National Sporting Goods Association (NSGA) Hall of Fame. The NSGA has honored Sporting Goods leaders since 1956, but it’s a highly selective award. This year’s inductees bring the total number of Hall of Famers to only 150.
Under Raynor’s skilled leadership, Fleet Feet Inc. seems to show no signs of slowing down. The company plans to continue to meet customers’ evolving needs and soon will be tripling the space of their Raleigh location in the Ridgewood shopping center.
“We’ll have consistently smart growth,” Raynor says. “We’ve doubled our business every four years for the 12 past years, which is about 20 percent growth a year. We will continue to do that. We’re going to expand the business to deliver an even broader complete customer experience with some ancillary businesses like lifestyle retreats, yoga retreats and travel.”