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Growing up, some people dream about going away to college and breaking out of their hometown. Others dream of planting their own roots where their parents planted theirs. A few lucky ones combine the two into reality.
Scott Hartman, president and CEO of Rutter?s Farm Stores, is one of the lucky ones. And it was his dream of planting his own roots in the family business while striving to grow that business ? and the convenience store industry as a whole ? that led him to take this year?s honor as the retailer inductee into the Convenience Store News Hall of Fame.
?It was a wonderful feeling, both for me and my team. I view it as an accolade that was personal in the sense that I know so many of the inductees over the years and attended inductions,? Hartman said of his induction. ?I?ve admired all the inductees in terms of their business sense. I?ve tried to learn from many of them and served on boards and committees at NACS with many of them. They were my peers and friends. Some were what I would call my industry elders who would give me advice over the years and who I could learn so much from.?
He likened the honor to serving as chairman of NACS, the Association for Convenience & Fuel Retailing, from 2005 to 2006 ? a role he lists as another career highlight. ?To think I could be part of a group of industry leaders and people who have shown success over the years was very nice, very complimentary,? he explained.
Hartman is also a member of the convenience store industry?s Technology Hall of Fame, making him the first CEO to be inducted into both Halls of Fame.
?I hope this encourages the next generation of industry CEOs to embrace technology and change at their companies,? he said. ?It is a wonderful industry to be part of and overall, this recognition is another part of our team?s year of celebration.?
In Hartman?s eyes, it truly is a team effort. He points to the number of long-term people on Rutter?s team who have been a part of the company?s success through the years.
?We have people who have been with us since before I returned to the family business, 35-plus years. The fact that they have been with us a long time is such a reward, to see them enjoying and participating in our successes. It?s always been a team approach at Rutter?s,? he said.
Hartman is part of the third generation to run the family business, Rutter?s Holdings Inc., which is comprised of Rutter?s Farm Stores, Rutter?s Dairy Inc. and M&G Realty.
The family farm, which dates back 10 generations, has been located in York, Pa., since 1747 and Rutter?s Holdings has been headquartered in the central Pennsylvania town ? two hours west of Philadelphia ? since its inception in 1921.
Raised in York, Hartman chose to attend George Washington University in Washington, D.C. After earning an accounting degree, he moved on to Duke University in Durham, N.C., where he earned a master?s degree in business administration.
Upon entering the working world, Hartman chose to work as a consultant at Pricewaterhouse in Baltimore. Still, he was never really far away from the retail scene. At Pricewaterhouse, he consulted with grocery retailers, grocery wholesalers, restaurant companies, convenience stores and petroleum companies, as well as other industries like banks and investment firms.
?I always had my fingers somewhere around retail and service industries. That was my background growing up, so it was kind of natural,? he said.
Seven years into his career, he was faced with a critical decision: continue to climb the corporate ladder or enter the family business. With Rutter?s literally in his blood, you would think assuming a role in the company was a foregone conclusion, but that wasn?t the case, said Hartman.
?When I went to graduate school, I had a passion for consulting and that?s really what I enjoyed doing for seven years,? he said. ?I got to the point where I was promoted to a senior manager at Pricewaterhouse and when you get that promotion, you have to make a career decision. Do you want to become a partner in the firm or are you thinking about other things you want to do??
Through the years with Pricewaterhouse, Hartman had gotten quite a few different job offers but didn?t bite on any of them. This time, though, he decided he owed it to himself to give the family business a try and see how it would work vs. going to other places.
?That?s what I did and here I am 25 years later,? he said.
In 1990, Hartman returned to York to take a position with Rutter?s. The rest is history. He remains in York today with his wife Cathy, whom he met while she was also studying accounting at George Washington University. Together they raised their two children in his hometown ? daughter Sara, now a fourth-grade teacher in Brooklyn, N.Y., and son Chris, a food broker for Crossmark in Plano, Texas.
Because of his last name, people don?t immediately recognize Hartman as a member of the Rutter?s clan. As he explains, his mother is a Rutter. Her father was George Rutter.
?People always have a hard time understanding the family tree and wonder where Hartman comes into play. My mother is a Rutter and my father is the son-in-law that came into the family business,? he explained. ?My grandfather George Rutter and his brother Bud were the founders of our dairy back in 1921. They sold eight quarts of milk by a horse-drawn carriage their first day in business. My father?s generation started the convenience stores in 1968.?
It was just a few years later that Hartman began his career in the c-store business. In 1972, at the age of 12, he started in the stores doing all the grunt work, as he calls it, and was paid 5 cents an hour for every year old he was. ?I was making a whopping 60 cents an hour,? he recalled.
Just as retail never really left him, Hartman still embraces his passion for consulting.
?It?s one of the things that got me involved with NACS and the technology side of the industry. It was a pseudo-consulting thing in terms of working with other industry people trying to achieve common goals,? he noted.
According to Hartman, the convenience industry as a whole has been slow to adopt technological changes. Of course, technology-wise, the convenience channel is the most complicated industry in the world, so change is naturally slow, he acknowledged.
?That?s been one of my common themes through the years. Technology has never been a huge comfort zone with a lot of CEOs, and I?ve tried to encourage CEOs to embrace it for a lot of years to see how technology could be a tool to run a better business and improve customer touchpoints,? he said. ?It?s always been my vision that technology and marketing go hand in hand.?
Hartman was fortunate to be on the forefront of many technology changes throughout his education and early career ? call it being at the right place at the right time. This advantage made him more comfortable than others, perhaps.
?From the time I was in college at George Washington University, I was taking programming classes using mainframes and card decks. Long before floppy disks, there were card decks and if you dropped your cards on the floor, it was literally 52-card pickup. You were done,? he recounted with a laugh.
By the time Hartman reached graduate school, mini computers and personal computers were entering the scene. In fact, he was the first to have a Macintosh in his office at Pricewaterhouse.
?All those things were just the right timing at the right place. I was on the curve of how technology was rolling out. I was doing technology and systems consulting, so it was part of my business acumen,? he added.
He didn?t check that acumen at the door when he returned to York in 1990. Instead, he tried to change the family business and take Rutter?s Holdings into the new technological age.
TECH & THE C-STORE INDUSTRY
Hartman also wrote Kerley Lebeouf, then-NACS president and CEO, urging the association to think about technology and standards, and where the industry needed to go.
?From my observation, from all my years consulting, our industry wasn?t current and we weren?t seeing how technology was changing the competitive landscape,? he said.
His push helped initiate tech standards and the formation of NACStech in the mid-1990s.
?A number of the NACS board and committee members probably thought I was a little bit of a lunatic. For the first couple of years, I would sort of beg to be invited to NACS committee and board meetings. I would try to explain what technology was doing, why the industry needed to embrace it, why they needed to fund meetings for technology, and why they needed a tech committee,? Hartman explained.
The first meeting, he said, took ?about two hours of discussion to get less than $10,000 in funding.? Eventually, NACS was funding more than $3 million in technology standards initiatives, and many of those standards are being used in almost every c-store today.
?I also had a tradition from the early ?90s where I would write a letter to every incoming NACS chairman before their speech at the NACS Show telling them why they needed to make technology part of their focus,? Hartman said. ?I used to enjoy doing that and hearing feedback later. That was my prod to each of them to embrace it and push it. That was fun.?
In the past 25 years, Hartman has had a front-row seat as the convenience store industry continues to move beyond cash registers to scanning, self-checkout, mobile payment and marketing initiatives that dynamically interact with customers.
?I remember when people used to ask if scanning was something we could do as an industry. I bet there was probably five to seven years of presentations at NACStech asking if scanning was right for our industry, what it would do for us and why we should do it. It?s kind of crazy thinking back about how that had to be a topic of coercion for people to get into it,? he said.
HITTING THE HIGH NOTES
Hartman counts his work with NACS on the technology front as one of his career highlights. Notably, he has enjoyed watching NACS embrace technology and seeing the NACS standards take hold. He also points to the annual NACStech events, being named the first chairman of PCATS (now Conexxus), and working with all his friends in technology areas.
?I?ll always remember sitting in a hotel on the MIT [Massachusetts Institute of Technology] campus in Boston designing the vision for the connected store with about seven of my best tech friends, including the late Teri Richman and John Hervey,? he said. ?It?s been a long-term highlight of mine to have been part of the industry?s technology journey.?
Growing Rutter?s convenience store business also ranks among Hartman?s top accomplishments. The company operated approximately 52 stores when he joined Rutter?s in 1990. The retailer opened its 60th store earlier this year. While the brick-and-mortar stores have not ballooned in number, what Rutter?s achieves with its stores has.
?We haven?t added that many more stores, but we were doing roughly $60 million in sales with 50 or so stores in 1990 and today we are doing well north of $700 million out of 60 stores. It?s not the store count; it?s what you are doing with the stores,? he emphasized.
Hartman also admires the physical evolution of the stores. Rutter?s opened its first superstore ? at 3,500 square feet with six gas pumps and a dedicated foodservice area ? in 1995. The chain is now considering a store model that?s more than double the size.
?It?s hard to believe that in 1995 we were one of the first to go that far. We had people coming in and visiting from a lot of the oil companies across the country. They wanted to see what this new concept looked like,? he said. ?That was the root of us changing from a 2,800-square-foot or less convenience store with no foodservice and limited fuel offer, to a much larger store and more complex offer. That 3,500-square-foot store was considered a superstore at the time and here I am today working on a store design of 8,800 square feet that we hope to open in 2015.?
Speaking of foodservice, hiring Jerry Weiner as Rutter?s first vice president of foodservice in the late 1990s, stands out as yet another bright spot, according to Hartman. ?That really defined our commitment to foodservice and propelled us a long way. Jerry is retiring in 2015 and our foodservice evolution has been a wonderful and rewarding journey with him,? he said.
OUT WITH THE OLD
While he has a notable list of career highlights, Hartman acknowledges there have been some challenges along the way. One major challenge is that the industry is always changing.
Early in his career at Rutter?s, he had to work hard at trying to get an ?old company? that had been in business 70 years at the time to change.
?We clearly have changed our corporate DNA and our culture today, but that was one of my earliest challenges. We had to keep changing. Our consumers were changing and everything was changing faster. We had to embrace change to be successful and to survive,? he said. ?That is not going to change anytime soon.?
Operating a small c-store chain also has presented challenges. From his grandfather?s and father?s generations to today, Rutter?s has never had the biggest dairy in its market nor has it ever had the largest number of stores. It?s always had much bigger competitors around it.
?It?s always a challenge when you aren?t the biggest. I?ve talked to people who are bigger and they like the idea of being smaller,? Hartman said. ?We recognize we will never be the biggest, so we embrace who we are, our size and what we can do with being a 60-store chain and a regional dairy.?
Trying to grow in good times and bad times, and being comfortable with who you are as a company and your growth strategies, though, can be challenging, he admitted. ?It?s sort of our corporate philosophy that we never get too high and we never get too low,? he said.
Where Rutter?s is now, and what the company and its team have accomplished, make Hartman proud.
?We have a picture on the front door of our office that has all the company?s accolades through the years ? foodservice awards from Convenience Store News to being named the International Convenience Retailer of the Year at the NACS Insight Convenience Summit-Europe, Best of York recognitions, awards for local charitable giving, or being the Central Pennsylvania Business of the Year,? he explained. ?When I look at the door, every day I walk in, that is a proud moment. It says we are doing good things. We?ve gotten local, national and international recognitions and they all mean something to our team, and we are all really proud of it. It?s not about me; these recognitions were all earned by the team.?