Pharma chain's next CEO has a modest demeanor, but a will of steel
It's usually easy for journalists to identify corporate bigwigs, especially on company premises. They are usually the ones wearing expensive suits, talking loudly, amidst a group of obsequious sychophants.
But when a reporter recently agreed to meet François Coutu, president of the Quebec-based pharmaceutical retail giant at one of the company's stores, he was nowhere to be seen.
Even after three trips up and down the aisles of Jean Coutu Group's TMR outlet, no one stood out. Finally, a tall, unassuming man emerged from a small group of employees with an outstretched hand. "Hi I'm François Coutu."
It's no coincidence that Jean Coutu's third son blended effortlessly into the suburban pharmacy. Not only does he run the company, he is a pharmacist himself, and owns several franchises, including the TMR store.
"I love branch operations. (They) keep me in touch with clients and I can test new ideas in my own stores first, before applying them to the rest of the chain," said Coutu. "And when franchisees tell me about their problems, I know what they are going through."
It's hard to evaluate new management talent in a business with as strong tailwinds as the Jean Coutu Group has at the moment. The company is in the midst of multi-year successes, with all the right numbers pointing up.
The company's five-year charts in its 2001 annual report show double digit combine annual growth rates in terms of sales, earnings per share, and shareholders equity, and its stock price is trading at record multiples.
The Jean Coutu Group is also well positioned to take advantage of demographic trends that will see a dramatic increase in prescription drug sales over the next decade as an aging population seeks remedies for all sorts of aches, pains and ailments.
Many of these increasingly-sophisticated medications will command higher prices, and their users, will undoubtedly be tempted to load up on chips, cosmetics, school supplies, and whatever else pharmacists choose to line the gauntlets to the drug counter with.
But there are numerous indications that François Coutu will be a good choice, if as expected, he takes over the chief executive officer title from his father later this year.
For one, although he only joined the company at 27, he did not take a bogus head office job, like many other kids in family-businesses do. Instead, he opted for a line job, running the firm's Park Extension store, which gave him the opportunity to learn the business from the ground up.
"Starting with the company at a late age was a big advantage," said Coutu. "It gave me the opportunity to establish my identity outside the business, rather than having it forced on me."
Despite his modest demeanor, that François Coutu is a fierce competitor. One story is telling. As a youngster, he heard his father remark over supper that the person who would eventually take over the chain would have to be a trained pharmacist.
So François Coutu, --despite already having completed an undergraduate business degree, -- went back to CEGEP, got his health sciences prerequisite courses, and went on to pharmacology school at Samford University in Birmingham, Alabama, an institution he retains strong ties with.
This mental toughness, which enabled him to take one step backward in order to jump three steps forward, is one of the key ingredients that helped him edge out four siblings, including two older brothers in the race for the reigns of the family business.
So despite the fact at least one of his two older brothers appears to have better credentials, -- at least on paper --François is the one in the corner office. (François's brother Michel, who heads U.S. operations, has both an MBA and a law degree)
Another big plus that François Coutu brings is that he is totally focused on the company's core business. That means he is unlikely to get the company involved in potentially damaging side interests like Edgar Bronfman's dalliance into movies, and the Stronach family's foray into horse-racing.
"Why would I be anywhere else other than (the pharmacy business)?" he asks.
Another big advantage that François Coutu brings to the table is his U.S. education. Long before the company became heavily involved in U.S. operations, Coutu foresaw the possibility, and took the opportunity to study American culture during his university days in Alabama.
This gives him a hands-on knowledge of the highly-competitive U.S. market, where the company is increasingly staking its future. François Coutu also seems to have worked out an amicable turf division with his brother Michel, who heads up those crucial U.S. operations.
But Coutu's biggest asset continues to be his father, who although he is less active in the business, remains a key presence. Entrepreneur-owners who built their businesses from the ground up are notoriously demanding and hard to work for. But Jean Coutu is likely to be far more supportive of his son, than of any other potential nominee.
Photo Caption: François Coutu may look unassuming, but the fact he edged out two older brothers to become the company's COO, show's that he has a will of steel.
Highlight this quote: "I love branch operations. (They) keep me in touch with clients and I can test new ideas in my own stores first, before applying them to the rest of the chain,"
Diekmeyer can be reached at firstname.lastname@example.org
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