Building an exit ramp

The business has grown from a single store on Sherman Avenue in 1957 to a publicly traded company of more than 1,200 stores covering half the country. Company officials estimate store sales for 2005 will be around the $2 billion mark.

But in the last few years, there seems to be a lot less O’Reilly at O’Reilly Auto Parts.

Siblings Charlie O’Reilly, Rosalie O’Reilly Wooten and Larry O’Reilly have retired from the company, serving only as board members.

Their brother, David O’Reilly, is the last member of the O’Reilly clan in the company’s upper echelon of management, having moved into the role of chairman of the board earlier this year. He’s still involved in the day-to-day operations, but a large part of the job of running the company is in the hands of Co-Presidents Greg Henslee and Ted Wise.

Keeping the O’Reillys busy these days are business connections far beyond the auto parts world.

The four siblings – David, Charlie, Larry and Rosalie – have opened a new office at 2831 S. Ingram Mill Road for their new business dealings.

David O’Reilly said the family has been involved for years in businesses outside the auto parts company, including real estate developments Southern Hills shopping center on East Sunshine and Pebble Creek Apartments on South Fort. The new office will help advance those types of ventures.

“I think all of us are too young to truly retire,” O’Reilly said. “The family is still involved in various businesses.”

It’s an impressive space – nearly 7,000 square feet, including corner offices for each of the four O’Reillys and conference space that is often used for meetings of boards the family members are part of, including Breast Cancer Foundation of the Ozarks, the Victim Center and the Developmental Center of the Ozarks.

The family owns the building, but David O’Reilly declined to disclose the construction cost.

Family tradition

The business genes have been passed to the next generation as well.

Charlie’s son, Tim, is an attorney at Springfield’s O’Reilly & Jensen LLC. Tim’s brother, Patrick, is in real estate development as one of the principals of Miller-O’Reilly Construction, while David’s son, Matt, owns and operates Springfield-based Dynamic Earth Equipment Co.

Tim O’Reilly said he never was pushed into working for O’Reilly Auto Parts; rather it was the opposite growing up as the grandson of company founder Charles “Chub” O’Reilly, who passed away earlier this year at age 92. Chub O’Reilly and his father, Charles F. O’Reilly, started the business in 1957.

“There’s sort of a family policy for O’Reilly where we’re encouraged to not work there,” he said. “They wanted us to go and get experience elsewhere, make sure it’s something that we want to do and we’re not just going through the steps.”

The idea was that the children could bring other skills and experiences to the company if they eventually chose to work there.

Tim O’Reilly has been a lawyer since he graduated from law school at University of Missouri-Kansas City in 1994. He said having the family name has been helpful over the years.

“It’s a well-known name, so that doesn’t hurt,” he said. “Just the fact that it’s a well-known company and the wide variety of contacts as well. But it’s hard to separate the company from the family. Growing up, the company was the family, but as the company has gone public and grown at such an exponential rate, the company and the family are more separate now.”

The separation has been dramatic since the company went public in 1993.

The four third-generation O’Reillys now own less than 5 percent of the company’s total stock.

Where it all began

As for the flagship, O’Reilly Auto Parts, it’s doing fine despite less direct family involvement.

The publicly traded company (Nasdaq: ORLY) reported third quarter income of $48.6 million, up 40 percent from the third-quarter 2004.

The company will have opened 150 stores in 2005, bringing its total to nearly 1,500 in 19 states.

The key to the company’s success, David O’Reilly said, is the continued implementation of the “O’Reilly culture,” an idea created by his father, Chub O’Reilly, decades ago.

And when the family presence does go away altogether, David O’Reilly said he’s not worried about the company’s future.

“We now have more than 20,000 team members, so long before now we’ve had to address that issue,” he said. “One thing we’ve done is to formally identify the things important to the culture. There’s no one thing you can do – it’s a constant way of doing business that perpetuates that idea.

“That idea is near and dear to us, because we think that the reason the company has been successful is our people and our philosophy.”