Fortune 500 in the Ozarks

All three companies – Kraft under former parent company Altria Group – made Fortune magazine’s list of America’s 500 largest corporations based on revenues. The annual rankings for 2007 were released in mid-April, with Bentonville, Ark.-based Wal-Mart Stores topping the list for the fifth time in six years. The world’s largest retailer collected revenues of more than $350 billion last year for a profit of $11.2 billion.

Like many of its Fortune 500 peers, the world’s largest retailer has a local presence with 11 stores in the Springfield metropolitan statistical area. Wal-Mart also has stores in Branson and Branson West, and construction of Branson’s first Supercenter is under way at U.S. Highway 65 and Bee Creek Road.

Other big-box retailers with an Ozarks presence that placed high on the list were Home Depot (No. 17), Target (No. 33), Sears Holdings (No. 38), Lowe’s (No. 45) and Best Buy (No. 72).

Retailers aside, Springfield’s business landscape also has been fertile ground for Fortune 500 companies in telecommunications, banking and manufacturing. Carthage-based manufacturer Leggett & Platt is the only southwest Missouri company to make the list (No. 419), with revenues of $5.5 billion and profits of $300 million.

“Fortune 500 and large corporations – they go where the business is,” said Greg Williams, economic development director at the Springfield Area Chamber of Commerce. “Growth in this marketplace and … the very reasonable business costs make it a very attractive place to operate.”

Williams also noted Springfield’s equidistance to the coasts as well as its access to raw materials, supplier networks and customers.

Those factors played into Kraft’s decision to set up operations in Springfield nearly 70 years ago, said spokeswoman Cathy Pernu. The dairy processing company opened its Springfield plant in 1954 at the current 2035 E. Bennett St. location, she said.

Today, Kraft’s 750,000-square-foot plant employs 935 people and spends more than $88 million annually doing business in southwest Missouri, Pernu said. The company also tops the list of personal property owners in Springfield, based on the county’s assessed valuation of $15 million.

Big-box boom

Last year, Wal-Mart opened a Supercenter in Marshfield and announced plans to build two more of the one-stop shopping emporiums, in Branson and Buffalo.

The company has steadily expanded its presence in the Ozarks during the past decade, but Wal-Mart spokeswoman Carrie Thum said there are no plans to build additional Supercenters or Neighborhood Market grocery stores in the Springfield area.

One of Wal-Mart’s biggest competitors, Minneapolis-based Target Corp., also has expanded its operations in southwest Missouri. Last year, the retailer spent $4 million remodeling its Springfield store at 1825 E. Primrose St. to make room for a pharmacy and a licensed, in-store Starbucks. Target also opened its first Branson store in March 2006 in Branson Hills Plaza, a shopping center that also houses a T.J. Maxx and Home Depot – two other retail chains on the Fortune 500 list.

Home Depot also has one of its home-improvement stores in Springfield, where rival Lowe’s has two stores. Lowe’s most recently opened an Ozark store in late 2005.

Telecom-petition

Telecommunications firms AT&T and Alltel have been operating in the Springfield area for years, and the anticipated arrival of New Jersey-based newcomer Verizon Wireless later this year will only amplify the competition.

All three companies made the Fortune 500 list, with Verizon Communications falling just outside the top 10 at No. 13. The company’s revenues in 2006 were $93.2 billion for a $6.2 billion profit.

Verizon Wireless officials have declined to publicly discuss their plans for the Springfield market, but a spokeswoman has said the company is actively scouting real estate in the metro area for new cellular tower and antenna sites needed to support its wireless network expansion. Multiple cell tower permits filed with area municipalities indicate Verizon’s arrival is near.

Verizon tops the list of Fortune 500 companies in the telecom industry, but Texas-based AT&T is a close second with 2006 revenues of $63 billion for a $7.3 billion profit.

Late last month, AT&T officials announced that the company would invest $335 million to expand and enhance its Internet, video and other services in Missouri.

Enhancements include the extension of AT&T’s high-speed Internet technology to 42 rural towns, including Walnut Grove and Fair Grove. The company’s fiber-optic video service, which offers up to 400 channels, will roll out in St. Louis and Kansas City before expanding elsewhere in the state, said AT&T spokesman Kerry Hibbs.

“We do plan to go beyond those two metro areas,” he said. “We want to aggressively roll that service out and make it as widely available as possible. … Springfield is a city we would be looking at.”

Little Rock, Ark.-based Alltel is farther down the Fortune 500 list, clocking in at No. 256. In November 2006, Alltel launched its Axcess Broadband service in Springfield and southwest Missouri. The technology provides secure, reliable wireless Internet access at speeds comparable to wired broadband connections such as cable modem or DSL, according to spokesman Dale Ingram.

Alltel has activated 17 new cell sites in the Ozarks since 2005, and another half-dozen are scheduled for activation this year.

Internal versus external growth

Starbucks Coffee Co. is a classic example of a corporation that has grown rapidly from within to become a multibillion-dollar success story built on a beverage.

The Seattle-based phenomenon had steadily climbed up the Fortune 500 list (currently No. 310) and was recently recognized by BusinessWeek magazine as one of the country’s 50 top-performing companies.

Starbucks now has 6,000 stores nationwide and 110 locations in Missouri after starting with two near St. Louis in March 1998. There are two stand-alone stores in Springfield with another on the way. Starbucks recently hired contractor LR Mourning of Little Rock, Ark., to renovate a former Popeyes Chicken restaurant at 631 S. Glenstone Ave. for its newest coffeehouse, which is expected to open this summer.

HCW Development Co. is also working with Starbucks to build two stand-alone stores in Branson: one on Main Street in historic downtown, and another on West State Highway 76 near the Cannery Restaurant.

Another Fortune 500 company that relies on a combination of external and internal growth is Charlotte, N.C.-based Bank of America Corp., which entered the list’s top 10 companies at No. 9 this year.

Bank of America’s recent acquisition of MBNA credit card services played a major role in the banking giant’s new ranking, but Michael Homeyer, market president for the Springfield region, said “organic growth” is vital.

“The industry has evolved to a point where bankers really need to be proactive about business development,” Homeyer said.

Bank of America, which Homeyer said is the fifth most profitable company in the world, has seven banking centers in Springfield and two in Branson. In 2006, Bank of America’s revenues were $117 billion for a $21 billion profit.[[In-content Ad]]