'More than a gold watch' awaits Race Brothers workers

Nearly 30 years ago, Max DeForest bought himself a little business in Springfield with two names: Tractor Supply Store and Race Brothers Farm Supply. The company, not surprisingly, sold tractor parts and supplies.

DeForest bought the store from the Race brothers, who had operated it as a franchise outlet for the Chicago-based Tractor Supply Company. TSC usually owned and operated all of its stores, but Lloyd and Orville Race had traveled to Chicago and successfully convinced the parent company to sell them a franchise. DeForest met the Race brothers during that visit, and when he left TSC in 1972, he bought out the Race Brothers and relocated to Springfield.

"We kept making changes in the business to fit what was happening in society," DeForest said. "We added items customers wanted, and eventually went to Sunday hours when we realized that so many of our customers worked the same hours we did during the week."

The beginning

In the early days of his ownership, minimum wage was less than a buck and a half, he said, and pension plans and profit-sharing were reserved for top management. Even medical benefits were hard to come by for the hourly wage earner.

But DeForest, now the chairman of Race Brothers, had spent 24 years with TSC and worked his way up to a vice presidency with only a high school education, and he was determined to create a work environment that would attract and keep qualified employees. With less than a year invested in his new store and six full-time employees on the payroll, he began providing the workers with profit-sharing, a pension plan and solid health coverage.

Why did he implement such a progressive, and costly, program? DeForest has a ready reply. "A retirement plan is a good incentive for employees to stay with the company. They leave here with more than a gold watch."

One of his original employees retired several years ago with more than $100,000 in his retirement fund. "It's not uncommon for retirees to make more money in retirement than when they worked," DeForest said. "And this way they don't have to rely on just their Social Security."

Mentor

DeForest credits his mentor and friend Charlie E. Schmidt, owner of TSC, with influencing his ideas about how to run a business.

"Although I only had a high school education, and it bothered me, I was promoted fast at TSC," he said. "Charlie seemed to know that I felt bad about my lack of education. One day he took me into his office, looked me in the eye, and said, Max, why don't you reach for the top? It's not as crowded up here as you might believe, and we're not as smart as you think we are.' He taught me new ways to think about business."

DeForest chuckled, then added, "Let me tell you a story about Charlie. Late in his career, he acquired the Boca Raton Golf Club in Florida. When someone asked him how he ended up owning a place like that, he would laugh and shrug I told my wife I wanted a new golf club for my birthday,' he would say, So that's what she bought me.'"

Retirement experts say that a person making $7.50 per hour and contributing just 3 percent of his pay to a pension fund over a 30-year period could have more than $300,000 in his retirement account by age 65. Race Brothers now employs 55 workers, almost all of whom are full time, meaning they work 30 hours or more a week. Full-time employees now participate in a 401(k) plan in which the company matches 4 percent, or, according to DeForest, "a little more to prime the pump if we have a good year."

DeForest said that the company places a dollar amount equal to 10 percent of an employee's annual salary in the pension plan every year, and pays 100 percent of medical benefits for the employee. His full-time-employee benefits start after 60 working days.

"What bothers me today," he said, "Is that so many of the big stores use only part-time employees to avoid having to pay benefits, and then it's hard to compete with their retail prices. If someone is earning $10 per hour, we're adding roughly $4 per hour in benefits."

Long-term employees

Although all of DeForest's original employees are now gone, there are still some on staff in the store at 2310 W. Kearney who joined the company in 1977. DeForest is sure that the company's generous benefit package has helped keep them, and long-term employees are his goal.

"I'll tell you what long-term employees are a real help to a company," he said. "Over the years they go to seminars, they gain a lot of knowledge. Because they've been around so long, they know what they're doing. And they give excellent customer service."

Employees at Race Brothers appreciate the benefits package. Bookkeeper Holly Fifer has been with the company for three years. She said that her health insurance had broader benefits at her last job, but there was no retirement plan. "It's worth it to stay here for the better retirement benefits," she said, "although I'm only 25 years old, and retirement's not something on my mind very much. If I leave here, it'll be to stay at home and raise kids, not to go to another job."

Anita Gott is a sales associate in clothing and will mark the end of her second year with Race Brothers in June. "The benefits package is better than what I had before," she said. "Benefits always count for a lot of money, so good benefits make you think twice about leaving."

Helen Weatherford, manager of the company's animal health department, has been with Race Brothers for 24 years. She said that before she came to the company, she had worked other places, but the benefits couldn't compare. "This benefit package has given me the incentive to stay in one company," she acknowledged. "At my age you start thinking about retirement, and you see how much your retirement fund's built up and it looks good. If my health permits, I'll stay here until I'm 65, or maybe older. Every job has a drawback, but in all the years I've been here Max has never asked me to do a job he wouldn't do. I've even seen him sweep the floor. Having a boss like that is a job benefit, too."