By Hadley Malcolm, USA TODAY
From the looks of him, Jay Stein is a retailer. He dons circular tortoise-shell glasses that frame his tanned face, a blue shirt with a white collar custom-made in Hong Kong with his initials embroidered on the pocket, a grey flannel suit and preppy bright green and pink-striped tie, a gift from his older daughter, who followed her father's career and works as a buyer at Ralph Lauren.
But when he opens his mouth, you realize Stein is something else: a storyteller. Of how his family's chain of department stores, Stein Mart, got its name - the first store in Greenville, Miss., was called Stein's Self Service, but when Stein's father Jake bought more real estate to make the store bigger, he wanted a new name. Stein's uncle said he had a friend in Arkansas named Sam Walton who was opening stores and calling them Walmart.
Of his realization while walking through a store shortly after becoming CEO for the second time in 2011 that he didn't have to ask "a frickin' soul" about the changes he wanted to make to the store design.
And of being inspired by other retailers - even calling his Director of Stores Gary Pierce during his interview with USA TODAY to have Pierce tell the story of Stein calling him in excitement from an Anthropologie in Jacksonville, about six months ago after seeing the retailer's hardwood floors. Now the gift departments of newer Stein Mart stores have hardwood floors, and sales are up 20% there since installing them.
"It looks so damn good," Stein says in his slight Southern accent.
Stein is president and CEO of his family's namesake, Stein Mart, a chain of 262 stores - 263 as of Thursday, when another opens in Watchung, N.J. - primarily throughout the Southeast and Texas. It's headquartered in Jacksonville. As Stein says, "Stein Mart does best where the sun shines."
The sun has been good to the department store company, which has managed to remain afloat and maintain strong sales at a time when regional department stores have all but disappeared - closed or bought by bigger national players - and struggled to compete with both discounters and the likes of higher-end retailers such as Nordstrom. In the first two quarters of this year, sales at stores open at least a year were up 8.2% and 6% respectively. The company announced a 5% increase in sales in September.
The chain bills itself as a discount retailer. Stores feel like a smaller version of Macy's, but with the kind of prices you'd find at designer discounters such as TJ Maxx. Stein himself compares the company with Marshall's or Nordstrom Rack. He says pricing strategy is what sets Stein Mart apart.
"What built this company was values every single day," he says. He inherited that philosophy from his father, and it's the first he reinstated when he returned as CEO of the company two years ago, after stepping down in 2001 for health reasons.
Now, Stein is focused both on rebuilding his customer base since losing shoppers as the company went through three CEOs in 10 years before he returned, and expanding his customer base. He plans to open eight to 12 stores next year, many in sunny California. The retailer also launched its first e-commerce site last month.
In his blood
Stein was born into retailing. His grandfather, Sam Stein, started the company in 1908 with a store in Greenville. By the time Jay was born in 1945, his father, Jake, was running the store (Sam had died in the 1930s).
"I can clearly remember myself at the cash register at 10 years old," Stein says. "It was what you did. I didn't think there was anything else to do. When you grow up in a small town and your father has a retail store, it's the center of your life."
Stein is an only child, making the question of who would inherit the family business easy to answer. After graduating from New York University in 1967, Stein returned to Greenville to work for his father for the next 10 years. But they didn't always have the same vision for the company.
"He was not an easy man to work with because he had very strong opinions and because he was a product of the Depression," Stein says. "He clearly wasn't expansion minded."
But when Stein saw how much inventory the store received when high-end retailers such as Saks Fifth Avenue and Neiman Marcus had "sell-offs" of their designer goods, "I said, 'There's got to be other cities that would like this merchandise, as well.' "
In what today would be called a pop-up shop, Stein persuaded his father to let him open a temporary store in the closest big city, Memphis, for sell-off merchandise. "For one whole week, the town went wild," he says. "It was very successful." That was in 1977. A year later, the store became a permanent fixture and led Stein Mart's expansion into a retail chain. Stein followed up with a third store in Nashville in 1980.
At that point, he also had another goal in mind: become president of the company. Stein wanted to join the Young President's Organization, a professional group that only admits company presidents younger than 40. This proved an easy feat, having no siblings to fight with about titles, and a father who only cared to focus on the Greenville store. Stein was 36 when he essentially appointed himself president.
"We didn't have titles," he says, "it was a family business. ... Nobody objected" when he gave himself the role.
In the next 21 years, Stein expanded the family business to include 239 stores in 29 states. The company went public in 1992. But after having bypass surgery in 1999, he decided to step down as CEO in September 2001. He maintained his position on the board of directors and meant to act as an adviser. That didn't go as planned.
"Nobody would listen," Stein says. "They didn't want to. They thought they had a better plan. They were good people; they just didn't understand the culture."
Stein Mart went through three CEOs from 2001 to 2011, when Stein was reinstated as interim CEO. He was officially named as CEO in June.
"It was just time to make a change," he says of resuming the helm. "We saw the company was continuing in a direction, on a path that I wasn't comfortable with, and neither were our customers. ... Neither were our stock holders."
Stein says merchandise quality had deteriorated, and the company was being "impersonalized."
He returned to a warm welcome. "I have never felt as embraced in my life as the day I came back," he says.
That personal touch
For Stein, the business is personal. Every customer is sent off from the store with a thank-you note from Stein, printed in his handwriting. It reads, "There is no company more grateful for its friends and customers than we are ..."
"We have the most loyal base of fans of I think any retailer in America," says Stein, pointing out the company's more than 400,000 Facebook "likes." Stein is on the road nearly every week, traveling frequently to New York City and to visit his stores. But he's not necessarily there to see how things are going.
"I'm not coming to check on stores, I'm coming to thank people," he says. "We have enough people out there to check on stores."
Stein gave up his year-end bonus last year, distributing it to store employees to use for meals out with each other or other activities. He says his bonus was the thank-you letters he received from customers in the months following his return to the company.
"That meant more to me than anything in this world," he says.
Stein Mart's success may have as much to do with offering customers great deals as with its familial roots and personality. Stein has an 87% approval rating on job ratings site Glassdoor.
When he returned to the company, his wife Deanie Stein told USA TODAY they would tour stores and could "see on (employees') faces how relieved they were."
While at a store in Chantilly, Va., for the USA TODAY interview, several employees asked to have their picture taken with Stein.
He says the feeling is mutual: "It's important that I can meet as many people as possible that work with this company and just thank them."