Teel Back as CEO of Raley's

ELLIOT ZWIEBACH

WEST SACRAMENTO, Calif. — The need to return family leadership to a family-owned business in a difficult economic time prompted Michael J. Teel to return to Raley's last week as chief executive officer.

Teel, grandson of the chain's founder, had previously served as president and CEO between 1997 and 2002, when he abruptly left the company.

“In difficult times a business needs family leadership, and I'm in a place in life where I can devote time to that and to serve the family and employees of Raley's,” Teel, 58, told SN last week. “My focus will be to ensure we achieve market-share gains.”

Observers told SN last year that the 134-store, $3.4 billion chain is caught in the middle between Whole Foods Market and Nugget Markets on the high end and Wal-Mart and Winco on the low end. They also said the company has suffered from a lack of capital investment.

Teel said Good Eats, the foodservice business he has been running for several years — which operates a restaurant in Scottsdale, Ariz., with another one due to open in the spring in Sacramento — is being run by his fiancee and his son, and will not conflict with his obligations at Raley's.

At Raley's he is succeeding William J. Coyne, who left the chain Nov. 2 as president and CEO. Dave Clark has been serving since then as interim president and chief operating officer.

In a press release last week, Teel said of Raley's, “This is a special company. We are unique in how our employees offer service to our customers. I value that strength and see it as essential to who we are. As a leader, my role is to foster this unique quality and allow it to thrive.”

He also said he plans to keep the company private.

In announcing his hiring, Jim Teel, the company's co-chair, said, “He knows the market, he knows the company. The board and the family welcome Michael back with our full, 100% support.”

Jim Teel and his wife, Joyce Raley Teel, are co-chairs of the company and Michael Teel's parents. Michael Teel has remained a Raley's director since leaving the company, and has been involved with outside investments since then.

Michael Teel was originally named president of Raley's in 1997 and added the title of CEO in 1998. He resigned in April 2002 in a move described at the time by a co-worker as unexpected, “although knowing Michael, the unexpected is always what you should expect. That's just his personality — he's not a person who does what you would expect him to do.”

Michael Teel talked about his upbringing and his development as an executive in a 1998 interview with SN. “As a child I grew up in a family that taught us don't assume and don't presume,” he said at the time. “When I left the company in 1983 to pursue other ventures, my grandfather [founder Thomas Raley] thought I was nuts, but I felt my plan in life was outside Raley's.”

He subsequently moved to Seattle to attend Bible college, then took a job in sales and eventually bought a small advertising company. Though the company went out of business within 18 months, “I learned the hard way about working capital, lead time and other business functions,” he said in the interview.

“But the most important lesson I learned was, I survived. And I realized that the world is made up of all kinds of people, and the decision-makers in positions of power and leadership are really ordinary people who have some outstanding skills and some weaknesses.

“And that helped me — a perfectionist — to understand that no one is perfect and you need to put your strengths to maximum use and shore up your weaknesses with strong people around you.

“With that perspective I saw people like Chuck Collings [his predecessor as Raley's president] and my father as ordinary men, not men to be put on a pedestal, and I felt capable of doing what they did, and when my parents asked, I came back to work at the company.”

Michael Teel spent 1988 through 1993 on a management development program prior to being named assistant to Collings, ultimately succeeding him in 1997.

One of the biggest challenges in returning to Raley's in 1988, he said, was working for his parents. “I think it's hard for a father to give up the reins and view his child as an adult, but my father actually stepped aside to make way for me. I never found him second-guessing my decisions.”