Melanie Dressel, CEO, Columbia Bank

| FROM THE PRINT EDITION |
 
 

EARLY YEARS: I grew up in Colville, Washington, where my parents ran a gift store. My dad taught me what true service is. People would call us on a Sunday because they had forgotten their wife’s birthday and he would go into town to open up the store. He didn’t think twice about it.

AMBITION: I told my parish priest at age 6 that I wanted to be president of the United States. At age 7, I loved watching the Democratic national convention on television. I grew up in the age of great politicians like Maggie [Warren Magnuson] and [Henry] Jackson. I planned to go to law school, then into politics after college, but I thought I should work for nine months first. I wanted weekends free so I could spend time with my husband. That’s how I got into banking.

COLUMBIA BANK: When we started Columbia Bank 18 years ago, we did something unusual. We decided to offer almost all the products and services that big banks have, like private banking and cash management. Later, we added a trust department. It was something very few community banks did. We didn’t want our bankers to have half a toolbox. I think [the diverse offerings] helped to accelerate our growth. The first day we opened, we had people lined up to open accounts with us. It was one of the most exciting days in my professional life. Puget Sound National Bank, which had 50 percent of the local market, had just been acquired by KeyBank. I think the community perceived the hometown bank was gone. We wanted to fill those shoes. We went on to make seven small acquisitions until March 2008, when everything came to a screeching halt.

FINANCIAL CRISIS: We always knew we would make it through because we had a traditional balance sheet. [During the boom years] analysts were always asking, “Why aren’t you earning as much as Frontier Bank [which invested heavily in real estate]?” I told them, “This is not our business model.” Even at the top of the market, only 12 percent of our loans were residential construction. We make loans to business owners and their employees funded by retail deposits. If we loan a lot of money to a business, we take real estate as security. So we have a lot of commercial real estate in our loan portfolio, but it’s all tied to a relationship.

EXPANSION: When we saw the markets loosen up, we raised capital. We’ve since made five more acquisitions [of troubled banks]. We expect to see opportunities to acquire more banks.

RISK: I’m worried that some banks are jeopardizing structure and safety to put loans on the books. It’s way too early to be taking big risks, particularly in commercial real estate. We want to make loans and we will be competitive, but banks are going to get in trouble again if they make loans with no guarantees and no equity.

GOAL: We want to be the Pacific Northwest’s regional community bank. Being a community bank means that you are involved in a lot of different things and through our involvement we strengthen the community. It’s a different style of banking. I don’t think that anyone has become the old Rainier Bank or the old Seafirst. They had such marvelous community ties. We believe that the value of our franchise is embedded in customers and our employees. If we take good care of our customers and our employees, then our shareholders will benefit.

CULTURE: We believe you can’t be a great place to bank if you aren’t a great place to work. We have teams of bankers from other banks that approach us and say they would really like to be a part of Columbia because of our culture. We are very picky about who we hire. But we have been fortunate to attract very strong bankers. We had a salary freeze in place for over a year. Our employees understood that if we gave people raises we would probably have had to lay people off. Everyone was willing to make short-term sacrifices for their fellow employees; those are the kinds of people we attract.

GROWTH: As we grow, our key concern is how to preserve our culture. Not a week goes by that the management team doesn’t discuss that. Of course, it’s important to have financial strength. And we’ve been a dynamic, evolving company. But we don’t want to just grow to put more zeros after our assets. We really want to continue to be who we are, but also to provide great opportunities for our people and to really take excellent care of our customers. We have a two-day Columbia banking school where new employees get to know who we are and how important our culture is. We take very seriously being among [Seattle Business magazine’s] 100 Best Companies to Work For. We slice and dice the data from the survey and share it with our staff.

WOMEN CEOS: I think management is more a product of the individual than gender. Each one of us in our executive team is as different as night and day. That brings different conversations to the table. But listening is an important quality in a CEO, and women are typically good listeners.

TACOMA: We don’t do as a good a job as we could to talk about the good things of Tacoma. I bring people here as often as I can so they can see the nature, the water and the affordable real estate. There is a lot here to attract companies.

The Outsider’s Perspective at Bartell Drugs

The Outsider’s Perspective at Bartell Drugs

Brian Unmacht, the first non-Bartell to run Bartell Drugs, knows his mission is to keep the family-owned business relevant in the face of stiff competition.
FROM THE PRINT EDITION |
 
 

Brian Unmacht spent six years working at his father’s drugstore company and, after college, 27 years at REI, before becoming only the fourth CEO in Bartell Drugs’ 126-year history. Now he’s intent on using local partnerships to make Bartell a strong competitor to the national drugstore chains. 

FAMILY: My father had been an executive at the Bon Marché. In the 1970s, he formed his own chain of small drugstores in rural areas. I spent six years in high school and college working for my dad and eventually managed one of his stores. We were a $20 million business and I computerized the record keeping and did the finances and everything. It was a sort of love/hate thing because you could never separate the business from the family. But I appreciate having had a chance to work with my dad. In 1980, 19 percent interest rates and the recession did us in. We had loyal customers, but customers still went for price and selection when grocery stores started competing with us.

TRAVEL: After college, I spent a year backpacking in Nepal and Pakistan and skiing in Europe. When I returned, I had no money, so I went to work for REI. They had seven stores and a catalog and were beginning to expand beyond the Northwest. I managed the Tempe store in Arizona, opened the Chicago store and then worked on the store in Japan as vice president of international. That was an exciting time.

RETAIL: In the ’80s, it was Walmart that dramatically changed retail as it sourced overseas. In the last 15 years, it’s been Amazon. You’re always going to have disrupters. It comes down to how do you keep yourself relevant? In the recession of 2009, the number of paddling and canoe shops in the country dropped to 1,500 from 2,500. With fewer distribution points, vendors like North Face were trying to increase web sales. At REI, our value proposition was to provide expertise and credibility. North Face would give REI an exclusive for a certain time because of that. It was a win-win.

BARTELL DRUGS: I’ve come full circle. Now I am back in the drugstore space. We are up against $120 billion retailers like Walgreens and CVS. How do we find unique products and services that they can’t carry in their 8,000 stores? We offer assortments of local candy like Theo or Seattle Chocolates. We partnered with Snoqualmie Ice Cream to sell our own brand. At our Bellevue store, we offer scooped ice cream. If you go to Fourth and Madison downtown, we have a partnership with Caffé Vita for the espresso, and with other local vendors for sandwiches and other food offerings.

BEER: Bartell always sold beer but it tended to be Budweiser and Heineken. We put in a beverage buyer who had a passion around craft beer and empowered him to form partnerships. Now we have a partnership with Two Beers Brewing Co. to do a Tangerine IPA limited run. Last year, we did Bartell Spring Elixir with Fremont Brewing. We have 150 partnerships with other locally owned firms.

FAMILY BUSINESS: There have only been three top executives [before me] at Bartell’s over 126 years and they were all named George Bartell. Being family owned, we’re part of the community and take the long view. I tell employees that’s not enough to be relevant. There are a lot of family-owned businesses that fail. 

OUTSIDER: The family put together an outside board five years ago to get a wider point of view and I was put on the board. The family recognized there was going to be a gap before the five cousins in the fourth generation were ready to manage the company. That’s why they brought me in as the first outside manager. With revenues of $500 million and growing, management was also getting more challenging. Evelyn Merrill, the oldest of the cousins, is senior marketing manager. She has a lot of good ideas and is challenging the third generation in terms of her view of the brand.

STORES: We have 62 stores. We are talking about adding two to three stores a year. Today, we’re primarily in King and Snohomish counties, but I want to look at Whatcom [County], Bellingham, Poulsbo, Bainbridge Island and potentially farther south. With the Walgreen/Rite Aid merger, some Rite Aid stores will probably be divested. If the right stores came on the market, we would be interested. The Greater Seattle area is still booming, and with more density there is room to put a lot more drugstores in convenient places. 

HEALTH CARE: We do flu shots now, but we are looking at providing other immunizations as well as testing for strep throat or flu so that you don’t need to go to your primary care doctor every time. Because of our concentration of stores in Greater Seattle, our share of the pharmacy business is right up there with Walgreens. It’s important that we have that scale to work with the insurance plans. We had a pilot program to have Group Health clinics in 25 of our locations, and Kaiser [which is acquiring Group Health] seems interested in continuing the concept.

COST OF DOING BUSINESS: I worry that in five years, if Seattle’s not booming anymore, what does it mean if you’ve raised the fixed cost [by raising the minimum wage]? But I worry less about the minimum wage than the growing congestion issue. I have 2,000 employees who live all over the Puget Sound region. We have to move freight around. Congestion is a bigger and bigger issue. 

EXECUTIVE Q+A RESPONSES HAVE BEEN EDITED AND CONDENSED.