UA Business Hall of Fame 2015: Stephen L. LaFrance Sr.

UA Business Hall of Fame 2015: Stephen L. LaFrance Sr.
Stephen L. LaFrance Sr.

Stephen L. LaFrance Sr.
Founder, Former Chairman and CEO, USA Drug

Twenty-six dollars went a lot farther in 1968 than it does today. Even then, that was a small amount for a business to take in on a single day. But $26 is exactly what Stephen L. LaFrance Sr. put in the cash register on his first day in business at the pharmacy at Gibson’s Department Store in Pine Bluff.

From that rather modest beginning, LaFrance built that single drugstore into USA Drug, which grew to be the largest privately owned chain of drugstores in the United States.

USA Drug covered nine states and more than 150 locations with over $825 million in annual sales. SAJ Distributors, a wholesale drug distribution operation also owned and operated by LaFrance Holdings, regularly served more than 1,200 customers in 14 states in addition to USA Drug’s own retail drug stores. LaFrance Holdings had expanded to include a real estate portfolio with strategically located retail properties. In total, it was an Arkansas organization supporting more than 3,500 employees and their families.

In 2012, shortly before LaFrance died, Walgreens acquired USA Drug for more than $550 million.

All from a $26 opening day in Pine Bluff.

LaFrance was born in New Orleans. He earned a bachelor of science in pharmacy degree from Northeast Louisiana State College in Monroe and took a job as a pharmacist at the Medic Pharmacy in Shreveport, Louisiana. Four years later, he moved to Pine Bluff where — with 12-hour workdays and six-day weeks — he built the pharmacy in Gibson’s into a thriving concern.

He got the opportunity to buy another pharmacy a few blocks away in Pine Bluff, but he didn’t have the cash. After a few banks turned him down, he secured the $5,000 necessary to make the deal. He combined the prescription departments and began to build the business. He expanded within Pine Bluff and then into Warren and Malvern.

He and his wife Linda — they married in 1969 — decided the name USA Drug and a red, white and blue color scheme carried the kind of small town values message they wanted for the company.

With so many stores, LaFrance realized he could help the bottom line by controlling his wholesale costs. He formed SAJ Distributors in the mid-1970s. LaFrance always put an emphasis on family, and the S, A and J represent the names of his three children — Stephen, Amy and Jason.

SAJ allowed LaFrance to buy directly from vendors so he could sell at a better margin. It became apparent that he couldn’t buy enough for his stores to get the kind of volume discounts he wanted, so he began to sell to other outlets. His first warehouse consisted of the garage and third bedroom of his home.

SAJ Distributors grew to be the provider of more than 22,000 health, beauty and general merchandise products to over 1,000 grocery, drug and discount stores.

LaFrance took another innovative leap that would make a lasting impact on the pharmacy business. He had seen the need to create an easy ordering relationship between SAJ Distributors and its customers. In a time when personal computers were still a rarity, LaFrance decided to put ordering terminals in each of his customers’ stores — for free. That made it easier to order directly from SAJ Distributors and provided information back to the SAJ fulfillment system. That way, LaFrance could track sales and target products to specific customers. A common business practice today, this was an innovation for its time.

LaFrance’s companies grew and prospered through aggressive acquisition of other stores. For example in 1997, when USA Drug had 15 stores, it bought the 89-store Super D drug store chain.

LaFrance went on to acquire May’s, Med-X and Drug Warehouse stores. The distribution business also saw aggressive growth through distribution deals with larger drug store chains.

Through it all, LaFrance paid the most attention to his customers and his employees. He treated their concerns as his own.

LaFrance only retired after selling his business holdings to Walgreens for more than $550 million in July 2012.

Stephen L. LaFrance Sr. was the stereotype for the humble man. He neither sought nor accepted accolades for his public service during his lifetime. But that does not mean he did not live a life of service to his community and his fellow man.

He preferred his philanthropic efforts to be anonymous. The Salvation Army, the Susan G. Komen Foundation, the Arkansas Children’s Hospital and work on diabetes research at the University of Arkansas for Medical Sciences were just some of the projects that enjoyed his support.

LaFrance passed away June 5, 2013.

His hobbies included a Friday afternoon spades game in Pine Bluff, fishing in Florida with a group of close friends and cooking – including legendary Thanksgiving feasts in a fully equipped kitchen in his home.

His wife Linda and sons Stephen LaFrance Jr. and Jason LaFrance live in Little Rock. His daughter Amy Bancroft lives with her husband and children in California. LaFrance had seven grandchildren.