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Retail chiefs still well compensated

If you're looking for the one thing that separates retailers from their suppliers, the salient fact that sums up the relationship between these greater and lesser partners in a shifting, increasingly uneasy relationship, consider this: In 2001, the highest-paid supplier earned only a tenth as much as the highest-paid retailing executive.

Once his stock options were factored in, Mohawk Home's Bill Kilbride made $1.5 million in 2001 as the highest paid home textiles exec in the United States. But several links up on the food chain, Target ceo Bob Ulrich made 10 times as much, an easy 10 dollars for every one that Kilbride took home, a grand total of $15.1 million in combined salary, bonus and stock options.

And the comparison becomes even more striking when looked at another way — last year, Bob Ulrich, with his $15.1 million pay package, made 53.0 percent more than the combined compensation packages of all 22 senior executives of public home textiles companies ranked in the 2002 edition of the Home Textiles Today Executive Compensation Report — they pulled down a relatively paltry total of $9.9 million. For that matter, each of the five most highly paid retail execs in this year's ranking made more than all of the textiles execs put together.

Top dogs in this year's retailer ranking, their pay rocketing higher in lockstep with sales and earnings of their company, are the two top managers at Target Corp., ceo Ulrich and Target Stores chief Gregg Steinhafel, who came in second in this year's ranking with $14.9 million in compensation.

Nailing down third place, and earning more than his bosses, is Steve Temares, president and coo of rocket-hot Bed Bath & Beyond, who banked $13.5 million, more than twice as much as co-founders Warren Eisenberg and Leonard Feinstein, each of whom took home $6.1 million during 2001.

Notably, Bed Bath & Beyond is one of the few American retailers to reward one of its front-line merchants, chief merchandising officer Arthur Stark, who pulled down $4.8 million for his role in securing the chain's position as the top specialty retailer of home fashions products.

In fourth place this year is another Target exec, vice chairman Gerald Storch, with $13.1 million. He's followed by Kohl's ceo Lawrence Montgomery, with a $10.4 million compensation package.

Home Textiles Today's Executive Compensation Report: Retailers
dollar amounts in thousands

Name, Title Company Total cash, stock options exercised Salary 2001 Bonus 2001 Long-term incentive plan Total cash compensation Value of stock options exercised Total cash comp. 3-yr. % chg. 1999-2001
1. Incentive payment.
2. Joined the company on Sept. 13, 2000.
3. Girouard deferred all of his bonus for the year.
4. Named president and ceo on Dec. 5, 2000.
5. Employment ended on March 11, 2002.
6. Resigned effective April 8, 2002.
7. Employment ended Jan. 15, 2002.
8. Promoted to president in March 2001.
9. Joined the company on Feb. 1, 2000.
10. Employment ended March 25, 2002.
11. Employment was from May 7 to Nov. 14, 2001.
12. Company announced liquidation in 2002.
13. No longer with the company.
Robert J. Ulrich, chairman and ceo Target $15,148 $1,415 $3,700 $0 $5,115 $10,033 -44.9%
Gregg W. Steinhafel, president, Target Stores Target 14,883 872 814 0 1,686 13,197 -53.5
Steven H. Temares, president and coo Bed Bath & Beyond 13,499 733 0 0 733 12,766 39.6
Gerald L. Storch, vice chairman Target 13,123 752 531 0 1,283 11,840 -43.8
R. Lawrence Montgomery, ceo Kohl's 10,381 919 307 0 1,226 9,155 22.9
H. Lee Scott Jr., president and ceo Wal-Mart 10,328 1,123 1,785 (1) 0 2,908 7,420 44.3
David D. Glass, chairman of the board's executive committee Wal-Mart 8,728 1,087 1,298 (1) 0 2,385 6,343 -39.6
Kevin B. Mansell, president Kohl's 7,107 727 244 0 971 6,136 30.4
Leonard Feinstein, co-chairman and co-ceo Bed Bath & Beyond 6,061 792 0 0 792 5,270 5.6
Warren Eisenberg, co-chairman and co-ceo Bed Bath & Beyond 6,061 792 0 0 792 5,270 5.6
Norman Axelrod, chairman and ceo Linens 'n Things 5,715 771 0 319 1,089 4,626 -16.5
Arlene Meier, coo Kohl's 5,353 600 198 0 798 4,555 54.6
Arthur Stark, senior vp, chief merchandising officer Bed Bath & Beyond 4,819 442 0 0 442 4,377 26.3
Gary Vasques, executive vp, marketing Kohl's 4,191 387 129 0 515 3,676 10.5
Thomas M. Coughlin, executive vp and president and ceo of Wal-Mart Stores Wal-Mart 4,081 886 936 (1) 0 1,822 2,260 5.4
Richard Leto, executive vp, gmm & product development Kohl's 3,949 529 177 0 706 3,244 15.3
Alan Questrom (2), chairman and ceo J.C.Penney 3,205 1,308 1,897 0 3,205 0
Howard R. Levine, president and ceo Family Dollar 2,800 510 192 0 701 2,099 4.6
John H. Williams Jr., vice chairman and ceo Stein Mart 2,396 585 0 0 585 1,811 -0.4
Alan J. Lacey, chairman and ceo Sears, Roebuck 2,061 900 673 488 2,061 0 31.4
Vanessa J. Castagna, executive vp and coo, JCPenney stores, catalog & Internet J.C.Penney 2,034 700 1,334 0 2,034 0 56.1
Marvin J. Girouard, chairman and ceo Pier 1 Imports 1,774 850 924 (3) 0 1,774 0 41.9
Eugene S. Kahn, chairman and ceo May Dept. Stores 1,770 1,371 190 209 1,770 0 -28.4
Joseph R. Ettore (12), chairman and ceo Ames $1,766 $1,103 $663 $0 $1,766 $0 -46.1%
James M. Zimmerman, chairman and ceo Federated Dept. Stores 1,700 1,250 450 0 1,700 0 -58.9
Cal Turner, chairman and ceo Dollar General 1,596 796 800 0 1,596 0 42.1
John B. Menzer, executive vp; president, ceo, International div. Wal-Mart 1,556 717 839 (1) 0 1,556 0 13.4
Thomas C. Shull (4), president and ceo Hanover Direct 1,500 900 600 0 1,500 0
Charles Conaway (5), former ceo Kmart 1,475 1,475 0 0 1,475 0
Terry J. Lundgren, president and chief merchandising officer Federated Dept. Stores 1,450 1,100 350 0 1,450 0 -46.3
Leon Levine, chairman Family Dollar 1,274 1,019 255 0 1,274 0 -16.4
Thomas R. Grimm (13), executive vp and president and ceo of Sam's Club Wal-Mart 1,245 648 596 (1) 0 1,245 0 40.7
Bart Butzer, executive vp, Target Stores Target 1,220 622 598 0 1,220 0 -19.6
Judith Hofer, ceo, May Merchandising Co. May Dept. Stores 1,151 744 56 84 884 267
John Belk, chairman and ceo Belk 1,135 747 388 0 1,135 0 6.7
Donald Shaffer, president and coo Dollar General 1,025 425 600 0 1,025 0
Jay R. Jacobs, executive vp, merchandising Pier 1 Imports 1,006 300 218 0 518 488 41.8
John L. Dunham, president May Dept. Stores 1,003 848 75 80 1,003 0 -11.8
R. Brad Martin, chairman and ceo Saks 963 963 0 0 963 0 4.8
R. David Alexander Jr., executive vp, coo Family Dollar 920 296 74 0 370 551 23.0
James A. Coggin, president and chief administrative officer Saks 893 788 105 0 893 0 21.0
William P. McNamara, vice chairman May Dept. Stores 886 705 54 58 817 69
William G. Pagonis, senior, supply chain management Sears, Roebuck 857 420 437 0 857 0 21.0
H.W. McKay Belk, president, merchandising and marketing Belk 778 550 228 0 778 0 6.8
Thomas Belk, president, store divisions Belk 778 550 228 0 778 0 6.8
William J. Podany (6), chairman, president and ceo ShopKo Stores 740 740 0 0 740 0 -46.2
William Dillard II, ceo Dillard's 710 710 0 0 710 0 -64.8
M. Schwartz (7), former president and coo Kmart 706 706 0 0 706 0
Denis T. Lemire (12), president and coo Ames 678 553 125 0 678 0 -30.2
Steven B. Silverstein (8), president Linens 'n Things 596 440 0 157 596 0 -0.6
Mike Dillard, executive vp Dillard's 540 540 0 0 540 0 -55.4
Gwen K. Manto (9), executive vp & chief merchandising officer Stein Mart 525 475 50 0 525 0
Drue Corbusier, executive vp Dillard's 500 500 0 0 500 0 -54.5
Cecil Kearse (13), executive vp merchandising Kmart 496 496 0 0 496 0 -20.4
Jay Stein, chairman Stein Mart 475 475 0 0 475 0 2.9
Alan Rosskamm, chairman, president and ceo Jo-Ann Stores 465 465 0 0 465 0 -31.1
Michael D. Fisher, president and coo Stein Mart 465 405 60 0 465 0 64.2
Anthony D'Onofrio (10), former executive vp, global systems capability and chief supply chain officer Kmart 457 457 0 0 457 0
Larry G. Kirk, chairman and ceo Hancock Fabrics $411 $276 $135 $0 $411 $0 39.3%
Tom Hartshorn, executive vp, merchandising Dollar General 398 226 173 0 398 0 49.6
Michael J. Hopkins, president, Pamida ShopKo Stores 392 392 0 0 392 0 -35.5
Dave Bolen, executive vp, merchandising and marketing Jo-Ann Stores 343 343 0 0 343 0 -8.7
Jack W. Busby Jr., president and coo Hancock Fabrics 324 219 105 0 324 0 41.4
Gary W. Ramsey (11), coo ShopKo Stores 320 270 50 0 320 0
Steven T. Harig, senior vp, planning replenishment & analysis, distribution & transportation ShopKo Stores 314 274 40 0 314 0 -25.5
James A. Austin, executive vp Hancock Fabrics 158 108 50 0 158 0


Retail stock options exercised

As a spur to management to boost the bottom line — and thus the company's stock price — senior executives are rewarded with options to buy the company's stock at a deeply discounted price. The stronger the company's performance, the higher the stock price and the greater the payday for managers, or so the logic goes. And if a company is doing well, and its stock price riding high, these options can easily be the single biggest component of an executive's pay compensation package. A case in point is Target Stores' president Gregg Steinhafel, who exercised stock options valued at $13.2 million last year, making his options worth about 15 times as much as his cash salary of $872,000. In Steinhafel's case, the stock options he exercised amounted to almost 89 percent of his total compensation package of $14.9 million. When it came to options, Steinhafel did even better than his boss, Target ceo Bob Ulrich, whose options exercised were valued at the somewhat lesser amount of $10.0 million.
Top five
Gregg W. Steinhafel, Target Stores $13,197,000
Steven H. Temares, Bed Bath & Beyond 12,766,000
Gerald L. Storch, Bed Bath & Beyond 11,840,000
Robert J. Ulrich, Target Corp. 10,033,000
R. Lawrence Montgomery, Kohl's 9,155,000
Bottom five
William P. McNamara, May Dept. Stores $69,000
Judith Hofer, May Merchandising Co. 267,000
Jay R. Jacobs, Pier 1 Imports 488,000
R. David Alexander, Family Dollar 551,000
John H. Williams Jr., Stein Mart 1,811,000


Retail cash bonuses

Top five
Robert J. Ulrich, Target $3,700,000
Alan Questrom, J.C. Penney 1,897,000
H. Lee Scott Jr., Wal-Mart 1,785,000
Vanessa J. Castagna, J.C. Penney 1,334,000
David D. Glass, Wal-Mart 1,298,000
Bottom five
William P. McNamara, May Dept. Stores $54,000
James A. Austin, Hancock Fabrics 50,000
Gary W. Ramsey, ShopKo Stores 50,000
Gwen K. Manto, Stein Mart 50,000
Steven T. Harig, ShopKo Stores 40,000


Retail salaries
(straight salary, excluding bonus, other cash compensation and stock options)

Top five
Charles Conaway, Kmart $1,475,000
Robert J. Ulrich, Target 1,415,000
Eugene S. Kahn, May Dept. Stores 1,371,000
Alan Questrom, J.C. Penney 1,308,000
James M. Zimmerman, Federated Dept. Stores 1,250,000
Bottom five
Steven T. Harig, ShopKo Stores $274,000
Gary W. Ramsey, ShopKo Stores 270,000
Tom Hartshorn, Dollar General 226,000
Jack W. Busby Jr., Hancock Fabrics 219,000
James A. Austin, Hancock Fabrics 108,000


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