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Lessons From an Ousted CEO

Entrepreneur who found success after leading Circle K into bankruptcy dies at 90
karl eller

TUCSON, Ariz. — Karl Eller, the entrepreneur and advertising executive who led the Circle K convenience-store chain in the 1980s and early 1990s, died March 10 at the age of 90.

Born in Chicago in 1928, his infatuation with outdoor advertising began when he moved to Tucson, and along his drive there he read the incremental, rhyming messages on the now-iconic Burma Shave signs, according to the Arizona Daily Star.

Eller began his advertising career in 1952 with Foster & Kleiser Outdoor Advertising Agency. He then joined Needham, Louis & Borby Advertising Agency, where he pioneered the concept of the miniature candy bar for Mars.

In 1962, Eller acquired the Arizona operations of Foster & Kleiser, renaming it Eller Outdoor Advertising. Following the purchase of several newspapers, TV stations and radio stations, he morphed the outdoor advertising company into Combined Communications. Eller was CEO of Gannett following its merger with Combined Communications before becoming president of Columbia Pictures in 1980.

After Coca-Cola bought Columbia Pictures, Eller grabbed a chance in 1983 to head Circle K, a chain of about 1,200 convenience stores in the Southwest, contributing what was then the novel idea of including fuel pumps at c-stores, the report said. He built Circle K into the largest publicly owned c-store company in the United States, with more than 4,000 stores and more than $3.4 billion in annual revenue.

His aim was to expand the chain rapidly and then sell it to an oil company, said a Wall Street Journal report. He made a series of acquisitions, including the nearly 1,000-store UtoteM chain, and ran up debt of more than $1 billion.

By 1990, results were deteriorating, and it became clear there were no buyers for Circle K, said the Journal. Directors criticized Eller’s management. The stores had quirky inventories, including slow-selling items such as hairnets. “We knew what we bought, but we didn’t know what we sold,” Eller wrote later. The board ousted him as CEO. The company declared bankruptcy that same year.

His wealth was gone and he had $100 million of personal debt, according to the report. Rather than declaring personal bankruptcy, he came to terms with his creditors; those who wanted immediate cash got 10 cents on the dollar, and the rest eventually were paid in full, he wrote later. One motive was to preserve his reputation so he could have another shot as an entrepreneur.

Among the lessons Eller learned, he said, was “stick to something you know.”

Eller returned to outdoor advertising in 1992, forming the Eller Media Co. He sold the company to Clear Channel Communications in 1997 for $1.15 billion and became CEO of the outdoor division, where he would remain until his retirement in 2001.

In 1999, the University of Arizona in Tucson renamed its school of management the Eller College of Management. In 2004, Eller was conducted into the American Advertising Hall of Fame.

With approximately 8,400 stores in the United States, Circle K is now owned by Laval, Quebec-based Alimentation Couche-Tard Inc. It is No. 2 in the Top 40 update to CSP’s2018 Top 202 ranking of c-store chains by number of retail outlets.

 

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