Smith Drug celebrates 70 years in business

May 30--When businessman James M. Smith set up a small regional drug wholesaling operation in Spartanburg County in 1944, he could only hope that his venture would still be around seven decades later.

But after 70 years, Smith Drug Co. has grown into one of the largest wholesalers in the country, serving 1,300 independent retail pharmacies in 21 states, employing 357 people and earning $2.3 billion in sales annually.

And the company has been the cornerstone of J M Smith Corp.--the third largest privately held company in South Carolina. J M Smith Corp.'s holdings comprise Smith Drug and five smaller and younger companies, including QS/1 Data Systems, Smith Premier Services, Integral Solutions Group, Norgenix and RxMedic Systems Inc., based in Raleigh, N.C.

"The success of the company over the past 70 years has been phenomenal," said Ken Couch, president of Smith Drug. "Mr. Smith laid a phenomenal foundation for success, and we have had the greatest employees. Not only has Smith Drug become a key player in a very competitive industry, its success spurred the creation of four additional companies, all headquartered in Spartanburg."

On Thursday, Smith Drug celebrated its 70th birthday with a party for its employees at its corporate headquarters and warehouse off Fairforest Road.

The 250,000-square-foot facility opened in 2004, the same year Smith Drug celebrated its 60th anniversary. It occupies 25 acres of a 128-acre plot of land and is the largest location in the company's operating chain, which includes two 110,000-square-foot warehouses in Paragould, Ark., and Valdosta, Ga.

Couch said more than 16,000 boxes of prescription drugs are shipped out of the three facilities every night and delivered the next morning to customers via the company's "hub and spoke" delivery system.

"We have to be faster than FedEx, more accurate than UPS and more secure than some bank carriers," he said.

Smith, a pharmacist and entrepreneur, built a chain of 16 pharmacies in the Carolinas and Georgia in the 1920s and 1930s. He sold off the chain to finance his wholesale company, with the provision that the new owners would buy from him.

His son, Jim Smith Jr., followed in his footsteps and led the company's expansion into data processing and computer services, which marked the beginning of J M Smith Corp.

After computerizing Smith Drug in 1959, Smith established Smith Data Processing, which originally provided batch processing services to government and businesses.

Smith Data Processing is now a premier supplier of data processing systems and services to local government agencies in South Carolina, including law enforcement departments, judicial offices, municipal utilities and other offices.

In 1977, Smith's interest in computers and in pharmacy led him and a handful of programmers for Smith Data Processing to develop a computer system to help pharmacists manage their businesses.

The QS/1 Pharmacy System was born. It helped pharmacists maintain customer records, manage paperwork required by government regulations and print labels for medicine vials.

QS/1 Data Systems became a separate division in J M Smith Corp. in 1990 and has used its expertise to develop computer systems for home medical equipment providers, institutional pharmacies and the point-of-sale side of pharmacy business. The company's corporate headquarters is one of downtown's most impressive buildings.

The younger Smith died in 1985. His brother, Henry Dale Smith, led the company through the creation of the fourth division, Smith Premier Services, in 1997. Smith Premier provides a full range of prescription-related services for employers and insurance carriers, as well as a prescription benefits program known as the Premier Pharmacy Plan.

Henry Dale Smith retired from leadership of J M Smith Corp. in 1998. In 2011, the position of chairman and CEO was given to William "Bill" Cobb, who had previously served as president of QS/1 for 21 years.

J M Smith Corp. has remained a privately held company over the years, a characteristic Couch said has helped Smith Drug and its sister companies succeed.

Couch said Smith Drug has zero debt. The company also is famously good to its employees and known far and wide for attracting and retaining talent.

Employees are encouraged to give back to their communities by making contributions to their houses of worship and approved nonprofits. J M Smith Foundation, the company's ecumenical organization, matches the contributions of its employees dollar for dollar.

Couch said the foundation has raised $10 million over the past five years. Eighty percent of that money has remained in the Upstate.

Smith Drug, like its parent company, hasn't changed its philosophy during the past 70 years. The values stem from the four business tenets of its founder, the senior Smith, who believed in taking care of his employees, customers, finances and community.

"This is a family," Couch said. "I have been with the company for 33 years, and it has been the ride of my life. This is such a great group of people."

For more information, visit www.jmsmithcorp.com.

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