Meredith’s reach extends beyond its titles

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Sylvia Johnson, a single mother of four, is filled with joy when she remembers the day in October when her house was transformed from rundown to remodeled, compliments of employees from Meredith Corp.  

Before then, sections of siding on the exterior of her 124-year-old home were rotting. The home’s 10 windows were in such bad shape that Johnson feared they would fall out if they were opened. Worried the windows might hurt one of her children, Johnson had them locked down and painted over. They hadn’t been opened in years.

Johnson, who works for Child Serve, an agency that provides services for children ranging from daycare to speech therapy, couldn’t afford the improvements. State programs balked at helping her, saying the project was too costly, Johnson said.

She applied for aid from a group called Rebuilding Together, a philanthropic organization that helps the elderly, handicapped and families with young children improve their homes so they are safe to live in. On her birthday in August, she learned she had been accepted to Rebuilding Together’s program.

What Johnson didn’t know is that Meredith, the publisher of Better Homes and Gardens and some of the world’s other best-read magazine titles, was planning a massive philanthropy push across the country in celebration of the company’s 100th anniversary.

Meredith, whose products largely focus on the home and family, had partnered with Rebuilding Together. Leaving its offices with a skeletal staff, hundreds of the company’s 3,000 employees fanned out to help revamp 40 homes in 12 cities on Oct. 9-11. The company worked on 25 homes in Des Moines alone, according to spokesman Art Slusark.

More than 30 Meredith employees arrived at Johnson’s home. In one day, they removed and replaced the rotting wood and the dangerous windows. They applied fresh paint to the home’s exterior. Broken plumbing and other problems in the house were fixed. In addition to the labor, Meredith donated $250,000 in cash to Rebuilding Together.

“I was left in awe,” Johnson said. “It was like my house was a honeycomb and all these hard-working bees were swarming over it. When I sit and think about it, I still think I am dreaming.”

Those days are just one example of the many ways that Meredith’s reach extends far beyond its publishing and broadcasting businesses in the cities in which it conducts its operations.

In Des Moines, Meredith’s home city, the benefits of having the company here are wide and varied, ranging from the above-average salaries Meredith pays its workers to strong support for cultural attractions such as the Des Moines Art Center to providing opportunities for local businesses, including catering companies, hotels, freelance writers and printing-related companies.

It’s likely that some institutions, such as the Science Center of Iowa, wouldn’t be here at all if the company and members of its founding family weren’t in Des Moines.

The company’s headquarters itself is an example of Meredith’s continued reinvestment in Des Moines. Work began on the original building in 1911.

The company’s founder, Edwin Thomas “E.T.” Meredith, bought the 2.8-acre site between Locust Street and the Raccoon River in celebration of the circulation of the company’s sole magazine, Successful Farming, hitting 500,000.

The building, which the Des Moines Register at the time estimated was built at a cost of $150,000 to $175,000, has been renovated nearly a dozen times since. Most recently, Meredith spent $40 million adding 185,000 square feet in 1998. The city granted Meredith a three-year tax exemption on the addition, Slusark said.

The company pays its workers relatively well. The median salary at Meredith is about $60,000, Slusark said. In addition, Meredith’s pension plan supports 375 former employees in Des Moines, injecting further cash into Greater Des Moines. The company paid $2 million in property taxes last year.

Perhaps one of the first acts that showed Meredith was a catalyst for growth in Des Moines came early, when the company was barely a decade old.

In 1914, company founder E.T. Meredith was looking for ways to attract advertisers and expand Successful Farming. Meredith wanted to charter a train full of East Coast business and advertising executives, to let them see for themselves the Midwest’s farms and businesses.

Turning to local bankers for help, Meredith asked to borrow $10,000. His bankers, who already had lent him the lion’s share of the funds to build his headquarters, resisted.

“Unless we show these people what we have, we are broke and you are broke with us,” E.T. told the bankers, according to a book on the company’s history that is expected to be published soon. The bankers agreed and lent Meredith the additional money.

The first of two Meredith Flyers, as the trains were called, arrived in Des Moines in June. The plan worked and Successful Farming’s circulation climbed to 600,000, while the company’s annual revenues passed $2 million.

Since then, Meredith has continued to attract visitors to the city and to its Locust Street campus. The company is a major supporter of the Des Moines International Airport, where is keeps two business jets made by Lear Corp. The jets are frequently flown between Des Moines and New York City, home to Meredith’s Ladies’ Home Journal and More magazines. With more than 300 employees, it is Meredith’s second-largest office.

Meredith owns television stations in 11 U.S. cities, and has offices in seven others, including Chicago, Detroit, Los Angeles and San Francisco. As a result, the company’s employees are a constant presence at the Des Moines airport.

Like many companies that import talent or host guests, Meredith’s visitors and potential employees are housed in Des Moines’ hotels. They are frequently taken to dine at some of the city’s best restaurants, including 801 Steak & Chop House, Splash Seafood Bar & Grill and 43 Restaurant and Bar, which is located at the Hotel Fort Des Moines.

Real estate agents are brought in to give prospective employees or those relocating to Iowa tours of the city.

The company’s headquarters, where roughly 900 people work, has a cafeteria. However, Meredith frequently hires local catering companies to serve special meals, especially when the board is meeting.

“Meredith is a very good customer,” said Diana Quick, owner of Food with Flair, which caters a variety of meals for Meredith several times each month. “They do a nice amount of business with us.”

Quick’s meals for the board might include beef tenderloin or sea bass with white chocolate mousse and raspberries for dessert, she said. “They’re always sit-down dinners.”

One of the biggest events happened on Oct. 2 when Food with Flair catered one of the company’s 100th anniversary events.

On Meredith’s lawn, employees were given champagne and had their choice of nine different cheeses, along with fresh fruit, all provided by Food with Flair, Quick said. During a ceremony, workers were given 100 $1 coins in recognition of the company’s centennial.

Meredith’s business is responsible for at least 187 jobs at CDS Inc., which helps manage subscriptions for Meredith and other publishers. The Des Moines-based company has about 3,000 employees worldwide, according to President Chris Holt.

CDS maintains subscription information on roughly 136 million households. Meredith accounts for about 16 million of that figure. CDS, which is closely held, doesn’t release sales and profit figures. But Holt said Meredith’s business accounts for about 12 percent of the company’s revenue.

“It’s extremely important to us to have the best in the industry in Des Moines, and to be able to tell others that we work with the best,” Holt said.

At least a dozen other publishing-related companies in Central Iowa owe their success, in part, to Meredith, including Hansen Printing Inc., Edwards Graphic Arts Inc., Quantum Imaging, Beeline Color Center, Finish Binders Inc., Bindery 1 and Plasti-Pak.

About 3 percent of sales at Acme Printing Co. are derived from work done for Meredith, according to Chuck Stansbury, Acme’s vice president of sales and marketing. The figure makes Meredith one of Acme’s top 10 customers. The company, which has 100 workers and last year had $13 million in sales, has worked with Meredith since the mid-1970s, mostly performing short-run printing services.

“It’s great to have a company of their stature in the community because it gives us a chance to do work that has a national, if not worldwide, audience,” Stansbury said.

Des Moines is home to hundreds of writers, editors and photographers who earn their living, in part, from work they perform for Meredith.

Meredith makes big use of outside talent to fill the editorial content of its 16 subscription magazines and 150 special-interest publications. For example, the company only recently hired two full-time photographers. Before that, freelance photographers had taken all of the pictures in the company’s magazines.

Mary Kay Shanley was a reporter at the Des Moines Register for years before she had her first child. With her family growing, Shanley wanted more flexible hours to spend time with her child. Freelancing for Meredith offered those opportunities.

“As a freelancer in Des Moines, you can have as much luck with a career as you could in a much larger city,” said Shanley, who wrote stories for Meredith for 20 years. She now writes books.

Philanthropy is central to both the company and to the Meredith family, according to those who know the family. Members of the Meredith family declined to be interviewed for this article.

The family controls the Edwin T. Meredith Foundation, which in 2000 had assets of $21.3 million, making it the 22nd-largest foundation in Iowa. Issues of importance to the company and the family include the arts, education and human services, Slusark said.

Along those lines, the family has been a major supporter of the Des Moines Arts Center, contributing about $4.3 million over the past several decades, according to Art Center Director Susan Talbott.

Family members, as well as company executives, have sat on the Art Center’s board of directors. E.T. “Tom” Meredith is a current board member. A major source of the Art Center’s endowment came through a $3.5 million grant from Anna Meredith, Talbott said. Anna was the wife of E.T. “Ed” Meredith Jr.

The money from Meredith has allowed the Art Center to buy one of its most prized paintings, a portrait by John Singer Sargent.

On Nov. 22, Meredith installed a   24-foot-high sculpture of a garden trowel by Claes Oldenburg on its grounds. Plantoir, as the sculpture is known, cost $1 million.

Meredith supports the arts, in part, because the company’s products depend heavily on the creative process. The stronger the art community in Des Moines, the more likely it is that Meredith will be successful in attracting talented employees to Des Moines, Slusark said.

Katie Meredith, the wife of E.T. “Ted” Meredith III, was the force behind the creation of the Science Center of Iowa in 1966, and the family has been active in the center since, according to Mary Sellers, the center’s executive director.

The Meredith Foundation recently announced it would contribute $7 million to help build a new $60 million Science Center in downtown Des Moines. The 100,000-square-foot center, which will be four times bigger than the current Science Center and will have an IMAX theater, is expected to open in 2005.

“It’s immeasurable the impact the family has had on Des Moines,” Sellers said.

Both the company and the family have been generous contributors to Simpson College and Drake University, where a building has been named after the family. Drake’s journalism school, which includes a rare magazine journalism program, is largely in place because of Meredith.

Similar programs are being explored with Iowa State University and the University of Iowa.

In recent years, Meredith has formalized its philanthropic contribution system. Donations from the company, which controls its own foundation, total roughly $1.2 million a year. Of that total, the company has $400,000 that it reserves for causes important to Meredith employees.

The company will match, dollar for dollar, any gifts from employees to charitable causes, Slusark said. Gifts to educational institutions are matched on a two-to-one basis, he said.

While matching programs are fairly common, Meredith has another arm to its philanthropic program that is more unusual.

The company will pay charities up to $500 per organization for the time that employees spend volunteering. The company does this, Slusark said, because “some employees may not have the means to make a large contribution (of money), but their time is valuable.”

In fiscal 2002, which ended in June, 150 Meredith employees submitted forms for charities for which they volunteered, totaling $121,000 in gifts, Slusark said.

Meredith’s executives, too, are some of Des Moines’ most visible public figures.

Suku Radia, the company’s chief financial officer, was named earlier this year as chairman of the Greater Des Moines Partnership. He has held the chairman’s position at the Greater Des Moines Committee, the Rotary Club of Des Moines and the Better Business Bureau. He has also served as chair of the board of trustees of the Convalescent Home for Children.

Steve Lacy, the president of Meredith’s publishing division, which accounts for about 75 percent of the company’s sales, is the chairman-elect of the board for the United Way of Central Iowa, one of Des Moines’ largest charities. He is the board chair of the Iowa chapter of the American Red Cross and he has led the boards of Junior Achievement of Central Iowa and for Big Brothers Big Sisters of Central Iowa.

“This community would be very different, and a much poorer community in many respects, if not for the Meredith corporation and the Meredith family,” Talbott said.

Next Week: The Business Record will focus on the challenges that Meredith faces now and the strategies the company is developing to overcome them.