business news in context, analysis with attitude

by Kevin Coupe

Yesterday, in my FaceTime commentary, I offered a tongue in cheek proposal:

I’m pretty sure it has legs, could be an enormously powerful and revenue-generating idea, and could make me millions, if not billions. The name of the company will be Front End Systems Global, and here’s how it will work. I’m going to be in the business of hiring front end store personnel - I’m going to hire all the people, pay their wages, and provide them with as little health care and benefits as I can get away with. Then, retail stores can come to me and outsource all their front end needs - they’ll never have to hire a checkout person again, and can take all those expenses right off their books. I’ll handle all the scheduling, all the HR. Retailers will see me as a godsend.

Even better, I will be able to build efficiencies because when I go into a market, I’ll hopefully be able to get three, four five companies as clients, so I can move people around as needed. The people who work in store A on Mondays and Wednesdays might work at store B on Tuesdays and Fridays, and store C on Saturdays - it’ll all depend on how I schedule them, and who is available.


The punch line was this:

Because I’m moving front end personnel from store to store and chain to chain, I’ve essentially managed to level the playing field for all these companies, eliminating any differential advantage they might be able to achieve in the one place in the store where employees actually interact with shoppers.

In other words, a crappy idea - at least for retailers. And then I compared it to Instacart’s business model.

Well, while my tongue was decidedly in my cheek when I made this proposal, apparently I wasn’t that removed from reality.

The Financial Times yesterday reported that Uber is working on a similar proposal.

Seriously.

Uber, the story said, “is developing a new short-term staffing business, dubbed Uber Works, that would help to diversify its business ahead of next year’s planned initial public offering. Uber hopes to apply its ‘on-demand’ model and large database of contractors to provide a temporary workforce for events and corporate functions, such as waiters or security guards.”

The story goes on:

“While some on-demand workforce companies such as TaskRabbit have offered an extra pair of hands to consumers to help with house cleaning or building flat-packed furniture, Uber Works is pitched as a business-to-business service, like Uber Freight.

“The effort could also help to retain Uber’s drivers — which the company calls ‘partners’ — by offering alternative sources of income. Drivers on the Uber ride-hailing network can already opt to deliver food for Eats customers.”

Okay, this isn’t exactly what I was suggesting, but it is pretty damned close. And it isn’t hard to imagine Uber extending itself into the retail front end arena. It would be a natural move.

It also would be smart, especially as it drives to drive up its IPO value, for Uber. But not smart for retailers looking to differentiate themselves in customer-facing roles that ought to be of a much higher priority.

Still, the FT piece was pretty Eye-Opening.

One other thing. Just FYI, I recorded that FaceTime video more than a month ago … I just never had a chance to use it because of other subjects and opportunities that intervened.

Like I said. Just call me Nostradamus.
KC's View: