retail news in context, analysis with attitude

One MNB reader had a thought regarding Ahold Delhaize USA's announced plans "to transform and expand U.S. supply chain operations over the next three years by investing $480 million, including leases." The investment, the company says, "supports a strategy to transition the supply chain network into a fully-integrated, self-distribution model. The move includes the acquisition of three warehouse assets from C&S Wholesale Grocers and new leases on another two facilities.

This move will also give them the ability to more easily absorb any mergers or acquisitions that may occur…



On another subject, MNB reader Brian Blank wrote:

Interesting piece on Kroger and Walgreen Boots Alliance furthering their team-up efforts.  I hope they do a better job than Target did when it “teamed up” with CVS for its pharmacy and HBC.  Back when we lived in Cincinnati, Kroger’s pharmacy and HBC department were always competitive with the Walmart next door and the Target a block away.  Kroger had our pharmacy business and HBC purchases simply depended on which store we were shopping in when we needed something.  Moving to New England, we have moved our prescriptions around, but kept our HBC purchases divided between Target and Walmart—Walmart being slightly lower priced, but Target being more convenient and a bit nicer to shop in at the time.  Then, when Target decided to hand over their pharmacy and HBC departments to CVS, the prices of HBC items skyrocketed—suddenly the Target private label goods were ringing up as CVS-brand, at CVS prices.  And that was the last time I bought anything of that nature from Target (and truth be told, my overall purchasing at Target dropped precipitously as well).

Brian also had some thoughts about Lord & Taylor's situation:

As to Lord & Taylor, I used to love that store, but I haven’t even set foot in the local one this Christmas shopping season.  Nothing to do with their selection (they actually have a lot of youthful fashions), it all boils down to two things:  they never have sufficient staff, and the staff they do have is somewhat awful (maybe they used to be good, but they’ve been beat down by the company and conditions—I know I couldn’t keep up a good attitude with no one to help me take care of customers; and the condition of the store itself—run-down and ratty (broken chairs, worn carpet, peeling wall covering, etc.).  Such a shame, and I can’t figure out why.  Sure, under May Company ownership, I could see it—May’s store’s were never quite as nice to be in as the cross-mall competition from Federated or Dayton-Hudson.  But when Hudson’s Bay took them over, I expected much better and never saw it.  Now these new owners…feels like the “Millennials are killing” new parent company are “OK, Boomer-ing” L&T to death.



And regarding Maryland real estate firm St. John Properties, which handed out a total of $10 million in end-of-year bonuses to employees, based on length of tenure, to reward the people who make the company work, one MNB reader wrote:

I loved this article. I fully recognize I'm in a small minority, but when times are good, I truly feel companies need to share the wealth with everyone, not just the C-suite folks. Companies need to focus more on their people and less on what wall street wants or feels it deserves. It's insane we "reward" the institutions we borrowed money from and take away any goodwill from the people actually running the boat.

I remember when I first started with Safeway back in the 90's. At the stores, we were given a bonus and Turkeys/Hams for Thanksgiving and Christmas. Granted, the financial bonus was roughly $100 or less but at least it was something. First,  the bonus went away, but hey, we could earn double time if we worked the holidays. Then about 3 years later, the Turkeys and Hams were gone. Finally, before I left the company, we could get 10% off one grocery order. The store managers, assistant stores managers, district managers and upwards (And IT managers and higher) would continue to receive bonus but the normal worker was left always chasing after that dream of making it to a "full time" position where 40 hours a week was guaranteed.  After 21 years of service on both the retail and IT sides, I left and found a job which surprised me with yearly bonus if certain financial goals are hit. People are the reason companies function. 

No matter how good a CIO/CEO/CFO/President is, no matter how many hours they put in and no matter how many boards they are a member of, if they forget about who is actually doing the work at ground level, I suggest they check their egos and do a reality check.Weakened foundations can only endure so much neglect before either the building collapses or serious issues arise. 

I have a friend who owns a his own fledgling company and he makes sure his people are paid bonuses and are given paid time off/holiday time off. To say his turnover rate is low is an understatement. When people are treated like they matter, then the company does better all around and overall.

KC's View: