Albertson’s Top Management Deals With Big Picture Problems But Fails To See Smaller Issues

Albertson’s Top Management Deals With Big Picture Problems But Fails To See Smaller Issues

Albertson’s is owned by a big box house operation, Supervalue Inc.  This may have set up top management to think in terms of resolving company and store performance issues from a twenty thousand feet top down view and not take the time or interest to view street level uniqueness for each individual store and how each store interfaces with the local community.  One approach does not fit all (stores), is the point I am making.

In a Business Week web site article it was stated that “Albertsons Southern California President Dan Sanders said in a statement. “Albertsons suffered a decrease in customers and sales throughout the division and did not respond adequately to customer needs.”  Later in the same article Greg Conger, president of United Food commercial Workers, Union 324 in Orange County stated that “ever since SuperValu purchased Albertsons, they have had difficulty running conventional grocery stores”

What I see:

  • The produce is too high priced.  Trader Joe’s is doing much better.
  • The cut beef products behind the meat counter and packaged do not seem to be better than select grade.  COSTCO is offering much better quality and value.
  • Many store sale items were close to expiration dates and some items we found were past those dates.
  • The new June 2012 layoffs of store staff may have hurt Albertson’s even more because management failed to realize that portions of their stores are separate smaller store operations.  They made the mistake of laying off all store employees by seniority and not taking into consideration individuals that possessed specialized skills along with customer loyalty and customer following.   For example, our local store offers an in store Starbucks.  That small Starbucks operation really enhanced the store sales and drew customers into that store.   This especially was true in the mornings.  Many people go to these Starbucks ONLY and do not intend to shop in the store.  But, I have seen countless Starbucks customers add greeting cards, special event balloons, gift cards, salads, bakery items to their drink purchases.  The Starbucks that we visited had personnel that offered exquisite service and banter that really made the customer feel welcome and almost like we were in a small town.  With the June 2012 layoffs, the well performing staff was fired or dispersed to other stores.  The staff that replaced those that had to leave had more seniority but failed to provide the level of service and failed to bring a customer following.  The store sales dropped significantly.  We witnessed a huge fall off from one store that had almost all of its top baristas removed.  Within a week of the Starbucks staff change, the morning drink lines were real short with only one or no one waiting.  Prior to the layoffs the lines were often times five to ten people deep and customers would stand around the counter and talk to one another while waiting for their drinks.  Some customers even stayed to carry on conversations with other customers they knew.

 

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