RobDownSouth
General Disaster
- Joined
- Apr 13, 2002
- Posts
- 79,102
Longish, but worth it:
When Covid lockdowns began to subside, and retail business began to "return to normal", media noticed a curious new trend: shoplifting became rampant in smaller stores.
This notion was immediately fanned here on the political board by the political board's staff racists @Rightguide and @Buffalogurl. Much pearl clutching ensued as calling for their fainting couches. They immediately found ways to blame this on, you guessed it, the Biden administration.
Walgreens read the unfavorable press in the Wall Street Journal and executives basically panicked.
They found their per-store "shrinkage rate" (loss due to shoplifting) had "skyrocketed" from 2.5% of non-prescription sales to *gasp* 3.5% of sales. They began a series of initiatives to stop retail theft, every one of which failed miserably.
Wall Street was not amused. They demanded to know what the hell had gone wrong with Walgreens?
To appease Wall Street investors, Walgreens contracted with the University of Southern California to determine why/how their customer base became kleptomaniacs.
The results were fascinating:
The retail employment world had changed, and Walgreens had failed to 1) notice the change and 2) adapt to this brave new world.
Walgreens insisted on using the ancient 2008 Bush Banking Crash recovery plan as a hiring template:
Entry level employees did some soul searching and decided as a group that they would not go "back to work" for a minimum wage that hadn't adjusted in years, and being at the beck and call of whims of management was particularly distasteful. So Walgreens became a pariah as an employer.
Nobody WANTED to work for Walgreens, they were the employer-of-just-about-last-resort (one step above the all-time worst employer ever, Dollar General).
Walgreens was constantly attempting to hire new employees, but virtually no one was willing to work for Walgreens.
Walgreens refused to budge from their employee hiring guidelines, which management had declared to be sacrosanct (No Exceptions!)....and stores began running chronically short staffed.
Walgreens shrugged it off. It made no difference to them if they had one or two staffers running the retail side of the house instead of the usual two to four, the dedicated employees who DID show up would just have to "suck it up, buttercup" and do the job of two people....all for the same wage.
Employee morale plummeted. Stressed employees were essentially chained to the front register, and no one was available to do such luxuries as "restock the shelves" "cleanup the aisles" and... importantly....."be a presence in the aisles to deter potential shoplifters".
Researchers found that many of the short-staffed employees actually noticed active shoplifters, but they decided as a group that "they weren't paid enough to deal with this shit"
This will make a fascinating business-school case study some day about failing to adapt to a changing market. It's right up there with Henry Ford's refusal to manufacture automobiles in any color other than black (which paved the way for the rise of General Motors).
Walgreens' Wall Street "Mea Culpa":
We Shit The Bed Post Covid
Interesting story in the NY Times a bit back on how Walgreens drug stores mishandled the management of their retail stores after the end of Covid lockdowns ....their CEO even admitted it during an investor call.We Shit The Bed Post Covid
When Covid lockdowns began to subside, and retail business began to "return to normal", media noticed a curious new trend: shoplifting became rampant in smaller stores.
This notion was immediately fanned here on the political board by the political board's staff racists @Rightguide and @Buffalogurl. Much pearl clutching ensued as calling for their fainting couches. They immediately found ways to blame this on, you guessed it, the Biden administration.
Walgreens read the unfavorable press in the Wall Street Journal and executives basically panicked.
They found their per-store "shrinkage rate" (loss due to shoplifting) had "skyrocketed" from 2.5% of non-prescription sales to *gasp* 3.5% of sales. They began a series of initiatives to stop retail theft, every one of which failed miserably.
- First they hired off-duty police officers as anti-theft detterants. This was a disaster, as these cops began treating many customers as potential criminals, and created a hostile shopping environment. Sales dropped, customer satisfaction surveys plummeted.
- Next they hired a small army of private security guards, but the rates they were willing to pay to private security companies assured they'd get what they paid for: Walgreens got a bunch of third-tier overweight choads who sat at the front entrance and played games on their cell phones for hours at a time.
- Walgreens then spent $$$ installing bubble ceiling 360-degree ceiling cameras as an anti-theft deterrent. Nobody could have known that these cameras would also be required to be monitored, and Walgreens didn't want to cough up the money to actually, you know, monitor the cameras. So they repurposed these cameras to do a direct feed to an LED TV right over the entrance showing people walking in....they put a note above the camera "YOU ARE BEING RECORDED". Didn't work as folks figured out they weren't actively monitoring
- Finally, they threw up their hands and said, fuck it, we'll put the most shoplifted stuff behind plexiglass and make customers get staff to open it up.
- The result: Well, shopping at Walgreens is considered a "convenience". Customers were "inconvenienced" by have to seek out an employee every time they wanted baby formula or condoms. Their shrinkage rate returned to pre-Covid norms but retail sales plummeted.
Wall Street was not amused. They demanded to know what the hell had gone wrong with Walgreens?
To appease Wall Street investors, Walgreens contracted with the University of Southern California to determine why/how their customer base became kleptomaniacs.
The results were fascinating:
The retail employment world had changed, and Walgreens had failed to 1) notice the change and 2) adapt to this brave new world.
Walgreens insisted on using the ancient 2008 Bush Banking Crash recovery plan as a hiring template:
- The federal government requires us to pay a minimum wage. We therefore will pay the minimum wage, nothing more. There will always be someone available who will work for minimum wage, they'll be "happy just to have a job", right?
- Most Walgreens are open 12-16 hours per day, some 24 hours a day. Shift differential? Never heard of him.
- As usual, employees will once again work when we tell them to work. They have no input on their availability for the schedule. We are management. They can go work elsewhere if they don't like it.
- Hey, this is a golden opportunity to cut benefits...let's hire new people for a maximum of 32 hours a week so we won't have to pay health insurance! (Ironic for a pharmacy, no?)
Entry level employees did some soul searching and decided as a group that they would not go "back to work" for a minimum wage that hadn't adjusted in years, and being at the beck and call of whims of management was particularly distasteful. So Walgreens became a pariah as an employer.
Nobody WANTED to work for Walgreens, they were the employer-of-just-about-last-resort (one step above the all-time worst employer ever, Dollar General).
Walgreens was constantly attempting to hire new employees, but virtually no one was willing to work for Walgreens.
Walgreens refused to budge from their employee hiring guidelines, which management had declared to be sacrosanct (No Exceptions!)....and stores began running chronically short staffed.
Walgreens shrugged it off. It made no difference to them if they had one or two staffers running the retail side of the house instead of the usual two to four, the dedicated employees who DID show up would just have to "suck it up, buttercup" and do the job of two people....all for the same wage.
Employee morale plummeted. Stressed employees were essentially chained to the front register, and no one was available to do such luxuries as "restock the shelves" "cleanup the aisles" and... importantly....."be a presence in the aisles to deter potential shoplifters".
Researchers found that many of the short-staffed employees actually noticed active shoplifters, but they decided as a group that "they weren't paid enough to deal with this shit"
This will make a fascinating business-school case study some day about failing to adapt to a changing market. It's right up there with Henry Ford's refusal to manufacture automobiles in any color other than black (which paved the way for the rise of General Motors).
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