Posted on 07/26/2014 9:51:59 AM PDT by SamAdams76
A New England supermarket chain embroiled in a labor dispute provides a boon for its competitors—or does it?
One week after a company-wide employee dispute slammed the breaks on food deliveries, the shelves are looking pretty barren inside most of New England’s 70 or so Market Basket stores. Rather than shuffle past picket lines to contend with empty meat cases and dwindling produce bins, many of the region’s customers have been taking their business elsewhere.
Exactly how many customers have been going elsewhere is a question that’s begging to be answered, though of some of the area’s competing grocers are remaining rather tight-lipped on the matter.
Judi Palmer, spokeswoman for Stop & Shop’s New England division, declined to share specifics as to how the Market Basket situation was affecting the chain.
She noted, however, that Market Basket is “a main competitor” with a good portion of Stop & Shop stores scattered around Massachusetts. The chain no longer has stores in New Hampshire or Maine, but the Quincy, Mass.-based chain has more than 380 stores in New England. “Right now, we’re so just focusing on giving all our customers a great shopping experience,” Palmer said this week.
Jessica Stevens, spokeswoman for Target TGT , likewise declined to comment on the Market Basket strife or whether an increase in demand led to stocking shortages in the region. There are nearly 40 Target locations in Massachusetts and nine in New Hampshire, according to the company website. The chain carries a variety of perishable and nonperishable grocery items.
Officials from other competing grocery chains, including Hannaford Supermarkets and Wal-Mart WMT , did not respond to calls or emails sent this week.
But Jeffrey Gulko, spokesman for Shaw’s Supermarkets, said the past week has been a busy one for staff working in the company’s Massachusetts and New Hampshire locations.
“We’ve definitely seen an uptick in our sales, as well as the number of customers coming into those stores,” Gulko said on Friday. Company officials said the “most noticeable jump in sales” was this past Monday and Tuesday.
Shaw’s Supermarkets employs 18,500 workers around New England. The company has two distribution centers: one in Maine and one in Massachusetts.
“The sheer number of shipments being made to stores in those areas have definitely increased last week,” Gulko said, noting that the company has been successful in refilling shelves to meet consumer demands.
The national implications of the Market Basket upheaval remain uncertain.
“So far we haven’t heard much from any of the (competing) retailers in that area,” Laura Strange, spokeswoman for the Virginia-based National Grocers Association said on Friday.
In late June Market Basket’s board of directors set off an unanticipated chain reaction when they terminated beloved CEO Arthur T. Demoulas, replacing him with Co-CEOs: former Knowledge Universe CEO Felicia Thornton and former Radio Shack CEO James Gooch. Market Basket employees demonstrated their outrage this week by ceasing store deliveries, encouraging store boycotts and rallying en masse in shopping plazas.
The company has over 40 stores in Massachusetts, nearly 30 in New Hampshire and one in Maine. About 25,000 workers are employed with Market Basket.
On July 23, Demoulas made an offer to buy out his rivalling family members for an undisclosed sum in an effort to gain control of the company again.
“We care deeply about Market Basket and all our associates and we want to work together to return the company to its successful model for serving our loyal customers,” Demoulas said in a written statement issued the following day.
The company’s board was scheduled to meet Friday, though there’s no word yet as to whether or not Demoulas’ offer would be accepted. Meanwhile, upwards of 10,000 workers, many of them boarding buses from their respective Market Basket stores, attended a massive rally in Tewksbury, Mass. on Friday morning, backing up traffic for miles.
According to The Griffin Report of Food Marketing, the company is valued at $3.5 billion. Market Basket’s company revenues reportedly exceeded $4.6 billion last year.
Learn to identify ironic quipping before you fly off the handle.
Let them go out of business, this ship of fools sounds like they deserve it
He was their daddy, he gave them bonuses instead of using it to expand the business. Very paternalistic apparently.
SO now they will burn it down I guess since "Bad Uncle" with more shares took control.
If you read through the article, and some of the posts here on FR you will see that they are doing this for the stated purpose, have Arthur T. reinstated as the CEO.
The reinstatement will mean that they will continue to be paid (it appears) for their worth to the company.
I saw the pic, they are sitting down, not working and still getting paid.
Their worth to the company is less than zero at this point.
The chain is never going to go national the way it was being run.
Neither of us have a lot of facts to work with, but I came to just the opposite conclusion.
I see a greedy cousin who wants to operate the company for the benefit of short term profits, Arthur T. wants it operated with an eye towards a strong employee work force.
The relationship between market employees and market shoppers is intimate: by being loyal to each other, good stores turn into great stores.
It’s great to see the people who created the greatness using the correct model - capitalism - to buy it back, instead of unionism.
True, if you have a short term view of things.
In the long term, this may be the most productive time in their work lives, and also their personal lives.
Yes, I remember the Eastern airlines debacle. Employee-management was a big reason it folded, but not the only big reason. The airline was fought over by corporate raiders who didn’t give a hoot about the company or employees, financial dealings were done very stupidly, the FAA leveled unprecedented fines for safety violations, etc etc. The employees were left standing with their teeth in their mouths, pensions were cut off as I recall.
I was in Miami just a month after Eastern closed its doors forever, attended the world’s largest garage sale, or hangar sale, picked up some wonderful sturdy airline china and linens…but it was a very sad event.
I’d flown Eastern to Puerto Rico just a year earlier and had a blast, a memory I’ve cherished all these years.
Anyway, I hope these rival supermarket factions can come to terms. The employees seem very dedicated, and why shouldn’t they make a living at their work?
Only problem with your theory is that they are non-union. Now how do you explain that?
No share holders, it is 100% family owned.
Usagi, you may not know who Wintertime is, it's reasonable to assume that that was not irony.
They need to get their act cleaned up then. Paying employees to do nothing and shelves being empty is a good sign that this company should probably go out of business.
http://www.wbur.org/2014/07/25/market-basket-final-rally
Market Basket Board Will ‘Seriously Consider’ Ex-CEO Proposal To Buy Chain
Arthur T. Demoulas was fired last month by a board controlled by his cousin, Arthur S. Demoulas. Both are grandsons of the company’s founder and have feuded for decades.
The board said it will evaluate Arthur T’s offer, as well as prior offers and future offers.
Arthur T. offered to buy the 50.5 percent of the company now controlled by relatives who backed his firing last month.
“Our offer is a very full and fair one and should meet or exceed a seller’s expectations of the value of the company,” Arthur T. said in a statement Wednesday. “We care deeply about Market Basket and all of our associates and we want to work together to return the company to its successful model for serving our loyal customers.”
If they are getting paid and not working, they might as well be union.
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