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.
In my experience, when somebody starts a reply to me with the word "so", they are about to attribute something to me that I neither said nor implied.
Nothing to do with grammar, just the poster inferring something erroneously.
They could lose a lot of customers this way.
You are completely mis-reading this situation. Go read thru the links to see the perfect strategy of Artie T. and his employees.
So, this Artie T guy came up with this strategy to burn the business and salt the fields?
He’s SAVING the business by buying it back from his slash-and-burn cousin Artie S, who wants to kill employee loyalty for a few more bucks.
Artie T is offering a more-than-fair price for the chain so he and his employees and customers can get back to business.
You’re going to be pretty embarrassed when the truth of this story sinks in.
They sure could lose a lot of customers, and even suppliers. Even employees.
It appears to me that the employees are standing on principle, and the fact that this ‘strike’ is apparently including everyone is showing the strength of their convictions.
According to one poster up thread, the employees he knows are politically conservative.
However, all employees (both hourly and salaried) are pretty much 100% united on this and even when unions offered to lend a helping hand, they were summarily rejected.
Frankly speaking, the employees have the BOD pinned in a corner. Not only are the employees basically shutting off the revenue flow but they have somehow united the customer base behind them as well. I have personally witnessed shoppers walking up to the doors, speaking with the employees, and then walking away after signing a petition pledging not to shop there again until the old CEO is re-instated. This is absolutely unprecedented.
Again, the employees are not looking for a pay increase nor increased benefits. They are paid in line with what most supermarkets employees in the industry earn so they are not asking to be compensated more than what they are worth.
This is a case that will be taught in business schools for years to come.
That was very confusing. Want to give it another shot?
FYI, ‘most productive time’ was reference to using their clout to force the issue.
Now take it away..........
The take-away from this great story is that employees need to be picking their owners and CEOs, not the other way around.
It’s a business model I hope catches on all through the world of retail. Where the rubber meets the road - employees and shoppers - is where profitability and loyalty lie, not some accountants and raiders who could care less about the intimacy of grocery retailing.
The recipe for success being: BUY your company, don’t UNIONIZE it to get what you want.
Pick their owners?
They’re 100 years too late to do that.
https://en.wikipedia.org/wiki/DeMoulas_Market_Basket
Market Basket loyal customers are taping the receipts from their purchases elsewhere to MB’s windows.
Hope the BOD approves the sale Monday.
You’re right, this unprecedented business model is not only going to be taught, but practiced widely, soon.
I hope the majority shareholders stand firm. Let the stores remain closed for a few months and see what happens.
Sorry, posted before reading that last, most important, sentence you posted.
I don’t think the family will be selling though.
OK, *new* owner(s).
FTA:
BOSTON — Board members of the beleaguered Market Basket grocery store chain say they will “seriously consider” a proposal from its fired chief executive to buy the company as the chain faces a workers’ revolt that has paralyzed the stores.
The board issued a statement Friday after meeting to discuss the company’s future as thousands of employees protested the firing of a popular chief executive, Arthur T. Demoulas.
OK, before I put words in your mouth based on that post alone, what conclusion would you like to see happen?
I meant that they won’t be selling to any outsiders, and I don’t blame them.
This company was built by the family. As important as the employees are, they didn’t build this, they only contributed.
they didn’t build this, they only contributed.
Yes, and with the buy-out will continue to contribute to the success of MB.
I personally will be cheering from TX when Artie S says ‘fine, take it.’
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