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Date Posted: 13:47:20 11/13/13 Wed
Author: Buc2
Author Host/IP: 23.25.106.209
Subject: Re: Good article about it...
In reply to: 5280 's message, "Good article about it..." on 13:20:11 11/13/13 Wed

> >href="http://www.forbes.com/sites/rickungar/2013/04/17/
>walmart-pays-workers-poorly-and-sinks-while-costco-pays
>-workers-well-and-sails-proof-that-you-get-what-you-pay
>-for/">http://www.forbes.com/sites/rickungar/2013/04/17
>/walmart-pays-workers-poorly-and-sinks-while-costco-pay
>s-workers-well-and-sails-proof-that-you-get-what-you-pa
>y-for/
>
>Walmart Pays Workers Poorly And Sinks While Costco
>Pays Workers Well And Sails-Proof That You Get What
>You Pay For
>
>Costco’s most recent quarterly earnings report reveals
>a fairly healthy eight percent rate of growth in
>year-on-year sales—including a five percent rise in
>same store sales. What’s more, with membership fees
>rising from $459 million in the same quarter last year
>to $528 million this year, it’s pretty clear that a
>significant number of customers are moving over to the
>retailer to do their discount shopping.
>
>Meanwhile, Costco’s primary competitor, Walmart, saw
>an anemic 1.2 percent rise in sales, while other
>competitors such as J.C. Penny and Target TGT +2.11%
>experienced even greater disasters in their sales
>results.
>
>Here’s a crazy thought—might it have something to do
>with the fact that Costco pays nearly all of its
>employees a decent living (well in excess of the
>minimum wage) while Wal-Mart continues to pay its
>workers as if their employees don’t actually need to
>eat more than once a week, live in an enclosed space
>and, on occasion, take their kids to see a doctor?
>
>And just in case the occasional Walmart employee finds
>a way to squeak by, the company has sought to put an
>end to that by cutting their employment roster by 1.4
>percent, even as they increased their store count by
>thirteen percent.
>
>The result?
>
>Walmart service now pretty much sucks—and customers
>don’t like it.
>
>Without enough employees to get the basic work of a
>retail operation done—and with those on site being
>paid a wage so low that it is difficult to expect much
>in the way of pride or motivation—Wal-Mart merchandise
>remains stacked on pallets in the warehouse rather
>than making it to the floor where customers can find
>the products they want. At the same time, check-out
>lines are painfully long and annoying as the overall
>shopping experience continues to deteriorate.
>
>One is left to wonder about the value of offering
>products at a lower price if those products are not on
>the shelves when the customer needs to buy them?
>
>Per Bloomberg Businessweek:
>
>“Wal-Mart Stores WMT +0.11% (WMT) has been cutting
>staff since the recession—and pallets of merchandise
>are piling up in its stockrooms as shelves go
>unfilled. In the past five years the world’s largest
>retailer added 455 U.S. Walmart stores, a 13 percent
>increase, according to company filings in late
>January. In the same period its total U.S. workforce,
>which includes employees at its Sam’s Club warehouse
>stores, dropped by about 20,000, or 1.4 percent.” The
>article continues, “A thinly spread workforce has
>other consequences: longer checkout lines, less help
>throughout the store, and disorganization. Last month,
>Walmart placed last among department and discount
>stores in the American Customer Satisfaction Index,
>the sixth year in a row the company has either tied or
>taken the last spot. The dwindling level of customer
>service comes as Walmart has touted its in-store
>experience to lure financially strained shoppers and
>to counter the threat from online rivals such as
>Amazon.com AMZN +0.71% (AMZN).”
>
>So, does paying an employee a living wage make a
>difference when it comes to profits?
>
>Harold Myerson writes in a terrific piece published in
>today’s WashPo—
>
>“One lesson that emerges from the experience of
>low-end retailers is that putting workers in crummy,
>low-wage jobs tends to yield crummy service as well.
>McDonald’s earnings have fallen, the Wall Street
>Journal reports, and a management webcast to franchise
>owners acknowledged that customer dissatisfaction is
>rising in part because “service is broken.” Myerson
>adds, “Some of the most successful retailers follow a
>different path. As MIT management professor Zeynep Ton
>argued in Harvard Business Review last year, Costco
>and Trader Joe’s pay their workers far more than many
>of their competitors, offer their employees
>opportunities for promotion and enjoy markedly lower
>worker turnover and far higher sales per employee than
>their low-road counterparts. Sales per employee at
>Costco are nearly double that at Sam’s Club.(emphasis
>added)”
>
>As the old saw goes, you get what you pay for. Costco
>pays their employees a livable wage and gets sales per
>employee at double what Walmart subsidiary Sam’s Club
>gets from their employees who work for lousy pay.
>
>Maybe the time has come for Wal-Mart to take a lesson
>from Costco and consider the potential upside of
>treating employees like human beings.
>
>It might just prove to be good for business.

Interesting article. Unfortunately there are no Costco's anywhere near Lynchburg. There is a Sam's Club & two Super Walmarts though. I can't stand any of them and for exactly the reasons cited in the article... understaffed with employees who don't give a shit. If I must shop at a discount store here, I choose Target. Competitive prices and much better service. At least at the Lynchburg store.

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