Sweat the Small Stuff, Duane Reade $WAG

16 Aug

Listen to any CEO speak and he (she)’ll surely tell you about how innovative and dynamic his (her) firm is, how they’re doing things at all levels to respond to customer demands and trends in real-time.  In reality, this is, in my experience seldom the case.  You know, those lovely days you leave your umbrella home because there’s a 20% chance of rain and not a cloud in the sky?  Today was (kinda) one of those days here in NYC, one of several we’ve had the past few weeks.  I’ve noticed at the several Duane Reade (subsidiary of Walgreens, WAG) locations around my apartment that on such days, the umbrella rack (which is on casters) is seldom, if ever, moved to the very front of the store.  At the one on Wall & Water Streets its actually in the absolutely furthest corner of the store from the door/register.  While I realize the average employee at most retail stores, especially of the grocery/etc variety aren’t bringing the business acumen, attention to detail, etc of an investment banker, these things really aren’t rocket science.  Let’s go through the thought process here from a DR employee: 

 

1. Its raining. 

2. It wasn’t  before, and anyway, people need umbrellas. 

3. Hey!

4. We sell umbrellas (grossly overpriced ones I have to buy because I, too, am a schmuck & forgot/lost mine and the Chinese lady who sells them outside my building leaves before I get out of work, ugh!)

5. Where are the umbrellas in the store?

6. Oh, stupid, they’re all the way in the back corner by the random stuff no body buys!

7. Hey!

8. I bet if we moved them right by the front entrance or checkout counter we’d sell a lot of umbrellas!

9. Sell Umbrellas!  Yay!
 
Its one thing that low-level store employees and their managers don’t have the inclination and/or sense to make these simple changes, but there’s no excuse for the regional if not national managers who handle product placement, etc to miss out on simple, common-sensical business decisions that individually might not impact the bottom line, but together have the potential to make a serious dent.  Chances are that if firms aren’t getting the basic, easy decisions right there’s a lot more room for improvement (to say the least) throughout the entire organization.  

When I’ve brought up such observations, others try to defend it with straw man-esque BS like “The company has tens of thousands of employees and 7,000 stores, give ‘em a break, the CEO can’t control EVERYTHING” or some such nonsense.  Successful organizations have the incentive structures in-place and HR policies to hire the right people and make sure they’re on top of their stuff.  They empower/reward employees at all levels of the organization and encourage them to really embrace continuous process improvement. 

It appears Duane Reade likely isn’t one of these organizations

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One Response to “Sweat the Small Stuff, Duane Reade $WAG”

  1. Hondo August 16, 2010 at 11:59 pm #

    Anal_yst: could it be that Duane Reade is too clever by half? Perhaps they think everyone already *knows* drugstores carry cheap umbrellas, so they *want* you to wander through the store, past other higher-margin items, on your way to what you want. Maybe you buy some of those higher-margin items. I think that’s why TGT and WMT put low-margin items in the back of the store.

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