Recently the UK supermarket chain Morrisons has been in the news, regarding the state of the business, potential job cuts, and a lambasting for the Board at the recent company AGM from former chairman and straight-talking Yorkshireman Sir Ken Morrison, son of the company’s founder.
While CEO of the company, he was known for reportedly “skip diving” on visits to his Morrison’s stores – sifting through the bins to see what was being thrown out and wasted. Sir Ken has a simple philosophy to the supermarket business – “shop in your own shops, get to know your customers and don’t make presidential visits“.
It seemed to work well for him, for Morrisons was profitable for good number of years, until, in 2004, Morrisons acquired Safeway UK (by then already independent from it’s US namesake), a company who I used to work for as a teenager.
One of the things which used to irk me about the way that Safeway was managed was the way that the senior management conducted visits of the stores. When it was known that the regional manager was visiting, significant amounts of overtime became available. The store would be scrubbed top to bottom, the normally messy behind the scenes stockrooms would be tidied up, the shelves would be neatly filled and faced up, and almost every checkout would be open.
This resulted in the management not seeing the real experience, but some sort of show, or “shop in a bottle”.
The very “presidential visits” that Ken Morrison speaks of.
To borrow Sir Ken’s turn of phrase, they left with a “bullshit” experience of what shopping in one of their stores was like. They thought it was okay, and didn’t suck.
Even on short notice “unannounced” visits, somehow the store was tipped off, either by other local managers or by more junior flunkies of the regional managers, fearing for their own jobs if a shop was seen in disarray. Of course, overtime was rapidly offered, and 90% of the time you would take it because you wanted the money.
It seems that Morrisons’ management have picked up this behaviour along with a number of other bad habits from the Safeway acquisition.
One of my own pet hates is the way they build-out the aisle ends with free-standing stacks of items on promotion. This narrows the aisle width, reducing circulation area, and making it harder to manoeuvre your trolley, for fear of knocking over this teetering pile of products.
Obviously the idea is you take something from this wobbly pile to reduce it in size!
Tesco still aren’t much better. It’s a confusing environment of bright yellow price tags, contradictory “special non-offers”, and shouty shelf-edge “barkers”. It’s just a meh experience, and that’s after you’ve battled your way in past all the TVs, clothes and other crap they sell in the big stores.
Also, you’ve got to look if the business model is wrong? Are Morrisons working to a growth-centric business model? In a saturated market such as grocery shopping, the growth most likely has to come from stealing market share from a competitor. This likely comes with a higher cost of sale, as you’ve got to do something to make that fickle customer choose you today. Should Morrisons instead be looking after it’s own customers and working to a retention-based business model?
Rather than providing an unpleasant and stressful experience, do something to make your customers want to come back. You can’t compete on price alone or Aldi and Lidl will take your business away, and the niche high-ends are dominated by the likes of Waitrose and M&S.
I can’t help feeling that devouring Safeway was a meal that still gives Morrisons indigestion to this day, and they would maybe do better following Ken Morrison’s three simple tenets by which he ran the business for many years: good staff, good suppliers, loyal customers.