Why Most Supermarkets Suck

One of the greatest unstated assets Whole Foods has had forever has been evident to anyone who cared to look.  Its the dirty little secret about conventional grocers.  The simply the fact the most large chain supermarkets suck.

The dirty little secret about the supermarket business is that it’s not about the consumer at all.  It’s about the process and what is needed before anything gets on the shelves.  It’s about the buyer, the office and the replenishment system.

When looking at most conventional grocers and their natural foods selections things look pretty ugly.  At first it might not make sense.  After all aren’t these retailers the ones who claim that they want the natural and organic consumers in their stores.  But remember that it’s not about the shoppers and things make more sense.

Most natural and organic sales are still too small to really drive all but the most savvy of stores to pay attention.  So what determines what products get on the shelves has everything to do with the process and little to do with creating sections that work.

As more stores use Retail Measurement Data this is starting to change but just slightly.  Take me to 5 conventional stores and I can tell you 20 things that anyone who just started working at Whole Foods two months ago knows should be done differently.

Furthermore if you can’t get anyone at the store level responsible for a natural foods section who’s going to stock it.  In these sections you might have items that ring through the grocery, frozen, dairy and produce departments but if you’re clerks are working in the rest of the store, possibly overworked or just plain lazy, who is going to bother to see if the soymilk is out of stock.  I’ve seen stores from Safeway in California to a Connecticut Stop & Shop where the natural food sections had empty shelves for days in a row.

On a slightly different note I’ve seen pallets of Pampers sent to the Castro Street Cala Supermarket, a neighborhood famous for being predominately gay, hence few children and a store with a tiny back stockroom.  Yet corporate orders the deals for the whole chain, so every store gets the same shipments regardless of whether it makes sense.  What doesn’t move will get shipped back to the warehouse, or in the case of smaller vendors, get shipped back to the vendor instead.

So you see the system isn’t flexible.  When you’re concern is less about the customers and more about how to maximize a schematic that works for most of your stores and gets the most money from slotting fees. I’ve seen fancy neighborhoods with grocery stores that had 6 facings of VegAll (a low end succotash) and not enough of the premium items people would actually buy.  But you know this is the way the system works, because if nobody buys the VegAll the up front money from the manufacturer still looks mighty good compared to the gourmet item the Direct Vendor who doesn’t pay a penny to get on the shelf.

And the fact is that the inertia at the top, at corporate works just fine with the folks at every level of the store.  Corporate makes deals and everyone likes wheeling and dealing.  And these deals that grease the wheels don’t really bother a lot of store level folks either.  After all they aren’t paid to be creative and sure enough there were probably times when they were young and got creative and all it did was get them summoned to the manager’s office or worse.

So the system just rolls along, like a slow train that loses more and more passengers and claims to wonder why they don’t get on board anymore but when you come down to it they just don’t really care.


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