Responding to the Market Basket situation, one MNB reader wrote:
Seems like Artie T DeMoulas was running the company like his father did, with a strong hand. His father rewarded those who worked hard and followed the company line. Those who didn’t found themselves without a job. His dad ran the company with a thin management team and shrewd eye toward spending. It appears this is how the current company runs where they own much of their locations and avoid debt putting income back into price.
If the company is sold to outside investors it won’t take long to load the balance sheet with debt and Market Basket will join the ranks of Purity Supreme, Heartland, Star Markets and other former New England supermarket chains. I am surprised Arthur didn’t try to peel off one of his sisters to his side unless they all rebuffed him. This saga will drag on for some time with the chain suffering because Arthur DeMoulas is so closely linked to its operations.
From MNB reader Steven Ritchey:
Too often I see chaos in family run businesses, Those who aren’t running the company often think the one who is should do things differently, and maybe they are right.
What I’ve read of Arthur T. Demoulas says he had his priorities straight. Have good loyal employees who respect you and your business, who take care of customers, don’t grow too big too fast, make sure what you have is working properly before expanding.
One of the basic things I was taught in college was to not grow, not expand unless what you have already is working. If something isn’t working right, fix it, that expanding then fixing it when it’s exposed by growth is much, much harder. So, get all your ducks in a row before expanding, it goes a lot more smoothly.
Second, and here’s where I might lose you. I have to wonder about the consultant who says that Demoulas was “too conservative” he should have been expanding faster, the business would support more growth. First, it’s easy to make pronouncements like this when you have no skin in the game, when it won’t be you whose hung out to dry when things don’t go well from expanding too fast, too soon. Maybe, just maybe Demoulas was being judicious about expanding, making sure his company was ready before adding more stores. Maybe, they were at a size he felt comfortable that they could manage effectively. There is something to be said for being happy with what you have.
Finally, his sisters may not realize they may be playing with fire. This mess may cause them to lose precious, loyal, competent employees, and to lose loyal customers. Both once gone can be hard and expensive to replace, if it can be done.
To be sure, there are mistakes here on both sides, there always are in a break up like this. It’s going to be interesting to see how both sides pick up the pieces.
Reacting to my FaceTime about the importance of retail branding, MNB reader Bob Wheatley wrote:
Kevin – amen and amen. May I offer a perspective on cause: leadership teams get focused on promoting their brand bona fides, their achievements, their balance sheet victories to a point that ongoing critical self-examination of where their brand sits vis-à-vis the inevitable loss of uniqueness and differentiation over time is overlooked. It’s lost in points of difference that become ever more trivial and inconsequential, due in many ways to what happens through expansion and chasing efficiencies that have an unintended consequence. They operate to help commoditize the brand, pushing it towards the vanilla middle of sameness and thus the unremarkable retail shopping experience you mentioned in your analysis. It takes constant vigilance and unvarnished honesty to look at the “truth” of where a brand sits year to year. Differentiation is a stronger strategy, as you point out, but that requires courage and boldness – two characteristics that can be hard to pursue when any kind of added risk is involved. Yet as you point out, this is precisely what must be done. Perhaps a future story for MNB – profiles in retail brand courage?
On another subject, MNB reader Greg Broadwater wrote:
Great write-up on the Ocado/Kroger partnership. I was working for Kroger at the time this partnership was announced. Rodney (McMullen) had aspirations of delivering “anything, anytime, anywhere” to customers. It was a downright mantra going around the offices like wildfire.
I’ve since departed ways from Kroger (now overseeing Marketing for New Seasons Market) and always thought for Kroger to expand their e-commerce businesses and get into markets thy weren’t in, they would have been better off to buy Instacart back around the same time when they were looking for a buyer. Leveraging the data they could garner form the business and also take the sales while being in almost every other grocer in America. Again, I wasn’t in the room for ANY of those types of conversations, just a curious employee at that time.
MNB reader John Marshall, of the United Food and Commercial Workers, wrote:
We have had doubts about the Ocado model (and e-commerce a large part of the business generally) for a number of years… I truly believe that if KR had put ½ the investment into staffing its stores better it would have higher sales and profits and lower shrink.
Yesterday we reported that the 1939 Group, which is owned by the family that owns Schnuck Markets, is acquiring “100% of the shares of the Wisconsin-based parent company of Skogen’s Festival Foods and Hometown Grocers, Inc. The purchase includes shares held by Mark Skogen, CEO of Festival Foods and Hometown Grocers, Inc, as well as the shares in the trust held by associates in their Employee Stock Ownership Plan (ESOP).”
One MNB reader wrote:
Just saw the piece inside the newsletter on the Schnucks acquisition. It’s all good…. there was some shedding of people and some other restructuring for the last few months. Some viewed those moves as a precursor to a big change, a sale was coming. It will be interesting to see how they transition and whether or not they can keep Festivals prominence that the company has built up over the decades. Nevertheless, a huge issue here in the Badger State!
And finally, MNB reader Brian Dowling wrote:
Thanks for the commentary on Robert Redford’s passing. Not a day goes by where we read obituaries on notable people. However, the news on Redford struck a chord with me largely because I grew up watching him. I recall being “allowed” see “Butch Cassidy” in the theater. It was rated PG and my parents wouldn’t, up to that point, allow me to see anything but G rated movies.
To say that I was mesmerized understates the experience. I actually met Redford once at the 1986 Dallas premiere of “Legal Eagles,” one of his few flops. My wife and I were part of a small group that had about a six minute audience with him at restaurant next to the theater where the premiere was being held. I can’t recall why my company, Safeway, was part of the opportunity. What I do recall was him being very friendly and soft spoken. I also recall my wife’s comment afterward “Wow. That is a handsome man.” RIP Mr. Redford.
“Legal Eagles” isn’t a good movie, but Redford has a great scene in which he mimics Gene Kelly doing “Singing in The Rain” as he deals with insomnia.
MNB reader Steve Burbridge wrote:
Given your love of baseball, I was a bit stunned that you didn’t have “The Natural” as one of your favorite Redford movies. Yes, the premise was a bit far-fetched and the pacing can be slow. But, the final scene—Hobbs hitting the home run that explodes the stadium lights—is one of the most iconic in sports cinema. It perfectly captures the film’s theme of triumph and redemption. A great cast as well.
For me, as good as “The Natural” was, it paled next to “Bull Durham” and “Field of Dreams.” But it is all a matter of taste – I know people who hate “Field of Dreams.”
And MNB reader Matt Tripepi wrote:
I liked your Robert Redford take, and your visit to the A’s in Sacramento as I’ve been to 28 major league parks and have seen the pros play in a minor league park but only during spring training.
Here’s another fun but not necessarily great Redford movie that was actually filmed in Cincy a few years back: “The Old Man & the Gun.” If you are looking for a good watch in his later years, would recommend you check it out!
I’ve seen “The Old Man and the Gun,” and reviewed it here when it first came out in 2018. I actually watched it again last night, playing it in the background as I worked, and Redford is absolutely charming in it. I totally agree with you.
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