Can You Use Economic Crisis to Upgrade Your Workforce?

Can You Use Economic Crisis to Upgrade Your Workforce?

This topic came up at our Foodservice Roundtable earlier this year, and then I heard more talk of it at some recent trade shows.

Basically, the theory is that the current economic recession has created an excellent pool of potential employees. Recent college graduates, who are currently shut out from more traditionally high-paying jobs in the financial and other industries, are looking elsewhere for employment. Some retailers I’ve spoken with see this as an opportunity to recruit better talent – even the next generation of leaders at their companies.

I’ve read that some restaurant companies are already doing this, so does it behoove the convenience industry to do likewise. Of course, this begs the question: how do you hire these new recruits if you already have a hiring freeze due to the economy? Does this mean you fire current employees with lesser potential to make room for the new recruits? And, what happens when the economy improves? Will these new hot shots look to move on to other, more glamorous jobs? Of course, this is also a great opportunity to show these new recruits both the challenges and rewards of working in the convenience store industry.

What do you think? Are you finding that it’s easier to hire a higher caliber employee in today’s market? Why? And, is this good for your company and the industry?-- Don Longo, CSNews' Editor-in-Chief, dlongo@csnews.com.

Working It Out

In a marketplace where every retailer is looking for an edge, could knowing where  customers work  -- and partnering with those employers -- be helpful?

By a whopping margin of 82 percent to 18 percent, consumers said they would be more likely to act on an offer from their employer rather than one they received at home, according to the 2009 Payday Cycle Spending Survey, which asked nearly 1,100 American workers and employers their opinions on marketing in the workplace.

Nearly 85 percent of employers would agree to deliver special offerings to their employees on payday. Meanwhile, 86 percent of employees said they would be more likely to purchase a product/service when receiving that offer on or near their payday.

Most employers continue to distribute employee paychecks/direct deposit stubs by hand (66 percent). Eighteen percent use  inner-office mail;  16 percent use the postal service.

They key for c-store operators may be getting to the big local employers -- schools, hospitals, factories  -- or even smaller employers such as real estate firms, and seeing if they'd pass on special offers. When paychecks are getting slashed, 401K funds drying up and people being furloughed for weeks at a time, who wouldn't want to find a coupon for a buy-one-get-one sandwich deal or free coffee with the purchase of a breakfast pastry?

Barb Grondin Francella

 

Update from Nielsen’s Consumer 360 Conference

Collaboration is the theme vividly painted at The Nielsen Co.’s Consumer 360 morning kick off -- as attendees found themselves consumed in data illustrating a continuously changing consumer mindset, fed by an ongoing shift in consumer psychology.

And the message was clear from the start: collaboration at the retail-vendor level will be the key to successfully navigating this challenging, changing landscape.

The grocery industry, indeed all of retail, is caught in the turmoil described in David Bowie’s 1971 classic “Changes.” "Ch-ch-changes...turn and face the strain…Ch-ch-changes…just gonna have to be a different man." And while Bowie may have focused on the compulsive nature of artistic reinvention, the retail industry is focused now on its own reinvention -- and that of today’s consumer.

Almost as if echoing Bowie’s own theatrical presentations, The Nielsen Co. collaborated with Infinia Group to create a multi-media experience, entitled “Consumed: The Economy Hits Home.” The dynamic learning platform brings guests into the minds of consumers with a series of video screens – streaming messages, visions, pictures, thoughts and observations, and of course, cutting-edge Nielsen data -- combined to paint an exhibit of Mark Leiter [President, Professional Services] and John Lewis’ [President & CEO, North America of Nielsen Consumer, North America] analysis Consumer or Consumed: Achieving Clarity in an Uncertain World.

Viewers of Consumed literally walk through Nielsen’s data and the consumer mind, sharing the latest perspective on how macro forces in today’s unpredictable economy are shaping consumers’ attitudes and behaviors. The fact is that today’s consumer is stressed, but the fact still remains that consumers are still actively shopping, buying and using a wide range of essential products. How the industry chooses to move ahead in the most productive manner is critical.

“Navigating through this new landscape requires bold leadership coupled with a sophisticated, analytical edge, one that allows you to see around the next corner and spot the many new options for growth as quickly as possible.”

Consumed spotlights nine chapters or elements to navigate -- Contrast, Changes, Coping, Challenges, Channels, Choices, Competition, Clarity and Curiosity. In a blitz of media messages, the participant’s vision becomes clear -- change is inevitable and welcome. The mission now is to get close to our consumers as an industry, understand and service their needs.

Key points include:

•    The American dream is enduring, although that dream was just heavily edited.
•    Most Americans can still afford the essentials: food, clothing and shelter.
•    Living a healthier lifestyle isn’t a passing fad or fashion
•    Consumers are creatively redefining the media landscape.
•    Long-term demographic forces will continue to created unprecedented growth opportunities.
•    The home is quickly becoming the centerpiece of eating, entertainment and work.
•    Discount shopping has become a full contact sport.
•    Trading across (or out) of categories are today’s most important consumer decisions.
•    Trading down (or over) to private label brands continues to gain momentum.
•    Value messaging loses its meaning if everyone adopts the same positioning.
•    Consumers may be ready for fewer, simpler and more meaningful choices.

Manufacturers and retailers need to keep focused on what’s changing and just as importantly what’s not changing. For example, in the world of private label, Nielsen reports that 62 percent of consumers agree private label is just as good as national brands and 90 percent say they are comfortably served by those private label options. Still, national brands continue to serve the consumer.

Beyond the flashing screens of the Consumed exhibit, Lewis reinforced these visions in his opening remarks, noting the industry must focus not only on their own “micro-wars” of local competition but on the “macro-war” being waged in other economic spheres such as restaurants and spas. As consumers shift discretionary dollars from outside dining experiences and salon treatments, how is the grocery industry responding?

“What are you doing to make this an opportunity for you?” Lewis questioned. Finding clarity in the challenges ahead will make this an industry that leads change rather than one consumed by it.

Consumed -- the video experience -- will be available on Nielsen.com in the coming weeks. Stay tuned.

--Michele Moran, Editor-in-Chief, Progressive Grocer Magazine

Glass Half Full?

Neck deep in this recession, small store operators are more optimistic than entrepreneurs in other industries, even though they are making more personal sacrifices, according to a recent study.

 

This past  February and March, when 727 small business owners  with fewer than 100 employees were asked by the American Express OPEN Small Business Monitor to evaluate the economic environment, retailers had the most positive outlook, compared to owners of small manufacturing or services companies.

 

Despite their tendency to sacrifice personal finances (67 percent) or to stop taking a salary to deal with the recession (42 percent), 47 percent of the retailers  had positive outlooks, a sharp contrast to their attitudes in spring 2008,  when 34 percent of them were optimistic.

 

I find it interesting -- and hopeful -- these small retail operators who have daily, face-to-face contact with consumers, are feeling better about their businesses' future, especially since almost 60 percent said they were concerned with cash flow, due in part to larger- than-necessary inventories.

 

Although nearly one-third of the retailers have no capital investment plans (compared to 37 percent six month ago, nearly the same amount identified themselves as  “opportunists” who make the best of a bad situation (30 percent).

 

Small store operators' sacrifices for the love of retailing are well recognized. This study simply puts numbers to a story most of us have seen played out for decades.

 

-- Barb Grondin Francella

The 'Downturn Generation'

To weather the recession and keep a closer eye on spending long-term, a significant number of Americans are picking up shopping practices that resemble those of Depression-era Americans, according to a recent study.

 

Many consumers are permanently changing their diet, self care and home maintenance rituals,revealed "Dissecting the Downturn Generation: Recognizing and Leveraging Permanence in Today's Transformational Economy,"by IRI.

 

 Retailers and product makers should take one of three emerging types of shoppers: Optimists who believe "things will get better in the next 12 months' and are spending wisely, cutting back selectively and making sacrifices as a last resort; Maintainers who believe "the economy won't get worse, but it wont get better either" and are more aggressively cutting back' and  Pessimists who believe "if you think times are tough now, next year will be worse" and are cutting back wherever possible and hunting tirelessly to find deals.

 

Interestingly, even though gasoline prices are down as much as 50 percent from last fall's peak, 73 percent of the people surveyed said rising gas prices 'impacted" or "strongly impacted" their financial situation during the past six months. Three-fourths said rising food prices "impacted" or "strongly impacted" their financial situation, even though food pries have largely leveled off or declined since summer 2008, according to the report.

 

Little surprise then, that low prices and sale items dominate shopper decisions. How this translates to the c-store industry, remains to be seen. But competitive street prices and efforts to deliver better values in the store will be more important than ever.

 

Two-for-$1 hot dog specials anyone?

 

-- Barb Grondin Francella 

Appreciation Defined at Valero

While visiting the energy company and c-store operator’s headquarters, I was struck by the appreciation Valero had for its employees, and the resulting dedication of its employees to the company.

 

Touring Valero’s San Antonio corporate campus, I came to understand why the company was named on Fortune’s 2009 list of 100 Best Companies to Work For, and was the 2009 No. 1 Best Big Company to Work For in the magazine as well.

 

Just passing the entrance into Valero’s facilities, there is a playground visible. I later learned this is the company’s daycare program. And on the way to the cafeteria where a wide variety of food is offered -- pizza, pasta, Mexican, deli, salads and much more -- I passed the company’s gym, where weights, cardio machines and even classes are held for its employees. I also heard about the company’s on-site medical clinic, where employees can go for a prescription, tests or a quick consult. And in the company’s support center, where employees serve stores and customer service, an Internet café is available for lunch breaks, complete with three mini refrigerators, a microwave, computers and magazines.

 

But beyond these benefits, there were also the little things, like offering courtesy umbrellas at the doorways for rainy days, a Redbox DVD rental machine, an ATM and a Coinstar change terminal.

 

More than just perks, the things this oil refiner and convenience store operator provides its employees are a sign of how much it appreciates them. Valero undoubtedly makes getting everyday tasks done more convenient for its employees, but it also improves their lives and builds the foundation for a strong loyalty. And the company reaps the benefits of these offering because it is commonly thought that happier workers are more effective.

 

Meeting the people behind the brand showed me the loyalty and appreciation they had for the company as well. Some have worked for the company for decades, and can’t imagine themselves anywhere else.

 

Valero has invested in its employees, and in these uncertain economic times, is reaping the rewards. When many other firms are cutting back programs and laying off workers, it is a refreshing and welcome sight to see this is not the case at Valero.

 

-- Mehgan Belanger

Seeing Valero from Both Sides

Three years ago, for our annual Day in the Life feature, I had the privilege of working on Valero’s front lines as a customer service representative in one of the company’s Corner Stores. This week, I returned to San Antonio, and got the chance to see Valero from the other side -- shadowing two employees at the chain’s retail corporate headquarters.

 

I spent the first part of my day with Director of Retail Maintenance Rodney Watts. He and his team tackle maintenance issues of all kinds for Valero’s 1,000 corporately owned stores. In the afternoon, I partnered up with Barbara Klein, manager of payroll and benefits, who started out with Valero 31 years ago as a payroll clerk and now oversees a staff of five direct reports. Together, they ensure 8,800 retail employees get the right pay and benefits.

 

When I worked in the store in 2006, I was really surprised at how upbeat the work environment was and how genuinely happy the employees were to be working for Valero. And now, after experiencing the corporate side, I can see why that is the case.

 

As Barbara told me, she considers every store-level employee “her customer” and customer service is her top priority. “I really enjoy my job, and I tell people that all the time. Every two weeks, when people are paid correctly, I’ve accomplished something,” she said.

 

Kudos to Valero for fostering a positive environment that permeates from the top down.

 

-- Linda Lisanti

Automated and Efficient

Spending a day at Valero revealed happy employees, company perks and a reliance on automation throughout the company.

After spending six and a half hours at the headquarters office of Valero Energy Corp. Wednesday in San Antonio, Texas, it became clear why the employees are all smiling -- and not just because the first quarter results showed retail and gas sales up.

Located in Building D at One Valero Way, Valero Retail Holdings Inc., the retail arm of the company, truly works as a team. Several times I saw different departments popping in and out of each other’s offices with questions and concerns, and you got the sense each person was willing to help out the department just down the hall.

I spent the day with accounting, IT and fuel pricing/transportation, and each person I spoke with talked about working closely with the other departments and the importance of keeping everyone in the loop. Two years ago, the company reorganized, and many departments are now located in the same building. Everyone I spoke to agreed it was a big benefit, making their time and work much more efficient since the retail operations were previously spread out among separate buildings. Before the move, there were not many visits to one another’s office. Most of the questions or issues required phone calls, according to employees. Considering how much we are always interacting (some might say screaming) with one another here at Convenience Store News, I could understand how difficult it must have been to be so far apart!

I was also impressed with the benefits given to all employees -- an amazing cafeteria; an in-house gym with weights, machines, exercise classes and trainers; and even a clinic on the campus for employees to use when they are feeling under the weather, or need a weekly allergy shot.

Even before lunch, I realized the importance given to technology and automation, with each department explaining how they rely on systems and reports, and how much easier life is with automated systems. I even got a peek into the technology lab where they test new technology and also deal with any issues at the store level in terms of system errors.

But more on that in the article -- stay tuned for our Day in the Life at Valero cover story in the July 2009 issue!

--Tammy Mastroberte