business news in context, analysis with attitude

We wrote yesterday of Whole Foods’ use of a “line director” in one of its New York City stores to keep a single, serpentine line moving in a way that is human and entertaining. MNB user Bob McMath writes:

“At Christmas time, Best Buy was using the "Director" approach to sending people to the best lane for them to use based on the length, the items in the cart, and whether they would pay with cash or credit.

“I entered the wrong end and was redirected to go behind a large barrier built of boxes that was intended to keep consumers from going directly into a single line behind a cash register. And the barrier was high, long and the line as it got inside it, was longer, it could have been a real pain. But cards placed along the barrier which people had to pass as they waited gave minutes left to a check-out. And when the person got to the "Director," he joked and directed you to that best line -- which I noted seemed to be about right as you looked down the line to see if anyone behind you was going faster! Meanwhile, for a change, people waiting in line talked to one another. Another rarity in this insular world!

“It was a change for me, at least, but somehow eased the strain of Christmas shopping lines, and made me stay in line and wait to check-out, instead of walking out without the gadget I wanted to buy.”

A perfect example of the importance of a human connection in an increasingly impersonal retailing world.

MNB user Ron May chimes in:

“There is hardly anything novel about the "line director" position mentioned in the article. This is just another name for a "front end manager," albeit with reduced responsibilities. Many large retailers have eliminated or scaled back this position, which in my opinion is misguided as well as a slap in the face to the customer.

“The way I see it, the checkout area of a store contains the store's money pipeline. When a checkout line gets backed up, there is a clog in this money pipeline. Many retailers don't see this and don't realize what they are losing. A good front end manager keeps the line moving and the money flowing.

“It's all about the service. It's all about viewing your staff as an asset and not an expense. It's all about watching the store and caring about your customer.”

Exactly. The question is, how many good front end managers out there these days?

Regarding the debate about whether it is time to implement sales taxes on Internet transactions, or continue the moratorium on such taxes, MNB user Kevin Tschudi wrote:

“I think the arguments about sales tax on internet sales have been misdirected. In most states, the sales tax is due the state no matter whether it's purchased over the internet or not. Here in Connecticut, you're responsible for paying 'use tax' on anything you purchase out of state that you did not pay sales tax on. The question is whether vendor should be responsible for collecting it, and allow some consumers to evade the taxes, while other consumers cannot.

“Currently, a catalog or internet company is only responsible for collecting sales tax in the state in which it's based. This gives an advantage to companies based in low population states. For example, an internet company based in South Dakota has an advantage over an internet company based in California on California sales. A company with a physical presence in many states (e.g. Sears) would have to charge sales tax in most states, or set up a separate entity that belongs to only one state. That's not fair, and it's not conducive to bricks and clicks arrangements.

“The flip side is that state sales tax laws are convoluted and painful to administer. Connecticut has weird exceptions like clothes under $75. New York has different rates for each county, and sometimes different rates within counties, making it a nightmare to comply with the rules if you sell into New York. It's unreasonable to expect an Internet merchant to learn the quirks for each and every jurisdiction that they sell into.

“A set of homogenized rules on what's taxable or not, combined with a standard rate for each state, would make compliance by merchants relatively simple, and avoid market distorting behavior. Eventually, the governors will make sales tax collectible on Internet sales - even a 'permanent' rule can be revoked. Companies should use this opportunity to clean up the oddities and inconsistencies that have evolved in sales tax rules.”

We speculated the other day about the possibility that a major supermarket retailer might decide to acquire Circle K…which prompted the following email from MNB user Dennis Barthuly:

“Just FYI, Kroger is already well into the C-Store business. They own TurkeyHill Minit Marts, Kwik Shops, Loaf ‘n Jugs among others.

“The CircleK’s may well fit into their geographic scheme already in place.”

We got several emails responding to a piece last week about the US threatening legal action against the EU because of its resistance to genetically modified foods; we simply wondered if this particular time in history, what with wars and terrorism on everyone’s front pages, is a good time to be alienating our EU allies.

One MNB user writes:

“Your points are excellent, and I have one question to add --

“If the market itself (governments AND most importantly consumers) have already made it clear (and it's CRYSTAL clear -- just take an amble down an EU grocery aisle) that they do not want a given product (and this is not limited to GM, by the way) -- why, why, WHY would you file suit to overturn the ban that they have opted to enact? Does Zoelickis think that he can MAKE people buy something they don't want just by overturning the ban? Further, are there any manufacturers who really in their heart of hearts believe that just because it's legal means that someone will buy it?

“When are we going to learn that just because a market behaves differently from the US doesn't make it wrong or backwards, it just makes it different?”

Good question.

Another member of the MNB community, who we are assuming had his tongue planted firmly in cheek as he wrote this, suggested:

“I think we should force GMO food on those dumb Euros. Next we can force them stop making fuel efficient cars and really bring the American Dream to the world. If Bush does not get to have his Iraq War, we could bomb Europe to purge them from the evil of non-GMO food…

Okay, folks, he was kidding…let’s not get too exorcised here.

However, another member of the MNB community makes a different point:

“Look into the eyes of those starving in Africa and elsewhere because their leaders are trying to abide by the politically correct concerns of EU. Do you think they care (about GMOs)?”

On the subject of Wal-Mart further venturing into the wholesaling business, MNB user Richard A. Cognetti Jr. writes:

“Hmmm. Let’s see, they control C-store supply in many markets, soon will control grocery and then perhaps purchase Cardinal or McKesson to control drug. Plus they are dictating what they want suppliers to make for them already.”

And the problem is what exactly?

MNB user Don Sutton has another thought on this issue:

“There is one area where Wal-Mart could enter the wholesale market without the problems and antitrust suits that would certainly come with a traditional wholesale operation, and that would be the specialty food market.

“This is an area with a lot of room for serious competition.

“With a system of regional warehouses, linked with a GOOD computer system, regional products from smaller operations would have more national exposure and local retailers would have the opportunity to offer a wider variety of products.

“The largess of the Walley World distribution operation, combined with a tracking system similar to UPS, is a natural in this niche. True, operations like Fleming and Nash Finch have specialty food operations, but a serious entrance into this market from the Bentonville Behemoth would force increased competition quality and scope that could only benefit retailers and consumers.

“It always makes more sense to aim sales and products at vacuums or weak areas in the marketplace rather than to jump into a crowded arena where you're just one more outlet trying to beat up on entrenched competition that's kicking and scratching to fight back. This is especially true in antitrust areas where the only winners are law firms with a couple dozen partners whose primary focus is to justify as many billable hours as possible.”

Couple of quick notes to a whole bunch of you who wrote in on the same two subjects:

  • Thanks for all the Brussels sprouts recipes. We can’t promise that we’ll use them, but we appreciate the thought. And thanks for correcting our spelling -- it “Brussels sprouts,” not “brussel sprouts.”

  • Despite the generous offers, we will not be able to rent or loan out our 13-year old who cooks. Though it was tempting…

KC's View: