business news in context, analysis with attitude

Yesterday we took note of a Boston Globe story about how the strike by members of the United Food and Commercial Workers (UFCW) against Ahold Delhaize-owned Stop & Shop - now in its sixth day - could be “a last stand for unionized grocery workers, whose stores are under attack by a host of competitors, all looking to grab a piece of the supermarket bounty.”

The Globe wrote that Stop & Shop is “one of the last remaining union shops in the industry,” and quoted Burt Flickinger of the Strategic Resource Group as saying that “the cost of benefits can be difficult to convey to union workers. ‘It really becomes a challenge to communicate to the team members at the stores that while the compensation could be going up 5 to 8 percent,’ other factors, like filling the hole in an unfunded pension plan, providing a robust health insurance package, and accommodating new minimum wage laws, hurt profit margins.”

I commented, in part:

I’m sympathetic to the UFCW in this case, but mostly that’s because I think that organized labor hasn’t yet figured out a way to pivot to a new role in the management-labor construct. Too often, I think, the negotiations and tensions are focused around arrangements that make labor part of the problem, not part of the solution. Now, to be fair, I’m not sure that traditional corporate interests always allow for this … the two sides have been in opposition to each other for so long that it may be hard to find another way.

I must admit that I wonder if, at the beginning of the negotiations between Stop & Shop and the UFCW, the labor folks looked at management and said, “Tell us about your problems, and tell us how you think we can help solve them.” And if management looked at the labor representatives and said, “Tell us about your problems and how you think we can help solve them.”

Do you think that they discussed each other’s problems as opposed to their negotiating positions?

MNB reader Michael Blackburn wrote:

The problems are the same: non-unionized competition.  As these competitors grew over the last few decades, in order to stay competitive, unionized shops were forced to curb pension contributions, leading to the current funding issues, despite very strong capital markets.  And now, after consumers have become “addicted” to low prices, we can’t go back to a world of strong pensions and healthcare benefits. 
Side note: it’s interesting we have the same pension/healthcare cost issues with public unions (teachers), where the price (tax) has certainly not been kept low, especially here in the Northeast.  Perhaps the real issue then is, our prior private company executives and public sector administrators provided too generous of a benefit package to their employees, and the current generation is paying the price.

On another subject, from MNB reader Doug Galli:

Kevin, reading your view about the FDA going after Wal-Mart and Kroger seemed rather flippant. It assumes that these retailers are not responsible and aren’t doing enough to keep age-restricted sales out of the hands of minors. As the individual responsible for 83 convenience store locations we take the following steps to train and reinforce positive behaviors with our associates:

During orientation a  state-mandated and state-sanctioned training on both tobacco and alcohol (In New York State our people have to be re-trained on tobacco every three years.)

When starting a shift they have to sign off that they understand our policy which is we proof everyone for alcohol and anyone that appears to be under 40 for tobacco (which includes e-cigarettes).

A monthly sign off sheet stating that they understand our policies.

We hire a third party to conduct monthly checks for both tobacco and alcohol and recognize and reward those that follow our policy.

A store manager’s bonus is impacted if any of their associates fail a sting.

If a store fails a sting the District Manager has to conduct a training class for all of the associates.

We have to enter the birthdate for any age-restricted sale into our POS.
In spite of all this, we still do on occasion fail a government sting. I’m sure that larger companies have programs equal to or greater than what we are doing. Seeing everything we do, the law should change and the individual employee that violates the law should be fined, not the responsible retailer that is doing everything possible to prevent this.
I can assure you that we take this very seriously and don’t consider it the cost of doing business as the FDA assumes.

I only meant to be flippant about companies that don’t take it seriously. You clearly do, and I applaud your efforts.

Finally, regarding yesterday’s piece rhapsodizing about baseball caps (yes, there was a business lesson), MNNB reader Lance Hollis McMillan wrote:

When The Los Angeles Dodgers won the World Series in ’88, I bought a brand new cap with the idea that I would only buy a new cap when the Dodgers won another World Series. 30 years on and I’m still going strong, but my cap is not – even the dog avoids it. Maybe this year…

I find rotation is the key. And probably avoiding unreasonable expectations.
KC's View: