How a store puts itself out of business.

What you see above is an internal memo circulated to management at Shaw's Supermarkets, a division of SUPERVALU. This is basically what the memo says:

• The profit the company makes on each individual product sold has decreased.
• This is due to increased shipping costs caused by higher gas prices.
• The company isn't on track to hit its projected earnings.
• The company needs a competitive pricing strategy that will attract more shoppers.
• Instead of introducing consumer-friendly prices, they're going to raise prices because higher prices mean higher profit on each item sold.
• These exciting new higher prices are effective immediately.
• The company will lower prices once it makes up the difference between its expected earnings and its current earnings.

Sound like a good plan? Well, it's not; it's fucking stupid. See, what the memo doesn't fucking tell you is that Shaw's already has SIGNIFICANTLY worse prices than its two main competitors in Massachusetts, Market Basket and Stop & Shop. Over the last year and a half, Shaw's has lost lots of fucking business to these chains because it's run by complete fucking retards. See, the fucking morons who run Shaw's are obsessed with fucking profit margins when they should be focusing on net profit. Let's say that the overhead on Land O' Lakes White American Cheese is $3.00/lb. I don't know if that number is right, but let's say it is. Shaw's would rather fucking sell one fucking pound at $6.49/lb than three and a half pounds at $3.99/lb. The problem is, Market Basket is selling the same fucking cheese for $3.99/lb. And while Market Basket isn't making as much money per pound of cheese sold, they're selling a whole fuckload more of it, so they're still banking a higher overall profit than Shaw's; they're also getting a whole lot more repeat business. Shaw's has allowed itself to become perceived as having high prices, and rightfully so, as their prices are completely fucking shitty. Customers are leaving the company in droves and they're not gonna come back anytime soon; once you get a reputation of having shitty prices, it's hard to win people back. These are things that a fucking first year business major could tell you, but the fucking braindead shithead morons who run Shaw's can't seem to grasp it. It's easy: YOU MAKE YOUR FUCKING PROFIT THROUGH VOLUME NOT MARGIN. If you open a lemonade stand and charge $50,000 per glass, you won't have to sell many glasses to make a profit. But guess how many you're gonna sell? FUCKING ZERO. A fucking second grader could tell you that. A fucking chimpanzee could figure that out. But Shaw's can't. Well, I hope you fucking enjoy your slow self-induced demise, Shaw's. Since you insist on running your business like assholes, then you can die like assholes. I'm just gonna sit here and fucking laugh.

1,292,955 people could run Shaw's better than its current management team.

haddox@sydlexia.com

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© 2008 by Haddox