I believe by now everyone understands the plight of our economy here in North America and indeed globally. I don’t think anyone has missed hearing about (or indeed, feeling) the shocking loss of value in the stock markets, housing prices and the dire straits some globally iconic companies find themselves such as Citigroup, AIG, Merrill Lynch, General Electric (GE), General Motors (GM), Chrysler, Ford and Bank of America. It is hard to believe but we have already been in this recession’s grasp for at least a few months now, the headlines ensuring everyone on the planet knows we are in this “Global Economic Crisis”. It’s the only thing that may sell newspapers these days as they are staring at possible extinction as well.
As every retailer knows, it is now time to batten down the hatches, reduce costs, conserve cash and manage your business tightly. Wherever it is that a retailer makes money, that is where all the attention and focus of the organization should be.
A company like Starbucks should know we are in a recession by now. As a matter of fact, I believe they were in their own little “recession” for about a year or so prior to the market meltdown this past fall when their founder Howard Schultz stepped back in in January, 2008. Apparently he has re-focused the company, created a new “value” coffee for customers in the freeze dried variety and pared down the menu to the most profitable items. He has also emphasized, in a very wordy manifesto, the culture of the company and how important the store/customer “experience” is. He was so serious about this shift back to the company’s roots that he had every store in the world close for a few hours one evening last year so that the staff could be “re-trained” on the basics of the customer experience and individualized coffee preparation
So why, I ask, for the second time in a month, at the same Starbucks store, are they out of spoons? They sell yogurt parfaits which are delightful, but hard to eat without spoons. I asked the employees how that can be, and they shrug and giggle and apologize. To be perfectly honest, this is unacceptable.
It is a bad sign for this company, which is busy closing more stores than they are opening in the U.S. at the moment. Their operations, judging from the spoon experience, is not up to snuff, neither is their focus. I know this is an isolated example. If it had happened once, I can understand. But twice within a matter of weeks at the same store leads me to believe that Starbucks has serious problems.
Not only that, in this new era of every sale being more cherished than ever before, there is no excuse for this kind of incompetence. It is symptomatic of a larger issue, especially right now in this economic downturn. If times were booming and the line-ups were out the door and they keep tripling the spoon order and still can’t keep it in stock, that is one thing. But there are no line-ups, every sale is difficult, people are trading down to Tim Horton’s or McDonald’s – you better be as close to perfect in your execution in this economy or you are in serious trouble. They lost two parfait sales this past month from one customer. Multiply that a few times on what else they missed and you get a clear picture of what could be transpiring.
I would say any retailer is in serious trouble if they cannot figure out how to stock up on “spoons”, especially now.