Over at The Splendid Table they’ve posted an eye-opening excerpt from this interview with Stephanie McMillan, whose new book, The American Way of Eating, chronicles her experiences working undercover in farm fields and a Walmart store outside of Detroit.
McMillan’s mini-expose leads us once again to ask whether Walmart’s aggressive cost-cutting has reached its limits as an effective business strategy.
She tells Splendid Table host Lynne Rossetto Kasper that Walmart’s much vaunted supply chain “completely broke down when it came to produce.”
I spent a shift one day throwing out about 200 pounds of asparagus that had molded and rotted in the cooler and hadn’t been rotated out – it was about 6 weeks old. The cooler had a leak from the ceiling that lasted almost the entire duration of my time there, about a month, so we were losing a lot of produce in that way.
McMillan came out of her experience with a new respect for frontline produce managers.
If you think about it, somebody has to be on top of the 300 to 500 items that are all dying at different rates in front of you.
McMillan’s experience suggests that a business model premised on cutting staffing to the bone is going to face constant difficulties – and associated costs – managing fresh inventory.
Her story is consistent with the growing stream of critical commentary on the company’s direction.
In March, Bloomberg’s Renee Dudley reported on growing customer dissatisfaction with Walmart, related to chronic understaffing and empty shelves. Dudley cited interviews with workers who told her that the merchandise customers want “is piling up in aisles and in the back of stores because Wal-Mart doesn’t have enough bodies to restock the shelves.”
Then The New York Times published a piece highlighting the company’s problems with fresh products.
Internal notes from a March meeting of top Walmart managers show the company grappling with low customer confidence in its produce and poor quality. “Lose Trust,” reads one note, “Don’t have items they are looking for — can’t find it.”
Retail industry veteran Walter Loeb, a Forbes contributor, was shocked recently by the “total disarray” he saw during a visit to a Massachusetts Walmart store. Merchandise was disorganized, shelves were empty, and store bathrooms were “both filthy and in need of management’s attention.”
And, as we noted in July, a recent MarketForce survey shows that Walmart ranked last on customer satisfaction and likelihood of recommending to others.
Of course, anecdotes ultimately take a back seat to the bottom line on these questions. But Walmart’s disappointing second quarter earnings report suggests that CEO Mike Duke has yet to identify a sustainable strategy for re-igniting the company’s growth.
Hat tip to the The Inquisitor for pointing us to the Splendid Table post.