Some of the information released by Loblaw today was confounding and really shows the weakness of this company right now in my opinion.
- Loblaw said they're trying to tackle the 1 Billion dollar problem of goods disappearing from their stores because of theft or mismanagement, by weeding out prospective employees with criminal records, while trying to reduce employee turnover by offering up a 10% employee shopping discount.
---- Wow, I don't know where to begin....Loblaws 2007 revenue was about 30 Billion. So 3.3% of their annual revenue was simply being lifted from their stores, or otherwise disappeared. This surely shows poor management. Never mind Wal-Mart, Loblaw's own staff is quite literally eating their lunch.
---- Hiring employees with criminal records might have been a bad idea from day one. Ya think..?
--- I appreciate the attempt to have their employees as customers, but is a 10% shopping discount going to really reduce turnover? Perhaps it might keep a few employed there, but I'm not sure Loblaws can take that kind of margin hit.
4 comments:
Having worked 15 years for HBC, the employee discount was a perk, nothing more. I can tell you that if someone i going to steal or commit fraud in the workplace, they don't care about a discount. You can't discount free.
I'm now a general contractor and have worked in some Real Canadian Superstore locations while helping a friend install, you guessed it, their security systems. Their loss prevention program lacks direction and leadership that's for sure. Those at the store level are inexperienced to say the least. When we install the cameras for example, they really don't know what they want. They have multiple cameras watching a few cashiers but none in critical back areas.
They also have no covert(hidden) cameras to watch internal theft/fraud. Most retailers are focusing more on the internals now, Loblaw just needs to catch up.
"weeding out prospective employees with criminal records"
Not a quick fix to the problem. Most employee 100% discounts would undoubtedly be from those without records.
Oh, and human rights legislation will make this more problematic. Sure, you can weed out someone with a record of theft, but not, say, drunk driving. Also most criminal records (for non-indictable offences) can be expunged after 2 years. This would include almost all shoplifters, unless they shoplifted over 1000 bucks worth of goods. See where I'm going with this? It's a useless policy.
Anyway, this seems to indicate general flailing. Security cameras, strict inventory control and tracking, and general didlgence and effort are really the only things that reduce theft.
I notice you and many hate this company and true some of this hate is justified, but is it overdone. As a recent BNN guest pointed out the real estate portfolio of Loblaws is worth about $30 so you get the company earnings for nothing.
Bringing Mark Foote aboard who helped your favourite retailer crappy tire out of the gutter was a step in the right direction. This turnaround will not be quick, but one would think this company is not going away.
The Walmart effect seems to be back news, but should actually help Loblaws become leaner and meaner in the end? You also get the added bonus Sobeys had, which is at any time Weston's could and maybe should, at these prices, buy out remaining shareholders for $40-50/share.
I've been watching Loblaws fall since $65 and i get more interested everytime it falls further! But there is no rush, unless it pops quickly.
DH
"weeding out prospective employees with criminal records
Not a quick fix to the problem. Most employee 100% discounts would undoubtedly be from those without records."
FWIW, I've also worked in Loss Prevention and non of the shoplifters we caught, customer or employees, get charged criminally. They stopped charging them years ago, to much court time and fees wasted.
For prospective employers, they usually can't find out about prior theft with the new privacy laws. When I worked for HBC, we weren't allowed to disclose why someone didn't work for us anymore even when asked by the person doing a simple reference check.
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