More confusion in this week's WSM employee Market Messenger. But also some rays of hope.
Page 1 tells us, once again, that we are making record sales because of the WOW weekend deep discount program. But again, it doesn't mention the impact on profit margins.
Deep discount programs have their place in any marketing exercise. As a way of focusing customers' attention on something. But that only works on an ongoing basis if you explain to customers what you are doing and why, and you have some sort of follow-up element to keep them interested.
We have neither. What we have is a messload of unconnected, unexplained discounts, week after week, which are deeply impacting profit margins, with no other discernible impact or benefit.
But, you say. But the Market Messenger says that last week's strawberry WOW deep discount sale was specifically to promote local organic fruit. Great. But it was immediately followed by a deep discount sale promoting mangoes.
This doesn't educate customers. It confuses them.
Ok. So I flip to 4, which deals almost exclusively with WOW employee feedback, to see if there is any further explanation to be found here.
Well. First thing. Yay for the fact that there is some employee feedback. Not so much for the fact that it is almost all gushing in favor. When I know I am not the only one with expressed doubts.
Yay also for the fact that a couple of folks have also mentioned the points about there being narrative for what we are doing, and more follow through.
But, I would be even more impressed if management would comply with WSM Employee Co-op Policy, and actually involve employees before these decisions are made, not after. But feedback is a ray of hope.
Another ray of hope is that management encourages we workers to engage with customers to find out what they want. At least someone is beginning to understand that the purpose of a co-op is to provide for the needs of the owners.
But, I am still left wondering why we have to engage in all of this indirect, expensive marketing gimmickry. When we could simply ask our owners and customers what they want, on an ongoing and regular basis, by means of blogs, an online forum and discussion groups?
Then, I am completely floored by the suggestion in a table that WOW is actually improving margins. This is a nonsense.
I used to be a marketing and management consultant, back in my bad 'ol corporate days. There is no business discipline in the world that teaches that volume of sales over strict adherence to margins is good business practice.
Of course, we have sales. We know they affect margins. But the sales efforts are carefully designed. Spread over time. And marginal. They are not every week, deep discount, profit-hammering giveaways, with no narrative and no clearly-explained purpose.
This isn 't good business protocol. It is recklessness.
And it matters not if last week the heavens intervened and improved the overall profit figure (very slightly - $800 or so, on an improvement in sales of some $100,000).
We were told two Market Messengers ago that some weeks we made a small overall improvement in profit, but many weeks we made a loss.
This is playing with figures. To what end? I don't have a clue. We're not being told.
Finally, Page 2. We are told there has been a slight improvement in our overall asset versus liability position. But again, we are not told the whole story.
We are still some $7,000,000 in debt from the ill-fated expansion project of 2008. We were told that debt was going to be fully paid off by about 2015. We are nowhere close.
Why is it not being paid off? Because management would rather be using the money for new ill-fated capital projects (cf. overrun on the Carrboro store refit).
Why does this matter? Because it means that we workers are still having to bust ass each and every year to find some $500,000 in bank interest to service that debt. And management don't tell you that in their 'Market Messenger.'
Why does any of this matter? Because a co-op is not supposed to look and act like WalMart. A co-op is supposed to be a model of business based on democracy, not top-down management.
It's very simple. Consumers are supposed to decide what they want to buy. And employees are then supposed to decide how to sell it to them. This is what is set out in the ICA definition and principles of co-operation. It is what is in our WSM Mission Statement. And it is what is contained in our WSM Employee Policy.
The only reason I keep writing these posts is to remind WSM management of these facts.
But. Rays of hope. We are bring told at least some of the financial information. We are being given some opportunity to provide feedback. And we are being encouraged to ask customers.
What we now need is a fuller, more democratic conversation, where we are allowed to vote alongside management on important decisions. Hmm. Methinks more pressure needed ...
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