Last updated on September 5th, 2012 at 04:05 pm
It’s funny how the little things get you thinking.
There was a story in The New York Times about consumers who stubbornly refuse to wash clothes in cold water, even as popular detergent makers have developed formulas specifically for the job.
Evidently, that’s too much of a sacrifice, or at least, that’s how it read to me.
Washing clothes in cold water would directly benefit consumers with lower electricity costs and, because three-quarters of the energy used to wash a load of clothes heats the water, would help reduce carbon emissions.
Both seem to be benefits, but they don’t outweigh the notion that hot water helps gets laundry clean (which it does, hence the new formulas).
Procter & Gamble introduced Tide Coldwater six years ago to help reduce energy usage. The percentage of cold-water washing machine loads has increased since then from 30 percent to about 40 percent. Procter & Gamble’s goal is 70 percent by 2020.
Is using cold water such a huge sacrifice? Well, in the big scheme of things, maybe not. But it was that anyone was asked, even in an oblique way, to sacrifice anything at all that struck me as pretty darned amazing.
It seems to be the right thing to do, so why such resistance? And what satisfaction do the nearly 40 percent who are willing to “sacrifice” have that the rest of us don’t?
That got me to thinking about Kwik Trip and Skogen’s Festival Foods. What do these chains know that the rest don’t? Why would the owners sacrifice any personal profit and share it with their employees?
In these economic times, that seems both unique—we all see how much ado the media make of class warfare—and perfectly logical. Turnover is costly.
Many people who have jobs today will hang on fang and claw to it, no matter what. So, is there really a need to worry about disposing of or replacing employees?
Well, yes. With a razor-thin profit margin, losing even one customer because of frustration about ill-trained or, worse, disengaged employees is costly.
It is, after all, a tough time for retail, too—even grocery retail.
“You know, people who don’t sell groceries for a living will always say to us, ‘Your business has to be good. People have to eat,’” Mark Skogen, president and CEO of Wisconsin-based Festival Foods, told The Shelby Report. “Well, that’s true. They have to eat, but they eat differently and shop differently during tight times. They go from steak to chicken. They stock up on sale items. So we have to continue to monitor those behaviors and offer an appealing assortment of products at the right price.”
Listening to retailers like Skogen talk, it becomes clearer, at least to me, that there is a basic understanding that everyone is in this together. At Festival Foods, which employs more than 4,000 full and part-time workers, Skogen considers it a great accomplishment that his company now offers an employee share ownership plan. Employees are 30 percent owners in the business.
Festival Foods is rewarded with employees who are determined to take better care of shoppers than any other grocery store—or any gas station, hotel, restaurant, “you name it,” Skogen said. Its go-to-market strategy is to hire the best people to take care of its shoppers.
“And we’re happy to be able to reward associates for the fine job they’re doing,” Skogen said.
Festival Foods is growing, too. It opened a new store in Sheboygan in September, bringing its store count to 16.
While some companies shed employees and cut hours as if both were just numbers, there remain companies willing to reward their people. No government program or legislation makes them do it. It just so happens that sometimes the right thing to do is good for everyone.
Kwik Trip, based in La Crosse, shares 40 percent of the company’s pretax profit with employees, who are all called “co-workers.” The co-workers also own all of the stores the company has built since 1990.
Kwik Trip earned the No. 1 spot in a Milwaukee Journal-Sentinel contest to find the “Best Place to Work in Southeast Wisconsin.”
The chain has the distinction of having the lowest turnover rate—25 percent—in the convenience store industry, and, according to Steve Loehr, VP of operations for Kwik Trip, in the retail grocery industry, too. Kwik Trip is growing at a rate of 20 to 25 new locations annually.
Even in the worst of times, smart companies are willing to sacrifice some short-term profit for long-term success.
Innovators like Procter & Gamble are asking their consumers to sacrifice a little bit to solve a big problem.
Both ideas could change the world.