The corporate freakout over shoplifting that’s been going on for the past few years is a load of bullshit. There was not enough data showing these companies were getting their stock stolen to the degree they were saying they were. To combat the fake problem, companies enforced policies that anyone could immediately recognize as a stupid waste of time—anyone other than the companies themselves. Until now, that is.
While on a first-quarter earnings call this past Friday, Walgreens CEO Tim Wentworth admitted that locking products behind a glass door severely hurt the company’s sales. “When you lock things up, for example, you don’t sell as many of them. We’ve kind of proven that pretty conclusively,” Wentworth said, per Business Insider.
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No duh. No shit. You don’t say? You mean to tell me that making your products inconvenient to access was a bad idea when the entire point of your business is to essentially be a corporatized version of the mom-and-pop brick-and-mortar convenience store, with an emphasis on convenience? Get out of town!
Wentworth described the ongoing battle against “shrinkage” as a “hand-to-hand combat” situation. Not really sure what that means, but he said it in the context of trying to strike a balance between preventing theft and making the customer experience as smooth as possible. Whenever I think of improving the customer experience, I, too, think of it in terms of hand-to-hand combat.
The company reported a $245 million operating loss for the quarter compared to the previous year, which only had a $39 million loss. Sure seems like you made a lot more money when you were gripped by fear and paranoia over a problem that wasn’t nearly as bad as you said it was.
A lot of what these companies define as “shrinkage” could be explained by something as simple as food going bad before it could be sold. Not to mention companies have such a wide and inconsistent definition of what shrinkage even is that you should be skeptical whenever they start complaining about it.
Walgreens is facing some stiff competition from the likes of Walmart, Target, and Amazon, while other nationwide drugstore chains like CVS and Rite Aid are also struggling to retain a foothold thanks to increased competition. The invisible hand of the market at work, folks.
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