customer service vs. Amazon

[PaulW]

That article says that the reason for empty shelves is lack of staff. Hilo staff say the same but who knows, Hawaii is special.
Store size vs number of customers makes sense.

[Bullwinkle]

Funny how costco manages just fine while paying a decent wage.

The article, I remember reading, made the point that wally world allocated payroll in relation to gross sales.

When short staff - stuff does not get stocked, sales decrease as a result - corporate cuts the already meager payroll, more stuff never makes it to the shelves

[lavarat]

Whatever their problems, Walmart stock is near their all time highs.

http://finance.yahoo.com/echarts?s=WMT+Interactive#

[kalakoa]

Funny how costco manages just fine while paying a decent wage.

No mystery here; Costco is selling bigger-ticket items to people with more money, and I'm pretty sure they have lower labor costs (pallet racks, no hand-stocking the shelves).

[Cagary]

quote:

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Originally posted by kalakoa

Funny how costco manages just fine while paying a decent wage.

No mystery here; Costco is selling bigger-ticket items to people with more money, and I'm pretty sure they have lower labor costs (pallet racks, no hand-stocking the shelves).

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Costco has another advantage; on average it stocks only about 4000 items. Compare this to a typical supermarket, about 40,000 items. A Walmart? 100,000. Keeping track of and restocking a store with only 4000 items would seem to be a lot easier than restocking a store with 40,000 to say nothing about a store that has to restock 100,000 items.

-Veritas odium parit”(Terence 195–159 BC))-"Truth begets hatred".

[punafish]

The last four comments are interesting. It tells me Costco's business model is a lot different from its (perceived) competition Walmart than I had originally thought. Costco has obviously found an efficient niche and its current model is (apparently) working effectively for Costco's stakeholders. (Disclaimer: I have a happily employed brother working for Costco back on the mainland.)

In the case of many businesses here, I blame our "inventory problem" on a combination of geographical realities and poor management.

Operating with minimal inventory is always the optimal way to run your business. Reduced part numbers simplifies life for sure, not to mention it takes up less warehouse space (both capital drivers). Return on capital employed is an important barometer of success in this kind of business. Throughput is king and precise management of that product pipeline can be the difference between making a bunch of money and losing it.

Back in the day resource planning was a black art. Today it's a science with realtime logistical information that allows precision planning, adjusting and shipping. Only problem is, if the human side is poorly managed none of it works. People have to be managed and trained to use the technology. They have to be on top of things; they have to care.

My conclusion: the geographical distances that come with doing business here makes resource planning more challenging for sure, but they could do a better job than they're doing (in my opinion).

Just some observations. That said, staring at an empty shelf can be annoying when you need the product in question. But overall, I feel like we already have an abundance of what we need so no complaints.

Just my two cents!

[Punatic007]

A Costco in Hilo would surely be a success? Or does the Kona store depend on our business?

[kalakoa]

A Costco in Hilo would surely be a success?

The model seems to be working for Cost-U-Less. I am left to assume that either Costco ran the numbers (and they were not good), or that Costco wanted to open but was "myseriously unable" to secure a location.

a science with realtime logistical information that allows precision planning

Yet the Walmart keeps running out of product. Maybe they don't care?

typical supermarket, about 40,000 items

Typical 7-11, about 1000 items.

[Bullwinkle]

Good read (two years old) from bloomberg..... I haven't been in a walmart since then ....place depresses me - throwaway junk, greatest common denominator is low price and cheap quality - not a great addition to the community or worth my frog skins (Thanks Mimosa)

http://www.bloomberg.com/news/2013-03-26...ostco.html

[PaulW]

I wish there were more Walmart snobs, then the shelves wouldn't be so empty.