Five years ago, Plumb’s grocery stores had to contend with just two Meijers Supercenters in the Muskegon, Mich. area. Today, there are three Meijers and two Walmart Supercenters. Jim Nader, president and CEO, said his predecessor saw the influx of new competition as the perfect time to sell the chain and retire, but the younger executives thought differently. They bought the company, established it as an ESOP, and started making changes.
“Our previous owner was very community-minded; he was always working for charities or sponsoring community functions. That strategy worked at the time, but I saw we needed to keep our management in the stores to get a better feel for what the customers want and what our employees need,” Nader said.
Since day one, Nader said he has tried to visit each store at least once a week. Customers with concerns can e-mail him directly, and employees can, and do, call his desk with suggestions or questions. His personal approach to management is part of the shift to emphasize a high level of customer service where Plumb’s can’t compete on price alone.
“Personal service is going to help us succeed. We’ve spent a lot of time getting to know who our customers are and what they want from us, and we’re continuing to find better ways to deliver that to them,” Nader explained.
He added that most of Plumb’s customers visit the stores several times during the week looking for dinner, so the company redesigned the store layout to facilitate that. All the products necessary for a meal are grouped together as much as possible; there’s a pasta section, for example, with various kinds of noodles, sauces, garlic breads, and even pasta serving spoons.
Plumb’s Web site emphasizes the same theme with its popular Recipe of the Day page, which features items customers can find at any Plumb’s location. Nader said the site will be updated in the next couple of months to feature recipes with ingredients on sale. He added that the company has pumped up its event marketing budget and used its Web site to publicize its sales.
In addition, Plumb’s started upgrading its stores with larger perishable sections a little over a year ago. According to Nader, gaining a reputation for the best and freshest meats, vegetables, and baked goods gives the company and edge over big-box retailers, even if its prices aren’t as low. Plumb’s is also managing its inventory better with a new tracking system installed last July. Nader and his team can track sales and inventory week by week, changing prices or purchase orders accordingly.
All these changes are only half the equation, Nader said. “In spite of the new look we were creating in our stores, we weren’t seeing the success we wanted to see. We quickly realized the problem was our dated mentality toward training: quick orientation and send them in.”
Plumb’s HR department was restructured to develop training programs for every level of employee, including Nader and his team. Now, employees attend seminars through the University of Phoenix, for example. Instead of a brief orientation, all employees have training schedules to learn the ins and outs of the location where they’ll be working and receive a certificate for their efforts. Store managers receive management training, and Nader was pleased to report most of them thanked the company’s HR staff for putting together such a useful program.
Many of these seminars focused on improving internal communication. Nader said everyone used tell each other what to do over and over again, but now they are more specific and better at listening.
Nader said all this education has made a huge difference in daily operations. “Things run more smoothly when everyone knows what is going on and what they need to do. Our customers can tell, too. They appreciate shopping at a well-run store where the staff is knowledgeable and helpful. And if you don’t have the lowest prices in town, you need to have something else.”
One of the first steps Plumb’s took toward this employee-centric approach, indeed the first program Nader and his team started when they took over, was the institution of service awards for long-time associates. After a certain number of years of service, associates choose from a variety of gift packages and receive a certificate from Nader or a member of his management team.
“We had so many dedicated employees and no way to recognize their hard work, so we were very excited to start up the service reward program,” Nader said, adding that, even with the recent addition of several competitors nearby, Plumb’s didn’t lose a single employee to the new stores.
“If we’re going to grow and succeed, we need great people; there’s no way around that,” he said. “Luckily, we have a dedicated staff that is willing to learn and grow with the company, so we have high expectations for the future.”