PCC urges Seattle mayor to reject grocery hazard pay

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PCC urges Seattle mayor to reject grocery hazard pay

Post by SamSpade »

In the Seattle Times piece about Trader Joe's, it appears PCC also has to meet this pay increase. They are not sure how the company will afford it.
https://www.seattletimes.com/business/l ... ationwide/
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Re: PCC urges Seattle mayor to reject grocery hazard pay

Post by storewanderer »

SamSpade wrote: February 3rd, 2021, 8:20 am In the Seattle Times piece about Trader Joe's, it appears PCC also has to meet this pay increase. They are not sure how the company will afford it.
https://www.seattletimes.com/business/l ... ationwide/
They will increase prices. That is how. The same way you handle any other cost increase. When you do business in this type of city, you have to be able to be agile and bend your operation so it fits within the rules that are being imposed by city councils that are being more hands on than usual (polite way to say it), with regards to how you should operate your business.

Trader Joe's ability to just go ahead and increase wages nationwide is great but not all chains do the volume of Trader Joe's.
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Re: PCC urges Seattle mayor to reject grocery hazard pay

Post by veteran+ »

storewanderer wrote: February 3rd, 2021, 9:33 am
SamSpade wrote: February 3rd, 2021, 8:20 am In the Seattle Times piece about Trader Joe's, it appears PCC also has to meet this pay increase. They are not sure how the company will afford it.
https://www.seattletimes.com/business/l ... ationwide/
They will increase prices. That is how. The same way you handle any other cost increase. When you do business in this type of city, you have to be able to be agile and bend your operation so it fits within the rules that are being imposed by city councils that are being more hands on than usual (polite way to say it), with regards to how you should operate your business.

Trader Joe's ability to just go ahead and increase wages nationwide is great but not all chains do the volume of Trader Joe's.

Or maybe Trader Joes has a superior moral compass during a human crisis.
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Re: PCC urges Seattle mayor to reject grocery hazard pay

Post by storewanderer »

veteran+ wrote: February 3rd, 2021, 2:25 pm
Or maybe Trader Joes has a superior moral compass during a human crisis.
To be fair, there are other grocers who have been extending the hazard pay as well. Stater in SoCal extended the $2/hr hazard pay into January (not clear if it is extended at present). Save Mart also did ongoing extensions of it through 2020 (not clear if it extended at present but suspect it is). We know historically Stater has not exactly been a cash cow and was not making huge profits back when they released earnings information due to the debt they had, and Save Mart's financial situation has been sort of documented over the past decade and obviously it is not earning tons of money either, so once again these privately held chains have made the decision to do what is in the best interest of their employees.

With as high as The P's, I mean PCC's, prices are I am surprised how little money they make. Where is all the profit going? Must be real poor day to day expense control, too high of rents, or something going on at that place. Time for a crash course in cost control to afford to pay the mandated wage increase per Seattle City Council. Given PCC is run by a former Kroger person I would expect they should have some strong knowledge there on efficiency and cost control.
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Re: PCC urges Seattle mayor to reject grocery hazard pay

Post by pseudo3d »

storewanderer wrote: February 3rd, 2021, 3:50 pm
With as high as The P's, I mean PCC's, prices are I am surprised how little money they make. Where is all the profit going? Must be real poor day to day expense control, too high of rents, or something going on at that place. Time for a crash course in cost control to afford to pay the mandated wage increase per Seattle City Council. Given PCC is run by a former Kroger person I would expect they should have some strong knowledge there on efficiency and cost control.
In the last few years, there has been a bloodbath in the natural/organics market sector, so I'm not sure if that's related. But PCC is stuck with 15 locations, all more or less located in Seattle (they can't off-load any price increases to areas cheaper to operate, or just eat the cost), and Seattle has to be a tough operating environment as is: the homicide rate has spiked, a general economic downturn, the police department is being cut down to almost half, and they're considering a bill (as of 12/20, haven't seen if it passed or failed yet) that decriminalizes shoplifting if the defense of poverty can be used...which is on top of any existing leniency toward shoplifters.

At the end of the day, another locally-owned store bites it while the corporate chains claim another victim, but hey, at least Trader Joe's was "morally superior", amirite?
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Re: PCC urges Seattle mayor to reject grocery hazard pay

Post by veteran+ »

It is way more complicated than all that.

And your law enforcement comments are a bit misleading.

I think we should stay away from political commentary, don't you?
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Re: PCC urges Seattle mayor to reject grocery hazard pay

Post by storewanderer »

veteran+ wrote: February 4th, 2021, 6:03 am It is way more complicated than all that.

And your law enforcement comments are a bit misleading.

I think we should stay away from political commentary, don't you?
All of these issues add to overhead. Increased wages, more lax shoplifting laws (means you need more security... or more labor in the store to provide additional levels of customer service to deter theft). The amount of fresh prepared food some of these stores throw away is pretty major and it would be nice if they could try to maybe feed that to the homeless around the store or something... rather than throw it all away. But they justify throwing it away saying it is past its hold time or whatever and it may make someone sick so they don't want to risk that.

I think one of the best solutions for stores in these situations is to downsize their square footage. By doing so, they will use less labor. They will have less inventory to deal with (so ideally, less shrink). The problem is these newer companies are tied up in recently signed leases, probably signed at high lease rates. With refrigeration and departments everywhere it isn't easy to downsize a grocery store without major cost. Unless you built a combo store with half drug half grocery and a clear split in the middle and no refrigeration on the drug side- which isn't what these stores are. Now a labor increase comes and they can't afford to pay it. Meanwhile the larger chains who have been sitting on the real estate for decades (long paid for) can better weather this storm.
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Re: PCC urges Seattle mayor to reject grocery hazard pay

Post by pseudo3d »

storewanderer wrote: February 4th, 2021, 6:21 pm
All of these issues add to overhead. Increased wages, more lax shoplifting laws (means you need more security... or more labor in the store to provide additional levels of customer service to deter theft). The amount of fresh prepared food some of these stores throw away is pretty major and it would be nice if they could try to maybe feed that to the homeless around the store or something... rather than throw it all away. But they justify throwing it away saying it is past its hold time or whatever and it may make someone sick so they don't want to risk that.

I think one of the best solutions for stores in these situations is to downsize their square footage. By doing so, they will use less labor. They will have less inventory to deal with (so ideally, less shrink). The problem is these newer companies are tied up in recently signed leases, probably signed at high lease rates. With refrigeration and departments everywhere it isn't easy to downsize a grocery store without major cost. Unless you built a combo store with half drug half grocery and a clear split in the middle and no refrigeration on the drug side- which isn't what these stores are. Now a labor increase comes and they can't afford to pay it. Meanwhile the larger chains who have been sitting on the real estate for decades (long paid for) can better weather this storm.
Real estate is definitely the way to extend the lifespan of a chain. Sears burnt all that away to make the balance sheets look better (instead of actually improving the stores...) and Albertsons is doing that to retire debt (and also to make the balance sheets look better). Most other supermarkets also have dark stores used to lock out competition, and probably could get rid of those leases and buildings in a pinch. I don't think PCC has those advantages, though, and if they do, not much.
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Re: PCC urges Seattle mayor to reject grocery hazard pay

Post by SamSpade »

PCC and its union have agreed to extend raises beyond Seattle, Burien.

I hadn't realized that PCC has grown so much over the past decade.

https://www.seattletimes.com/business/p ... d-seattle/
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