A Broadcast Lesson from the Corner Grocery Store

By on Aug, 28 2014 with Comments 8

Clark-SmidtClark Smidt – Media Connector

I’m very fortunate to live in the original trend-setter part of our country: Boston! Lexington-Concord, Tea Party, USS Constitution, Paul Revere, Old North Church, folks who built America. And, between the business, digital innovation, medical, educational and cultural communities, mixed with a healthy dose of politics, sports, and innovative highway driving, there aren’t too many dull moments in this Top 10 market.

For the past six weeks an inbred dispute over the corner grocery store – one that grew into 71 excellent supermarkets within two hours of the suburban Tewksbury, MA headquarters – has drawn significant attention. In authentic Family Feud style, one of the family directors switched sides and gave a 50.5% majority to one of two battling Demoulas cousins. Arthur S. got control over Arthur T. who was running the company, and dipped to 49.5% control. Arthur T. was fired as CEO on June 23, and two outside Co-CEOs were brought in. Ironically, one was from Radio Shack which lost its mojo because it didn’t respect radio.

In a lesson to all big business, small business and people business, the employees, from stockroom to supervisors, rallied for the return of their beloved CEO. All business is rough and too often ethics and employee care get shorted. Arthur T. rewarded his employees with profit sharing, benefits, personal caring and communication. It was a family and every employee felt part of it. Customers were rewarded with excellent service, quality and the best prices around. In fact, this year, Market Basket gave an additional 4% off on everything.

The new management didn’t get it, didn’t communicate and fired eight top managers. Rallies, protests, steadfast sacrifice and loyalty to Arthur T ensued from the staff and other real people. Stores emptied. In support, customers went elsewhere and taped their shopping receipts from competitors on Market Basket windows. No ground chuck – things ground to a halt.

Market Basket and the employee commitment topped local news every day since. Teams of lawyers, analysts, PR firms and the MA & NH governors worked to settle a private war that brought public harm to real people. Professors at Harvard B. immediately caught the importance as an unprecedented case study.

Here were cashiers and truck drivers, stock clerks and folks at the deli counter standing up for their company and culture. 20+% in grocery cost savings means a lot to average folks. A good job and part-time wages are essential to many, in these times. Many employees worked for Market Basket and The Demoulas family for over 30-40 years! The stores lost millions every week and the $4 billion company was close to falling off a cliff, harming many people who were losing real necessities.

I just watched the live settlement statement by Arthur T. Demoulas, the former and now once again CEO, who paid over $1.5 billion to buy out his cousin. His “thank you” was inspiring. The CEO thanked everyone for protecting the Company’s culture. “It was YOUR grass roots efforts that saved the Company. Everyone is special. Everyone is equal. Your values, courage and kindness prevailed to save our Company. You’ve fought to preserve the family business and keep an honorable dignified place to work. I love you all! Let’s get to work and have lots of fun.”

OMG. A Company with a caring heart? I didn’t hear any “I” in the speech, except “I Love You All!” This was a humble CEO thanking his employees for their caring and support and pride in their company. Arthur T. said “We’re all born at a certain time and place for a purpose.” Broadcasters, especially the “old guard” Boomers and beyond, care about our culture, quality and customers. This is new history and a new, positive shot heard ’round the world. Let’s take a lesson from the corner grocery store and be extremely proud & pro-active for our people, product, value and service.

Clark Smidt has been involved with Boston broadcast management since 1970, Broadcast Advisor est. 1982 and ownership 1987-2012. Working on customized and confidential projects, Clark and Clark Smidt – Media Connects are  accessible at 978.470.2120 and clarkfsmidt@gmail.com. Please visit www.broadcastideas.com, start with a conversation and meet at the NAB.

About The Author: RBR+TVBR has been reporting on the business of broadcasting for nearly three decades. Beholden to no one, it is independently owned.

  1. Ken Shelton Says:

    Nice job. Cut right to the heart of a strange situation with an unexpectedly wonderful resolution.

    Sadly, no fairy tale endings like this in the radio industry. Even if all the managers, sales people, office staff, announcers and LISTENERS (remember them?) started marching and yelling SAVE OUR STATIONS!!!!

    The owners wouldn’t hear them. They’re too far away, and busy watching the stock market.

    Maybe somebody will sail a ship out to international waters and…….

    Ken Shelton

  2. This is a brilliant understanding of something that goes way beyond the every day business of radio. It goes to the heart of what seems to be going extinct in modern American business…and in the heart of way too many Americans. The understanding and the obvious affection in the composition of Clark’s post clearly indicate that his heart is in the right place…and it’s a very healthy heart.

  3. As someone who speaks and writes on the impact leadership has on culture, I love this story. I got goose bumps watching Arthur T’s thank you speech and each article I read on this story. It is so touching. I predict this story will be studied for years in business schools. I also believe that CEO’s and the C suite leadership team will start to think twice about their culture and implications of their decision making in the board room.

  4. Bonnie Cronin Says:

    You hit the nail right on the head. I hope all the doomsayers that are moaning, “He took on too much debt, things will never be the same,blah, blah, blah” are as wrong as they were when they said, “The strike will never work. They can’t hold out.”

  5. Clark,
    Great recap and David vs Goliath story. In a world where companies ONLY care about the bottom line and not the people who keep them IN business, it’s refreshing to see a victory for the hardworking. CBS Sunday Morning just ran a piece about the best Fortune 100 companies to work for that actually put stock into their employees and get a much more productive result. Chock one up for the little guy. Excellent job Clark!

  6. A local mom and pop station MUST be superior to the corporate FM and AM that takes a satellite feed all day. Agencies do not believe a local station can be excellent and independent. The line. No one listens to AM radio anymore is brutal. Especily coming from other radio. Also the comment. We set aside some advertising dollars to support the local station but when we need REAL advertising we contact the billboard company. You just gave to do an outstanding job and talk about it all the time

  7. As soon as I saw the words “co-CEOs”, I knew there would be major trouble.

    Really? Two people in charge? Never works.

    It’s clear that the takeover folks didn’t really understand how to run the business. Sounds like they were typical VC folks who focused on the Excel spreadsheet before they looked at the customer.

    On the flip side, where did Arthur T get the $1.5 billion to buy the company back?

    That will put a lot of debt on Market Basket. Where will the money come from to pay it back?

    And, we know how ugly the results of debt-based takeovers of can be. Just look what happened to radio.

  8. Clark – You and I have been back, forth and all over on this exact topic! I’m so happy that you’ve voiced it loud and clear! Radio needs to adopt this policy too! There is no “I” in TEAM! I love the grassroots effort to save this company.

    I’m in. Where do I sign up?