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Small is beautiful

I had to drop into the local WalMart Supercenter to pick something up the other day. I don’t shop at WalMart very often, mainly because of ideological reasons, so I was surprised to see that the store was changing drastically. They were still renovating but much of the work seemed to have been done.

I was surprised to see that the display aisles were now only around 6 feet high, whereas before they were at least 8 feet tall.

There seemed to be less merchandise as well, although this could be a function of the unfinished nature of of the redo. Not only did there seem to be less of each item, there seemed to be less total items. I wondered if this was a concrete manifestation of the economic crisis that we’ve been going through. It looked like a fairly drastic downsizing of the Supercenter.

This seems to be borne out by this CNN article:

http://money.cnn.com/2010/02/15/news/companies/walmart_dropping_brands/

When I left the store, I noticed that the Superstore signage had even been removed. Perhaps they’re just changing the signage and it will continue to be considered a “Supercenter”, but I wonder if it’s being “demoted”. They certainly don’t seem to be shrinking the square footage.

Doing some superficial browsing, it looks like WalMart is contracting a bit. In one case, they actually cut the size of the store in half. It doesn’t look like that’s going to be the case here, but it does look like there’s going to be a much smaller inventory and assortment.

I think that we’ll see the same forces at work in restaurants as well. I wonder how long it will be before we see restaurants that used to open units with 200 seats start redesigning their new units to be 150 seats (just to use a random example). I wonder how long it will be until menus start contracting the number of items on their menus. And I wonder how long it will be before we start seeing smaller staff (larger sections, fewer hosts/hostesses/fewer managers stretched with more hours, fewer kitchen employees consolidating more and more tasks, etc.)  In many states, there’s not much savings in cutting waiters that make $2.13 – $4/hr, but there could be some savings in reducing the number of server assistants, putting more burden on waiters in general.

I saw this happen at P.F. Chang’s about 3 years ago when they went from one Server Assistant for every two servers to a couple of SAs for the whole restaurant. They did it the right way though and shrunk each server’s section by 1 table and added an additional server (that’s 1 more server and 2 less SAs).. SAs made 4.50 an hour, so this was a net gain against payroll and probably didn’t affect service too much. but I can see some big corporate entity with less savvy trying to trim staff without taking the impact on service into consideration (Darden, I’m looking at you!).

This trend could trigger some realignment of a large chain’s strategy and could also impact the gross number of jobs available to waiters in general. It could have a benefit of making it more feasable for smaller independent restaurants to make a go of it. If restaurants in general get smaller, then, in the eyes of the average consumer, a smaller indie restaurant might be on more of an equal footing with the larger chains due to the general perception in the US that “bigger is better”. On the downside, it could make waiters’ jobs more difficult and it might make great service harder to give and get.

These are just some random thoughts triggered by a mundane shopping experience. If anyone has seen some manifestations of this trend, feel free to comment. Or if you have any thoughts on the matter, please weigh in.

Yes, that’s a restaurant under the striped blue awning.

Photo is from “Rene G” at the “lthforum” at  http://www.lthforum.com/bb/viewtopic.php?f=15&t=24958

It’s a “Chicago-based culinary chat site”.

And the insanity just goes on and on and on…

Darden sees potential for 1,000 more units

By Mike  Troy