City Market’s $7 million shrink
The troubled City Market, which saw$7 million in shrink by year-end June 30, is now launching an aggressive$300,000 marketing campaign in a bid to cash out$120 million in sales by the end of the current fiscal period.
The campaign kicked off over the weekend with$1000 cash giveaways daily at all 11 stores throughout The Bahamas, new CEO Mark Finlayson toldGuardian Business. The strategy is one centered on continuing the regrowth of its customer base. The Finlayson-led Trans-Island Traders group bought the majority interest in the company from Neal and Massy last month.
“Based on numbers when we first came in,[the company]was down 45 percent[in traffic]compared to the end of last year,”he said.”Last week we saw 51 percent and this week we’re at 58 percent.
“We’re in the process of building back our customer base[and]this[promotion]will go on until the December 24. We hope it will incentivize[shoppers]to come in… we realize(the stores)are not going to have everything, but I want(shoppers)to see what we’re doing everyday in the store, getting it back on track.”
Finlayson’s statement comes as the company undergoes the rigorous challenge of turning its troubled operations around, with hopes of building it back to pre-2008 sales levels of$144 million. Finlayson has a$150 million sales target in mind by the 2012 year-end.
To get to that point, the company has had to put several checks and balances in place to reduce the shrinkage level it was seeing–lost sales due to spoilage and theft. City Market in its year-end results averaged about 7 percent of$100 million in shrink, which Finlayson openly concedes employee involvement has played a large hand in along with refrigeration issues.
That’s$7 million the new owners are trying hard to avoid this fiscal period, with five compliance managers being brought in to monitor and double check the operations.
It’s a part of a the company’s immediate plan for returning the grocery store chain around to profit. It also follows a massive effort to clean up the stores’physical appearance, organize and renovate the 11 different locations throughout The Bahamas.
“In two weeks we hope to get back to doing$120 million in sales by next year,’Finlayson added.”Every vendor of ours has been working with us… everyone has given us five weeks of credit.”
That’s after an approximately$2.5 million pay out on a balance of$5 million to about 30 vendors in The Bahamas alone in the last month. It’s international vendor Super Valu has even offered marketing and clean up assistance to the company in the last month. There will also be a revamp of the company’s web site coming in the future.