Thursday, January 9, 2014

Snowmageddons, Iceapocalypses—From Kroger's Point of View

Posted By on Thu, Jan 9, 2014 at 9:21 AM

  • @sciencebastard

It's one of those funny-'cause-it's-true scenarios. The forecast calls for snow or icy conditions. Visions of being stuck — trapped! — in your house for who knows how many days enter your mind and you go, along with apparently everybody else in the city, to the grocery store, where the place is packed and the shelves bearing eggs, milk, and bread are almost empty.

Inevitably, someone on Twitter cracks that the grocery store and the forecasters must work in collusion, because the stores must be loving all this extra business, amiright?

Joe Bell, manager of marketing and public affairs for Kroger Delta, took time to answer questions from Hungry Memphis about the grocer's point of view of Snowmageddons and Iceapocalypses.

Is there a set plan for when the forecast calls for bad weather, like Operation Egg-Milk-Bread?
Joe Bell: Yes, Kroger does have different foul weather plans, which depends on the type of alert and time of the year. As an example: The plan is different if there is a hurricane heading towards the Gulf Coast that would affect our stores in the Jackson, Mississippi, area, as opposed to a plan for a winter snow storm predicted for West Tennessee or Arkansas.

People who have been through a hurricane or a tornado know they need, first and foremost, bottled water…milk and eggs probably aren’t on their list. But batteries for flash lights and candles are, gasoline would be, plus any type of canned meat that is precooked. People who may be facing snow, typically, are more concerned with just not being able to get out of the house due to roads and foul conditions, so they become interested in the milk, bread, sandwich meats, pizzas, products that are quick to fix and can feed hungry kids confined to the house and not in school. If the electricity goes out, then their needs change also.

What's Kroger's attitude about these days? Is it "Yay! $$$!!!"? Or, "OH NO!"?
Honestly, it is a combination of both. Any business likes the euphoria of a dramatic sales gain. However, the warning time for most storms is days, IF you are lucky, and not weeks, where you could plan and prepare for it.

So, generally, Kroger has only days to prepare and bring in enough product to handle sales that include a week’s worth of bread in an 8-hour time period. There isn’t a commercial bakery in the U.S. that has the facilities to flip a switch and bake that much bread immediately. The bakery is in the same situation as Kroger. They probably don’t have an extra 100,000 pounds of flour on hand, the bread packaging, nor the ability to produce bread fast enough, let alone have the different varieties of bread a family might prefer to purchase. So, it can be a ripple effect all the way through the food supply chain. A typical, average Kroger store will stock 12,000 different items, so think about all of the different suppliers across the U.S. that within a few hours’ notice would need to gear up to handle a “Christmas- or Thanksgiving-type of sales rush” on stores.

Why do you think it's all about eggs-milk-bread? Is there a surge in sales of other products?
Customers who feel they may be confined for several days with family members know that there is only so many activities you can do during that time. Typically, when people are watching TV, reading, playing games with the children or whatever they may be doing, eating or snacking is often part of it. So, more lunches and breakfasts are prepared, thus the eggs, bacon, biscuits, bread, lunch meat, and certainly more snacks and drinks for the children — and for mom and dad.

Sales go up 20 to 30 percent on bad-forecast days. What's the next day like?
Typically, if a family stocks up on a lot of product preparing for a few days of confinement and the snow doesn’t come, then yes, it does affect future business because they have food in their house they need to eat. If the storm does hit, then no one can get out to go to the stores anyway, so business is hurt. Plus, Kroger will not put its own trucks on the road if the situation is hazardous to deliver product to our stores.

Is this something that happens only in the Mid-South?
Absolutely not. You will see this in every state in the country. They will prepare for different reasons and events, but every location has something in their geographical area that they need to react to.

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