September 2, 2008
R&FF Retailer: Why Publix Is So Darn Good
By Warren Thayer, Editorial Director
Through a special arrangement, what follows are excerpts of a current article from Refrigerated & Frozen Foods Retailer magazine, presented here for discussion.
Is there anything that Publix doesn’t do extraordinarily well? Shoppers and vendors love it, it wins lots of awards and makes lots of money.
“There’s nothing particularly over the top about the way they do things; they just do what they do very well,” said Ken Harris, managing director, Cannondale Associates.
Mr. Harris, who authors Cannondale’s annual Power Ranking Survey, noted that the stores have wide, clean aisles, brightly lit stores and friendly service. And while anybody can have wide aisles and good lighting, it’s a real trick to have consistently clean stores and friendly associates.
“Being able to run stores that are pleasant to shop isn’t easy,” he said. “These are fundamental things they’ve been able to master. They do so many little things incredibly well that it builds into a store experience, and that makes people enamored of Publix.”
The Lakeland, Fla.-based chain is the best supermarket in the country when it comes to satisfying its customers, according to the American Customer Satisfaction Index. It’s been at the very top of the list since the National Quality Research Center, Ann Arbor, Mich., began the annual rankings back in 1994. This past year, it scored an 83 out of a possible 100, well ahead of Kroger (75), Supervalu (74) and Whole Foods Market (73), the next three on the list.
“Being associate owned and operated allows our associates to take a personal interest in our business and our customers’ shopping experiences,” said Maria Brous, director of media and community relations for Publix. “Our mission is to be the premier food retailer in the world. To that end, we will provide our customers with stellar customer service and quality products at competitive prices.”
Kevin Janiga, president of Winsights Marketing, said Publix provides “a very pleasant shopping experience. Customer service is very good and the employees truly act like they enjoy working there. The stores are uncluttered, in-stock and clean.”
Said another observer, “Publix has used customer service as a major differentiator versus its competition. This includes being in stock at rates better than the competition as well as having more and better-trained employees. They are in stock, both case and features, and they have well-trained and committed employees.
“I think they have more full timers than the industry average, which means better commitment and knowledge. This is important when you are selling and merchandising more volatile sections like frozen and refrigerated foods. In a soft economy, I don’t see them moving away from this (a strong service model) because, like Wegmans, it is part of the culture. They may have to focus a little more on price, but they have good perimeters and will find a way to maintain margins.”
Discussion Questions: What are some obvious and less obvious reasons Publix has been so successful? What’s their secret to achieving superior customer service?
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One factor is their location in the southeast. I’m not sure this top notch customer service could be replicated in more congested areas with generally grumpier labor pools.
As a thirty year veteran of the grocery DSD world with multiple companies, and twenty of those thirty years in South Florida, I will confine my remarks to the nature of the relationship between Publix and its DSD manufacturer partners and why this relationship is unique in the industry. To do this I will relate some actual incidents from my personal experience.
Upon servicing one store for the first time as Route Sales Rep, the manager of this store wanted me to be clear on our relationship. The manager told me that I was no longer my company’s rep to him but instead I was now his rep to my company. I was regularly invited to the store Christmas party as I was considered a member of their team. When I would routinely take my four year old daughter with me for Sunday morning pull-ups, I would deposit my daughter with the manager, do my stocking and then when I went to pick her up she would be sitting on top of the customer service counter with her cookie and juice box updating him on her weekly adventures.
Once at the end of a very long week and at the point of exhaustion due to a very high volume sales promotion, I was beginning to unload at my best stop for the second time in one day and apparently I looked like I was at the end of my rope. The store manager came out to my truck and asked if everything left on the truck was going into his store. I replied yes and he then ordered me inside into the air conditioning while he and two stockers unloaded my truck for me.
I once asked a manager why he spent so much of his time in the receiving area during receiving hours, he pointed at the back door and said that is where I make my bonus.
Publix was one of the last companies to use the scan in process for vendor deliveries. There were always two receivers on duty during peak hours at the back door and even then if both were tied up with time intensive check-ins, they would get on the PA and call a manager to the back door to keep a vendor from waiting.
Publix posted receiving hours that were very generous and never failed to honor them. If for emergency reasons you could not make the posted hours, they would open the door and never turn down a vendor delivery.
You knew that Publix managers could make store level decisions and if you did your homework with fact based selling you could get something done.
Publix never demanded from their vendors more than they were prepared to give in the way of effort and respect.
The reputation and admiration that Publix now enjoys is no accident. I have been a fan for many years. In many ways it was Publix’s ethics and policies in the DSD environment that inspired and motivated my current enterprise. Publix built its reputation the old fashioned way, They Earned It!
Being employee-owned isn’t the reason for Publix’s success. Costco isn’t employee owned, it’s a publicly-held corporation, yet it’s famous for treating its staff well and for its consistent profitability and loyal customers, too. Publix is a well-managed company. Period. So few American retailers fit that description. Every supermarket company has access to the same suppliers, equipment, people, and very similar real estate. But most American supermarkets pale in comparison to Publix.
It’s not that complicated. Publix treats their employees with respect, as partners in their mission. Everyone knows what the mission is and it never changes. The employees are never surprised or embarrassed by their company. Anyone who knows anything knows that God shops at Publix. Would he come into your store?
One of Fred Reicheld’s main points in “The Loyalty Effect” is something that we see time and time again: customer loyalty goes hand in hand with employee loyalty. Treat employees well, vest them and they will take care of the customers.
Nordstrom gets this, Home Depot used to, and Circuit City has no idea. Publix does and this consistency, along with other areas of their business (and customer experience) where they are equally consistent, is what makes the habit of grocery shopping far superior at Publix.
Ron Margulis made a comment about sharing a cab with some Publix associates at FMI. If you ever go to an FMI conference, you can’t go 100 feet without running into someone at Publix. I have found a high correlation of well run companies and those than send a lot of employees to conferences.
Publix is so good it’s scary. Employees walk around as if they are in some kind of cult. I mean that in a good way. Like one panelist said earlier, we could write a book about Publix. I wish I had known about them when I was getting out of college looking for a job.
It’s amazing that with the onslaught of Walmart in the Southeast, Publix only got bigger and gained more market share. Publix has used Walmart as muscle to help push out the competition. They use adverse situations to grow stronger. It’s like the perfectly run company. The CEO is paid well but not in the zillions like at Winn-Dixie, which typically just loses money.
Publix isn’t perfect. They make mistakes like everyone else. The difference is they learn and grow stronger from their mistakes. Being somewhat privately held, they can tell it like it is and not candy-coat their problems for Wall Street.
Fortune Magazine each year validates America’s best performing companies in two issues; Fortune’s Most Admired Companies in America and The Best Places to Work in America. Publix is a repeat honoree in both issues. They share common characteristics with many of their peer companies with like recognition:
1)They are fiscally successful;
2) They have “raving fans”;
3) Their associate turnover is low;
4) They are trusted by their customers, thus are given their permission to innovate and try new approaches.
5) The experience they create for shoppers,seems to occur everywhere, with every one almost everytime.
All of the above are hallmarks of great service companies
1. Consistency in stock
2. Consistency in presentation
3. Consistency in maintenance
4. Consistency in (authentic) service
Publix will succeed with this formula in the South, North, East, and West, because the service is authentic, not because it’s easy to pull off in the South. They kill the competition in the South for those reasons.
My son applied at Kroger and at Publix. He filled out an application at Kroger, and was asked what hours he could work. He filled out one at Publix; he went through a 45 minute questionnaire on service scenarios with customers (what would you do if…?).
They’re old school; they don’t just fill holes. That will win anywhere, especially in this world of ever lowering expectations.
I really had a chuckle at Al’s comment. I live in Miami. This could be one of the most congested cities in the country, and when it comes to congeniality…well, we’re #1 in road rage just for starters. This is not a “we care” kind of place.
Having said that, Publix is fabulous here too. The employees are, in fact, courteous. The store is shoppable. Assortments are stunningly local (as in, different assortments 50 blocks apart). Customers notice the community concerns.
The only thing that befuddles me is why my local Publix consistently re-stocks shelves during high traffic hours. It seems to happen during the “after work” hours of 5:30-7PM. Strikes me as really odd.
I’m not the best one to address this, (I am not particularly price sensitive), but Publix does seem to be “in the ballpark” price-wise. I do know the company sells seltzer for 1/3 the price Whole Foods does. I don’t see anything egregious like that Whole Foods example.
I wonder how much is due to the company being privately held…as opposed to held up to Wall Street’s scrutiny. In any case, give it its “props.” Publix rocks.
In three of the last four years when FMI’s annual conference was in Chicago, I had the good fortune to have encounters with senior Publix managers, either sharing a cab to the airport or sharing a meal. In each of these cases, the Publix manager was very forthcoming with both news from the company and with insight into the retailer’s success. They all agreed that being an employee-owned company drives morale. They said incentives are paid for good ideas and good execution. Most importantly, they said everything the company does is planned to the most minute detail. I remember one manager who had a military background said it was similar to his time in the Navy. Even the way they attended FMI was planned so every hour was dedicated to something that would deliver benefits to the company.
I’m going to disagree (slightly) with Al–there is a significant level of variation in service here in the South–even in my part of Atlanta, even in the grocery stores surrounding me in the NW suburbs. Publix stands out, because of its service, and I think it’s because that’s what they emphasize. It costs more to shop at Publix v. Kroger, as Kroger ads often remind us, but the service at Publix is far superior (meat departments that cut meat to order, the best bakery in the area–something we really lack down here, hint hint, even the checkout clerks).
The associate concept works well for Publix. It’s not just an overworked grocery manager interacting with the customer. The owner has a true stake in the business, thus the drive for great customer service.
In my personal experiences with Publix, I would say that staff are well trained and there is a real focus on putting the right person in the right job. Combined with innovative store layouts, Publix can deliver an customer experience that truly differentiates itself from its competition.
Why is Publix so darn good? I could write a book. They know who their customer is and their customer knows they are a Publix customer. So many grocers have made it confusing on who they are truly trying to reach out to. Publix remains consistent and their customers know it.
Publix gets involved locally. They do an excellent job participating with charities and schools close to their stores which help make them part of the fabric of the local community. My oldest daughter’s third word (after “dada” and “momma”) was balloon because she got a free balloon every time she went to Publix. My youngest daughter wants to go in a Publix every time she sees one because she knows she can have a cookie in the store.
They have a passion for service and you can see it at every level. Whether you are dealing with corporate or a bag boy, they have a passion for answering assisting you and doing the right thing. The employee ownership, in my opinion, has a tremendous impact on their success. I met a Publix employee once that told me that over 20 members of their family work for Publix. They have employee and customer loyalty. And, the recent business decisions they have made are brilliant–buying Albertsons, healthy food, green issues, etc. They are the greatest retailer in the US.
No secrets here. Treat your employees and customers well and it’ll all come back to you.
At the center of it all–ever since Publix was founded–has been a creative, flexible and highly focused management team. Going back to George Jenkins, who I met a couple of times at the beginning of my career, this is a company that has never shied away from trying new things. From frozen foods to automatic doors, Publix has been a thought leader.
The fact that these people like the business they’re in shows!
Ever since she moved to Florida over 20 years ago, my step mother has had nothing but praise for Publix. Everything from the kindness of their employees, to the corporate kindness they demonstrated by hiring mentally challenged workers to gather carts and keep the front of the store tidy.
So the answer is obvious: Happy employees breed happy customers.
Publix promotes having good partnerships with its suppliers. This causes suppliers to go out of their way to make meaningful and inspired proposals to do business beyond the norm. These partnerships help to give Publix an edge for keeping the shopping experience reliable, interesting, and diverse, for consumers. For example, in the HBC section, Publix looks beyond IRI and Nielsen to understand and provide niche brands and points of differentiation to its consumers. Publix “gets it.”
All of the commentators above have in some way referenced “customer service” as the key to Publix excellence.
I once attended a seminar on human development given by Mike Vance, who built his reputation as the HR lead for Disney theme parks. He told a wonderful story of being called in by an Atlantic City casino. They said they had “scuzzy employees” and they wanted Mike to “Disneyize them.” Mike arrived early and sat unannounced in the lobby to observe the “scuzzy employees” at work. He watched otherwise normal behavior turn surly when bus loads of pensioners from New York and Philly started arriving later in the afternoon. As lines formed and patrons fumed, the employees magically transformed into “scuzzies.”
Mike met with the casino managers the next day, announcing that the training was canceled because they didn’t need it. Dumbfounded, the managers asked why. Mike replied, “because you don’t have scuzzy employees, you have scuzzy customers!”
In truth, world-class customer service is a bit of the “chicken or the egg” question. Do pleasant customers beget helpful employees or vice versa? Whatever the reality, Publix excels by managing their own controllable–employee owners–as well as anyone in retail.
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One factor is their location in the southeast. I’m not sure this top notch customer service could be replicated in more congested areas with generally grumpier labor pools.
As a thirty year veteran of the grocery DSD world with multiple companies, and twenty of those thirty years in South Florida, I will confine my remarks to the nature of the relationship between Publix and its DSD manufacturer partners and why this relationship is unique in the industry. To do this I will relate some actual incidents from my personal experience.
Upon servicing one store for the first time as Route Sales Rep, the manager of this store wanted me to be clear on our relationship. The manager told me that I was no longer my company’s rep to him but instead I was now his rep to my company. I was regularly invited to the store Christmas party as I was considered a member of their team. When I would routinely take my four year old daughter with me for Sunday morning pull-ups, I would deposit my daughter with the manager, do my stocking and then when I went to pick her up she would be sitting on top of the customer service counter with her cookie and juice box updating him on her weekly adventures.
Once at the end of a very long week and at the point of exhaustion due to a very high volume sales promotion, I was beginning to unload at my best stop for the second time in one day and apparently I looked like I was at the end of my rope. The store manager came out to my truck and asked if everything left on the truck was going into his store. I replied yes and he then ordered me inside into the air conditioning while he and two stockers unloaded my truck for me.
I once asked a manager why he spent so much of his time in the receiving area during receiving hours, he pointed at the back door and said that is where I make my bonus.
Publix was one of the last companies to use the scan in process for vendor deliveries. There were always two receivers on duty during peak hours at the back door and even then if both were tied up with time intensive check-ins, they would get on the PA and call a manager to the back door to keep a vendor from waiting.
Publix posted receiving hours that were very generous and never failed to honor them. If for emergency reasons you could not make the posted hours, they would open the door and never turn down a vendor delivery.
You knew that Publix managers could make store level decisions and if you did your homework with fact based selling you could get something done.
Publix never demanded from their vendors more than they were prepared to give in the way of effort and respect.
The reputation and admiration that Publix now enjoys is no accident. I have been a fan for many years. In many ways it was Publix’s ethics and policies in the DSD environment that inspired and motivated my current enterprise. Publix built its reputation the old fashioned way, They Earned It!
Being employee-owned isn’t the reason for Publix’s success. Costco isn’t employee owned, it’s a publicly-held corporation, yet it’s famous for treating its staff well and for its consistent profitability and loyal customers, too. Publix is a well-managed company. Period. So few American retailers fit that description. Every supermarket company has access to the same suppliers, equipment, people, and very similar real estate. But most American supermarkets pale in comparison to Publix.
It’s not that complicated. Publix treats their employees with respect, as partners in their mission. Everyone knows what the mission is and it never changes. The employees are never surprised or embarrassed by their company. Anyone who knows anything knows that God shops at Publix. Would he come into your store?
One of Fred Reicheld’s main points in “The Loyalty Effect” is something that we see time and time again: customer loyalty goes hand in hand with employee loyalty. Treat employees well, vest them and they will take care of the customers.
Nordstrom gets this, Home Depot used to, and Circuit City has no idea. Publix does and this consistency, along with other areas of their business (and customer experience) where they are equally consistent, is what makes the habit of grocery shopping far superior at Publix.
Ron Margulis made a comment about sharing a cab with some Publix associates at FMI. If you ever go to an FMI conference, you can’t go 100 feet without running into someone at Publix. I have found a high correlation of well run companies and those than send a lot of employees to conferences.
Publix is so good it’s scary. Employees walk around as if they are in some kind of cult. I mean that in a good way. Like one panelist said earlier, we could write a book about Publix. I wish I had known about them when I was getting out of college looking for a job.
It’s amazing that with the onslaught of Walmart in the Southeast, Publix only got bigger and gained more market share. Publix has used Walmart as muscle to help push out the competition. They use adverse situations to grow stronger. It’s like the perfectly run company. The CEO is paid well but not in the zillions like at Winn-Dixie, which typically just loses money.
Publix isn’t perfect. They make mistakes like everyone else. The difference is they learn and grow stronger from their mistakes. Being somewhat privately held, they can tell it like it is and not candy-coat their problems for Wall Street.
Fortune Magazine each year validates America’s best performing companies in two issues; Fortune’s Most Admired Companies in America and The Best Places to Work in America. Publix is a repeat honoree in both issues. They share common characteristics with many of their peer companies with like recognition:
1)They are fiscally successful;
2) They have “raving fans”;
3) Their associate turnover is low;
4) They are trusted by their customers, thus are given their permission to innovate and try new approaches.
5) The experience they create for shoppers,seems to occur everywhere, with every one almost everytime.
All of the above are hallmarks of great service companies
1. Consistency in stock
2. Consistency in presentation
3. Consistency in maintenance
4. Consistency in (authentic) service
Publix will succeed with this formula in the South, North, East, and West, because the service is authentic, not because it’s easy to pull off in the South. They kill the competition in the South for those reasons.
My son applied at Kroger and at Publix. He filled out an application at Kroger, and was asked what hours he could work. He filled out one at Publix; he went through a 45 minute questionnaire on service scenarios with customers (what would you do if…?).
They’re old school; they don’t just fill holes. That will win anywhere, especially in this world of ever lowering expectations.
I really had a chuckle at Al’s comment. I live in Miami. This could be one of the most congested cities in the country, and when it comes to congeniality…well, we’re #1 in road rage just for starters. This is not a “we care” kind of place.
Having said that, Publix is fabulous here too. The employees are, in fact, courteous. The store is shoppable. Assortments are stunningly local (as in, different assortments 50 blocks apart). Customers notice the community concerns.
The only thing that befuddles me is why my local Publix consistently re-stocks shelves during high traffic hours. It seems to happen during the “after work” hours of 5:30-7PM. Strikes me as really odd.
I’m not the best one to address this, (I am not particularly price sensitive), but Publix does seem to be “in the ballpark” price-wise. I do know the company sells seltzer for 1/3 the price Whole Foods does. I don’t see anything egregious like that Whole Foods example.
I wonder how much is due to the company being privately held…as opposed to held up to Wall Street’s scrutiny. In any case, give it its “props.” Publix rocks.
In three of the last four years when FMI’s annual conference was in Chicago, I had the good fortune to have encounters with senior Publix managers, either sharing a cab to the airport or sharing a meal. In each of these cases, the Publix manager was very forthcoming with both news from the company and with insight into the retailer’s success. They all agreed that being an employee-owned company drives morale. They said incentives are paid for good ideas and good execution. Most importantly, they said everything the company does is planned to the most minute detail. I remember one manager who had a military background said it was similar to his time in the Navy. Even the way they attended FMI was planned so every hour was dedicated to something that would deliver benefits to the company.
I’m going to disagree (slightly) with Al–there is a significant level of variation in service here in the South–even in my part of Atlanta, even in the grocery stores surrounding me in the NW suburbs. Publix stands out, because of its service, and I think it’s because that’s what they emphasize. It costs more to shop at Publix v. Kroger, as Kroger ads often remind us, but the service at Publix is far superior (meat departments that cut meat to order, the best bakery in the area–something we really lack down here, hint hint, even the checkout clerks).
The associate concept works well for Publix. It’s not just an overworked grocery manager interacting with the customer. The owner has a true stake in the business, thus the drive for great customer service.
In my personal experiences with Publix, I would say that staff are well trained and there is a real focus on putting the right person in the right job. Combined with innovative store layouts, Publix can deliver an customer experience that truly differentiates itself from its competition.
Why is Publix so darn good? I could write a book. They know who their customer is and their customer knows they are a Publix customer. So many grocers have made it confusing on who they are truly trying to reach out to. Publix remains consistent and their customers know it.
Publix gets involved locally. They do an excellent job participating with charities and schools close to their stores which help make them part of the fabric of the local community. My oldest daughter’s third word (after “dada” and “momma”) was balloon because she got a free balloon every time she went to Publix. My youngest daughter wants to go in a Publix every time she sees one because she knows she can have a cookie in the store.
They have a passion for service and you can see it at every level. Whether you are dealing with corporate or a bag boy, they have a passion for answering assisting you and doing the right thing. The employee ownership, in my opinion, has a tremendous impact on their success. I met a Publix employee once that told me that over 20 members of their family work for Publix. They have employee and customer loyalty. And, the recent business decisions they have made are brilliant–buying Albertsons, healthy food, green issues, etc. They are the greatest retailer in the US.
No secrets here. Treat your employees and customers well and it’ll all come back to you.
At the center of it all–ever since Publix was founded–has been a creative, flexible and highly focused management team. Going back to George Jenkins, who I met a couple of times at the beginning of my career, this is a company that has never shied away from trying new things. From frozen foods to automatic doors, Publix has been a thought leader.
The fact that these people like the business they’re in shows!
Ever since she moved to Florida over 20 years ago, my step mother has had nothing but praise for Publix. Everything from the kindness of their employees, to the corporate kindness they demonstrated by hiring mentally challenged workers to gather carts and keep the front of the store tidy.
So the answer is obvious: Happy employees breed happy customers.
Publix promotes having good partnerships with its suppliers. This causes suppliers to go out of their way to make meaningful and inspired proposals to do business beyond the norm. These partnerships help to give Publix an edge for keeping the shopping experience reliable, interesting, and diverse, for consumers. For example, in the HBC section, Publix looks beyond IRI and Nielsen to understand and provide niche brands and points of differentiation to its consumers. Publix “gets it.”
All of the commentators above have in some way referenced “customer service” as the key to Publix excellence.
I once attended a seminar on human development given by Mike Vance, who built his reputation as the HR lead for Disney theme parks. He told a wonderful story of being called in by an Atlantic City casino. They said they had “scuzzy employees” and they wanted Mike to “Disneyize them.” Mike arrived early and sat unannounced in the lobby to observe the “scuzzy employees” at work. He watched otherwise normal behavior turn surly when bus loads of pensioners from New York and Philly started arriving later in the afternoon. As lines formed and patrons fumed, the employees magically transformed into “scuzzies.”
Mike met with the casino managers the next day, announcing that the training was canceled because they didn’t need it. Dumbfounded, the managers asked why. Mike replied, “because you don’t have scuzzy employees, you have scuzzy customers!”
In truth, world-class customer service is a bit of the “chicken or the egg” question. Do pleasant customers beget helpful employees or vice versa? Whatever the reality, Publix excels by managing their own controllable–employee owners–as well as anyone in retail.