As independent operators and their wholesalers convene in Las Vegas this week for the National Grocers Association annual convention, questions are sure to be raised about Efficient Consumer Response. Unless I miss the mark, the bottom-line intent of questions will be simply this: Is ECR an initiative that has much relevance for independents and moderately sized wholesalers, or is that business segment wasting perfectly good time and energy in even thinking about it? This is an especially good time to pose the question because I think ECR -- as characterized by process orchestrated by a hierarchy -- is fading away and in its place is arising the next-generation ECR.
Now, I believe, ECR is becoming a shorthand way to describe the current business fashion involving issues such as communication, trust, decentralized decision-making and, above all, a willingness to challenge the traditional way of doing things. And if that's the case, there's no doubt that independents and their wholesalers belong in the ECR game now, even if they didn't earlier. This view of a new ECR shone through to some extent during a session earlier this month at the Joint-Industry Conference on ECR in Dallas. The session was all about independents and wholesalers in the world of ECR and it was moderated by Charles P. Butson, the independent operator from Woodville, N.H. He's also NGA chairman.
After the Dallas session, I talked to Chuck to see how he views the new ECR. (As for the session itself, there's a news article about it on Page 9 and other articles about the conference are in this issue.)
He said: "I agree that ECR has become the new word for communication, efficiency and taking costs out of the system and that it's coming to mean less about a process.
"What it means to me is that we need to step out of the traditional mode of doing things, and we can do that by examining every expense. We need to see if what we're doing makes sense, if our traditions make sense. "At the bottom of it all, retailers inflict costs on wholesalers and wholesalers inflict costs on retailers. It's now time to work together to decrease costs."
Chuck said he's well down the road with several programs such as this one: He's making plans to share scanner data with his wholesaler, information he has always held closely. (Butson's Supermarkets pulls from Supervalu.)
Here are a couple of other views that came up during the session Chuck moderated in Dallas that together represent no less than a call to action:
John F. Hanson, president of Sixth Street Food stores, an independent in North Platte, Neb., said that "we are discarding the notion that independent retailers are a relic, a dinosaur, a thing of the past. I personally think we are at a time of tremendous opportunity for independent retailers. Independents can move quickly; we don't have the burden of bureaucracy." Indeed, Sixth Street is making major investments in computerization and electronic communications, but all in the context of business basics such as expanding and remodeling.
John R. Dickson, chairman and chief executive officer of Roundy's, the wholesaler in Pewaukee, Wis., said that "each wholesaler and each individual store should teach people to make real decisions, not necessarily how to look up a problem in a manual but to be able to make a decision at the time it needs to be made. "We all fear this kind of change, but the smarter people realize how to eliminate the fear. Many people unknowingly equate change with loss of power. "We must move from fear to understanding. We must let go of a lot of responsibility, realizing that organizations cannot be run from the top down. "We must push out responsibility to managers, to decision makers at whatever level, whether on the floor of a store or the floor of a wholesaler." And, at another point, he said that "as we go into this ECR movement, there is a reward system. The reward system may not necessarily be a change to the bottom line. It may not improve it. It may not change your top line. It may not improve it. "The reward system is staying in business."