Sorry Sir, we’re not selling today.

Yesterday with my colleague we headed for went for lunch near our office. As usual we ordered our food and then a drink which by habit is normally is a large ice coffee and a large coke.

Before we even start to order, the seller, knowing what we’ve order said “Sorry sir, we are out of large cups, will you accept a small one instead?” With no option we accepted and went back to our tables and talked about the customer service impact of this.

A similar case also happened a year ago when I remember going to a Dairy Queen shop for an ice-cream cone. “Sorry sir, we have no cones. We ran out a couple of days ago.” They also told me other stores in this area had the same problem.

Dairy Queen Thailand, a branded outlet chain of around 200 shops is owned and managed by Minor Food Group, who also distribute The Pizza Company. Sizzler, Burger King and Swensens

Minor were also a customer of ours some time back, so my imageconcern sent me later to digging out my contacts there and I wrote them a letter to alert them to this flaw in their supply chain management.

image

I had estimated, based on my crude observation of traffic, the shop would potentially have lost sales of cone products, of around 8,000 Baht for the day. If all 200 shops had this problem, the daily loss would be 1.6 Million Baht ($50,000 USD/day). And if this continued, imagine the loss over an extended period.

By the end of the profit reporting period I’m sure some variances would start to appear and questions arise: Why the loss, will it happen again, and do they need how can we deal with it. I was also interested how their deployed reporting systems were now being used to alert then for early warring issues like this for timely corrective attention.

This may have been especially relevant in understanding the situations that were reported in the published management discussion and analysis of DQ’s sales growth some time back.  This showed a decline back in soft server products in 2007 when sales of DQ showed an overall improvement”.

As for me, I’m just a customer who doesn’t seem to be happy when I don’t get my cones when I want them.

-000-

Kitipan Kitbamroong is a Director of Sherwood Group Consulting based in Thailand and Technical Director Benox Co Ltd

2 thoughts on “Sorry Sir, we’re not selling today.

  1. @Sam Donley
    Thanks Sam,
    Doesn’t seem to work that way. The store operators (not sure if they are managers) is not allowed to. “Think differently” is impossible when SCM is deployed.

  2. I have more concern about the local store management’s inability to resolve the problem directly. Why would you simply not send a staff member down to Tesco with some Petty Cash, and buy some cones.

    Perhaps supply chain is the big issue here, but a simple resolution is to train your management to behave differently in such situations.

    My general observation is that there seems little incentive for local store management to think differently in such situations. Perhaps store P&L ownerhsip (with the rewards and penalities that go with this level of responsibility) may drive a different behaviour all together.

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