Friday, April 11, 2008

McDonalds - Starbucks Round Four

Now if this is the only blog you read, you may be wondering about rounds one, two, and three. Well, those rounds appeared in my general interest blog, mrontemp.

Round one, entitled You think Feldman-Israel is a bad war? Wait until McDonalds-Starbucks gets into battle mode!, ventured the opinion that Starbucks would do better by differentiating itself from McDonalds, rather than trying to grab the McDonalds crowd.

But then I remembered how businesses work. Round two concentrated on the needs of stakeholders other than the customer - namely, the investors. Investors, whether public company shareholders or private company investors or venture capitalists, wants businesses to grow and expand and continue to show growth, and growth, and growth. A Starbucks that maintains the same level of revenues and profits is a failure for those folks.

I just wrote round three, which concentrated on cost optimization, or whatever euphemism you want to use for cost cutting - another thing that the investors want to see, since lower costs result in higher profits, don't they?

Well, I saved round four for this blog, because it's taking place right in Ontario. Continuing on the cost-cutting theme, but adding a new twist.

From the Daily Bulletin:

Mervyns distribution warehouse in Ontario is laying off 200 employees and will outsource to a manager of third-party logistics vendors called Kalserve....

Mervyns expects to save $4million. It will keep about 30 employees in Ontario to oversee its third-party vendors.

More here. While Matthew Wrye took the local point of view, the Sacramento Business Journal noted that layoffs took place in northern California also. (By the way, I didn't realize that Mervyns was no longer part of Target. But hey, it's only been independent for four years now.)

As for Kalserve...well, I can't find out anything about any logistics company called Kalserve, or for that matter any company called Kalserve, other than an unidentified company in Dublin, Ireland.

But Mervyns would probably like it better that way.