Market Basket leaves customers with empty carts
Market Basket leaves customers with empty carts

Market Basket leaves customers with empty carts

By on Aug 28, 2014 in Blog | 0 comments

How do you destroy a successful, and wildly popular 98-year old company in just a month?  Hire the wrong CEO, or in this case, CEOs, to replace a beloved CEO, and then mismanage the PR.  Market Basket, a family owned grocery store in New England, is writing the book on cutting off your nose to spite your face.  With little coming out of the board room except layoff threats and ultimatums, the DeMoulas family has created a serious PR problem.   Market Basket leaves customers with empty carts

According to various media reports: the family/business turmoil started when the original owners of the store sold it to two of their sons.  When one of them died unexpectedly, things started to go downhill.  The surviving brother, the father of Arthur T. DeMoulas, was accused of defrauding the deceased brother’s children, among them, Arthur S, DeMoulas, out of all but 8% of the company’s stocks using shell corporations.  When the case was tried, the judge ruled in favor of the children of the deceased brother, and awarded them 51% of the stock.  From then on, things have been strained.

Fast forward to about 5 weeks ago, and things have gone from strained to flat out broken.  The major players, Arthur T and Arthur S, have been able to throw away tens of millions of dollars by simply keeping their mouths shut.  Arthur S, in a board room coup, ousted Arthur T, and replaced him with the former CEOs of Alberton’s (Felicia Thornton) and RadioShack (James Gooch).  The backlash from employees and customers was almost immediate.  With their benefits, bonuses, and possibly jobs in jeopardy, the employees began protesting, encouraging customers to join them.  The stores have become ghost towns with no fresh produce or meats coming in, and only a smattering of people walking the aisles.  Part time workers have been told that there are no hours for them.

What could have been done to prevent all this?  Get out in front of possibly troubling news with a strong public relations plan.  While a laundry list of coming changes isn’t needed right away, something that sends the message addressing the employees’ fears should be included.

Many family run businesses can learn a huge lesson from this whole debacle.  First, keep family squabbles in the family, and don’t let it affect the business.  Most importantly, though, get information to the employees and customers.  Have a PR firm in your corner who can keep the message simple and on point.  This business is so entrenched within its own history that to ignore the employees has become corporate suicide.  Many have been there since before completing high school, and feel just as much ownership over the company as the DeMoulas family.  Leaving them out of the loop created many of the problems currently plaguing their beloved company.

Is your company a family run business that can use some well written PR?  Contact us now to let us help you stay out of this kind of trouble.



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