Retail’s Big Show Tackles Big Issues

NEW YORK -- "Dysfunction" in Washington, D.C. led to the world witnessing a "lack of leadership in the United States of America," Starbucks Corp. Chairman, President and CEO Howard Schultz stressed during a panel discussion yesterday at the National Retail Federation’s (NRF) 102nd Annual Convention and Expo.

Schultz alluded to the "fiscal cliff" debate and said retailers will be directly affected as the government dysfunction impacts consumer behavior. Starbucks itself had employees write the words "Come Together" on coffee cups to express their displeasure with the U.S. government.

Schultz implored retailers not to simply watch what happens in the nation's capital.

"We have to have a voice," he told the crowd of retailers gathered at the Jacob K. Javits Convention Center. "The world is hungry for America to lead. We must send a message to Washington that we deserve better. I ask you to do everything you possibly can as employers not to be bystanders, and demand Washington does everything it can to deliver aspirations we deserve as citizens of the United States."

In addition, Schultz noted that the "rules of engagement" for businesses and business leaders have changed. "The burden of responsibility is on us. That means participation in the political process," he added.

During the session, entitled "Conscious Leadership: A Call to Action for the Retail Industry and Beyond," Schultz was joined by Walter Robb, co-CEO of Whole Foods Market Inc., and Kip Tindell, chairman and CEO of The Container Store. Robb relayed that with the U.S. debt ceiling expected to be surpassed shortly, retailers face another "rough couple of months."

"It's frustrating to see lack of leadership," Robb said. "You wouldn't run your business that way."

While Tindell believes The Container Store will have a strong 2013, he also acknowledged that government disarray is causing a "drag" on business.

Eventually, the three panelists shifted the discussion away from the government and focused on how retailers can beat the competition.

Tindell said the best way is to truly put the customer first. "[Employees] will take care of the customer better than anyone else," he said. "Customers almost feel like part of the company. They don't like us, they love us."

According to Robb, encouraging employees to innovate is a top way for retailers to separate themselves from the pack. He further stated that employees should feel they are part of a team. At Whole Foods Market, that's accomplished as 40 percent of employees own stock in the company. Starbucks’ Schultz noted that retailers must adjust to a "seismic change" in consumer thinking linked to technology.

"It's never been more difficult and challenging for brick-and-mortar [stores] to succeed," he said. "Any company using traditional ways to communicate is in a collision course to time. Invest ahead of the growth curve and technology. Be as relevant outside the four walls [as you are] inside [of them]."

Along the lines of staying relevant, Wawa Inc. announced yesterday at the NRF Show that it will implement Merchant Customer Exchange's (MCX) mobile wallet solution at its convenience stores.

Wawa Treasurer Jay Culotta offered some insight into why the c-store chain chose MCX over the many other players in the mobile wallet space, including Google, PayPal, Isis and Square.

"At Wawa, we really looked at MCX as providing us a way to create a solution for us and by us," Culotta said during an afternoon session, “Meet MCX: The Only Merchant Owned Mobile Wallet.” He added that MCX will give Wawa access to better data, down to the SKU level.

Culotta also pointed out that MCX can reduce costs for the Wawa, Pa.-based convenience retailer. "Some of our convenience stores handle around 15,000 customers a day," he explained. "If we get our associates and customers confused, it will kill our speed of service." Wawa is not the only convenience retailer that has signed on with MCX. As CSNews Online previously reported, 7-Eleven Inc., Alon Brands Inc. and Sunoco Inc. were founding members.

Also seen and heard by CSNews Online at the NRF Show yesterday:

  • NRF President and CEO Matthew Shay said three things need to be accomplished in order for retailers to be more successful. First is reform of the tax code. At 35 percent, America has the highest corporate tax rate in the world. Second, the United States must open new trade opportunities, including bilateral relationships with the European Union. Third, the U.S. government must fix its broken immigration and VISA system. "We need a system to attract brightest and most skilled workers around the world," Shay stated.
  • Attendance at the 2013 NRF Convention and Expo, nicknamed “Retail’s Big Show,” is expected to reach 27,000, a sharp increase over last year. Several exhibitors told CSNews Online that booth traffic was excellent throughout the convention center, even in areas usually "less traveled."
  • NRF kicked off yesterday's festivities with a keynote speech from Kofi Annan, Secretary General of the United Nations from 1997 to 2006. During his speech, entitled "Building Strong Nations: The Three Pillars to a Prosperous Society," the 2001 Nobel Peace Prize winner asserted that we live in a turbulent world. "Syria is the most dangerous situation. It will explode beyond its borders if we are not careful,” Annan said. Regarding retail, he said the industry has an important role to play. "You must create million of jobs to keep young people busy…Small businesses have lots of clout."
  • Two of the most discussed topics on the show floor were the future of mobile wallet payment solutions and the potential around geolocation services
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