I recently attended a breakfast presented by Guy Russo, the former MD of McDonalds (who started working in one of their stores as a teenager) and who is now the CEO of Kmart.
During his presentation, his standout points were:
- “Know who you are” and stick to it. Don’t be all things to all people – it’s too hard!
- Kmart’s “know who you are” is that it is a “grab and go” business
- Their where to play and how to win is to sell every day items (i.e. whatever you use every day it must be “grab and go”) at the lowest possible price
- To achieve the lowest possible price they sought the lowest possible cost from their suppliers which meant they have moved from 4,000 suppliers in Australia some 4 -5 years ago (the Australian market had too many middle parties in the supply chain and this added cost) to 300 direct suppliers in China.
What impressed me mostly, was the significant turnaround in the fortunes of an organisation the size of Kmart and adopting a simple and focussed strategy.
– Tony Monisse (Director – Brentnalls WA)