When the going gets tough, Wawa gets going. While retailers of various box sizes have engaged in large-scale store closings and layoffs since the recession hit, the Media, Penn.-based convenience store chain chose a different path when it first spotted the economy turning downward in 2007.
Harry McHugh, senior vice president at Wawa, told CS News Online, "We've been through this many times before and know we are left to our own devices. We knew what we should do: cut expenses and make sure the balance sheet was in order, and be prudent in investments."
Wawa's prudent approach meant putting off any rapid expansion plans and looking to control costs without compromising service and the customer experience.
"We certainly don't want to cut customer service," Mr. McHugh told CS News. "It's foolish to do that by cutting labor costs. These types of economic downturns are a test of your commitment to customer service and an opportunity to provide a value."
To keep costs under control, Wawa has put off numerous projects that were ready to go. One area where it did not skimp was in store remodels.
"The stores have to remain world-class. If people are unhappy with the product, they won't shop in our stores, no matter what your customers service is," said Mr. McHugh.
"We have increased our investments in those areas (store remodels) and are revitalizing at least half the chain in 2009," he added.
Wawa also remained committed to its employees at a time when those at other companies are uncertain about their jobs and future prospects.
"You just can't say, 'I'm not offering you benefits now.' If anything, we are going the other way, offering more benefits and tuition refunds and a greater choice of benefits to more customer service staff," Mr. McHugh said. "We would never skimp on employee education or development. We have also raised our level of pay, but made it more merit-based. When you start exercising common sense, what you cannot compromise on becomes even clearer."
Discussion Questions: What do you think of Wawa's approach to management during an economic downturn? What are key insights from how Wawa runs its business and how does that apply to others in retailing or other fields?