Zero Wait - How Costco can double their profits and deliver better Customer Service

Since I like Costco so much, I thought I might take one concept and apply it all over their store — making them double their profits AND deliver higher quality service, while maintaining a similar workforce. First a key point — those who think having happier employees AND happier customers AND increased profits are not possible (without gain-loss) are failing at their first, most critical Leadership skill — Vision.

Let’s take a look at the big Wait times all over their store — Customers Exiting the Store (Inspection Qualification & Skip Lot is another blog, another day), Customers Waiting to Pay and Cars waiting to Drive Home. Wait a minute, who said anything about cars??!!!??? Most consultants would have focused on the first two customer scenarios, skipping the cars. But it’s true. Cars wait all over a massive parking lot — waiting to drive to another destination. Let’s hold this thought a minute and let it simmer while we go back to the obvious two.

Zero Wait

Since I skipped Customers Exiting the Store, let’s look at Customers Waiting to Pay — there are two major actions — 1) Employee scanning products and 2) Customers paying the bill. While the Employee scans everything, the Customer waits; and while the Customer pays, the Employee waits. WHAT IF — you eliminated the Wait to double the Productivity (and therefore profit, doubling throughput of the store)? How about 1st-employee scanning (with a hand scanner) the next Customer WHILE the current Customer pays at the register with 2nd-employee. ELIMINATE = the belt + items in & out of the cart + all the wait time. Yeah, all that extra work was Over-Processing waste anyway — other than my 4-yr old little girl, who wants to wait and watch items moving from a Cart to a Belt back to a Cart?

WHAT?!?!! You can do that? Why did they have all that work anyway? Well usually because of a limiting constraint that no longer exists. Scanners used to be so large the only way to get items to scan was to move the item to the scanner. Now that is a thing of the past. This is an easy solution even with current IT technology scanning the UserID (aka Costco ID) before scanning items and again before paying. Train your customers to orient their items barcode-side-up and it’s a Win-Win-Win = easier on Employees + faster for Customers + increased Corp Profit.

Cars waiting to Drive — well, I think I’ll wait for Costco to hire me for that one. After all, I just doubled their profit for free. ;-) Needless to say, anything that waits can be turned into a Profit AND Customer Satisfaction. Waiting is simply — a waste of time.

Chris

See…that is Simple.  Want help with Wait, Over-Processing, and other Wastes of Time?  Our purpose is to co-create the best companies the world has ever seen.  Contact us to get started with your journey together.

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