We Fixed It. You're Welcome.

Aaron Wolpoff [0:14 - 1:32]: All right, here's how this works. In each episode, we pick a company we all know that has something going on right now. Then we put ourselves in charge and see if we can fix it. You'll be hearing from Melissa in Operations Channel, Gino on people and culture, and me on marketing. My name's Aaron. As always, a quick disclaimer. We are going into this somewhat cold and nothing we say should be construed as legal advice, financial advice, or anything that would get us in trouble. These are our views and opinions. We're here to ask the kinds of questions everyone's thinking, have an engaging conversation, and maybe come to some conclusions that we feel are worth exploring by the end. If We Fixed it, you're welcome. All trademarks, IP and brand elements discussed are property of their respective owners. Welcome back to We Fixed It. You're welcome. Today we're here to talk about Walgreens and question why they are locking up all that deodorant, whether it's doing any good to prevent retail theft. Spoiler alert. It's been kind of a nightmare. We'll look at some other retailers and see what they've been doing about theft. There was a study by Capital One that projects retail theft could cost companies over 150 billion by 2026. So they are taking this seriously. Can we fix it if we do? You're welcome. Before we start, I'd like to introduce our guest finance panelist, Jason Kraus, who's joining Melissa Chino and myself. Jason, why don't you tell us a little bit about yourself.

Jason Kraus [1:33 - 2:18]: Thanks, Aaron. Great to be here. Great to be part of the show. I'm the founder and CEO of Prepare for VC Startup support Organization where we've helped over. We've helped dozens of startups raise over 450 million in venture financing through coaching, storytelling, and investor readiness programs. I also have a background in the venture capital space and I'm an active member of angel groups like the Boston Harbor Angels, investing in the tech and life science fields and love doing community events. So host a lot of fireside chats, you know, startup pitch competitions and other resources for founders across the the Boston ecosystem and beyond.

Chino Nnadi [2:18 - 2:18]: Great.

Aaron Wolpoff [2:18 - 2:32]: Thanks, Jason. It's great to have you here and we're going to put your finance muscle to a test and also we'll be thinking about this from a. What would, you know, what would a startup do in this situation? We're going to call on you for those types of insights.

Jason Kraus [2:32 - 2:33]: Sounds great.

Aaron Wolpoff [2:33 - 2:42]: Yeah. Before we get there, I'm just going to throw it to the room. We're going to talk about Walgreens today and other retailers, but let's start with Walgreens. Any quick stories or fond memories?

Melissa Eaton [2:42 - 4:06]: I don't know if I have fond memories. I used to work in downtown San Francisco pre pandemic. And it was when the shoplifting was getting out of control. And it was really that the security measures in place did not allow for security guards to actually actively apprehend people that were coming in. And I was actually in a Walgreens getting a toothbrush because I forgot one. And I saw a guy come in. He actually brought his bicycle in, opened his backpack that he had wearing it backwards, so it was on the front, unzipped it, and then just started throwing things in it and then rode his bike out. And we all just froze. I. I mean, I froze. I. I guess I could have tackled him. I wouldn't have. And it was just a really. It's. It was a sad time to be. I used to live in San Francisco. I love that city. And to see what it did. And it also scared people away from coming into these types of stores, which, you know, are run by local people. And this is. It was really. Actually, it's pretty disheartening. So I can see that it's a big issue for Walgreens and other retailers. And so I'm really excited to kind of talk about the security versus sales and what, you know, what we're. What we're going to get into today.

Aaron Wolpoff [4:06 - 4:07]: Good.

Jason Kraus [4:07 - 4:07]: Thanks.

Aaron Wolpoff [4:07 - 5:37]: Melissa and I went to Walgreens yesterday just to see it again for myself. But. But before we get there, let's just talk about a little bit about what got us to where we are now with some always reliable web research. So Walgreens was founded in 1901 by Charles R. Walgreen in Chicago. Started as a neighborhood drugstore. Most of you mentioned that neighborhood feel or presence. It started as one single store. Over time, expanded its offerings, introduced features like the malt and milkshake in 1922. Sounds pretty good. It was quite popular at the time, held on and grew during the depression. Was over 500 stores by 1930. We time jumped to 2003. Walgreens celebrated its 4000th store and then had a big merger with alliance boots in 2014 to expand its global footprint. And if we look stateside, as of January 2025, Walgreens operates approximately 8,475 stores across the United States today day. And if you've been to one of those stores lately, you might notice that these glass Door cages are springing up throughout the store. So you can't just grab shampoo or toothpaste and be on your way. Depending on which store you're in, you might have to get an associate, which has to be the best part of their day. Right. And come over and tip the cage and unlock it for you all so you don't steal it. So the first question is, are these kinds of theft deterrents working and what kinds of problems have they created as a result?

Melissa Eaton [5:37 - 7:32]: Well, I know that 55% of customers have said that if they can't immediately grab the item, that they will look for other sources to get the items, whether that be online or another store. So I do think that there is a risk. There's already. We've already seen it where that customer is not going to be happy at all. This actually kind of Chino made me think of you and your party city experience. But the reasons why people go to Walgreens for that in person shopping is really, they want to have a. The immediate gratification of grabbing it and seeing it and, and being able to also have that tangible experience. And so really, when you lock things up, you've kind of prevented them from that ability, because why not? Why wouldn't I just buy it online and have it doordash to my front door? And then the big thing about Walgreens, and I know I'm a. I, I have. I'm guilty of this, is that the impulse buys, so you know how they have all the snap at the front and they have like, you know, seasonal things or things on sale. That, that is a huge amount of their sales are these impulse buys. So you go in for deodorant, you leave with four boxes of hot tamales and, and Yoderin and maybe some lip gloss or whatever, right. At whatever is on the front. And you're. While you're waiting in line. So again, you've kind of created this space where you want kind of what feels like an impulse, you know, and very like, convenient store atmosphere. But at the same time, what you're doing is you're locking things up, making it very, very difficult. And, you know, later on we can talk about options that they have for the lockup. But I do think this is really detrimental to the survival of these types of stores.

Chino Nnadi [7:32 - 10:50]: Yeah, I would agree, too. And so as the honorary Canadian on the panel, Right. I've had a few experiences with Walgreens, right. But I was always blown away by the fact that they were open so late. So, you know, on Trips to New York for quick little things. You know, you always forget something when you're on a three day trip. This is kind of like is the case. And I remember, I think back in like 2012, 2011, I don't know, sometime then before kind of they were thinking it's down 2014. I remember going in at like 2 o'clock. So I needed to get double sided tape. Every woman understands like kind of the fashion emergency when you need a double sided tape. I remember going in and being shocked that it was like 1am and they had this. And my, you know, my friend bought a pair of those like fast flat shoes. She put some heels on that broke and so be able to go in. And I was shocked at how lively and open like there was people there. I was able to touch up my makeup. I was actually shocked by this kind of experience of being able to go and grab. Fast forward to November of 2024. I was going to Chicago for a quick business trip and I had a few hours off and I had chipped my nail, my nail polish before like a key meeting, which is not a good look. Again, for anyone that wears polish. You want to make sure you're polished. And so I walked into a Walgreens expecting like a very similar experience where, you know, customer service people were there to help you. I could grab what I needed to and I couldn't. I was, you know, looking around for things. The employees kind of looked a little bit sad or perturbed to be there because they had to keep going and like checking things for people and they just were not where they should be from. Like a shopper marketing experience, you know, it was really like I was in and out for something really fast and I couldn't get to it. And so I remember giving up, you know, walking to another store. They didn't have any nail polish. So you know, I was kind of moving along and going my way towards Chicago. And if you know anything about Chicago, neighborhoods are quite separated in different areas. And it was quite interesting to see walking into another Walgreens that was a little bit more in like a people of color kind of area, less gentrified. And just the stock difference as to how many more things were locked up there. Who. Which was shocking to me. And again, the workers just looked like they didn't want to be there. And it was such a quite stark difference to my experience way back in the day. Maybe it was a 1am thing, but I think, you know, it has completely changed the name of the game for the People who work there. For me, as a customer, I also felt like, really, you're locking up a nail polish. Like, I'm not going to steal that. Like, what are you saying to me as a customer? So it's been really interesting kind of watching that from the background. And of course, there are other retailers that are doing similar things, but I just think, you know, long term, as Melissa was talking about it, it's really taken away from that kind of immediate gratification, you know, that quick buy, that impulse buy, because it's all locked up.

Melissa Eaton [10:50 - 12:50]: Yeah. And I think that Chino, you bring up a good point. Is that the evolution of, let's say, shoplifting, which is a horrible thing to think about, but from a business perspective, and I'd love for Jason and Aaron to weigh in on this as well. But really, retail theft is in, like, four different categories. Right. So there's the shoplifting that we're talking about, like, oh, you know, you take a piece of candy, you take some nail polish. Then there's what they call orc, which is organized retail crime, which is a much more like, obviously, you know, bigger groups that are actually targeting very specific items and usually big ticket items for resale value right. On the black market. And these are professional groups that are coming in. And I, I've seen that firsthand with a friend that owned a small business in San Francisco, had the same thing where they come in and they do a full sweep cart transport is waiting. It's very, it's very quick employee theft, which I think, you know, any business, even, you know, not a retail business, there's the employee, you know, taking sticky notes and taking things, you know, extra snacks from, from the break room. You know, you always think about that. And then there's vendor and supplier fraud. So there's a lot of areas that the business of Walgreens needs to be focused on. And it just feels like, I'm sure for the average customer coming in, like, why are you locking up deodorant? Like, I get locking up. Maybe there was a time when, like, baby formula was a really hot black market thing because I think there was a problem there. So, like, you couldn't go to any store and get baby formula. Right. You had to get a little ticket and then you go and get it at the cashier. So from a business perspective, I wonder where Walgreens head is at, because they've got lagging sales and they've got to figure out how to, how to boost, you know, and small margins. So, Jason, your thoughts on that.

Aaron Wolpoff [12:50 - 13:19]: Yeah, Jason, let's throw you in, because the CEO, Timothy Wentworth, you know, had a January 10, like an earnings call with investment analysts and basically said they've the corrective or maybe over corrective measures are. Are tanking sales. They're going to close something like 1200 stores over the next three years. And as you said, they've proven conclusively, when you lock things up, you sell less of them. So what. What led to that decision? And why did. Why are they. You know, he's kind of doubling down on it, to my understanding, what's going on there?

Jason Kraus [13:19 - 14:30]: Yeah, I mean, I think some of it is tied to, you know, the branding and the category. We think of Walgreens and as a convenience store. So if things aren't convenient to get, you know, you can't walk in and grab your deodorant and, you know, spend less than 10 minutes in the store, get everything you need, it's no longer convenient for you. And also, you know, there's the same thing for the employees, like, if it's a hassle for them every time somebody comes in and, you know, there's two people working, having to go unlock, you know, things for 25 people in the store, that's not convenient for anybody that works there either. So, yeah, I think, you know, it's. It's a balance for them where, you know, you obviously want to prevent as much theft as possible, but you also want. You don't want, or the thieves aren't your customers, though, so you want your customers to have an amazing experience there and, you know, boost more people coming into the store, grabbing items, paying for them. So, you know, it's striking that. How do you prevent theft while still creating an enjoyable experience for everybody involved?

Aaron Wolpoff [14:30 - 14:49]: Yeah, well, I don't want to speak for everybody, but I don't know that we think of Walgreens as a trip to Walgreens is an amazing experience. It's not sensory delight. It's a functional experience. And when you put a barrier in the way of that functionality, that's really. That's your value prop. Right.

Melissa Eaton [14:49 - 16:50]: I do think that the company, from a business perspective, understands the cost of doing business is there's always losses. Right. Every company has that. But I think for Walgreens specifically, and Erin, you just pointed this out about them closing roughly 2,000 stores when last year, they had a $39 million quarterly loss, and year over year, it's now up to 245 million. Like there's something going wrong. Right. From the. Whatever the business strategy is. And so they really are. I mean, so what they're trying to do is stop the bleeding. And we've talked about this with, like, Party City and some other businesses, Spirit Airlines, you know, when you're trying to stop the bleeding, the first thing you do is, like, closing the stores. But then, you know, when we were talking the other day, when we're talking about how you have to invest money, Jason, you know, this. Invest money to make money, then how are you making sure that you're investing in the proper operations, security tools, experience, brand marketing, whatever it is that you're trying to do so that you can gain back the trust to people that this is really a convenience. Like, come on by Chino and stop in anytime you're in Chicago and you'll be fine. Like, don't worry that you forgot your toothpaste. Right. So it's. It's a really interesting, you know, dilemma for them because I think it runs way deeper than, you know, I think when people see the security measures, they think it's shoplifting. But. But it's way more than that. It's that operationally, you know, there's been this shift towards online shopping, you know, now embedded convenience stores and other stores. So, like, CVS is known as, well, like, kind of like the Walgreens, where it's a pharmacy, as well as other stuff. And now CVS is embedded in targets, you know, those kinds of things. So what are they going to do to kind of keep up with that competition?

Jason Kraus [16:50 - 17:34]: Yeah, and they're not. I was just gonna say they're not afraid to invest in technology like they were actually. And I know, you know, it turned out to be more of a scam, and, you know, they were on the wrong side of it, but, you know, they were the first one to want to implement Theranos and do blood testing in the store. You could go anywhere. They. That was part of their convenience, you know, proposition. As, you know, you don't have to go to a doctor, you don't have to go to an urgent care. You can get blood tests right in a local Walgreens. So, you know, I'm not sure what the hesitation is to implement security measures in their store, but they've definitely, like, tried to be on the forefront of other technology implementation in the past.

Chino Nnadi [17:34 - 20:47]: I agree. And I think it's really interesting to kind of look at it from, like, a loss prevention standpoint. So throughout university, I used to work at old Navy for four years. Shout out to O5488, which was really a great time. And I learned a lot about customer experience and, you know, theft, to be honest. You would watch people come in. You kind of knew the, the kind of signs to look out for. There was someone, you know, those like hidden shoppers that are kind of walking around, like the loss prevention people, LP people, that's what they're called. And you know, their whole mandate is obviously to prevent loss, Loss prevention. The name kind of gives that away. But the second someone steps out of the store, it's also like, you know, what is the value here? If someone had a gun, is it worth kind of, you know, tackling somebody for a shirt? Not necessarily. And so how a lot of retail stores have combated that is having people there. And so, Aaron, what you said was interesting to me about kind of the experience of Walgreens. And I would actually challenge that just a little bit because again, maybe it's because I'm Canadian, maybe it's because I've had a few experiences in Walgreens. But I remember again, back in New York that one time where I went in for, you know, double sided tape. We walked out and spent like $100 and there was someone there. It was 1 o'clock. We were shocked. There was two people helping us figure things out. They're like, try this, try that. Having just a person, a sales associate standing there actually prevents a lot of theft. Right? It's very easy to steal something when nobody's looking. You're in a corner, you can kind of fill your bags up. But I'm not talking about the overt theft that you were talking about, Melissa, where someone's walking in and it's that organized crime. I'm talking about people walking in and, you know, taking, you know, seizing an opportunity. I think as Walgreens, you need to cut that out. Your convenience store people are coming in and out, you know, instead of wasting your sales associate time from, you know, leaving the cash register because there's only two of you on cash and setting up a really long line and, you know, going to unlock the deodorant, that is four or five dollars. But now you have 10, 15 people waiting, which was my experience in Chicago. I was like, I really just know the second shop I'm at, I need to get what I need to get. So I'm sitting here waiting. I'm upset about it now. Everybody's kind of angry and that is sitting here. The cash register is not happy. You've wasted everybody's time and all of that. Like the time, the energy, the Customer experience, all can be prevented by. If you just had somebody standing there. Yeah. Just watching, looking over, kind of like doing their laughs. Have a loss prevention person, maybe, maybe invest in more loss prevention people who can actually stop because a sales associate, you're not allowed to stop from like a safety concern. Invest in more loss prevention people. Train your team on how to spot it. I think that will be do better. Especially if again, your market, your brand is convenience. If you're not making it convenient, what's the point?

Melissa Eaton [20:47 - 23:47]: I think you hit it right there. Is that operationally what changes need to happen. One of the things that I was, what that I was thinking of if I was going to do this would be also to figure out what kind of customer service ambassadors could you have in the aisles. And so really looking at like enhancing the store layout. So if you have all the items locked up, have it in a certain section and have those customer service ambassadors standing by so you can point to something and they can immediately go and unlock it with their digital key, whatever they have, give that to you. You can look at it and be like, oh, this isn't actually what I wanted. Right. Or it smells bad or whatever it might be. But then also having the cashiers at the ready because the convenience component of it is that you want to go in and out and, and have it quickly. So I think you're, you know, you're addressing the shoplifting by having things locked up, but you're not addressing that what the customer needs. And so to your point, you're really going to have to invest in talent. And I think that that's, that wouldn't be a bad thing to have. Like, if there was somebody, I think you'd have customers that were a lot happier if there was somebody from Walgreens standing in every aisle that's loc up, I wouldn't be so like pissed off about it, right. I wouldn't be like, oh, this sucks. Right. Because you know you're going to get helped. And I think it's kind of talks to the point of like when we were talking about Barnes and Noble, for example, and I was talking about how the book I wanted wasn't there and instead of going home and buying it, I talked to the sales associate and she recommended a great book to me. And so it's the same kind of thing. You're getting that interaction that we are talking about that people are craving in this, in this scenario. And there's a, a lot of technology now, right. When you go to, for example, now when you go to airports, you see these vending machines that have vending machines for everything. Right. There's like an Apple vending machine that has like all the cords, the AirPods, everything. Right. And you can, you can do that. And honestly, in my old office we had one like that too where you slide your, your ID and you could pull, you know, AirPods or whatever you needed for the day. But I think like having like something like that and, and companies such as CVS and Walgreens, I know, are already testing these very sophisticated vending machines where you could actually Apple pay or you could, you know, pay for it with a credit card right there and then is really a great option as well. It kind of gets away of having people there. So I don't know that that's what you would want necessarily, but it could be the kind of thing, Chino, if it's after hours that they'd have like a couple things right there, like convenient travel, travel sized things for people. But again, I do love the idea of focusing on how do you make your employees a very, very important component without risking their safety as well. Right.

Chino Nnadi [23:47 - 24:32]: I would agree. And I think the vending machine works for like high ticket items that we talked about. So like, yeah, if you're selling AirPods like you, let's not lock it up. Let's, you know, you're, you know, again, as a customer, what you're walking into when you're looking for an AirPod. But Jason, I have a question for you actually, because I think Melissa brought up a really good point around like looking at even the design of the store and like the investment maybe needed. Like what, like what would be the cost of like maybe even redesigning a Walgreens so that those high ticket items, like I don't want to have to use a vending machine to get deodorant. Simple. But like, can the deodorant be like placed somewhere else with high traffic area for sales associates? Like how much would that cost to Walgreens?

Jason Kraus [24:32 - 25:53]: And yeah, I mean, a couple of things I think, you know, with the people. Are there a few examples, like with the, you know, having people in the aisle, like, I think Best Buy does a good job of that. You know, if you go into the tech department, I mean those are more items you're probably expecting to have locked up. But you know, there's somebody there that can help you out, figure out what device you want and then they go unlock it and you know, they're ready to check you out. So, you know, that's One side, the other piece, I like the vending machine. You know, we've also seen examples like in, you know, I went to a Patriots game this year at the Gillette Stadium, they have a section where there's one like area you go into and you put your credit card, there's an associate helping you. You put your credit card in to go in and then they track everything you take and you just walk out. And it automatically pays for it based on what you took off the shelf. So I don't know how much that technology costs, but you know, that could be something that like, you know, those. There's a lot of up and coming technology now that can track, you know, what's being removed. And if you have people kind of pay, you know, claim who they are and pay when they go in the store or maybe when they go into a specific section, that could be another answer and solution there as well.

Aaron Wolpoff [25:53 - 27:00]: Yeah, I think that's the crossroads we're in. Right. Do you invest in people and take it back to the old days of the one store? Because if you walked into Walgreens store, I bet he would say hi and welcome you and show you what you needed to see. So do you invest in store ambassadors that play that role and maybe even introduce higher ticket merchandise as a result? Because now you have someone curating it for you and creating an experience. Or do you lean into the fact that you're a commodity business if you don't deliver fast enough? Amazon's got same day delivery. So if I don't need it in that moment, I can wait a couple hours. So how do you make that in person shopping experience as seamless and frictionless as possible? And that's a technology play. You put your money in people or technology, maybe a combination of both. But Jason, I'm glad you're here because, you know, let's. Walgreens is a multinational, you know, process driven company. They're kind of doubling down and leaning into what's not working. But what if they were a startup? What if, you know, how would a startup approach this type of situation?

Jason Kraus [27:00 - 28:43]: Yeah, so I think, I mean there are some really interesting startups and technologies in the space too. There's one on actually working with now called High Cart. And you know, it's a proven technology in, in Asia right now that they're bringing to the US and basically they, you know, they have shopping carts and then they also have an attachment to a shopping cart that can track, they can track all the items you put in your card. It can you Know, tell you where to find things around the store, get, you know, recommendations if you bought something and there's another item that could go really well with it, like kind of upsell the customers too. But, you know, I think, yeah, there's one angle that there's a lot of startup opportunities and, you know, helping solve these problems. And then there's also the angle of, you know, if you're a new store that wants to compete with Walgreens or cvs, like, how would you build it? And that goes out to the, you know, the layout, the design, even like the membership model where I was looking earlier. And Costco has a really, you know, very low rate of theft because, you know, people, you have to be a member to be a part of it. And then, you know, going in, you're giving your name and you know, if you give your name to the employees, like, you're probably a lot less likely to steal something than people that are just, you know, a random person walking into a store. So, yeah, I think there's a lot of ways, you know, a lot of opportunities to solve this. And it depends. Yeah, if you're going, you know, more the, you know, people, different business model or, you know, new technologies you're looking to implement and include.

Melissa Eaton [28:43 - 31:45]: I want to build upon what Jason said. As somebody who's worked in a couple startups as well, I think that one of the things that's really very forward when you're talking to these high growth companies is data. And so utilizing predictive analytics, leveraging data to identify theft patterns. Right? Identifying to understand the inventory of those most frequently stolen items in higher risk areas so that you could make adjustments in the store. So you would maybe place those behind the cage. Right. Or behind the glass or whatever you're calling it. And I do think that's something that definitely, you know, Walgreens and some of these more traditional retail outlets should be thinking about and utilizing as best they can because to Jason's point, there's so many different types of security measures that you could use that are really less intrusive. And actually you can, you know, you can kind of prey upon people's behaviors, shopping behaviors. Like I'm all about, like when it feels like it's a auction, like, you know, when the countdown comes on and it says like, you need to buy this in 10 minutes. I'm like, usually we'll buy it even though I don't need it. So, you know, like you could do something like that. Right. You know, and I do know that like wall I. I think Walgreens as well, has started testing this. But I know CVS is testing. They have an app. I know Walgreens has an app, too. And that you can use your app to unlock the cabinet, which is great because the data then tells you who's using it. Right. So, like, if you were going to shoplift something, you're not going to be able to shoplift. Right. You know, they'll know that you used it. So, again, I think that, like, figuring out, you know, digital keys, different kinds of things where you get rewarded for, you know, signing up for a membership. Jason. Right. Would be actually, you know, the kind of thing. I think that definitely, you know, this is a deterrent to shoplifters and even probably the big organized crime, you know, with. With, you know, all of things, you know, being equal. But I do think that for the customer, we're the ones that suffer. Right. And, you know, I really, I. I agree with Chino. I like the idea of going in and looking at all the colors. Like, they're also looking at price comparison right there. Right. What are my coupons? You know, what. What can I utilize? And so I do think I, you know, I really appreciate that. And Aaron, you brought up the very fun part of Walgreens. You know, these, like, pharmacy types of places used to be, like, soda, like, soda fountain place. I know that when I lived in San Antonio, there was a place called the Pharmacy, and it had still had the soda fountain. My daughter used to go for milkshakes there. She loved it. And so maybe there's an idea of, like, creating that kind of localized space again. Right. You know, where people actually go there for not just toothpaste. I don't know.

Chino Nnadi [31:45 - 35:10]: Yeah, no, I agree with this. And I think kind of interesting, and it's more on, like, I guess, social commentary, too, because I think, you know, most people, if you're going to actually buy something, you need a deodorant. Like, you're going there to buy something. Shoplifters usually have the intent to steal something. Right. And so I think with these technologies, sure, yes, I can have a cart that puts things in there. I was going to buy it anyway. Right. Like, Uniqlo does a really good job. And I think, you know, Jason, the argument between, like, tech versus people, you know, I think when it comes to the convenience side, what they can do with something similar to Uniqlo, I don't want to wait 10 years to go in and pay for what I've just picked up. It just took me 20 minutes to do that because I have to go call somebody. But why not? You scan my thing and I can go. But I still think there's a need for people because again, with the Amazons of the world, the reason people are coming in is for that literal, immediate gratification, the look, the feel, the touch. I think having a person there to help kind of guide you through that, curate that experience, similar to what we talked about in the Party City episode, is important and it also helps prevent theft. That said, when it comes to even like a, you know, vending machine, again, I was thinking of like it from the perspective of a shoplifter. I was never going to put my car down. I probably didn't even bring a wallet with me, right. I'm not going to have an app to come in and do that because I'm. My intention is to shoplift. So we can bring all this technology and again, it'll help the customer experience better, but it doesn't really address the shoplifting. And I think again, going back to having somebody physically there, you are less likely to. Similar to what you were saying, Jason, if there's someone standing in front of you, you're a lot less likely to put things in your bag, right? Organize shoplifters, you know, that calls for loss prevention folks, that calls for security. You know, in Canada we have the lcbo and you know, or not in Canada, in Ontario, it's a place where you buy all of your alcohol. And during COVID there was a mass. And it's still happening, mass ring of organized shopping where people would steal. And I remember being there with my husband and I was so confused as to what was going on because this person was just putting stuff in their bag, like, and they have like a trolley they brought in. I'm at the counter going to pay. And this person is just like talking to the people. And I was like, what is going on here? But there was no security guard. They usually have a security guard to go and deal with it. So the workers can't really do anything. Again, cost of life. There was a huge incident that happened where these cops actually chased a shoplifter from lcbo and the person was driving down the wrong side of the highway and actually killed a grandparent and an infant. And so again, they did all of that to kill three innocent people for what? A few bottles of alcohol? Not worth it. And so again, there's that level of a time when you need to bring in loss prevention and security people. And I think when it's in that organized kind of crime, Shoplifting, that makes sense. But to deter the everyday shoplifters, having somebody there would be really helpful.

Jason Kraus [35:11 - 35:11]: Yep.

Melissa Eaton [35:11 - 35:12]: Yeah.

Aaron Wolpoff [35:12 - 35:33]: Well, I'm glad you're saying that, Gina, because we, you know, we talked about a lot of the symptoms. Right, but, and I'm not saying these companies, Target and others do community give backs and things like that, but is the focus over. Is the focus overemphasized on the symptoms and not the underlying root causes? And what's the corporate responsibility to be a good citizen in the communities you serve?

Melissa Eaton [35:33 - 35:33]: Right.

Chino Nnadi [35:33 - 36:37]: And it's also interesting too. And I think there is, you know, there's training required because as we know in the past. Right. Sometimes when you have people in store looking, again, as a black female, I have to say it. There's been times that I've been followed around shopping and I was just like, hello, I'm not here to steal. And, you know, I've just, you know, look at my profile. I spend a significant amount of money here every year. You don't need to be following me. But again, it changes your perspective. So I think, you know, even if there are people brought in, there needs to be accountability if you can't profile things. And I think in a world where, you know, things have become politically correct, people are afraid to do that. I don't think that falls on the sales associate. Again, that requires training from loss prevention people. And so there's that balance of, like, in those situations having, you know, tech to, like, kind of move actual customers through. So you're not profiling your real customers, but deterring shoplifters, I think is the best option for Walgreens or any other big retailer that's facing similar issues.

Aaron Wolpoff [36:37 - 36:56]: Jason, let's. Let's fix it so they can start. They have new opportunity, fresh opportunity. They can keep doubling down on something that maybe isn't working and is leading to mass store closures, or they can go, is it a tech play? Is it a people play? What do they do? Let's fix this.

Jason Kraus [36:56 - 39:10]: Yeah, I mean, I think it can be both because they're already, you know, there's already employees in the store. Maybe some are understaffed and need more employees. But I think, you know, if the focus of the tech is how do we, you know, give customers a better experience while preventing shoplifting, and then there's still people in place, you know, that now don't have to focus on 100% of the store. Maybe they can focus on the areas that aren't solved by technology and, you know, have, like, certain processes in Place that, you know, they have standard procedures across all Walgreens and then there's local, you know, things that are applied to each local store as well. So yeah, I think part of it is, you know, having the right, you know, people ops and yeah, knowing, you know, what everybody in each store needs to do, what new people need to be bringed in, brought in and trained upon, but also, you know, enabling that experience where if somebody knows exactly what they want, you know, they either have the app or they have the smart shopping cart and you know, if they're scanned into the system like they can go easily in and out and you know, get exactly what they need and, and yeah, not have to worry about, you know, being, yeah, being like doing things in the certain way just because, you know, shoplifters ruin the experience for everyone else. So yeah, I think it can be a combination of technology that enables the people that currently work there and maybe new employees as well to, you know, focus on the tasks that, that they're needed to focus on to create that customer experience. And they also feel safer too because, you know, they don't have to necessarily worry about 100 of people coming into the store being shoplifters. They can, you know, focus on people that are more red flags by, you know, if, if you don't choose to use the app, if you don't choose to use the other devices, then, you know, maybe, you know, you're, I'm not saying like you're guaranteed to be a shoplifter, but you know, it helps eliminate basically the potential threats in the store as well.

Aaron Wolpoff [39:10 - 39:41]: So we train up and add staff, we make them more ambassadors or give a more curated shopping experience to help people find what they're looking for. We add some kind of tracking or smart cart technology for inventory control. We stop profiling and questioning our shoppers and we remove some of those barriers that the glass cages and things that are obviously proven to decline. Stores decline sales at a, at an alarming rate. Did we fix it?

Chino Nnadi [39:41 - 40:38]: I would think so. If Walgreens remembers kind of like who their customers and what they stand for and it's that convenience if they can remember to make sure that the customer experience is important to put away high ticket items like sure you're going to need with any like again, Best Buy is a great example. Those high ticket things, put them in a box, get someone to go for that deodorant. I need to be able to smell that. I need to feel. I need to remember why people are in your store. If you can't do that, you're going to lose it. And you know, whether that's convenience and making sure people can get out as soon as possible once they have what they need, that there's somebody there when they need to open up that high ticket item, or just somebody standing there greeting people to thwart them away from shoplifting, remember what you stand for. And if they can do that, I think that we fixed it.

Aaron Wolpoff [40:38 - 40:39]: How about you, Melissa?

Melissa Eaton [40:39 - 42:59]: I think that we have an opportunity here to fix it. And I do think it's what Jason and Chino have just said is that there's this lean into technology, lean into predictive analytics, understand where the high traffic, you know, high risk areas are and also use your talent and your team to help you to grow sales as well as grow the customer experience, feel safe, feel like they are there to help you. And I think you can do that by looking at the layout of the store, looking at what, you know, like starring in your role, understanding what you're there to provide. You know, also, you know, Chino, you've brought this up a couple times and I think community collaboration is really important. So really like knowing the other stores and businesses around you, sharing information. So because I do think what, what pieces and components are already putting into place are deterrence for shoplifting, it doesn't mean that there isn't other types of crimes happening. And so I think that that's really something that the whole community doesn't want that, that kind of toxic cancer in, in their, in their space. So I think that they can really focus on that. And I also think that there's alternatives to the lockup, you know, that we've been talking about today. And there's technology and there's ways to make people engage. So loyalty programs in the app. So self service checkout, you do that at the grocery store now. But like if you do that, do you get a discount? Do you get an automatic digital coupon? Those kinds of things. And I, I do think that today's shopping experience, because it is one of, you know, customers today are savvy, they're impulsive, they're, they want things personalized. So like, wouldn't it be nice to, you know, you know, if you use your app to get in access into the store, it tells you like, hey, are you here for some more of this stuff that you, you got last time? It's, you can find it over there in aisle four. And Melissa will be happy to help you. Right? So I think we could, we, we did have a lot of different options Walgreens that I think if they were to take into into measure, they will do great. They'll be more successful than they have been in the past.

Aaron Wolpoff [42:59 - 43:05]: I like it. Jason, thanks so much for coming on with us. It's, it's been a delight. If people want to find you, where, where do they go?

Jason Kraus [43:05 - 43:36]: Oh, I appreciate it. Yeah, really enjoyed the discussion and happy to connect with the audience. Happy to connect on LinkedIn or, you know, our prepare for VC side is prepare with the number four and then VC for venture capital.com and we also have a free tool on there called Chart My Course to help figure out your roadmap and strategy for your business as well. But yeah, happy to connect anybody on LinkedIn or through our site or over email as well.

Aaron Wolpoff [43:36 - 43:53]: Perfect. Thank you. Well, that wraps up this episode. We are your fearless fixers. If you've been thinking about a company and you want us to fix it or you'd like to learn more about our show, reach out@we fixeditpod.com and we'll see you next time. This podcast is produced by Straightforward Media Group.

Melissa Eaton [43:53 - 43:57]: All rights reserved. If you'd like to learn more about how a podcast can help your company.

Aaron Wolpoff [43:57 - 44:10]: Establish authority and generate leads, please email us@erictraightforwardmg.com or go to straightforwardmg.com for more information.