Jan

7

 The miserable performance of the text book company in all areas including the nook, and sales of books, and stock price, would seem to raise the question of whether a company that has declining sales might be worse situated to provide customer satisfaction than the companies with increasing sales and profits. Thus a positive feedback loop of sales, profits, and customer satisfaction develops. It would be interesting to look at customer satisfaction as an indicator of future stock performance.

Jeff Watson writes: 

In Florida, there are two main grocers, Publix and Wal-Mart. (Winn Dixie, Whole Foods, and Sweetbay are minor players). Publix charges higher prices, but offers better quality, good variety, better service, quick checkout, better trained employees, an enforced dress code, employees that smile, and bright, cleaner stores. Wal-Mart offers rock bottom pricing, surly employees, poor quality, and long waits at the register.

Here is a chart of Publix's 5 year performance (private yet employee owned).

Here is Wal-Mart's 5 year performance.

Maybe customer satisfaction in the grocery industry isn't reflected in the stock prices, but these are just two samples and Wal-Mart does a lot more than groceries.. My friends at Publix tell me it is an excellent place to work and they regularly receive bonuses every quarter while at Wal-Mart, the full timers are lucky because they might get 32 hours a week. 


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2 Comments so far

  1. Andre Wallin on January 8, 2013 9:12 pm

    what are the market implications of bitcoins and marijuana legalization. Inflation?

  2. Anthony on January 9, 2013 2:04 pm

    I wonder if quantifying employee satisfaction and sentiment could be an indicator of future stock performance. (e.g. Google)

    Did a quick search and came up with this…

    http://beta.fool.com/apinkasovitch/2012/02/01/does-employee-satisfaction-lead-strong-corporate-p/1566/

    The difficult part would be finding a reliable way to measure this for smaller companies.

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