Jeff Lenard:
You are the NACS chairman this year and you’re also CEO of The Hub Convenience Stores in North Dakota. What are you hearing and seeing with the labor shortage both at your stores and your communities and maybe in broader conversations with other NACS members?

Jared Scheeler:
To answer your question, Jeff, I’m going to back up a little bit. When we started The Hub back in 2015, it was really in the height of the oil boom here in Western North Dakota. And the most common question I got from friends, potential customers, suppliers was ‘where are you going to get your workers from?’ Because at the time, there was so much economic growth going on in Western North Dakota, and everybody was having difficulty hiring. And from day one, we at The Hub didn’t have any issues with not only finding people, but finding great people. We enjoyed the fact that that wasn’t an issue for us while other people were dealing with it. And I think there are various reasons for that, but over time, I think you start to take some things for granted.

Jared Scheeler:
And we don’t always acknowledge that—doing things how we’ve always done them may not necessarily be how we should do things tomorrow. So I think we were a little bit slow to react to the changes in the labor market over the past two years. And it has been an issue not just for us in Western North Dakota and not just for The Hub, but really all businesses in my area. And I’m hearing it around the country. I have friends who run companies who are working the occasional overnight in their convenience stores, something that they hadn’t done before, at least if they did it, they did it voluntarily. So, these are issues that are plaguing everybody, and I think we have to get creative on learning how to deal with them.

Jeff Lenard:
And you’re taking steps to look at creative solutions. And I would imagine a good place to start is by asking your current people, what you might want to undertake and convening them and saying, ‘Hey, what kind of ideas do you have?’ And that’s something you’ve recently done.

Jared Scheeler:
Yeah, I think there’s times when you get detached from the front lines, like a person like myself does from time to time. You lose a little bit of touch with what is really going on in the business and how things are going when it comes to people and our team members. Last week I convened the leadership team at The Hub for two days of half-day meetings to talk simply, how do we tackle this labor issue? What’s going well for you? What are you struggling with? The entire theme of the two days was how do we reinvent how we’ve always done things for the past 20-25 years that I’ve been in this industry? How do we change our mindset on people, on personnel, on task management and how we go about things?

Jared Scheeler:
It’s a challenge to get people to forget everything they’ve always known and start from scratch with a clean slate, but that was our attempt. So we brought our team together of store leaders from all of our locations and we talked through these things for two days, and we got into a lot of different areas. The beauty of it is we got a lot of ideas. In my time in this industry, if there’s anything that I’ve learned, it’s the best ideas come from our team members. That was no different last week when we were discussing this labor issue.

Chris Blasinsky:
Where do you guys think you landed?

Jared Scheeler:
Well, we really focused on four specific themes when it came to addressing the labor issue and reinventing the way we’ve always done things. The first one was to put a magnifying glass on our culture. I think that was one of the things that when we first started our business helped us in building and attracting top talent. And as our company grew from one location to three and then to four and then to five, I think each step along the way during that path of growth we lost a little bit of ourselves. I actually started the meeting off by conducting the exact same team orientation that we did for our first batch of hires when we first opened in 2015. And I warned the team of store leaders.

Jared Scheeler:
I said, ‘Hey, some of this might be a little elementary for you, but I want us to start this meeting by getting in the mindset of where and where we want be as well by the end of this meeting. We just might have to go about things a different way to get there.’ So that was the discussion, but we started talking about our culture at first and then that evolved into scheduling, hiring practices and task management in asking the team what are some things that we could do that we may have never thought of before that could work for us. So culture into scheduling, and then the third topic was automation. What are we doing now that maybe a machine or a robot or a computer could do for us to make our jobs easier? And the fourth topic was outsourcing. Is there anything that we could do right now that could be outsourced to another company to take a little bit of weight off of our shoulders at the store level? We knew going into that part of the discussion that there might be some cost challenges to that. But we challenged ourselves to put our minds in a place that they had never been before.

Jeff Lenard:
I would imagine that the reason more people don’t have meetings like this is everybody’s plates are full and resources. And then I would imagine the third reason would be a little bit of trepidation in hearing what you don’t want to hear. If you ask somebody a question about how to do things better, does it devolve into people telling you why things aren’t good and some people are better at handling that, and some people are better at guiding conversations. Was there a lot of planning and thinking through in advance how to get a specific outcome? I’m asking for other folks who may want to replicate what you just went through. What are some of the things that are good to do and to watch out for?

Jared Scheeler:
One thing I was a little bit concerned about going into the meetings was twofold. For me personally, I can easily look at the business from a 10,000 foot to 30,000 foot view because of the nature of my position, having ownership in the company and generally being a forward-thinking person. I knew that it was going to be a challenge to break that shell with my store leaders as far as getting them to think beyond the levels that they’ve normally been thinking. I had a pretty detailed agenda going into it with some a few pre-reads and some questions that I wanted them to ponder between the time I gave them the agenda and the time we met so they could get their juices flowing. Knowing that that might not be enough in and of itself,

Jared Scheeler:
I had some examples that I would start my speech with, or when I was speaking on a specific topic, providing some examples that may or may not be a good idea just to get their juices flow. Sometimes those ideas were off the wall, but again, I wanted to get them out of that typical mindset that we can get stuck into when we’re in the thick of things like we are right now. So, that was one thing that I was worried about was the inability to get those juices flowed. The other one was, when we’re talking about culture, as hard as it is to admit, culture derives from the leader of the company and in that case, that’s me. So here I am acknowledging that we have an issue with culture or our culture could get better. And I went in ready to ask the question: ‘What am I not doing well that you guys would like to see me improve on?’ It took me a while to prepare for that mentally. I knew it was an important part of getting to where we needed to get and I think it was a valuable question to ask,

Jeff Lenard:
And hopefully anybody that gave honest feedback will not be replaced by a machine.

Jared Scheeler:
I cannot confirm or deny, Jeff. [Laughter]

Chris Blasinsky:
I can imagine something of this nature happening at NACS, where we’ll sit down and we’ll do some strategic planning and nine times out of 10 we start getting into tactics. It loses the whole vibe of what we’re trying to accomplish. Don’t worry about how we’re going to do it yet, let’s just get the ideas out there. We can cripple ourselves with that because you get stuck in analysis paralysis, per se. Did you run into that? Did they get to that tactic phase a little faster than they needed to?

Jared Scheeler:
Well, in our case, Chris, we had to kind of kill two birds with one stone. So we started by painting a pie in the sky picture of what a perfect world looks for us when it comes to personnel and team building and developing people. We went around the room, everybody talked for a little bit and gave us what they thought was the ideal situation. So that allowed us to sit back and say, okay, what steps do we need to take to get there? So fortunately for us, our objective was both strategic and tactical. But the overall theme of the meeting, the strategic part of it, that drove our thoughts.

Chris Blasinsky:
Being the chairman you get the ability to hear from a lot of retailers from a lot of different places. What do you hear from them? What are some of their challenges and how they’re addressing it?

Jared Scheeler:
I think first and foremost, there’s the labor pool just being smaller than it always has been, with the labor force participation rate back in 2019 being north of 64%. Now it’s hovering around 61% or maybe a little bit lower. That’s just not going to get better, maybe ever. And we’re going in with the presumption that that number isn’t going to improve. The amount of available workers is not going to get higher. So we have to change the way we’re thinking. I have a lot of friends in the industry around the country and I’m hearing the same thing. We just can’t find people. We’re not even getting applicants. We may have in the past focused on we have 15 applicants for these two positions, let’s pick the best two people. And now we have two applicants for two positions. We probably don’t want hire any of them but in many cases we are. It’s just a different world that we’re seeing out there and I’m hearing it from all around the country.

Jeff Lenard:
And sometimes hiring the one who applied has a negative effect on culture. It can be a vicious cycle that takes you down a path you don’t want to be down because of the labor shortage. Without giving away trade secrets, are there any big takeaways that you would like to think about more?

Jared Scheeler:
There were a lot of takeaways. I can break it down by each of the categories starting with culture. I don’t think a lot of companies out there, whether they’re in our industry or in other industries, truly have a great company culture. That’s a big word that’s thrown out a lot, but I think we underestimate the power that it has in attracting people—not just team members, but customers as well. Great culture is tough to define, but when you have it, you can feel it in almost everything that you do. I think that a big part of that was the way we communicate with our team members. We talked a lot with our team about what’s going on in the business, we talked about financials,

Jared Scheeler:
and in general communicating better with our team starting from day one. What specifically do we want to communicate during that first week? How do we want to train? How do we want to train more consistently? What standards are we going to uphold? Because it’s so easy to lower the standards when I need somebody on that cash register right now. We can’t do that. We have to onboard people the right way. We need to communicate with them what we’re looking to accomplish as a business and how they fit into that. That’s just one of the things when it came to the culture aspect of the discussion. There’s many more that I look forward to building upon.

Jeff Lenard:
And scheduling and automation and outsourcing…

Chris Blasinsky:
As soon as you said outsourcing my mind said cost.

Jared Scheeler:
I can start with that one. I think we took it in a creative direction. When we talked outsourcing, we only have five stores in our company and we don’t cover a very tight geographic area. We’ll have upwards of 120 miles in between stores. We categorize this under outsourcing as the idea of having an internal commissary for production of many of our food items and our bakery items, and also some internal distribution. I don’t think that’s a math problem that we can make work. That kind of goes along with the cost you were talking about Chris, and we talked about the idea of outsourcing forecourt maintenance. Could we have a company come in periodically to wipe our fuel dispensers, empty trash cans, fill the washer fluid, fill paper, towels, cones, sweep around the dispensers and the curbs.

Jared Scheeler:
Again, that became a math problem. It would probably be significantly more expensive than what we’re paying right now, even though I’d say we’re probably not doing a good job with it. But in both of those cases, somebody suggested the idea of could we have our own company that does those things and we do that for other people. So we the outsourced, but we’re just we’re handling it ourselves and by doing it for other people, we’re making it a viable business model. Both the commissary and the forecourt maintenance idea are the ideas that are going to work or can work. I don’t know yet. We’re going to explore it and we’re going to dig into it as deeply as we can. Like I said, at the beginning of these meetings, we need to get creative to solve these issues that we’re having,

Jeff Lenard:
The way you’re talking about tackling problems, it sounds like the way companies with 500 stores and resources look to solve these big problems. It’s really impressive to listen to the thought process and going through this with a smaller company and saying that you can do this—anybody of any size can and should be as strategic as they can as often as they can.

Jared Scheeler:
That’s something that I really want to see. I think as a leader, when developing other leaders, it’s important to help them stretch their minds, stretch their level of thinking to be able to think beyond the norms or beyond the day-to-day. Sometimes in this industry we have a hard time seeing beyond the end of the business day. It’s my job as the leader of the company to challenge our team, and not just our store leaders but beyond. So, I think they handled the challenge well, and we got some great ideas when it came to hiring and staffing. We’ve got one of our store leaders who’s going to look into the idea of if we can’t make a commissary idea work.

Jared Scheeler:
One of our store leaders wants to put an idea of building a team of retired, elderly workers who are just bored, who might want to get out of their house a few hours a week, have some flexibility and come in and handle all the baking for our company. Something that we’ve just never really explored. They have an idea of actually going out and where to recruit and how to find those potential workers and it’s just an idea that might work. It very well might work, but we’ve never thought of that before.

Jeff Lenard:
And of course retirees also go to zoning hearings. There’s also a lot of other benefits for having them as enthusiastic supporters of the company, because they’re part of it.

Jared Scheeler:
That’s right. That always goes back to being connected with the communities that we do business in. That’s something that’s always been important to The Hub and why we call ourselves The Hub. We want to be The Hub of the community and this plays into that idea of hiring the retired workers. We know our coolers need two to three hours of attention each day, but does it really matter when those two to three hours take place? Probably not in many ways, some ways it does and sometimes it doesn’t. All in all the major bulk of the cooler work doesn’t have to be done at a certain time of day.

Jared Scheeler:
So could we build flexibility into that? Could we have a roster of 16 college workers who need that flexibility and each day somebody has to claim a shift out of those 16 workers or whatever it might be. They can come in whenever they want in between classes for a half hour here, a half hour there, or they can come in a three hour stretch at once. We don’t have to think in the same terms that we always have. It was a lot of fun talking about all these ideas and they ranged from retirees to the community to college workers to, we’ve never done that before, we’ve never thought of it that way but you know what, we can do whatever we want.

Jeff Lenard:
You’re feeling good about the whole process and what the future may hold.

Jared Scheeler:
I feel good about our first steps being everybody getting together, throwing every single idea on the wall that we can think of and seeing what sticks. I think where the rubber meets the road though is how are we going to curate that down to figuring out exactly what we’re going to do that works for us. I’m okay with trying some things that fail, but how are we going to figure out what our new path forward looks like when it comes to personnel. All I know is that it can’t look like it did yesterday. It needs to look a little bit different and that different might evolve over the next 1, 3, 5, 10 years. We have to continuously keep our creative juices flowing, keep evolving and I’m pretty confident that if we can do that all while keeping our culture strong, I think we’re positioned pretty well when it comes to the future in this labor issue.

Jeff Lenard:
Good way to sum things up. But before we let you go, that music that you hear, it’s trivia time.

Jeff Lenard:
You created The Hub after going home to your hometown. This is a quote from a movie and relates to your journey. And the quote is: “You can never go home again, but I guess you can shop there.” The [character] was commenting from inside a convenience store that had taken the place of his childhood home. The home was knocked down and a convenience store was put in its place. So was the movie “Bill & Ted’s Excellent Adventure, “Clerks,” “Grosse Pointe Blank,” or “The Jerk?”

Jared Scheeler:
Boy, I am not a great pop culture mind, so I’m not positioned well to answer this question. Chris, it’s all yours. Make me look good here.

Chris Blasinsky:
Jared says “Grosse Pointe Blank.”

Jeff Lenard:
Jared would be correct. From 1997, John Cusack’s character is talking to his shrink and trying to process how a plot of land where a store was is a convenience store. And he says ‘I’m standing where my living room was, and it’s not here because my house is gone and it’s an UltiMart.’ So there you go. Nice job, Jared.

Chris Blasinsky:
I think it gets blown up too, doesn’t it?

Jeff Lenard:
Yeah, it does get blown up and there’s a mob shoot out and things like that. So, not our best image but we were convenient for the scene.

Jared Scheeler:
As always.

Chris Blasinsky:
Well, Jared, thank you for being with us again because we spoke to you earlier this year. I hope we can keep having these conversations with you and we look forward to connecting again. For all of those who are listening, thank you for listening to Convenience Matters. You can subscribe to our podcast on your favorite podcast player and we’re going to keep trying—we keep inviting Matt Damon and he keeps not responding. So we’ll see what’s up. We’ll see what happens. Thanks everyone.

Outro:
Convenience Matters is brought to you by NACS and produced in partnership with Human Factor. For more information, visit convenience.org.

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