Estimated reading time: 4 minutes

It's Only Common Sense: A Tale of Two Arthurs

Some of you may have heard the ongoing story about the New England supermarket chain called Market Basket. This chain was launched in 1916 by a Greek immigrant couple, Athanasios "Arthur" Demoulas and Efrosini Demoulas, as a 600 square-foot grocery store in Lowell, Massachusetts.

Later, as he started to age and the chain started to grow, Arthur turned it over to his two sons Telemachus and George, who continued to grow and expand the business. The two brothers worked well together and created a very successful business. They offered their customers the best values around. During the depression, they extended credit to their customers. They always treated their employees as if they were family, making a point to know all of them and stepping in to help when they needed something. They always did their best to buy from local farmers and vendors and they always treated these vendors fairly, ensuring there were enough profits for all of them. The customers always came first and the money followed, and soon they had over 70 stores throughout New England. The sons grew older and became more successful. They each married wonderful women, and each had four children. But tragedy struck when George died of a heart attack at the age of 51.

Telemachus kept growing the company, always making sure that George’s family was taken care off. He made sure that they had a good strong income and that George’s kids had everything they needed. His son Arthur T. Demoulas was all about the business. He wanted to learn everything about the business from the ground up. But his cousins, on the other hand, wanted nothing to do with the business. They were always happy to take their share of the earnings to buy cars and houses. They enjoyed traveling and starting little boutique businesses, and for the most part they lived the good life of the idle rich.

Arthur S. Demoulas, the oldest of George’s children, was on the board of the company. In 1990, he took the other side of the family to court on the basis that they should be giving their shareholders more of the profits rather than turning them back into the business. And from there a true battle resulted. It was cousin against cousin, Arthur T. vs. Arthur S.

Arthur S. wanted less money paid out to the employees, fewer benefits and higher profits; in short, he wanted more money for the shareholders, made up entirely of his family and Arthur T.’s relatives. In the end, what he really wanted to do was sell the business to a global chain for billions of dollars. Arthur T., who was the actual working family member and CEO, did not want to sell the business. He wanted to keep it going, and growing into other states as well. He was always looking out for his customers. At that time, Market Basket provided the best value in groceries, with prices well below its two main competitors, Shaw’s and Hannaford, both of whom were owned by global conglomerates.

Well, Arthur S., whose family went through an extended court battle, now owned 50.5% of the company and eventually won out. Arthur T. was fired as the CEO of the Market Basket chain.

Here comes the interesting part, the part that I want all of you to think about. First, Arthur T.’s former associates rebelled and walked off the job. They went on strike, demanding that Arthur T. be reinstated as CEO. Remember that these were grocery store workers, people who lived pretty much paycheck to paycheck. But that did not matter; they found ways to help each other out during the hard times. Then another thing interesting happened: Most of the vendors went on strike as well. They refused to sell any more of their products to Market Basket, and soon the stores were almost empty. Then the customers started boycotting Market Basket. They shopped at competing stores, and many of them joined in to help the workers during the strike, as did the vendors. The customers boycotting Arthur S.’s Market Basket took their sales slips from rival stores and taped them to the doors of their local Market Basket stores to let them know exactly how much money they were losing.

Do you get that? Man, is that a story or what? In the end, Arthur S. caved and sold his share of the company to Arthur T., who was welcomed back by cheering workers.

It makes you realize just how well loved Arthur T. actually was. In the end, all those people were willing to risk their livelihood to keep his vision alive. They could have just shrugged their shoulders and kept working for a new CEO. They were grocery workers, after all. What did it matter to them whether they worked for a locally owned chain or an internationally owned chain? But it did matter. It mattered so much that they put everything on the line for their CEO.

Kind of makes you think, doesn’t it? Would your associates do this for you? Would your vendors do this for you? Would your customers do this for you? Think about that. What kind of vision do you have for your company? How do your associates, vendors and customers view you? Would they follow through hell to save your company and your job?

If you can’t honestly say they would, then it’s time to rethink your whole approach to business, don’t you think? It’s only common sense.