Layoffs, relocations to come from closure of UCLA Storehouse

Monday, August 24, 1998

Layoffs, relocations to come from closure of UCLA Storehouse

STOREHOUSE: Some workers, customers upset by decision to change
supply provider

By Lawrence Ferchaw

Daily Bruin Staff

The 38 employees of the UCLA Storehouse sat Thursday morning
among cases of copy paper and ink cartridges and heard that by
February, the Storehouse would be shut down.

The announcement only confirmed rumors of the Storehouse’s
closure for employees, who speculated that the sale of the building
and recommendations from outside consultants were the real reasons
behind the closure.

"This type of thing was mandated some time ago, when consultants
came in the storehouse," said Jim Parnell, the receiving and
physical operations manager of the Storehouse.

Half of the Storehouse’s employees will be laid off, said Sam
Morabito, associate vice chancellor of business and finance. The
Storehouse will be phased out by February to be replaced by the
office supply chain Office Depot.

"No one likes to announce people will be laid off," Morabito
said.

"Hopefully we’ll be able to place these folks, and it will be a
win-win situation for the campus and the staff."

Currently, the Storehouse – where some employees have worked for
more than 30 years – is the supplier for most of the office and
general supplies of the campus. Over the next five months, Office
Depot will replace the Storehouse as the primary supplier to campus
departments.

Because Office Depot cannot supply all the items needed by the
campus community, a smaller storehouse facility will still be
maintained. About half of the Storehouse employees will be
transferred to this new facility, which is a few blocks away from
the current Culver City site.

The other half will be placed on a layoff list which will be
determined within six weeks. Those employees on the layoff list who
do not find another job with the university will receive 60 days of
severance pay.

Morabito told the employees he would try to find jobs for them
within the business and finance department. He also indicated
Office Depot is interested in hiring some of the employees.

The campus’ human resources department will provide training for
employees to find jobs elsewhere.

"The goal is to place everyone, but I can’t guarantee it,"
Morabito said.

Office Depot will begin servicing part of the campus Oct. 1 and
expand to cover all areas by February.

"Office Depot affords the campus the best combination of service
and cost," Morabito said.

Business and Finance took bids from many outside vendors and
compared the prices to what the Storehouse offered. Morabito said
the outside vendors were cheaper.

Some Storehouse employees disagreed with this, however. They
produced a selected list of their prices and prices at Office
Depot. Most of the items on that list are cheaper from the
Storehouse.

Morabito said that if one looks at all the items and prices
offered by Office Depot, the switch would save money for the
campus.

Some people were surprised by the decision, despite the
rumors.

"It was a shock to everybody," said Parnell, who has worked
there for 38 years and expects to keep his job under the new
system.

"It’s no longer a rumor; now it’s a reality," he added.

Indeed, Morabito made it clear during the meeting that the
decision was final, and even if Office Depot is unable to handle
the campus’ needs, officials would look for a new vendor.

"We’re committed to this delivery and distribution
method-ology," Morabito said. He pointed out that other
universities use a similar system to take advantage of the
discounts that large outside vendors can get from
manufacturers.

The last time something similar happened at the Storehouse was
in 1991, when the staff of over 150 was reduced to little more than
40.

"We still made it work," said one employee who did not wish to
be identified. "The people here work hard."

Morabito acknowledged their effort, but pointed to the $6
million debt that had accumulated in the years that the Storehouse
had not met its financial obligations. Last year, the Storehouse
was profitable for the first time in the 1990s.

Much of the question and answer session which followed
Morabito’s announcement was consumed by employees challenging the
logic of closing the Storehouse and questioning the motives.

"What he’s after is this building. That’s what this is," one
employee said after Morabito left the meeting.

The building and the land will be sold by the university.
Proceeds will go to pay some of the Storehouse’s debt. Morabito
said that selling the land was not the reason for closing the
Storehouse.

Other employees pointed to satisfaction with the Storehouse and
the ease of ordering and delivery.

A survey of on-campus customers taken by the Storehouse showed a
92 percent approval of the ordering system and 81 percent approval
of the pricing competitiveness.

"After talking to customers, there’s no way they’ll be able to
do it," said the employee who did not want to be identified. "(Our
customers) are already stretched thin."

One of those customers agreed with the employee’s
assessment.

"I like the Storehouse; it made it easier," said Anna Lebon,
storeroom manager for the psychology department.

Campus departments can use an internal billing system when they
buy supplies from the Storehouse, saving on paperwork. Using
outside vendors requires purchase orders and invoices that must go
through an accounting department to be paid.

Morabito said he hopes the Office Depot plan will reduce the
number of invoices. The university will also pay Office Depot
electronically by wiring funds.

Campus departments will also be encouraged to order their
supplies through the Internet, a plan Storehouse employees
questioned at the meeting.

Departments will still be able to order over the phone or by
fax, Morabito pointed out.

Lebon said she doesn’t plan to use Office Depot for supplies
because she has found their prices to be higher.

Using Office Depot will be optional, just as using the
Storehouse has been, but Morabito said he wants people to "keep an
open mind."

"They need to take advantage of lower prices so they can save
resources for their departments," Morabito said.

Despite the impending closure, one Storehouse employee said the
Storehouse’s service offers will not change between now and
February.

"As long as we’re here, we’ll continue to provide customers with
best possible service to the end," Parnell said.