business news in context, analysis with attitude

On the subject of Internet sales taxes, we wrote yesterday that we’ve always felt that for the foreseeable future, there ought not be sales taxes on e-commerce purchases because we hate to see anything happen to slow down this channel of trade. It needs nurturing, not obstacles to growth. But since the current holiday season shows more strength in e-commerce than in much of brick-and-mortar retailing, and because so many state governments are seeking sources of revenue in tough economies, perhaps the time has come to reconsider.

MNB user Eric Peabody responded:

“It’s inevitable that states, (facing huge deficits due to overly optimistic tax cuts and a slowing economy (as if the cyclic nature of our economy had not been predictable)), would clamor after missed revenue. They cannot allow the ever-growing base of sales via the Internet to go un-taxed. Their alternative would be to seek increased levels of consumption taxed on analog sales which would further increase the (unfair?) advantage of online retailers.”

Another MNB user wrote:

“I find it interesting that the borders between brick and mortar stores and e-tailers is becoming fuzzy at best. Many retailers now offer you the option of ordering on the Internet and picking up your merchandise at your local retail outlet. The sales transaction is tax free since it occurred on the Internet, however the consumer saves the shipping charges and is still able to pick up the merchandise at a local outlet where they could have simply walked in and picked it up anyway. Is this really any different than going to the store and purchasing the item outright? I'm sure this will be answered in a court soon.”

There’s a reassuring thought…

And MNB user Susan Hesselgrave questioned our basic premise:

“Ah Kevin. ‘Needs of the channel?’ That's the black marketers argument.”

We wrote yesterday of studies suggesting that Vanilla Coke seems to be getting more trial and repeat usage than Pepsi Blue, and one MNB user wrote to suggest the reason:

“Anyone who tastes the product would have to agree. I was excited about Pepsi Blue because I like most blue flavored drinks, but was very disappointed when i tried it. Vanilla Coke is not my regular choice, however, it is in the mix.”

On the subject of why sales at McDonald’s are on the decline, forcing the burger retailer to declare the first quarterly loss in its history, MNB user Norma Gilliam wrote:

“I am wondering if sales are down at the local hamburger joints simply because the parents of today's younger children have gotten tired of the burgers and have gone on to Mexican, Italian and Chinese foods. The 27-35 and up adults have traveled more and their tastes have changed. Obviously, then, they have brought home more of the foods they like and their children have developed tastes beyond the burgers.”

Sounds logical to us, though we have no personal evidence to prove it. Our kids are some of the worst eaters on the planet…picky to the extreme, with little taste for experimentation. Breaks our heart…but hopefully, they’ll grow out of it. (They take after Mrs. Content Guy, who never has…)

Earlier this week, we wrote about how a lot of the big chain stores are putting the small roadside Christmas tree retailers out of business by using the trees as loss leaders. This story continues to generate a lot of email…

MNB user Reid Hjelmaas wrote:

“So, we are supposed to pay more for a tree and honor "small business" as an institution? Diminish the potential purchasing power of your dollars to support the "time-honored tradition of small entrepreneurism"? Get real.

“Going to the local tree stand is a convenience v. fighting through the mob at a big-box retailer. So the trade-off is time for dollars. Every dollar counts in today's economic environment and the average consumer is looking to maximize their purchasing power. Convenience aside, one key incentive to patronize the local tree stand is that many of them support and fund various benevolent organizations - so consider the price a donation of sorts.”

Another member of the MNB community wrote:

“Speaking of Loss Leaders, and accommodating the shopper, last week, if you shopped at IKEA and showed your receipt (regardless of how much you
-but hey, with their low cost items, it's never much! And lots for the trip!) you could pick out a live tree of your choice off the lot. They even helped tie it to your car or truck, and never begged for donations, just had a box out there for donations!

“My family now has the most beautiful 10 foot balsam fir for Christmas this
year! For FREE!”

We scoffed at the notion of artificial trees, which outsell real trees 2-1. MNB user Jim Green attempted to broaden our perspective:

“Artificial trees continue to look more real, don't drop needles and pay for themselves in a few years. Bah, Humbug, a real tree is the only way we always said.

“But our tradition of having to have a "real" tree became a liability as our kids grew up, got married and we or they moved to a different city. Now being away for a few days or a week during the Holidays is the new tradition for my wife and I. A real looking, fake tree doesn't need to be watered and is less of a fire hazard when no one is home.”

And MNB user Steve Panza wrote:

“For the past 10 years, we have always purchased our trees from either a tree farm (when we lived in Indiana), or a road-side stand (always the same stand). Now that we're in Texas, I need to find a new place to get my trees. I will still look for a tree farm or family stand. I get a better tree, and I know I'm helping keep someone in business.”

Kmart announced this week that it will stay open for 110 hours straight right before Christmas. We were mildly skeptical about this (in verse, no less!), but MNB user Lawrence Wilson had a different view:

“Kmart has done this for the past 2 Christmas seasons, if not more. Does it help? I know that I have gone shopping at 3 am, knowing that the stores would not have the usual 12 people waiting at every register. I used to live near a Super K and went shopping after hours throughout the entire year.”

But MNB user Missy Carducci agreed with us:

“After yesterday’s de-listing of Kmart’s stock on the NYSE, it’s hard to imagine that stressed out, bleary-eyed K-Mart workers ringing up a few extra overnight sales will be the answer to this beleaguered company’s woes. Too bad they don’t have a blue-light special for stockholders who are left now holding only the proverbial bag—an empty one at that!”

We wrote yesterday about Australian scientists finding a way to keep poultry disease-free without over-reliance on antibiotics. One MNB user thought this was an wonderful development:

“Excellent news. Can the Aussies get busy on beef and pork too?”

Yesterday we had a piece about the growth of dollar stores, and MNB user Bob Vereen adds his two cents (or, in this case, 99 cents):

“As a longtime stockholder in Dollar General (and down in price), I think Dollar General needs to be a bit more concerned about housekeeping in its stores, and maybe spend some of the money now spent expanding on better maintaining its existing store base.

“99c Stores is doing $5 million a unit, all at under $1; better per-store and square foot performance than Family Dollar or Dollar General.

“And Dollar Tree's stores (the ones I've seen) have the kind of organized, neat store that Dollar General needs to put in place.”

We also had a piece yesterday from that wondered why there has been no real counterpart to Whole Foods in Europe, prompting an email from a member of the MNB community:

“Perhaps the reason that no one is emulating Whole Foods in Europe is that there's less reason to.

“Don't know if you've shopped for groceries there recently, but our grocery scene could learn a lot from the European examples I've seen.

“We rented a cottage this fall (after tourist season!) in southwest France, so I shopped for two weeks "like a local". There is a greenmarket literally every day of the week somewhere within a 30 minutes' drive -- piles and piles of picked-this-morning veggies, cases of fresh fish and poultry (fish displayed on beds of ice and poultry in refrigerated cases, just in case you were a bit squeamish), and although it's not part of the market, the market parades past scores of bakeries, all with the smell of fresh-baked bread wafting through the morning air.

“Everyone (not just tourists -- I saw plenty of women coming and going from shops and offices with their bags loaded with good things to eat) shops at the markets -- and the majority have labels stating that the produce is organic. (the potatoes I bought one morning were so fresh that there was still a bit of mud - not dried dirt -- MUD -- clinging to them -- it hadn't had time to dry in the morning sun). And the veg there are beautiful -- bright, vibrant colors, and bright, vibrant taste. Compare that to those square pink tasteless things they're selling as tomatoes at the local grocery here -- 15 miles from where they were picked, by the way.

“Even the supermarkets -- Casino, Champion, and the truly amazing E. LeClerc -- have 24-hour delivery of locally-grown produce, fish, and poultry -- it's tagged as being locally-grown (sometimes even down to the village!) and again, it looks and tastes much better than what we have to offer. Beef, pork, and poultry are all tagged with country of origin, and a significant number are tagged as being hormone- or antibiotic-free. I bought trout one day that could only have been fresher if I'd caught them myself.

“I also have made pilgrimages to Tesco and they not only have tags highlighting locally-produced goodies, but long sections devoted to organics, vegetarian, and vegan. So do the supermarkets I've visited in Germany (hey, you gotta buy chocolate in bulk somewhere...)

“By the way, food costs there are not significantly different from here – some are higher, some are lower -- but the quality is significantly better. The stores are clean and bright, and while the employees aren't exactly outgoing, I've yet to encounter one with an attitude, either.

“Bottom line - there's a much narrower niche for a Whole Foods-type operation, as all of the things that you mentioned are available every day.”

Wow. That email had the effect of simultaneously making us hungry and wanting to book a flight to France…

Finally, we continue to get email about our story earlier this week -- and subsequent letters from MNB users -- about how Canadian researchers have developed a “vegetarian combination diet” that may help consumers cut cholesterol levels by about a third in just a month. The diet combines vegetables, such as broccoli and red peppers; soy milk and soy sausages; oat bran; fruit, and nuts. The researchers say that consumption of this diet may be as effective as medicine in reducing cholesterol.

We noted that while this diet may help you live forever, it would probably feel like forever. “On the other hand, if taking one Lipitor means that we can eat risotto, drink red wine and finish up the meal with warm bread pudding, we’ll opt for the Lipitor…”

So far, the letters are running about 60-40. Sixty percent of you think we’re an utter moron for taking Lipitor when there are more natural ways to lower cholesterol. Forty percent of you seem to want to buy us a drink. (Anytime!)

(There were similar reactions to a story this week in Rodale Beat about how fear-mongering about the evils of carbohydrates is completely out of proportion.)

While our tongue was firmly in cheek when we made our original comments, we certainly don’t want to make light of the passionate reactions it generated. For example, take this email from MNB user Jane Larson:

“As a breast cancer survivor (currently in treatment, but surviving nonetheless, almost 5 years), I can tell you that nutrition is a big deal to me. Everyone espouses the vegetarian way of life as the way to go, and indeed, my son is a vegetarian and enjoys fantastic health. However, soy contains plant estrogens, and I'm better off eating radioactive waste than soy. Those estrogens are Miracle Gro to my cancer, and I've had enough goofy things go wrong than to be foolish enough to tempt fate like that.

“I eat a balance of carbs (not processed, but natural grains and such) and animal protein. Lots of fruit and vegetables. My cholesterol is 175 despite being significantly overweight (those steroids and chemo drugs will really help pack on the pounds). I enjoy a glass of wine or a nice single malt occasionally. I walk my dogs briskly and religiously. If it weren't for this pesky cancer thing, I'd be the healthiest person I know. The key is balance. Fewer processed foods, more fresh produce, exercise, and awareness of your body. Too bad it took a cancer diagnosis to pound that into my feeble brain.

You sound anything but feeble to us, Jane. Thanks for sharing.

A couple of you came to our defense:

“Oh, screw 'em if they can't handle a bit of much-needed levity in our world. Gimme a break. They sound like a bunch of anal control freaks in Birkenstocks.

“I take Lipitor too, for the same reason. No side effects in 6 years, but have been told by friends I should be on an enzyme called "Co-Q-10" and so I am. Supposed to handle any negative "side effects" of Lipitor. But I've read research reports that say Lipitor has so many unexpected "good" side effects that some doctors would like to put everybody on it.”


“Hey everyone, lighten up. It was humor. This is a busy time of year in the retail world and I think we need to understand that MNB was just trying to give us a little levity. Lets move on and get back to taking care of our customers, whatever their needs are!”

Thanks to all of you…whether you agree with us or not. The exchanges have been illuminating…and the passion energizing.

Have a great weekend…and don’t get caught in the Christmas shopping rush!

We’ll see you Monday…
KC's View: