business news in context, analysis with attitude

In a week filled with I&I stories (Irregularities & Indictments), it’s nice to have commentary on other matters…

In response to our piece about the “Raise the Bar” coalition of independent retailers, one MNB user wrote:
“The Raise the Bar model shows how independent operators can leverage their individual strengths to improve the performance of their stores. Collaborating and sharing best practices to improve operations and service levels appears to be making a measurable difference with this group of operators. But the most impressive part is the shared learning that is taking place, not just with store employees, but with the owners themselves. Taking advantage of these types of opportunities is just another way innovative independents can create additional points of differentiation and grow their businesses.”

The obesity epidemic, and the appropriate response to it, continues to be a major discussion point. Earlier this week, when an MNB user championed the notion of personal responsibility, we responded: “For the moment, let’s play devil’s advocate. Sure, you harm only yourself. But what if an epidemic of obesity puts pressure on the health care system, which gets prohibitively expensive, which causes economic problems for the company, which then results in government action that requires higher taxes? If this is the chain of events, does it make sense to have some kind of social-cultural response to the issue so the long-term problems don’t emerge?”

MNB S. Kirk Lammert wanted to get in on the discussion:

“The epidemic of obesity that you spoke about is already here, in my opinion. You see it everywhere... people having to use scooters to get around just because they've become obese and not for any other reason. I have relatives in this condition. At least 40% of the time, she is getting medical attention of some type or another. Although this is sad and unfortunate, it is not something that needs to be legislated…it was their choice to get that way. It has to be their choice to reverse the trend.

“Years ago, folks constantly heard about the "President's Council on Physical Fitness.” Believe it or not, this still exists ( But you never hear about it anymore. All that you do hear about is this person suing the fast food industry for making them fat. Another one sues the tobacco industry for giving them cancer. And so on. It sounds as if they had no choice, no free will, but to swallow the meals and inhale the smoke. Being a former smoker and former obesity candidate, I say this is bull.

“This society seems hell-bent on trying to find someone, anyone that will take the responsibility for their choices onto their shoulders. It is not society's job to keep people from doing things harmful to their health (anyone remember "Demolition Man" and that the star couldn't get salt because it was bad for you, so therefore illegal??). You make the choice. You deal with the consequences.”

Another MNB user chimed in:

“As the culture slides into further socialism in health care, less of your personal life will be in any way personal. From what you eat to how many children you have will be everybody's business because everybody has to pay for it. The banner of personal responsibility will be waved but not for the good of the individual - rather for the good of our 'new' socialist system. This isn't a 'What if' question, unfortunately, it's already here.”

In response to our story about 7-Eleven CEO Jim Keyes described his company’s use of technology to be nimble, MNB user Charles Young wrote:

“Listening to Jim Keyes speak to the repositioning of his company made me think of another large retail chain that should take his advice on defining their role. I am thinking of the US Post Office. They have some of the best retail space around, cluttered with old-fashioned services. They have not innovated since the zip code!

“Their in-store service levels are awful, both in attitude and in customer care. While not sub-letting "shelf space" they certainly are not delivering a better product to keep their customers happy.

“Faced with technology they turn away... paid no attention to the FAX and now don't recognize the challenge of E-mail. Finally, they made a deal with FedEx, because they could not offer an effective competing service of their own.

Should the PO have just moved inside supermarkets? Should the PO have been franchised like Mail Boxes etc., should they be a retail check cashing service... there are many ideas and still opportunities. Perhaps when Jim Keyes is finished at 7-Eleven, he can help the PO... unless that system has already been finished off.”

In response to our piece about a Wal-Mart Neighborhood Market opening near Orlando, and Publix’s attempts to differentiate itself, one MNB user wrote:

“Publix will be able to differentiate themselves from Neighborhood Markets in the same way they've differentiated themselves from Kash and Karry, Albertson's, Winn-Dixie, et al. They are, by a long shot, an emotional favorite here in West-Central Florida, and I cannot imagine how the Bentonville Behemoth could sway the affection we all have for the folks in Lakeland. (Not to say it will never happen, just that I cannot come up with a way to make it happen...)

“I've run my own price comparisons, and everything comes out about the same -- and "market basket surveys" printed in the Tampa Tribune back me up. Most consumers aren't always looking for the lowest price -- a sizable proportion, I think, are looking for a price that's not out of line, compared with a shopping experience that is pleasant. (Any idiot can mark prices down – it takes a decent businessman to make us want to come back.)

“The stores are always a little cleaner, a little brighter, the staff a little more friendly and willing to help, and I simply cannot see this changing. Long live Publix.”

Regarding the growth of radio-frequency identification (RFID) technology, and the issue of consumer trust, MNB user Kevin T. Foley wrote:

“I do not think in this day and age of distrust (post Enron et al) that
consumers are trusting of any institution. There are many consumers who will not use a credit card on the web because they distrust the vastness of it and the corresponding risk association.

“So to think that consumers will trust any retailer or manufacturer to track or not track a product once they (consumers) take possession is hard to fathom in this current state of uncertainty.

“It is appears to me that there is tremendous value to retailers and suppliers in the RFID. However, it does not translate to anything tangible to the consumer with the exception of a new way to invade their privacy. We must also keep in mind that most of our population is still "technically challenged" and it will not be until our children's generation are adults that the true tech generation is dominant in our country. So wide spread acceptance of any technology that smacks of getting too personal will be met with resistance.

“That is my bet. Test it with a group of 40 somethings and see the answers you get and then ask 50 somethings and I bet the opinion is stronger.

“This is an interesting question and dilemma and one that will be debated for some time to come I am certain.”

We agree. Acceptance of these kinds of technologies will be largely generational. Manufacturers and retailers will have to do a good job of explaining to consumers why these initiatives make sense and why they should be trusted.

On the subject of a Spanish language television commercial that Procter & Gamble aired on national television in the US, one MNB user wrote:

“P&G may have a backfire from some of the English speaking people in this country. There are a few who believe that if you come to a country to live and work & benefit from there laws that you should be willing to learn to speak the language of that country. “

On the subject of Target cutting prices to get more competitive with Wal-Mart, one MNB user wrote:

“Target has a great niche in being able to market to a more affluent as well as specific age group. The worst thing they could do is allow themselves to be drawn into the price game with Wal-Mart. They have done a great job establishing value in their customers minds, and competing head to head with Wal-Mart on price will in my opinion devalue their image as well as their shopping experience.”

Yesterday, we reported on the US Environmental Protection Agency (EPA) approving a specific kind of genetically modified corn, prompting the following email:

“Three cheers for the EPA! By approving a GM corn resistant to rootworm they may be leading the way to help the agriculture industry lessen its dependence on petrochemical based pesticides. It seems to me that the trade-off between GM and toxic pesticides is simple and clear. We'll just sell all of those pesticides to the EU!”

On the subject of new products being introduced by Coke and Pepsi:

“Coke looks like they're hitting the "new flavor" notes successfully by using familiar flavors such as vanilla and tropical flavors. Vanilla Coke existed here long before it was bottled. And since Coke was there first, Pepsi has to try a different and apparently less successful tack or look very "me too!" in the market. Also, Coke is also keeping their brand identity very consistent even as they innovate.

“True, this is a tale of two titans. But if one giant can gain an advantage through 'familiarity in innovation' and consistent creative brand identity over another, smaller competitors in any industry would be wise to put the same ideas to work for them.”

One MNB user wrote in about our story that reported how United Airlines CEO Glen Tilton wants to make his company the Wal-Mart of airlines:

“Maybe there's more to Tilton's ideas than readily meets the eye.

“From Sam's Piper Cub, which I believe he flew himself, to today's fleet of 20 jets, there may be a message for UAL and their problems.

“Maybe "Just In Time, Always" as a slogan to start with.”

We like that slogan…

On the subject of supermarket competition in general, especially seen through the prism of investigations of accounting practices, one member of the MNB community observed:

“I have called on "The Big Four" supermarket chains in some capacity for over ten years, and while I consider many at these chains friends, tragically their demise is coming. They collectively refuse to change their business model to emulate Wal-Mart's consumer approach of guaranteeing low prices.

“Their antiquated system of holding vendors hostage to prop up an artificial bottom line grossly neglects the importance of driving the top line effectively: give consumers only the brands they want at the lowest possible price. The continued use of slotting and ad fees to force brands down people's throats just does not work, and the current sustained weak economy exposes this shell game in a glaring way.”

And, responding specifically to our coverage of the Ahold situation, MNB user Bob Schuller wrote:

“No speculation or innuendo just pretty specific reporting of the facts. Would the article have been different had you not been so complimentary of Ahold in the past?”

Good question. We don’t know the answer…though we have to admit that we’ve been surprised by the allegations coming out about Ahold this week.

If anything, though, our past respect for the company fuels our outrage at what appears to have happened. Though we think you’d agree that we have a fairly low tolerance level for any of this nonsense. Whether it is a gazillion dollar global conglomerate that lies to its employees, customers and shareholders, or a small dot-com startup that does essentially the same thing, we find that lack of honor and integrity to be distressing.

We’re not perfect. We make mistakes. And we try to be careful about climbing up on a high horse because it is so easy to fall off.

But we keep wondering, what the hell were these people thinking? At what point did their ethical compasses stop working? Or when did they decide that they were going to ignore what their consciences were telling them?
KC's View: