business news in context, analysis with attitude

Published on: October 25, 2016

by Michael Sansolo

I’m sure you are been in this exact place: you have a critical opening on your team and need to hire someone quickly. Incredibly, you find a great candidate only the interview doesn’t go well. The great candidate demonstrates none of the passion necessary for your team or your business.

So, what do you do?

That was the exact dilemma faced by Bruce Springsteen in one of the interesting chapters of his new book, “Born to Run.” While some of you may not be fans of Springsteen’s music, you’ll appreciate the challenges he faced as a small business owner that are sprinkled throughout the nearly 600-page book.

Now obviously The Boss did not write his book to provide business lessons, but here at MNB we find those lessons everywhere. And frankly, Springsteen’s don’t even require much of a stretch.

For instance, the autobiography traces Springsteen’s rise to superstardom, but also the business difficulties he encountered along the way. Like many of us, he was not born to run a business or a team. He needed to learn.

Springsteen made terrible mistakes on contracts and learned the importance of getting good and intelligent advice. He struggled with finding the balance between being one of the guys and running the band.

Most strikingly, he learned to understand his strengths and weaknesses, which helped fuel his rise. As Springsteen admits, he doesn’t have the world’s greatest voice, nor is he the best guitar player around. What he learned in the course of his growth is that he authentically believes in his songs and that authenticity endears him to an ever-growing audience.

And that passion for his songs, his bands and his audience is what fueled the lesson on hiring.

Late in the book, Springsteen recounts the painful loss of Clarence Clemons, the band’s saxophone player and a critical cog in the sound and vibe of the group. While mourning his friend, he faced an important business decision - a replacement had to be found for future concerts.

Luckily, there was an obvious choice: Clemons’ nephew, Jake, who occasionally filled in when his uncle was ailing.

But on the day of his audition him, Jake arrived an hour late, saying he got lost. Springsteen, like many of us, accepted this excuse even while his blood pressure rose. And then things only got worse.

When asked if he felt comfortable playing some songs Springsteen asked him to prepare, Jake said, “Somewhat.” The Boss exploded.

In very colorful language, Springsteen started yelling about what he feels makes “Bruce Springsteen and the E Street Band” so special. It’s about the passion for the music and the promise to deliver the best concert possible each and every time. Being “somewhat” ready doesn’t approach that level.

Springsteen told the young man to come back when he is far better prepared. It took a few weeks, but Jake returned, auditioned, and secured his place with the E Street Band.

Now clearly, none of us are hiring for a position as coveted as a spot in Bruce Springsteen’s band, but the lesson is so clear. Like the Boss we need to instill and express our passion to those we hire. We need to remind them what our customers expect from us.

Just like Bruce, we need to remind them that all jobs matter and success - theirs and ours - depends on us actually caring and trying to do our best.

You can’t be a rock star any other way.


Michael Sansolo can be reached via email at msansolo@mnb.grocerywebsite.com . His book, “THE BIG PICTURE: Essential Business Lessons From The Movies,” co-authored with Kevin Coupe, is available on Amazon by clicking here. And, his book "Business Rules!" is available from Amazon by clicking here.

Published on: October 25, 2016

by Kevin Coupe

I've long said that one of the best use of drones was when a Minnesota company tested the use of one to delivery beer to ice fishermen during the middle of winter.

And now, there's an earthbound corollary. The New York Times reports this morning that "the first commercial delivery made by a self-driving truck was 2,000 cases of Budweiser beer."

Sense a pattern?

The Times writes that "Otto, the Uber-owned self-driving vehicle operation, announced the completion of its first commercial delivery, having delivered its beer load from Fort Collins, Colo., to Colorado Springs, a roughly 120-mile trip on Interstate 25 ... Though largely symbolic, the beer delivery marks the first commercial partnership for Otto, which was founded less than a year ago."

“We think this technology is inching closer to commercial availability,” Lior Ron, co-founder of Otto, tells the Times.

One other note. The story makes it clear that the use of self-driving trucks creates the possibility of a future in which technology will replace human truck drivers. There will be those who will see this as a terrible thing, but it is important to remember that demographic studies show that the nation's population of truck drivers is rapidly aging, and not being replaced by young people yearning for a life on the road. Which means that if we want products to get from one place to another via the nation's highways, self-driving trucks may be essential.

It is an Eye-Opener.

Published on: October 25, 2016

The Wall Street Journal reports that "the rate of online card fraud is rising sharply as a growing number of purchases take place on the internet while brick-and-mortar merchants race to lock down vulnerabilities in the checkout line. That is prompting new steps to try to curb the threat: The credit-card industry this week is expected to announce a plan to encourage online merchants to provide card issuers with more detailed customer information that could be used to catch fraudulent purchases ... The move will allow merchants to send information such as the customer email address, billing and shipping details to the banks as additional tools to verify that the purchase is authentic."


One estimate suggests that "so-called card-not-present fraud will rise to $4 billion this year from $3.2 billion in 2015. It expects that figure to jump to $7.2 billion in 2020.

"As a result, online merchants and the card industry are scrambling to create products and procedures that can quickly identify fraudulent transactions when an unseen customer taps card information into a computer or mobile device."

Published on: October 25, 2016

The Cincinnati Business Courier has a piece in which it speculates that one of Kroger's big advantages over Amazon - which will be ever more important as Amazon expands into the bricks-and-mortar realm - will be its convenience stores.

The logic works this way.

Walt Doyle, CEO of Boston-based online gas price comparison site Gasbuddy, tells the Courier that convenience stores that sell gasoline tend to do better than c-stores that don't. Doyle notes that Amazon, at least to this point, seems to have no plans to get into the gas business. And Kroger "operates 785 convenience stores, making it one of the larger operators in that $575 billion industry. That’s on top of its 2,781 supermarkets."

This suggests that if Kroger is able to find a sweet spot where it is selling gasoline as well as offering click-and-collect online shopping through its ClickList service, it will have a combination that will appeal to consumers in a way that Amazon cannot.

Published on: October 25, 2016

The Boston Globe reports that Dunkin' Donuts CEO Nigel Travis, when talking about the fact that the company did not meet revenue expectations during the most recent quarter (growth was a sluggish 0.5 percent, though profits and same-store sales were said to be healthy), blamed "the overwhelming dampening effect of the presidential election,” among other things.

According to the story, "Travis also reportedly said ... that uncertainty due to the elections also meant the company would hit the 'lower end' of their previously estimated range of store openings this year, as franchisees wait to see what future holds with regards to regulations or minimum wage laws."

Published on: October 25, 2016

The Washington Post reports that Amazon, having made a major push into the fashion business, apparently can make one relatively significant claim. Slice Intelligence, the e-commerce analytics firm, apparently has become nation's top seller of leggings with 11.6 percent of US purchases; Nordstrom, at number two, has 10.8 percent.

Amazon also is doing pretty well in the denim business - it ranks third nationally with a 9.3 percent market share, behind only Old Navy and Nordstrom, and ahead of Gap, Macy’s, Kohl’s and Levi’s.

The story notes that leggings and denim are seen as a potential indicator for how Amazon may be performing in other apparel categories. And, the trend, the Post writes, "leaves clothing and accessories brands with some difficult choices to make: They can start selling their wares on Amazon, acknowledging they might as well go where their shoppers are already on the hunt. Especially at a moment when department stores are struggling, this might be an important avenue for reaching new customers."

Interestingly, USA Today has a story about how, while "Amazon's yearly sales account for about 15% of total U.S. consumer online sales, according to the company's statements and the Department of Commerce," it actually may be "handling double that amount — 20% to 30% of all U.S. retail goods sold online — thanks to the volume of sales it transacts for third parties on its website and app."

Published on: October 25, 2016

• The Baltimore Sun reports that Walmart-owned Sam's Club "is rolling out new scanning technology ... that lets shoppers skip the checkout lanes. Consumers can use the retailer's free Scan & Go mobile app on their smartphones and scan merchandise as they shop, pay from their phones, then show a digital receipt on the way out."

"We understand the holidays can create a major time crunch for our members, so we're using technology to ease the stress of holiday shopping," Rosalind Brewer, president and CEO of Sam's Club, said in the company's announcement.

Published on: October 25, 2016

• The St. Louis Business Journal reports that Schnucks and the United Food and Commercial Workers (UFCW) have reached a tentative contract agreement that, if ratified, would cover some 4500 employees who are part of the union. A vote on the pact is slated to occur tomorrow.

The story notes that "members of the UFCW Local 655 voted last month to reject a proposed three-year contract with Schnucks, with 89 percent voting against the offer. The union said at the time that Schnucks' proposed changes to the seniority portion of the contract would result in a reduction of 133 full-time jobs, while other changes would eliminate guarantees of a minimum 25-hour schedule for part timers, could cut health care coverage for most or all part-time workers, and would eliminate holiday premium pay for new hires, among other objections."


• The Chicago Sun Times reports that the Girl Scouts of America and General Mills are teaming up to offer new cereals based on the Girls Scouts’ Thin Mints and Somoas cookies.

According to the story, "The cereals will be called Thin Mints and Caramel Crunch. The Girl Scouts Cookie cereals will be available nationwide in January."


• The Tampa Bay Times reports on the opening of a new Winn-Dixie store in South Tampa, a new format store that is one of five developed by the Southeastern Grocers CEO Ian McLeod. According to the piece, "The store has a new focus on organic, locally sourced and prepared products, trends that can be seen across the board at grocery stores around Tampa Bay ... This way the new Winn-Dixie is better equipped to compete with more high-end grocery brands, like the Publix Greenwise store, The Fresh Market and Whole Foods around the corner."

The goal, the story says, is to create formats that are more locally oriented. "Some of these redesigns include closing pharmacies or seafood counters in some stores, or expanding the meat sections or delis in others. It comes down to demographics research from the neighborhoods each store is in and feedback Southeastern Grocers gets from customer surveys, McLeod said."


• Two news items about WinCo Foods - one saying that the company plans to open its first store in Montana, in Helena ... and the other saying that it plans to open a new smaller format - 40,000 square feet - in Keizer, Oregon. The latter unit will use the Waremart banner, which, ironically, is the chain's original name from when it was founded in 1967.


• The Safe Quality Food (SQF) Program aid yesterday that it will be partnering with Park City Group subsidiary ReposiTrak "to integrate SQF audit management into ReposiTrak’s Compliance Management System.  The move will benefit SQF’s thousands of registered suppliers, in addition to its certification bodies and auditors, in managing the audit process from initial request and payment, through collection of results and reporting.  As part of the initiative, ReposiTrak will host and provide exclusive access to SQFI’s audit results database."

Full disclosure: ReposiTrak is a longtime and valued MNB sponsor.

Published on: October 25, 2016

Responding to yesterday's story about how CVS positioned its decision not to sell tobacco products as being purpose-driven branding related to its commitment to health issues, one MNB user wrote:

CVS may be paying attention to cigarettes, but apparently the transfat connection to heart disease and strokes is viewed as "mythical" given they sell/stock several PopSecret popcorn products which serve between 4.5 - 5.0g of transfat per serving, 3 servings per bag.

I check their stores regularly and most recently in September found these high transfat skus on their shelves. And on their website, you can even order some for home consumption.

I have a tough time applauding the "no cigarette selling" strategy in a company who knowingly is selling high transfat products.  If you want my undying loyalty, take on the food manufacturers especially for obviously unhealthy products like this.

Popcorn anyone?




On another subject, from another reader:

I sort of understood the government anti-competitive concerns with the Staples-Office Depot merger.  But it bothers me that the government is spending scarce resources challenging the Walgreens-Rite Aid combination.  Nearly every grocery chain has prescription departments and a "yuge" health and beauty aids selection, as does Target, Wal-Mart, Costco, Sam's Club etc.  Consumers would be better served if the government would direct those resources elsewhere, e.g illegal robo calls, snake oil dietary supplement advertising, etc.




Regarding the power of millennials, who spend more and more money eating out and buying food to-go, MNB reader Steve Methvin wrote:

Tracking the millennials is the new norm and I don’t think any group as ever been easier to follow and harder to predict. IF and WHEN they establish homes, it would seem that those “out” dollars could convert to “in” options – if the millennial even knew it existed! One scary thought – what if boomers start to follow this trend and use smartphones to order food and to go items?




We've had some discussion here lately about the protests being staged by some NFL players, and another MNB reader wanted to chime in:

I am one of those people who….“normally embrace the notion of freedom of speech but have a problem when folks with whom they disagree actually practice it”.

I firmly believe that everyone has a right to express themselves regardless of how polarizing any issue can be.  What I have a problem with can be simply described as appropriate time and place.  The community in which I live is loaded with military personnel from all branches of the military.  The pride that I see in their defense of the flag is meaningful on so many levels.  Had Colin Kaepernick and his followers selected another time and place to address their concerns (and I do agree that there are some relevant concerns!) and provided the proper respect to their Country, I don’t think there would be an uproar.  His choice is similar to the disgusting antics of the Westboro Baptist Church community to protest at funerals of our fallen service men and women.  Yes, they also have a right to voice their opinion no matter how vile, but I am vehemently against their doing so at the venues that they chose.  What exactly is the difference?

With respect to the NFL, the leadership can regularly punish a player for things such as “excessive celebration” with fines yet they otherwise chose to not ask their collection of multimillionaires to cease this particular act.   The disrespectful display against our flag and our anthem doesn’t make me want to support the cause nor do I have any desire to support the stage upon which they protested.

Point taken. I've always felt that love of country transcends how one reacts to flags and anthems ... and that sometimes, some people feel that in order to achieve one's higher aspirations for the nation one loves, one has to take drastic measures. It wouldn't necessarily be my approach, by i get it.

I've also always sort of believed in the EM Forster line: “If I had to choose between betraying my country and betraying my friend, I hope I should have the guts to betray my country.”




Finally, also on the subject of the NFL and my reporting of game scores, one MNB user wrote:

Curious if you had ever considered referring to the NFL franchise in D.C. as Washington instead of the Redskins.  Since there is only one NFL franchise in Washington, I would know the team you are referring to.

As a white guy, I personally find the name inappropriate and demeaning to American Indians.  I was reminding of how much we have changed our language in both normal dialog and in  humor as I spent Friday evening watching “Blazing Saddles”, and was quite frankly turned off by the repetitive use of the “n-word” in attempts at humor.  And I was very surprised (and disappointed in myself)  that when I first saw the movie in the 70’s I never gave it a second thought…
                                                       
Just wondering…

Good point about the Washington football team. I'll have to think about it. (I imagine there will be similar comments about the Cleveland Indians during the World Series.)

However ... I totally, completely disagree with you about Blazing Saddles. First of all, it isn't "attempts" at humor - it is one of the funniest movies ever made. Second, the movie was co-written by Richard Pryor ... and it uses the word to mock racism, not promote it.

Mel Brooks often says that he'd never be allowed to make Blazing Saddles today, and he's probably right. But I'm not sure that says a good thing about our culture.

Published on: October 25, 2016

In Monday Night Football action, the Denver Broncos defeated the Houston Texans 27-9.