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Called Le Casino 4 and located near the Champs-Élysées, the store “has three floors and offers 6,000 products. It’s open 24 hours, seven days a week. And it boasts a selection of organic products, a ‘smart wine and spirits cellar,’ and sample dishes prepared by a chef. There is also a showroom for products from French ecommerce site Cdiscount and a free coworking space.”

The story notes that customers can take products home but also “have the option of ordering home delivery through a digital wall, where they can scan items and schedule delivery.”

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Booker T Washington Founder of Tuskegee Institute Using Education as a Key Instrument for Black Elevation

Booker T. Washington was one person whose abilities and energy have taken him far beyond the limitations life placed on him. He rose up from slavery and illiteracy to become the foremost educator and leader of black Americans at the turn of the 19th century. For decades, he was the major African-American spokesman, lecturer, Civil Rights/Human Rights Activist, Educational Administrator, Professor, Organization Executive/Founder and Author/Poet.

His childhood is recorded in his autobiography, Up From Slavery which this writer had the fortune of reading in his early years in an abridged edition at the second form of the Prince of Wales School at Kingtom, western Freetown in Sierra Leone West Africa from which end Washington's ancestors may well have hailed.

Booker T. Washington was born a slave on April 5, 1856 on the Burroughs tobacco farm which, despite its small size, he always referred to as a "plantation" at the community of Hale's Ford, Virginia. This was in what he described as "the most miserable, desolate, and discouraging surroundings." His mother Jane was a black slave who worked as a cook for a small planter. His father was a white plantation owner whom he never knew. Under the laws then, his mother's status also made young Booker a slave. His childhood was thus one of privation, poverty, slavery and back-breaking work, for from birth he was the property of James Burroughs of Virginia. His mother, Jane, raised him, and was put to work as early as possible.

Since it was illegal for a slave to learn to read and write Booker T. Washington received no education. For as he writes: "The early years of my life, which were spent in the little cabin, were not very different from those of other slaves." He went to school in Franklin County - only to carry books for one of James Burroughs's daughters. "I had the feeling that to get into a schoolhouse and study would be about the same as getting into paradise," he wrote.

In April 1865 when the Emancipation Proclamation was read to joyful slaves in front of the Burroughs home he was seven years old. President Abraham Lincoln it was who issued the Emancipation Proclamation, which freed the slaves. It could not be enforced until the end of the Civil War by the Thirteenth Amendment. The former slaves were at first jubilant about being free but it quickly became apparent that there was no place for most of them to go.

There was more singing in the slave quarters than usual as the great day drew nearer. It was bolder, had more ring, and lasted later into the night. Most of the verses of the plantation songs had some reference to freedom

After the reading of the proclamation speech Washington remember being told that they were all free, and could go when and where they pleased. "My mother, who was standing by my side, leaned over and kissed her children, while tears of joy ran down her cheeks. She explained to us what it all meant, that this was the day for which she had been so long praying, but fearing that she would never live to see."

After emancipation, his family was so poverty stricken that they could not make it on their own. So Booker Washington moved out with his mother and three siblings to join his stepfather in Malden, West Virginia, where he had found work packing salt. The young boy took a job in this salt mine. Work began there at 4 a.m. so that he could attend school later in the day. The nine-year old Washington spent long, exhausting days packing salt.

He worked with his mother and other free blacks not only as a salt-packer in this salt mine. He also worked in a coal mine. He even signed up briefly as a hired hand on a steamboat. Then he became employed as a houseboy for the wife of General Lewis Ruffner, who owned the salt-furnace and coal mine. Many other houseboys had failed to satisfy the demanding and methodical Mrs. Ruffner, but Booker's diligence and attention to detail met her standards. Encouraged to do so by Mrs. Ruffner, when he could, young Booker attended school and learned to read and to write so that soon, he sought even more education than was available in his community.

Always an intelligent and curious child, like many blacks after Emancipation he yearned for an education. So despite the exhausting days, he used his free time to go to school in the evenings. He was frustrated when he could not receive good schooling locally. So when he was 16 his parents allowed him to quit work to go to school. They had no money to help him, so he traveled 500 miles, often by walking, to enroll at the Hampton Normal and Agricultural Institute in Virginia. He did not know if he could get in, and if he got in he didn't know how he was going to pay for it. He arrived with only 50 cents in his pocket. The head teacher suspicious of his country ways and ragged clothes admitted him only after he had cleaned a room to her satisfaction.

"Students with little income such as Washington could get a place there by working to pay their way.", says one of a college application essay writers and history expert. So he was given a job as a janitor to enable him earn enough to pay his school fees. He thus paid his tuition and board there.

The normal school (teachers college) at Hampton was founded for the purpose of training black teachers and had been largely funded by church groups and individuals such as William Jackson Palmer, a Quaker, among others. In many ways he was back where he had started, earning a living through menial tasks, but his time at Hampton led him away from a life of labor. Hampton Institute was started and run by General Samuel Chapman Armstrong. Armstrong and the institution he created were to become the one great influence in Washington's life. Armstrong believed in work, study, hygiene, morality, self-discipline and self-reliance - in large amounts. It was not a place for slackers. Armstrong's purpose was to train black teachers, but he believed every student should have a trade as well. Washington imbibed these principles so well in him that later, when he developed the Tuskegee Institute it emphasized these same qualities and convictions.

Booker T. Washington who had only managed to get a primary education that allowed his probationary admittance to Hampton Institute proved such an exemplary student, teacher, and speaker that the principal of Hampton recommended him to Alabamans who were trying to establish a school for African Americans in their state to lead them to establish a school for African Americans in their state.

In 1881, he was hired as the first principal of a school being founded in Alabama, under a charter from the Alabama legislature for training teachers, the first time a black was being offered such a high position.They found the energetic and visionary leader they sought in Washington as he became the first principal of the Tuskegee Normal and Industrial Institute which he built from scratch into the most reputable and stable higher institution for blacks in the United States.

In 1895, Washington was asked to speak at the opening of the Cotton States and International Exposition, an unprecedented honor for an African American at that time. His Atlanta Compromise speech there explained his major thesis, that blacks could secure their constitutional rights through their own economic and moral advancement rather than through legal and political changes. Washington's address was widely welcomed in the African American community and among liberal whites North and South. Whites approved of his views. Thus he won over diverse elements among southern whites, whose support for the programs he envisioned and brought into being especially in the area of education he harnessed easily. He was supported by W.E.B. Du Bois at the time but several years later the two started having differences. Washington's conciliatory stand angered some blacks including Du Bois who feared his conciliatory stance would encourage the foes of equal rights. Whilst Washington valued the "industrial" education oriented toward actual jobs available to the majority of African Americans at the time Du Bois demanded a "classical" liberal arts education among an elite he called The Talented Tenth. Both sides sought to define the best means to improve the conditions of the post-Civil War African-American community. However, despite not condemning Jim Crow laws and the inhumanity of lynching publicly, Washington privately contributed funds for legal challenges against segregation and disenfranchisement, such as his support in the case of Giles v. Harris which went before the United States Supreme Court in 1903..

Washington the public figure often invoked his own past to illustrate his belief in the dignity of work. "There was no period of my life that was devoted to play," he wrote. "From the time that I can remember anything, almost everyday of my life has been occupied in some kind of labor." This concept of self-reliance born of hard work was the cornerstone of his social philosophy.

Although not everyone agreed with Booker Washington, he became a respected leader who helped many schools and institutions gain donations and support from the government and other private donors. From this position of leadership he rose into a nationally prominent role as spokesman for African Americans.

Washington's philosophy and tireless work on educational issues helped him enlist both the moral and substantial financial support of many philanthropists such as self-made men from modest beginnings as Standard Oil magnate Henry Huttleston Rogers and Sears, Roebuck and Company President Julius Rosenwald.

Washington associated with the richest and most powerful businessmen and politicians of the era who also funded his causes, such as in supporting, running and equipping the institutions of higher education at Hampton and Tuskegee. Besides being seen as a spokesperson for African Americans, he became a conduit for funding educational programs. His contacts included such diverse and well-known personages as Andrew Carnegie, William Howard Taft, John D. Rockefeller, Henry Huttleston Rogers, and Julius Rosenwald, to whom he made the need for better educational facilities well-known. As a result, countless small schools were established through his efforts, in programs that continued many years after his death.

A representative case of an exceptional relationship was Washington's friendship with the millionaire industrialist and financier Henry H. Rogers (1840-1909). Henry Rogers, a self-made man, had risen from a modest working-class family to become a principal of Standard Oil, and had become one of the richest men in the United States. Around 1894, Rogers heard Washington speak at Madison Square Garden. The next day, he contacted Washington and requested a meeting, during which Washington later recounted that he was told that Rogers "was surprised that no one had 'passed the hat' after the speech." The meeting began a close relationship that was to extend over a period of 15 years. Although he and the very-private Rogers openly became visible to the public as friends, and Washington was a frequent guest at Rogers' New York office, his Fairhaven, Massachusetts summer home, and aboard his steam yacht Kanawha, the true depth and scope of their relationship was not publicly revealed until after Roger's sudden death of an apoplectic stroke in May 1909.

A few weeks later, Washington went on a previously planned speaking tour along the newly completed Virginian Railway, a $40 million dollar enterprise which had been built almost entirely from a substantial portion of Rogers' personal fortune. As Washington rode in the late financier's private railroad car, "Dixie", he stopped and made speeches at many locations, where his companions later recounted that he had been warmly welcomed by both black and white citizens at each stop.

Washington revealed that Rogers had been quietly funding operations of 65 small country schools for African Americans, and had given substantial sums of money to support Tuskegee Institute and Hampton Institute. He also disclosed that Rogers had encouraged programs with matching funds requirements so the recipients would have a stake in knowing that they were helping themselves through their own hard work and sacrifice, and thereby enhance their self-esteem.

$1,000,000 was entrusted to Washington by another prosperous contact, Anna T. Jeanes (1822-1907) of Philadelphia in 1907. She hoped to construct some elementary schools for Negro children in the South. Her contributions together with those of Henry Rogers and others funded schools in many communities where the white people were also very poor, and few funds were available for Negro schools.

Julius Rosenwald (1862-1932) was another self-made wealthy man with whom Washington found common ground and from whom he received much support. By 1908, Rosenwald, son of an immigrant clothier, had become part-owner and president of Sears, Roebuck and Company in Chicago. Rosenwald, a philanthropist, was deeply concerned about the poor state of African American education, especially in the Southern states.

In 1912 Rosenwald was asked to serve on the Board of Directors of Tuskegee Institute, a position he held for the rest of his life. Rosenwald so adequately endowed Tuskegee that Washington could now spend less time traveling to seek funding. This allowed him to devote more time towards the management of the school. Later in 1912, Rosenwald provided funds for a pilot program involving six new small schools in rural Alabama, which were designed, constructed and opened in 1913 and 1914 and overseen by Tuskegee. The model proving successful, Rosenwald established The Rosenwald Fund, to replicate it all over the South. The school building program was one of its largest programs. Using state-of-the-art architectural plans initially drawn by professors at Tuskegee Institute, the Rosenwald Fund spent over four million dollars to help build 4,977 schools, 217 teachers' homes, and 163 shop buildings in 883 counties in 15 states, from Maryland to Texas. The Rosenwald Fund used a system of matching grants, and black communities raised more than $4.7 million to aid the construction of these schools which became known as Rosenwald Schools. By 1932, the facilities could accommodate one third of all African American children in Southern U.S. schools.

Each school was originally founded to produce teachers. However, graduates had often gone back to their local communities only to find precious few schools and educational resources to work with in the largely impoverished South. To address those needs, through provision of millions of dollars and innovative matching funds programs, Washington and his philanthropic network stimulated local community contributions to build small community schools. Together, these efforts eventually established and operated over 5,000 schools and supporting resources for the betterment of blacks throughout the South in the late 19th and early 20th centuries. The local schools soon grew to great sources of much community pride and were of priceless value to African-American families during those troubled times in public education. This work was a major part of his legacy and was continued (and expanded through the Rosenwald Fund and others) for many years after Washington's death in 1915.

In 1901 he wrote Up From Slavery - his autobiography which became a bestseller. Up From Slavery, first published in 1901, is still widely read today. As a result of his work as an educator and public speaker, Washington became influential in business and politics. Washington did much to improve the overall friendship and working relationship between the races in the United States.He also became an advisor to the then President of the United States - Theodore Roosevelt in the process becoming the first black ever to dine at the White House with the President, though it created a huge stir. Many whites thinking that it was wrong for whites and blacks to mix socially, were horrified at their President for doing so. Roosevelt defended his actions at the time, and continued to ask for Washington's advice, but without inviting him again. As Washington's influence with whites and blacks grew he reaped several honors.

Eventually Washington's leadership of blacks began to be undemined by the attitude of whites to the progress of blacks. It became apparent that the whites that had gained control of Southern institutions after Reconstruction did not ever want the civil and political status of blacks to improve - regardless of how hard they worked or how much character they had. They passed laws to keep them from voting and to keep them from mixing with whites in schools, stores and restaurants.

Washington's critics. charged that his conservative approach undermined the quest for racial equality. Washington was criticized by the leaders of the NAACP, which was formed in 1909, especially by W.E.B. Du Bois, who demanded a harder line on civil rights protests. After being labeled "The Great Accommodator" by Du Bois, Washington replied that confrontation would lead to disaster for the outnumbered blacks, and that cooperation with supportive whites was the only way to overcome pervasive racism in the long run. Although he did some aggressive civil rights work secretively, such as funding court cases, he seemed to truly believe in skillful accommodation to many of the social realities of that age of segregation. While apparently resigned to many undesirable social conditions in the short term, he also clearly had his eyes on a better future for blacks. Through his own personal experience, Washington knew that good education was a major and powerful tool for individuals to collectively accomplish that better future.

"In all things purely social we can be as separate as the fingers," he proposed to a biracial audience in his 1895 Atlanta Compromise address, "yet one as the hand in all things essential to mutual progress." Even though his methods partly arose from his need for support from powerful whites, some of them being former slave owner, it is now known, that Washington secretly funded anti-segregationist activities. But he never wavered in his belief in the attainment of freedom: "From some things that I have said one may get the idea that some of the slaves did not want freedom. This is not true. I have never seen one who did not want to be free, or one who would return to slavery."

However, by the last years of his life, Washington having moved away from many of his accommodationist policies, speaking out with a new frankness, attacked racism. In 1915 he joined ranks with former critics to protest the stereotypical portrayal of blacks in a new movie, "Birth of a Nation." He also spoke out against lynchings and worked to make "separate" facilities more "equal."

Washington was now the dominant figure in the African American community in the United States, especially after he achieved prominence for his Atlanta Address of 1895. To many politicians and the public in general, he was seen as a popular spokesperson for African Americans. Representing the last generation of black leaders born into slavery, he was generally perceived as a credible proponent of educational improvements for those freedmen who had remained in the post-Reconstruction, Jim Crow South.

Throughout the final 20 years of his life, he maintained this standing through a nationwide network of core supporters in many communities, including black educators, ministers, editors and businessmen, especially those who were liberal-thinking on social and educational issues. He gained access to top national leaders in politics, philanthropy and education, and was awarded honorary degrees. Critics called his network of supporters the "Tuskegee Machine."

Washington did much to improve the overall friendship and working relationship between the races in the United States. When Washington's autobiography, Up From Slavery, was published in 1901, it became a bestseller and had a major impact on the African American community, and its friends and allies. Washington in 1901 was the first African-American ever invited to the White House as the guest of President Theodore Roosevelt. His autobiography, Up From Slavery, is still widely read today. As a result of his work as an educator and public speaker, Washington became influential in business and politics. In addition to Tuskegee Institute, which still educates many today, Washington instituted a variety of programs for rural extension work, and helped to establish the National Negro Business League in 1900 in an effort to inspire the "commercial, agricultural, educational, and industrial advancement" of African Americans. For his contributions to American society, Washington was granted an honorary master's degree from Harvard University in 1896 and an honorary doctorate from Dartmouth College in 1901.Booker's leadership also earned him honorary degrees from Harvard University and Dartmouth College. He wrote several books, and several more books have been written about him.

Shortly after the election of President William McKinley in 1896, a movement was set in motion that Washington be named to a cabinet post, but he withdrew his name from consideration, preferring to work outside the political arena.

Washington was married three times as revealed in Up From Slavery, where he gave all three of his wives enormous credit for their work at Tuskegee emphasizing that he would not have been successful without them.

Blacks were solidly Republican, but after 1890 many lost the vote in the deep South .Washington emerged as their spokesman and was routinely consulted by Republican national leaders about the appointment of African Americans to political positions throughout the nation. He worked and socialized with many white politicians and notables. He argued that the surest way for blacks eventually to gain equal rights was to demonstrate patience, industry, thrift, and usefulness and said that these were the key to improved conditions for African Americans in the United States and that they could not expect too much, having only just been granted emancipation..

Despite his travels and widespread work, Washington remained as principal of Tuskegee. This had serious strain and stress on him. Washington's health was therefore deteriorating rapidly; so much so that he collapsed in New York City and was brought home to Tuskegee, where he died on November 14, 1915 at the age of 59. With the permission of his descendants, examination of medical records indicated that he died of hypertension, with a blood pressure more than twice normal, confirming what had long been suspected. He was buried on the campus of Tuskegee University near the University Chapel. At his death Tuskegee's endowment exceeded US$1.5 million. His greatest life's work, the work of education of blacks in the South, was well underway and expanding. A man who overcame near-impossible odds himself, Booker T. Washington is best remembered for helping black Americans rise up from the economic slavery that held them down long after they were legally free citizens.

In 1934, Robert Russa Moton Washington's successor, arranged an air tour for two African Americans aviators, and afterward the plane was christened the Booker T. Washington. On April 7, 1940, Washington became the first African American depicted on a United States postage stamp. The first coin featuring an African American was the Booker T. Washington Memorial Half Dollar minted by the U.S. from 1946 to 1951. He was also depicted on a U.S. Half Dollar from 1951-1954. On April 5, 1956, the hundredth anniversary of Washington's birth, the house where he was born in Franklin County, Virginia was designated as the Booker T. Washington National Monument. A state park in Chattanooga, Tennessee was named in his honor, as was a bridge spanning the Hampton River adjacent to his alma mater, Hampton University. In 1984, Hampton University dedicated a Booker T. Washington Memorial on campus near the historic Emancipation Oak, thus establishing, "a relationship between one of America's great educators and social activists, and the symbol of Black achievement in education." Numerous high schools and middle schools across the United States have been named after Booker T. Washington. At the center of the campus at Tuskegee University, the Booker T. Washington Monument, called "Lifting the Veil," was dedicated in 1922. The inscription at its base reads: "He lifted the veil of ignorance from his people and pointed the way to progress through education and industry."

References

- Washington, Booker T. The Awakening of the Negro, The Atlantic Monthly, 78 (September, 1896).

- Up from Slavery: An Autobiography (1901).

- Washington, Booker T. The Atlanta Cotton States Exposition Address (Sep, 1895).

- The Booker T. Washington Papers University of Illinois Press online version of complete fourteen volume set of all letters to and from Booker T. Washington.

- James D. Anderson, The Education of Blacks in the South, 1860-1935 (1988)

- Mark Bauerlein. Washington, Du Bois, and the Black Future" in Wilson Quarterly (Autumn 2004)

- W. Fitzhugh Brundage, ed Booker T. Washington and Black Progress: Up from Slavery 100 Years Later (2003).

- Louis R. Harlan, Booker T. Washington: The Making of a Black Leader, 1856-1900 (1972) the standard biography, vol 1.

- Louis R. Harlan. 'Booker T. Washington: The Wizard of Tuskegee 1901-1915 (1983), the standard scholarly biography vol 2.

- Louis R. Harlan. Booker T. Washington in Perspective: Essays of Louis R. Harlan (1988).

- Louis R. Harlan. "The Secret Life of Booker T. Washington." Journal of Southern History 37:2 (1971). in JSTOR Documents Booker T. Washington's secret financing and directing of litigation against segregation and disfranchisement.

- Linda O. Mcmurry. George Washington Carver, Scientist and Symbol (1982)

- August Meier. "Toward a Reinterpretation of Booker T. Washington." The Journal of Southern History, 23#2 (May, 1957), pp. 220-227. in JSTOR. Documents Booker T. Washington's secret financing and directing of litigation against segregation and disfranchisement.

- Cary D. Wintz, African American Political Thought, 1890-1930: Washington, Du Bois, Garvey, and Randolph (1996).

- Booker T. Washington High School

- Booker T. Washington's West Virginia Boyhood

- Works by Booker T. Washington at Project Gutenberg

- Up from Slavery, Project Gutenberg edition

- Up from Slavery, Electronic Edition

- Booker T. Washington's 1909 Tour of Virginia on the newly completed Virginian Railway

- Dr. Booker T. Washington papers - comments about Henry Rogers

- National Park Service Booker T. Washington Birthplace

- Legends of Tuskegee

- Booker T. Washington's Gravesite

The African American Almanac, 7th Ed., Thomson Gale. Reproduced in Biography Resource CenterThomson Gale.

- The Booker T. Washington papers digital archive, University of Illinois Press searchable index to complete annotated text of all important letters to and from Washington and all his writings.

- A Criticism of the Atlanta Compromise by W.E.B. Dubois

- Booker T. Washington Delivers the 1895 Atlanta "Compromise" Speech from the American Social History Project / Center for Media and Learning (Graduate Center, CUNY) and the Center for History and New Media (George Mason University)

Published on: January 8, 2020

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Published on: January 9, 2020

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Published on: January 20, 2020

Fast Company reports that Ikea, the Swedish furniture retailer that made its reputation with enormous stores with football field-sized parking lots - Tina Fey once joked that Idea is "where marriages go to die" - is testing a new format in a Vienna location that has zero parking spaces.

The store, in a new seven-store building, is part of the company's effort "to shrink its carbon footprint, including the pollution from customers driving to suburban stores … The location is next to a tram stop and a three-minute walk from a subway station; like other parts of the city, it’s easily accessible by bike. Anything that customers can’t easily carry away will be delivered from a new logistics center farther away (and soon, as with other Ikea stores, those deliveries will happen via electric delivery vans)."

The story says that two of the building's floors will be used as a hostel, and the roof will be used as a public park. And, the architects tell Fast Company, "the design is sustainable in another way: Unlike a standard big-box store, the design is aesthetically interesting enough that people should want to keep it around in the future rather than tearing it down."

Published on: January 21, 2020

by Kevin Coupe

On Saturday morning, Frieda Rapoport Caplan passed away. She was 96, and leaves behind not just a family company that continues to push the boundaries in terms of new and unfamiliar produce items imported into the US, but also a life in which she pushed boundaries in terms of what was appropriate and acceptable.

I feel the loss enormously. Frieda was my friend.

In 1962, Frieda launched Frieda's Produce Specialties in Los Angeles. It was the first wholesale produce company owned and operated by a woman.

The Los Angeles Times, in its obit, describes her as "the woman who broke the glass ceiling in the testosterone-doused produce world and forever changed the way Americans eat fruits and vegetables … a tenacious maven credited for introducing kiwis, mangoes, habanero and shishito peppers, passion fruit, bean and alfalfa sprouts, baby carrots, sugar snap peas, starfruit, blood oranges, shiitake mushrooms, turmeric, and hundreds more fruits and vegetables into the supermarket mainstream. Into the bellies of American consumers."

Frieda, the Times writes, "was loquacious, driven and loved to take risks … In heels and a skirt, she revolutionized the way the produce world did business, adding recipes and cooking instructions on packages of exotic produce to tame the distrust of an unsuspecting public."

CBS Sunday Morning produced a piece about Frieda that was supposed to run last fall, but was held until they had more time to devote to the piece; now an appreciation of a wonderful life, the piece ran yesterday, and you can watch it here.

I'm not exactly sure how we became friends. I think we saw each other at the occasional industry event, and suddenly I was getting emails from this wonderfully opinionated woman in her late eighties and early nineties, relentlessly curious, making suggestions about things to read, people to get to know, offering critiques about this story or that commentary, and even telling me when she didn't like the picture I was using, and expressing approval when I changed it.

I last saw Frieda on November 16. I knew she'd been laid up by a broken leg and subsequent complications, and so I stopped by her house in Southern California to say hi. It wasn't just a quick visit with an ailing friend. She asked me questions about MNB stories she'd read, told me about books she'd been reading, and was thoroughly engaging - I think I was there for a couple of hours.

When I heard that Frieda has passed away, it hit me like a freight train … I know she was 96, but I fully expected that she’d be around for many more years. She had such a wonderfully indomitable spirit, infectious enthusiasm for life, and mischievous sense of humor - she was the kind of old person that I would like to be, which is to say not really old at all. Sometimes the parts wear out, but the heart and soul continue on. In Freida’s case, they will be sustained by the business she created and that her family - Karen and Jackie and Alex - shepherd and grow. But they also will find life in those of us lucky enough to know her.

She opened our eyes to what is possible. I'll always treasure her friendship.

Published on: January 21, 2020

David Glass, who replaced founder Sam Walton as CEO of Walmart in 1988 and shepherded the company through a time of growth and expansion into the grocery business, has passed away. He was 84, and had been suffering from pneumonia.

The Wall Street Journal writes that "during his 12 years as CEO, annual sales soared to $165 billion from $16 billion as Walmart built supercenters, combining groceries with general merchandise, and expanded international operations and the Sam’s Club chain.

"When Mr. Glass became CEO, Walmart was the third-largest U.S. retailer after Sears, Roebuck & Co. and Kmart Corp. Within a few years it surged past both."

Glass joined Walmart as CFO in 1976, personally recruited by Walton. After succeeding him, Glass "stayed out of the spotlight and for years worked at a desk said to have been bought for $75 at a garage sale. When he had visitors at the office, he was known for fetching their coffee down the hall at a vending machine rather than asking an underling to serve beverages."

After retirement, Glass satisfied a longtime passion for baseball by buying the Kansas City Royals for $96 million in 2000. In 2015, the Royals won the World Series. Glass sold the team last year for $1 billion.

Published on: January 21, 2020

The Wall Street Journal reports that Best Buy CEO Corie Barry is being investigated by the board of directors following charges that she "had an inappropriate romantic relationship with a fellow executive, who has since left the electronics retailer."

According to the story, the charges were made via an anonymous letter saying that "Ms. Barry had a romantic relationship for years with former Best Buy Senior Vice President Karl Sanft before she took over as CEO last June … Mr. Sanft, former senior vice president of retail operations, had no comment for this article. He left Best Buy in early 2019 and is now the chief operating officer of 24 Hour Fitness Worldwide Inc."

Barry also did not comment about the charges, except to say she was cooperating with the investigation. The Journal notes that "she succeeded Hubert Joly, who led a turnaround at the retailer and still serves as its executive chairman. Mr. Joly’s predecessor as CEO resigned abruptly in April 2012 after the board opened an investigation into his personal conduct. The company was exploring whether he misused company assets in the course of an alleged relationship with a female subordinate."

Published on: January 22, 2020

by Kate McMahon

It’s that time of January when we seek to forecast the food and drink trends that will be captivating America – and captured on Instagram – in the coming year.

Prognostication is risky business, I know, but someone has to sift through the “listicles” promoted by chefs, retailers, foodies, PR firms, food and beverage trade groups, mainstream media critics, the folks at Pinterest and UberEats and “social media influencers.”

Here goes:

•  It’s raining purple. As in the multiple hues of lavender, violet and plum produced by the ube, the sweet purple yam being hailed as the “current flavor of the moment” and the “new most Instagrammable food.” Ube is a staple in Filipino jams, sauces and desserts. When mashed or boiled, this tuber produces a mild, sweet flavor like white chocolate or taro – but purple. Curious? Checkout out one of 358,000 #ube posts on Instagram.

(It is a lovely coincidence that Frieda's Specialty Produce is a major distributor - <a href="https://www.friedas.com/ube-or-not-ube-that-is-the-questionand-friedas-is-answering/" target="_blank"> and explainer </a> - of ube in the US.  Purple, as it happens, was founder Frieda Rapoport Caplan's favorite color.  As you probably know, she passed away last weekend at age 96 … and MNB remembered her <a href="http://mnb.grocerywebsite.com/News/Detail/59046/2020-01-20/" target="_blank"> here</a>.)

•  Plant. Based. Everything. Expect more meat-less proteins to be rolled out on a daily basis. This trend started with plant-based milks and skyrocketed with the success of both Beyond Meat and the Impossible Burger meat alternatives. The industry is notching double-digit growth and has gone from niche to mainstream. General Mills just announced it was investing in Good Catch plant-based seafood, Dunkin’ now offers a meatless Beyond Sausage Sandwich, and even the local Stop & Shop has a separate Plant-Based Meats section. 

•  Shirley Temple 2.0. Sophisticated mocktails are gaining popularity at swanky watering holes. At-home imbibers are also pouring kombucha, a bubbly fermented tea, booze-free drinks such as Kin and Hoplark’s sparkling HopTeas in several flavors, and adding botanical-infused elixirs such as Rock Grace to their sparkling water.  Low-alcohol beverages are also gaining market share, and low-sugar, low-calorie hard seltzers such as White Claw are the new must-have beverage for many millennials.

Also on the 2020 hot list:

•  Pea protein: Replacing whey and collagen in smoothies and fortifying meat-alternatives.

•  No end to gnocchi: Competitors trying to keep up with Trader Joe’s, which owns the cauliflower gnocchi market and has added chocolate and kale versions.

•  Flour power: Alternative flours made from watermelon seed, green bananas, sweet potatoes and cauliflower.

•  Some like it cold: Cold brew coffee is the new go-to order.

•  Some like it hot: As in Nashville Hot, the fried chicken that will scorch your lips.

Reviewing last year’s food trend column, the following predictions did indeed come true:

•  CBD Rules: Cannabis-infused drinks and food are everywhere, despite the FDA’s objections.

•  Gut Instincts: Probiotics and prebiotics moved from the health food store to supermarket staples.

•  Got (insert plant) Milk?: Oat milk continues to up-end the category, and it is now on the menu at select Starbucks and Dunkin’ shops.

Not surprisingly, the following 2019 predictions did not make it to the mainstream:  Food and wine from the former Soviet Republic of Georgia … hummus-based desserts … fake bacon snacks made from mushrooms and egg whites … and cheese-tea – cold tea topped with cream cheese and a pinch of salt.

You can't win them all.

Published on: January 22, 2020

by Kevin Coupe

If you've been doing something as long as I've been doing MNB - 18 years and counting - it is impossible to remember every story we've run and every commentary I've written.   We put stuff out there, hope we're right, hope we move the needle a bit, and then move on.

Sometimes, we get surprised.

Yesterday, I got an email from an MNB reader that read as follows:

<i>Am on a cruise celebrating my mother-in-law’s 95th birthday, and they are having “chic night.” I packed a bit light but have a nice sport coat.

I asked my wife if I could borrow a pair of her panties to use as a pocket square, to which she replied, “Who in the hell taught you that one?”

To which I replied “MorningNewsBeat.”

Well played sir. Well played.</i>

And he sent me a picture.

Okay.  I'll take his word for it, but I had no idea what the hell he was talking about.

So I did the logical thing.  I went to the MNB archives, and looked up "pocket square."

And found a column by Michael Sansolo from February 18, 2015, in which he was writing about finding creative, unexpected solutions to problems and he used the following as a metaphor:

<i>A few years back my friend discovered that he, like me, was unable to correctly fold a pocket square to provide the little color accent sticking out of his jacket. Somehow he learned that Victoria’s Secret seamless silk panties are the perfect solution. No matter how they are folded or stuffed into his jacket pocket, they always create the perfect look. And the choice in colors is staggering.

The added benefit, he says, is walking into a Victoria’s Secret store in a blazer to look for colors and practice. The salespeople simply cannot believe what’s going on.

But here’s the thing. My friend ends up with an easy solution to a problem by simply approaching it in an unexpected way. It’s the essence of creativity, innovation and a really, really good inside joke.</i>

Go figure.  MNB ventured into GQ territory, and apparently it stuck.

Talk about an Eye-Opener.  I'm glad we could be of assistance.

Published on: January 22, 2020

Lucky's Market, which lost a major investor when Kroger announced it was divesting its stake in the retailer, said yesterday that it will close down 32 of its 39 stores in nine states.

Florida, where Lucky's had its greatest presence with 21 stores, will see 20 of those units shuttered.

<i>USA Today</i> writes that "the natural and organic foods grocer was founded in 2003 by husband and wife Bo and Trish Sharon. The store is known for its 'Sip & Stroll' program that allows customers to drink a pint of beer or glass of wine while shopping."  

Kroger CEO Rodney McMullan said he decided to get out of the investment because "we just didn't think it created a good return."

Published on: January 22, 2020

<i>WGN-TV News</i> reports that Meijer has introduced a new mobile application designed to inform customers of price reductions on food products that are coming close to their expiration dates, pitching it as a way to cut down on food waste.

According to the story, "The initiative allows customers to purchase food nearing its sell-by date - like meat, produce, seafood, deli and bakery products - at up to 50 percent off on the Flashfood app, and then pick them up at Meijer stores."  The goal is to have the app available to customers at all of its 246 stores by the end of the year.

<i>WGN</i> reports that "customers go to the app, select a Meijer store, choose the items they want to purchase and pay for them directly on the app at up to 50 percent off. Then, they go in store to pick up their items and confirm their order with customer service.

The purchased food is stored in a refrigerator or storage rack located in the front of the store until picked up by the customer."

Published on: January 22, 2020

From FMI, which used to be known as the Food Marketing Institute:

"FMI today launches a renewed brand identity as FMI - The Food Industry Association, reflecting its strategy to more broadly represent the food marketplace and embrace a more interconnected supply chain. FMI views retail as the heart of the food industry and recently expanded its membership in response to retailers’ needs, helping them facilitate access and connectivity with suppliers and other business partners.

"'FMI provides the most productive forum for connecting and holding constructive dialogue across the food industry,' FMI President and CEO Leslie Sarasin remarked on the association’s announcement regarding a renewed focus.  'Driven by consumer relevance, we are in the business of food, wherever it is bought, sold or produced, and we are well-positioned to represent everything in the shopping basket – and work closely with every participant in the marketplace'."

Joe Sheridan, president and COO of Wakefern Food Corp. and chairman of the FMI board, said, "Over the last two years, we’ve inspired a recommitment, a renewal of vows among the FMI membership. We’ve even changed who can be a member in the association as a logical step in a direction we’ve been traveling for years, offering greater parity between retailers and their product supplier partner members at the Board of Directors level.”

FMI says that it will maintain its focus on public policy lobbying … "issues that matter" such as food safety … serving as a "forum for high-impact industry dialogue" … and continuing to be a "thought-leader in consumer and operations research."

The FMI rebranding comes on the heels of a similar rebranding by the Grocery Manufacturers Association (GMA), which now is the Consumer Brands Association (CBA), and has announced a broadening of its focus into nonfoods, among other changes.

Published on: January 22, 2020

USA Today reports that "greeting card and stationery chain Papyrus is closing its stores," with most of the 254 unites being shuttered within the next six weeks.

In a prepared statement, owner Schurman Retail Group said, "“Despite our Herculean efforts to realign our Papyrus and American Greetings stores to fit today’s shopping environment, Schurman Retail Group had to make the difficult decision to close all 254 of our stores in North America."

Some context from the USA Today story:  "Many Americans gave up cards in favor of digital alternatives, or they send fewer cards between major holidays such as Christmas and Valentine’s Day, analysts said.

"Major retailers, including CVS and Walmart, have cut back or considered cutting back on shelf space for greeting cards, and card companies have closed hundreds of locations.  Retail space occupied by greeting card stores declined by more than 27% from 2013 to 2018, according to real estate data firm CoStar Group."

Published on: January 22, 2020

<i>Fortune</i> is out with its annual list of the world's most admired companies, and the top 10 list includes, in order:  Apple, Amazon, Microsoft, Walt Disney, Berkshire Hathaway, Starbucks, Alphabet, JPMorgan Chase, Costco, and Salesforce.

Apple, the magazine, has owned the top spot for 13 straight years.

Other prominent companies making the to 100:  Coca-Cola (12), Netflix (16), Walmart (18), Nordstrom (20), Home Depot (21), Target (22), Procter & Gamble (23), Johnson & Johnson (26), Unilever (31), CVS (38), McDonald's (41), PepsiCo (43), and Publix (48).

The rankings are said to be based on executives, directors, and analysts who were asked "to rate enterprises in their own industry on nine criteria, from investment value and quality of management and products to social responsibility and ability to attract talent. A company’s score must rank in the top half of its industry survey to be listed."

Published on: January 22, 2020

•  From <i>Variety</i>:

"Netflix beat its forecast for overall subscriber additions for the fourth quarter of 2019, while it brought in fewer than expected U.S. streaming customers.

"The company added a net 420,000 streaming customers in the U.S. and 6.26 million overseas in the year-end 2019 quarter. Netflix had previously forecast a total of 7.6 million paid net adds for Q4 (600,000 in the U.S. and 7.0 million internationally) … The company ended 2019 with 167 million streaming customers worldwide (including 61 million in the U.S.).

Published on: January 22, 2020

•  From <i>CNBC</i>:  "Starbucks announced Tuesday that it will strive to become “resource positive,” storing more carbon than it emits, eliminating waste and providing more clean freshwater than it uses."

“By embracing a longer-term economic, equitable and planetary value proposition for our company, we will create greater value for all stakeholders,” said Starbucks CEO Kevin Johnson.

The story notes that "the coffee chain is among the growing number of companies that are announcing sweeping sustainability goals as consumers grow increasingly concerned about climate change. BlackRock, the world’s largest investment firm, announced a week ago it plans to overhaul its investing strategy to make sustainability the new standard. On Thursday, Microsoft said it is trying to remove more carbon from the atmosphere than it emits by 2030."

Published on: January 22, 2020

<i>…with brief, occasional, italicized and sometimes gratuitous commentary…</i>

•  Kroger yesterday announced that Pam Matthew, president of its Central Division, will be retiring after 40 years with the company, and will be succeeded by Colleen Juergensen, the current president of its Dillons division.

In turn,  Juergensen will be succeeded by Steve Dreher, currently the vice president of the Dillons division.

•  In the UK, the <i>BBC</i> reports that Sainsbury CEO Mike Coupe will retire later this year and be succeeded by the head of Sainsbury's retail and operations, Simon Roberts.

The transition is scheduled to take place in May.

The story points out that Coupe "has led Sainsbury's for almost six years, during which time he oversaw a failed attempt to merge with rival supermarket Asda … His exit was announced a day after Sainsbury's said it was cutting 'hundreds' of management roles to reduce costs."

<i>It sounds from all the coverage that folks in the UK believe that Coupe may have overstayed his welcome a bit.  Well, I'd just like to say that Coupe - to whom I do not believe I am related - is welcome us at family reunions, if he's looking for a port in the storm.</i>

Published on: January 22, 2020

•  The CBA is focusing on CBD to make sure it is A-OK.

The Consumer Brands Association (CBA), which used to be known as the Grocery Manufacturers Association (GMA), said yesterday that it has formed an advisory board "to guide the organization’s work to enhance safety and ensure appropriate oversight in the burgeoning cannabidiol (CBD) market for consumer packaged goods (CPG)."

Joining the CBD Advisory Board are: Mick Cornett, former Oklahoma City mayor; Edward Davis, former commissioner, Boston Police Department; Tom Galvin, executive director, Digital Citizens Alliance; Karen Tandy, former administrator, U.S. Drug Enforcement Administration; and Michael Taylor, former deputy commissioner, U.S. Food and Drug Administration."

“The individuals that we have assembled have decades of experience in tackling issues like the one we face today — the smart regulation of CBD,” said CBA CEO Geoff Freeman. “Each of the advisory board members bring a unique perspective that will be crucial in helping inform and guide the CPG industry’s advocacy approach on this rapidly evolving issue.”

Saying that research shows that Americans are confused about the most critical components of CBD - "92% of Americans incorrectly assume, or have no idea, if CBD is regulated at the federal level, and 66% assume CBD products are safe" - CBA has called for "increased funding for scientific research into CBD and additional resources for the U.S. Food and Drug Administration’s enforcement and regulation of CBD in consumer products."

Published on: January 22, 2020

Terry Jones, one of the founders of Monty Python, has passed away.  He was 77, and had been suffering from dementia.

The <i>Hollywood reporter</i> this morning writes:  "Although rarely receiving the same acclaim as Monty Python's other members, Jones also was widely regarded within the group as its underrated but passionate heart, known for his good-natured enthusiasm and a deep well of intelligence across a broad range of subjects … Among his most famous performances in the series was as an inept, bumbling cardinal in the Spanish Inquisition (seen wearing a leather WWI pilot's hat and goggles); a member of the Hell's Grannies, a marauding group of old women terrorizing the streets of London; an overly apologetic French waiter in a sketch involving a dirty fork; a Yorkshireman who had to 'get up out of the shoebox in the middle of the night and lick the road clean with our tongues;' and as a nude piano player with an erratic face in scenes often used to break up sketches."

Jones co-directed (with Terry Gilliam) <i>Monty Python and Holy Grail</i>, and was the sole director of two other Python films, <i>The Life of Brian</i> and <i>The Meaning of Life</i>.  And, he directed numerous films and television shows and wrote children's books, screenplays and non-fiction books.

Published on: January 22, 2020

<i>…will return.</i>

Published on: January 22, 2020

Yesterday morning I mentioned here that I was getting my regularly scheduled colonoscopy.

Thanks to all of you who sent nice notes - and a number of appropriate and some inappropriate jokes - about the procedure.

The good news is that when I emerged from anesthesia, the doctor told me that I was clean as a whistle, with no polyps, and that he would see me in five years.

Which are the words you want to hear, and that make all the prep worthwhile.

As I said yesterday, a colonoscopy is not something to be afraid of, or to delay or avoid. It's really important, when you reach a certain age or your specific health issues call for it, to make an appointment and get one. I've been getting them every few years since 2004, and while I won't go so far as to say I look forward to them, I do think they are a critical part of my ongoing efforts to stay healthy.

An example of how important it can be came from an MNB reader, who wrote:

<b>Can’t agree with you more about urging everyone to get their colonoscopy! I had my first one a year before it was required, at 49, due to, let’s just say worrying symptoms. They found a 5cm cancerous mass and removed 14 inches of my colon with no chemo or radiation necessary and now I’m happy, back to my normal routine, and cancer free for 4+ years. If I had waited until I turned 50 – the recommended time for a first colonoscopy – my results would not have been so positive. I cannot echo your PSA more loudly! Please, no matter your concerns, go! Knowing is better than not knowing in my opinion in most situations life throws our way.

Glad to hear you’re making every effort to stay healthy. I am too, and I hope to continue reading MNB for many years, nay decades, to come!</b>

Published on: January 22, 2020

Digital strategies aren't just about creating alternatives to the bricks-and-mortar shopping experience.  Done effectively, they can actually bring people back to the store, while also eliminating customer anonymity, creating rich and actionable data, and deepen relationships between the store and consumer in a way that transcends the simple transaction.

Our newest Retail Tomorrow podcast, which brings together a terrific panel of experts from a wide range of disciplines, was recorded at Google’s New York City offices during the recent National Retail Federation (NRF) Show.  Our guests:

•  Matt Alexander, co-founder of Neighborhood Goods, an unusual and fascinating take on physical retailing with stores in Dallas and New York.

•  Patrick Flanagan, senior vice president of digital marketing and strategy for Simon,  which has more than 200 properties in 37 states and Puerto Rico.

•  Tom Furphy, CEO and Managing Director of Consumer Equity Partners, a member of the Retail Tomorrow podcast family and a regular contributor to "The Innovation Conversation" on MNB.

•  And Jalna Silverstein, a leader in Ernst & Young’s Transaction Advisory Practice and its Real Estate, Consumer Experience and Retail Strategy.

<b>You can listen to the podcast <a href="https://www.retailtomorrow.org/podcast/online-to-off-line-all-the-lines-in-between" target="_blank"> here</a>.</b>

<i><b>This Retail Tomorrow podcast is sponsored by the Global Market Development Center (GMDC).</i></b>

<i>Pictured below are our panel members, from left:  The Content Guy, Matt Alexander, Tom Furphy, Patrick Flanagan, Jalna Silverstein.</i>

Published on: January 22, 2020

The Major League Baseball Hall of Fame announced its 2020 class yesterday and Derek Jeter, who helped lead the New York Yankees to four World Series championships, was elected with just one vote short of unanimity in his first year of eligibility.  Jeter had a .310 career batting average,  3,465 career hits, had 17 straight seasons with at least 150 hits and 13 seasons scoring at least 100 runs.  He was a 14-time All Star.

Also elected was Larry Walker, the Colorado Rockies slugger who also spent part of his career with the Montreal Expos and St. Louis Cardinals.  Walker is a one-time NL MVP, and was elected in his q0th and final year of eligibility.

Players on the ballot who were not elected - a 75 percent minimum among voters is required - included Barry Bonds, Roger Clemens, and Curt Schilling, as well as Bobby Abreu, Josh Beckett, Heath Bell, Eric Chavez, Adam Dunn, Chone Figgins, Rafael Furcal, Jason Giambi, Raul Ibanez, Andruw Jones, Paul Konerko, Cliff Lee, Carlos Pena, Brad Penny, Andy Pettitte, J.J. Putz, Brian Roberts, Gary Sheffield, Alfonso Soriano, Sammy Sosa, Jose Valverde.

Induction in Cooperstown is scheduled for July 26.  Also scheduled to be inducted into the call are Ted Simmons, who caught for the St. Louis Cardinals, Milwaukee Brewers and  Atlanta Braves over 21 seasons, and Marvin Miller, the late director of the Major League Baseball Players Association;  both were elected by a smaller committee last year.

Published on: January 23, 2020

This commentary is available as both text and video; enjoy both or either ... they are similar, but not exactly the same.  To see past FaceTime commentaries, click here.

Hi, , Kevin Coupe here, and this is FaceTime with the Content Guy.

Y'know, more and more it seems like the stuff we used to count on no longer can be counted on.

I find this disconcerting.

For example … did you know that 98.6 degrees Fahrenheit no longer is the average normal human body temperature?

I find this disconcerting.

A story in the Wall Street Journal explained that "body temperature is a crude proxy for metabolic rate, and if it has fallen, it could offer a clue about other physiological changes that have occurred over time."

The thing is, we all know that people are taller, fatter and live longer than they used to, and scientists say that this drop in average normal human body temperature is related to all these things … though the story also points out that they're not sure which one is the cause and which one is the result.

I find this disconcerting.

The thing is. 98.6 has been held as the standard for normal average body temperature for more than 150 years.  And now, suddenly, studies are suggesting that it is 97.5 degrees.

Of course, there could be other factors at work.  Like how people's temperatures are taken.  There used to be two ways - orally and rectally.  (It wasn't that long ago that doctors - and I'm thinking here of our family pediatrician when I was a little kid - believed that rectally was the only way to go.

Even as a little kid, I found that disconcerting.

Now, though, there are all sorts of ways to take a person's temperature.  You can stick the thermometer in people's ears, or run it across their foreheads.  So maybe that has something to do with the change in numbers.

What I also find interesting is that not everybody has gotten the message.

MNB readers know that earlier this week I got as colonoscopy.  As they were getting me ready, they took my temperature, and it was 98.2.  And so I mentioned the fact that the numbers have changed, and the nurse gave me a strange look and said, "I hadn't heard that."  

I find that disconcerting.

You can't count on anything anymore.  Not in how you take people's temperatures, nor how you view and cater to customers' desires and needs.

Disconcerting, right?

That's what is on my mind this morning.  As always, I want to hear what is on your mind.

Published on: January 23, 2020

by Kevin Coupe

It has gotten a lot of attention in the media that Delta, which consistently is rated as the best US airline, announced that it will pay its employees roughly two months of addition pay as a bonus - or about $1.6 billion.  It's the largest amount that the company ever has paid out in bonuses, but it isn't an anomaly - for six years in a row, Delta has paid out more than $1 billion in bonus money after a strong performance.

But Inc. has a story pointing out that while the money is important, what may be even more critical to the company's culture is an attitude that actually reflects an employee-centric approach.

"In response to a LinkedIn post calling him a rock star, Delta CEO Ed Bastian responded with two short sentences:  'Appreciate the shout out...but Delta would be nothing without our 90,000 people. They deserve all the credit'."

Those are magic words, Inc. writes, because they are backed up by action/money.

They reflect an approach that a) praises the people on the front lines, b) rewards the people on the front lines, and c) empowers the people on the front lines to solve problems and suggest solutions.

These are incredibly important.  And while the investor class - which apparently doesn't define the bottom line in a customer-facing business the same way Delta does - has suggested that the money used for such generous bonuses could be better paid out to stockholders - CEO Bastian has resisted these entreaties.

Y'know why?

It's because employees "deserve all the credit."

Delta says it.  Delta means it.  Delta's actions reflect it.

And that's should be an Eye-Opener to every customer-facing business.

Published on: January 23, 2020

New York's iconic Fairway Market said this morning that it "has filed a voluntary petition under Chapter 11 of the U.S. Bankruptcy Code in the U.S. Bankruptcy Court for the Southern District of New York to complete its strategic sale process.  The Company has entered into a stalking horse asset purchase agreement with Village Super Market, Inc. to sell up to 5 New York City Fairway stores and its Distribution Center for approximately $70 million.  In addition, the Company will execute a Court supervised sale process to continue to negotiate for the sale of its remaining store locations."

The company says that its stores will remain open and operating - with the assistance of 25 million in debtor in possession financing - as the sale process unfolds.

Abel Porter, Fairway's CEO, said in a prepared statement that "after careful consideration of all alternatives, we have concluded that a Court-supervised sale process is the best way to meet our objectives of preserving as many jobs as possible, maximizing value for our stakeholders, and positioning Fairway for long term success under new ownership."

Robert Sumas, CEO of Village Super Market - which operates ShopRite and Gourmet Garage stores in the New York metropolitan area - said in a statement, "Perry and Nick Sumas opened the first Village Market in 1937, and our family continues to believe deeply in the importance of neighborhood grocery stores.  We appreciate that Fairway's loyal customers are concerned about the future, and if we are successful in our bid, we are committed to keeping Fairway, including its name, unique product selection and value, a part of this community."

Fairway started as a fruit and vegetable stand during the Great Depression, and grew into an iconic New York City presence, serving a number of its neighborhoods in a way that many residents found to be both irresistible and inimitable.  But in 2007, when the founding Glickberg family sold an 80 percent stake in the company to a private equity group, things almost immediately downhill, as the new owners focused on expansion (at one point considering a national growth strategy) without any of the marketing and merchandising savvy and panache that the family had mastered.  It went public … then went bankrupt … then was bought out of bankruptcy … and then started closing some of the suburban stores that were the biggest drain on its operations and profits.

Published on: January 23, 2020

The New York Times has a terrific story about how the "direct-to-consumer brand revolution is one of the most dominant forces in the retailing business today. It began with a handful of start-ups, then grew to dozens, then hundreds — from mattresses (Casper) to bras (ThirdLove) to electric toothbrushes (Quip) to vitamins (Ritual) to tampons (Lola) to luggage (Away) to sneakers (Allbirds) to makeup (Glossier) to hair color (eSalon) to pet food (Farmer’s Dog) — and even thousands, counting the brands filling the endless digital aisles and shelves of Amazon Marketplace."

In analyzing the power of these brands, the story notes that they succeeded because "technology and globalization were leveling the playing field. You didn’t need to start with a big advertising budget to get the attention of consumers. You didn’t need a manufacturing plant. You didn’t need to spend millions of dollars on research and development. You didn’t need a retailer to carry your product … By targeting a corporate giant’s weakness — high prices or inconvenience or a stodgy image — a clever start-up with the right strategy, the right message and the right product value could create a new national brand virtually overnight."

Great piece, and you can read it here.

Published on: January 23, 2020

Politico has a story about how Atlanta has worked to solve a lack of access to healthy food by coming up with a unique solution - pop-up produce stands located in the city's transit system.

According to the story, "Since 2015, Atlanta commuters using some of the city’s metro stations have been able to buy fresh produce at pop-up markets inside or just outside the station. The program, Fresh MARTA Market, is the city’s solution to a persistent food-access problem in Atlanta’s poorer communities where fresh food is often scarce and the incidence of diet-related illnesses is high. One in 3 adults in Atlanta are obese and three-quarters do not eat the recommended daily servings of vegetable or fruit, according to a 2017 study by the Food Well Alliance."

In 2018, the story says, the program "sold 46,000 pounds of produce, most of it from local urban farmers - an increase from the first year, when it sold 8,000 pounds and returned almost $8,000 to local farmers … The markets allow small farmers - there are an estimated 52 urban farms and 300 community gardens in the city - to sell their produce wholesale to MARTA without having to sell it individually or the hassle of selling to co-ops or school systems."

Published on: January 23, 2020

The Washington Post this morning reports that "Burger King is cutting the price of its faux-meat burger as sales start to dip following last year’s introduction."

The nation's biggest Burger King franchisee said that it now is selling about 28 per-day per-store, down from 32 at the introduction, and it recently added the Impossible Whopper to its two-for-six dollars promotion;  when it launched, the Impossible Whopper was selling for $5.59 apiece.

Some context from the Post story:  "Across the U.S., restaurants and grocery stores are rushing to add plant-based options. It remains to be seen whether their popularity is a long-lasting trend."  However, "despite the rising popularity of faux meat, Americans are also eating more real meat than ever. Total red meat and poultry consumption is expected to rise to 225.6 pounds per person this year from 224.3 pounds in 2019, according to USDA data. Even at Burger King, there’s no evidence that the meat-free option has led to less meat consumption."

Published on: January 23, 2020

In case you're interested …

During the recent National Retail Federation (NRF) show in New York, Tom Furphy and I brought our "Innovation Conversation" to the Mercatus booth, where we had an extended discussion with company president/CEO Sylvain Perrier, and senior director of marketing Mark Fairhurst about using a customer-centric approach to retailing as a way of competing against Amazon.

It was a fun chat, and worth listening to, I think, here.

Published on: January 23, 2020

Yesterday MNB had a story about the Food Marketing Institute's rebranding and refocus as FMI - The Food Industry Association, which it said reflected "its strategy to more broadly represent the food marketplace and embrace a more interconnected supply chain. FMI views retail as the heart of the food industry and recently expanded its membership in response to retailers’ needs, helping them facilitate access and connectivity with suppliers and other business partners."

FMI also unveiled a new logo, which you can see at left.

I offered a "gentle" commentary about the logo:

The new logo has the initials "FMI" surrounded by three green curved lines … but the lines are disconnected. If it had been me - and I don't know much about graphic design - I might've wanted them to connect in some way, to visually illustrate the goal … that FMI wants to serve as the connective tissue between various stakeholders in the food business. Which it does, if I understand the purpose of the rebranding.

But, as I say, I don't know much about graphic design.

Well, Heather Garlich, FMI's vice president for Media and PR, agreed with my assessment of my own abilities:

Thanks for covering us in your blog today. Since you expressed interest in the graphical representation of our logo, I thought I would follow up:

The rings represent the three pillars of our strategic plan: advocate, educate and collaborate. These areas are intentionally not touching, as they suggest motion and convergence of community around FMI as the Food Industry Association. Related, the term “Food Industry” is intentionally inclusive of participants up and down the value chain, including suppliers, technology and service providers, wholesalers, retailers, and the end consumer themselves, and speaks to our industry-wide impact.

If MorningNewsBeat is up for design work, I’ve got a guy for you!

Points taken.

Published on: January 23, 2020

…with brief, occasional, italicized and sometimes gratuitous commentary…

•  In Rochester, New York, the Democrat and Chronicle reports that an updated Wegmans website and mobile application seem to be creating some consternation among Wegmans' shoppers, who are a notably passionate and loyal bunch.

According to the story, "regular users’ comments on Twitter, the Apple App Store and Google Play paint a picture of exasperation, about everything from how the digital coupon-clipping feature works to saved shopping lists disappearing to the checkbox tap zone being too small. One person tweeted that a search for 'Brillo pads' brought up results for menstrual pads.

"'Uh oh! Looks like we've got some tweaking to do!' the chain tweeted in response."

Wegmans is doing the promised tweaking, and has the advantage of knowing that it has established enduring relationships with its shoppers - as long as it is responsive to their concerns and addresses the issues that shoppers are raising, everything will be okay.  One Wegmans said that "this is a starting line, not the finish line. We’ll keep listening."  And that is about as smart an approach to these things as I can imagine.

Published on: January 23, 2020

…with brief, occasional, italicized and sometimes gratuitous commentary…

•  From CNBC:  "Fast-casual restaurant chains like Chipotle Mexican Grill and Sweetgreen have been stealing customers from full-service restaurant chains like Outback Steakhouse and IHOP. To fight back, some casual dining chains have been launching spinoff restaurants that copy that business model."

Examples:  Applebee’s Express, Flip’d by IHOP, Aussie Grill by Outback, and Social Monk Asian Kitchen, created by Cheesecake Factory.

The advantages of such an option:  "Fast-casual restaurants are smaller in size, with less seating and fewer employees serving customers, which means that they are cheaper to operate than a full-service restaurant. Menus are usually designed for convenience and fast service, and customers order at a counter, sometimes moving along an assembly line."

But it doesn't always work, according to CNBC:  "Cracker Barrel announced in October that it planned to scrap Holler & Dash, the fast-casual spinoff it launched in 2016, after it acquired Maple Street Biscuit, a fast-casual chain with a focus on breakfast and brunch."

I'm a big fan of retailers that test new concepts and formats, looking for ways to reach out to shoppers in ways that extend a brand's equity while trying something completely different.

•  Fast Company has the story of Fresh Bowl, which "offers vending machine salads and other on-the-go meals in returnable glass to hungry commuters as a way to cut down on our immense food packaging waste."  Fresh Bowl launched in New York City less than a year ago, and apparently, if you can make it there you can make it anywhere - the company "has big plans to expand. Currently, there are just five kiosks in the city, but cofounder Zach Lawless says the company aims to have 50 vending machines by the end of this year, and a total of 100 in 18 months."

According to the story, "A big reason Fresh Bowl feels ready to add its kiosks in more subway centers and office building lobbies—and, soon, retail locations—is because so far, its model seems to be working. Fresh Bowl aims to reduce waste and give greater access to healthy food by stocking vending machines with salads, grain bowls, and breakfast oats in reusable glass jars that can be returned for a discount off your next grab-and-go meal. Overall, across its current locations, Fresh Bowl has seen a jar return rate of 85%."

The company just got more than $2 million in seed funding, which will fund the expansion, and it hopes to use customer data being gathered by the vending machines to craft more targeted offerings that also will fuel its growth.

Published on: January 23, 2020

•  Albertsons announced that it has hired Alice Chan, a 16-year PepsiCo veteran who most recently was senior director of sales strategy for its Frito-Lay division, to be VP of sales and marketing for own brands, a new position at the company.

•  The Consumer Brands Association (CBA) yesterday announced that Ellen Davis, most recently senior vice president at the National Retail Federation and president of the NRF Foundation, will join the association as executive vice president, industry engagement.

Published on: January 23, 2020

Yesterday I recounted how an MNB reader, on a cruise and needing a pocket square to dress up his blazer, asked his wife if he could borrow a pair of her panties … and when she asked him where he'd learned that trick, he replied, "MorningNewsBeat."

This surprised me, because I didn't remember offering any such advice … but I did a little research and discovered that Michael Sansolo, in a column five years ago about finding innovative solutions, wrote about as friend of his who figured out that "Victoria’s Secret seamless silk panties are the perfect solution" when you need a pocket square.  "No matter how they are folded or stuffed into his jacket pocket, they always create the perfect look. And the choice in colors is staggering."

As I said yesterday, go figure. MNB ventured into GQ territory, and apparently it stuck.

One MNB reader responded:

That is absolutely the funniest thing that has ever appeared in MNB!

From another:

Congrats to Sansolo – but I really want to send kudos to the gent who remembered that and pulled it off!

MNB reader Bob McGehee wrote:

In the early 80’s, I saw Frank Abagnale (check forger extraordinaire and author of and subject of movie “Catch Me If You Can”) end his talk with the warning that “Things are not always as they seem”.  He then pulled from his suit coat pocket the aforementioned ladies panties.  Everything old is new again.

In Abagnale's case, of course, he probably said they were from Victoria's Secret, but they were just a knock-off.

Published on: January 23, 2020

Digital strategies aren't just about creating alternatives to the bricks-and-mortar shopping experience.  Done effectively, they can actually bring people back to the store, while also eliminating customer anonymity, creating rich and actionable data, and deepen relationships between the store and consumer in a way that transcends the simple transaction.

Our newest Retail Tomorrow podcast, which brings together a terrific panel of experts from a wide range of disciplines, was recorded at Google’s New York City offices during the recent National Retail Federation (NRF) Show.  Our guests:

•  Matt Alexander, co-founder of Neighborhood Goods, an unusual and fascinating take on physical retailing with stores in Dallas and New York.

•  Patrick Flanagan, senior vice president of digital marketing and strategy for Simon,  which has more than 200 properties in 37 states and Puerto Rico.

•  Tom Furphy, CEO and Managing Director of Consumer Equity Partners, a member of the Retail Tomorrow podcast family and a regular contributor to "The Innovation Conversation" on MNB.

•  And Jalna Silverstein, a leader in Ernst & Young’s Transaction Advisory Practice and its Real Estate, Consumer Experience and Retail Strategy.

You can listen to the podcast here.

This Retail Tomorrow podcast is sponsored by the Global Market Development Center (GMDC).

Enjoy!

Published on: January 24, 2020

by Kevin Coupe

Excellent piece in Forbes that asks a relevant question - in a world where people seem to be more focused than ever on sustainability issues, will that force them to make a choice about convenience and the one day/free shipping guarantees to which so many of the same people have become addicted?

There is conflicting data cited in the story:

"A study by Future Commerce released last week found that 7% of respondents with Prime members are unsure if they will renew their membership, with some going on to say that they can wait an extra day for shipping." 

"The report also found that consumers increasingly care more about sustainable business practices, with 42% having browsed or purchased from physical second-hand, thrift or consignment shops, and 47% saying they actively focus on buying fewer, better things."

But…

"Future Commerce also found in its consumer survey that the top three requirements for e-commerce websites are free shipping (58%), free returns (46.75%) and two-day delivery (30.39%)."

And, as companies such as Amazon and Walmart invest millions in faster shipping, it drives smaller - and less-well funded - competitors to do the same.

"Amazon and Walmart are not making its decisions in a vacuum," the story suggests.  "Consumer demand for one-day shipping would have to be apparent to execs in order to justify the huge investment required to get from two-day to one-day shipping. And it’s unknown which demographics are using one-day shipping. Are the younger generations who are self-reporting a tendency toward sustainability actually following through with this logic in their daily purchases?"

The conclusion?

"Shoppers are calling the shots. And unless we start putting our money where our mouth is, we’ll all be dealing with more boxes, more delivery trucks, and the long-term environmental effects of our decisions today."

Ultimately, the Eye Opener from the story is this:  "Consumers - indeed, citizens - are pretty much able to rationalize anything."

Which is true.  And ultimately a little depressing.

Published on: January 24, 2020

From the Wall Street Journal:  

"The Trump administration is moving to curb the sale of imported counterfeit goods over the internet, warning electronic commerce platforms and warehouse operators of greater scrutiny and penalties if they don’t help ferret out fakes … The Trump administration is seeking to pressure e-commerce giants including Amazon.com Inc., which increasingly hosts lucrative third-party sales on its platform, as well as financial firms, logistics services and other companies that are positioned to help stem the rising tide of counterfeits and pirated goods."

The story says that "the Department of Homeland Security is set to release a report Friday outlining its immediate actions and longer-term goals for enlisting e-commerce players to combat counterfeit products that officials say undermine U.S. technology and manufacturing, harm bricks-and-mortar retailers and endanger consumers."  This report will lay out the government's plans to “seek all available statutory authorities to pursue civil fines and other penalties against these entities," and will "explicitly permit the government to seek injunctive relief against third-party marketplaces and other intermediaries dealing in counterfeit merchandise.”

Published on: January 24, 2020

Kroger yesterday announced that one of its new Ocado-powered robotic customer fulfillment centers will be built in Frederick, Maryland.

It is the sixth such warehouse to be announced;  Kroger and Ocado have said they intend to have as many as 20 in the US.  It will be about 350,000 square feet, and likely will take some two years to build.

"We are excited to bring Kroger and Ocado's latest automated warehouse to Frederick. This site will be key to delivering amazing grocery experiences to households across Maryland, Pennsylvania and the District of Columbia," said Luke Jensen, CEO of Ocado Solutions.

And Robert Clark, Kroger's senior vice president of supply chain, manufacturing and sourcing, said, "Through our strategic partnership, we are engineering a model for the region, leveraging advanced robotics technology and creative solutions to redefine the customer experience."

Published on: January 24, 2020

Fox News reports that the New York City Council passed by a 43-3 margin a bill requiring the city's retailers to take cash.

The story says that the "rationale for joining San Francisco and Philadelphia, as well as the states of New Jersey and Massachusetts, in opposing cashless shopping: It’s unfair to residents who don’t have bank accounts or to those who simply prefer cash."

The move disregards the retailers who "argued that cashless shopping helped improve safety at stores because cashiers would not have to handle cash and managers would not have to take cash deposits to a bank, risking loss or theft.

But, Fox News writes, cash remains highly relevant for many consumers:  "Paper money is used for nearly a third of U.S. purchases, with debit and credit cards accounting for 31 percent and 28 percent, respectively."

Published on: January 24, 2020

The Wall Street Journal this morning reports that even as major CPG companies declare that they will rid themselves of non-core businesses and "unfashionable brands" that are a drag on profits, there actually is a surprising lack of divestment activity in the sector.  In 2019, for example, such activity was 74 percent lower than in 2018.

Why?

The Journal writes that "portfolio sales have stalled above all because it is hard to make the math work. Selling assets for low-yielding cash typically reduces leverage and therefore earnings per share. This problem is compounded by high stock-market valuations in the consumer staples sector. Disposals of weak assets at lower valuations theoretically destroy shareholder value."

Published on: January 24, 2020

The Atlantic has a long piece about Amazon founder/CEO Jeff Bezos that ponders what his "master plan" is.

Bezos, the story says, has compiled an amazing portfolio:

"Today, Bezos controls nearly 40 percent of all e-commerce in the United States. More product searches are conducted on Amazon than on Google, which has allowed Bezos to build an advertising business as valuable as the entirety of IBM. One estimate has Amazon Web Services controlling almost half of the cloud-computing industry — institutions as varied as General Electric, Unilever, and even the CIA rely on its servers. Forty-two percent of paper book sales and a third of the market for streaming video are controlled by the company; Twitch, its video platform popular among gamers, attracts 15 million users a day. Add The Washington Post to this portfolio and Bezos is, at a minimum, a rival to the likes of Disney’s Bob Iger or the suits at AT&T, and arguably the most powerful man in American culture."

Here are four excerpts from the story, which is totally worth reading in its entirety:

•  "To the U.S. president, he is a nemesis. To many Americans, he is a beneficent wizard of convenience and abundance. Over the course of just this past year, Amazon has announced the following endeavors: It will match potential home buyers with real-estate agents and integrate their new homes with Amazon devices; it will enable its voice assistant, Alexa, to access health-care data, such as the status of a prescription or a blood-sugar reading; it will build a 3-million-square-foot cargo airport outside Cincinnati; it will make next-day delivery standard for members of its Prime service; it will start a new chain of grocery stores, in addition to Whole Foods, which it already owns; it will stream Major League Baseball games; it will launch more than 3,000 satellites into orbit to supply the world with high-speed internet."

•  "Bezos loves the word relentless — it appears again and again in his closely read annual letters to shareholders — and I had always assumed that his aim was domination for its own sake. In an era that celebrates corporate gigantism, he seemed determined to be the biggest of them all. But to say that Bezos’s ultimate goal is dominion over the planet is to misunderstand him. His ambitions are not bound by the gravitational pull of the Earth … Bezos worries that in the coming generations the planet’s growing energy demands will outstrip its limited supply. 'We have to go to space to save Earth,' he says."

•  "Relentless might be the most Amazonian word, but Bezos also talks about the virtues of wandering.  'Wandering is an essential counterbalance to efficiency,' he wrote in a letter to shareholders this year. When I spoke with workers based at Amazon’s Seattle headquarters, they said what they appreciated most about their employer was the sense of intellectual autonomy it allowed. Once they had clearly articulated a mission in an approved six-pager, they typically had wide latitude to make it happen, without having to fight through multiple layers of approval. The wandering mentality has also helped Amazon continually expand into adjacent businesses — or businesses that seem, at first, unrelated. Assisted by the ever growing consumer and supplier data it collects, and the insights into human needs and human behavior it is constantly uncovering, the company keeps finding new opportunities for growth."

•  "In the end, all that is admirable and fearsome about Amazon converges. Every item can be found on its site, which makes it the greatest shopping experience ever conceived. Every item can be found on its site, which means market power is dangerously concentrated in one company. Amazon’s smart speakers have the magical power to translate the spoken word into electronic action; Amazon’s doorbell cameras have the capacity to send video to the police, expanding the surveillance state. With its unique management structure and crystalline articulation of values and comprehensive collection of data, Amazon effortlessly scales into new businesses, a reason to marvel and cower. Jeff Bezos has won capitalism. The question for the democracy is, are we okay with that?"

You can read the piece here.

And … the New York Times has a story about him this morning that looks at how Bezos' image and behavior have changed in recent years, turning him a geek into tabloid fodder.  Here is an excerpt:

"When Jeff Bezos and his former wife, MacKenzie, celebrated what would be their last anniversary together around Labor Day 2018, they arrived at a Miami nightclub with no fanfare. His table was booked online, which is 'totally what tourists do' and 'totally dorky,' the club’s celebrity liaison said in an interview at the time.

"Almost a year later, Mr. Bezos arrived at a hot Miami seafood restaurant in grander fashion, on a 90-foot-long Leopard superyacht in what The Miami Herald called 'the most extravagant entrance ever'."

Make of it what you will.  You can read that story here.

Published on: January 24, 2020

No one has any experience with the future.

The advertising run-up to the Super Bowl has begun, and one of the commercials getting the most attention is from Planters, which shows the death of its longtime mascot, Mr. Peanut.

You can see it above:  Mr. Peanut is driving the Nutmobile, accompanied by actors Wesley Snipes and Matt Walsh (Veep), when the vehicle goes off a cliff.  All three find themselves hanging onto a tree branch, which cannot support their weight … and it goes on from there.

Some sort of memorial service for Mr. Peanut apparently will be shown in a Super Bowl commercial.

AdWeek writes that "the loss of Mr. Peanut is a major moment for the brand. Planters first introduced Mr. Peanut to audiences in 1916, meaning that the mascot has been around since the midst of World War I, making him of the longest-standing brand mascots of all time."

Published on: January 24, 2020

…with brief, occasional, italicized and sometimes gratuitous commentary…

•  E-commerce provider and delivery company Instacart said yesterday that it is beginning the rollout of what it is calling Instacart Meals, described as "a new grocery meals product that powers easy ordering, delivery and pickup of made-to-order food. The launch marks Instacart's move into grocery meal delivery, helping retailers bring more in-store aisles and experiences online for customers across North America."

According to the announcement, "As a first step, Instacart has collaborated with Publix to introduce the product with a new digital deli counter including its popular Publix subs. The product will roll out to Publix locations across Florida in the coming weeks and to nearly all Publix stores across the Southeast in the months ahead, following a Florida pilot … The new Instacart Meals product makes it easy for customers to order specialty counter items alongside their groceries and household essentials, all to be delivered or picked up from the store."

Yup.  It gets Instacart into meal delivery.   And it also allows Instacart to compile supermarkets' customer data to further arm itself to compete with those same supermarkets at some point.  It has weaponized such customer data in the past, and there is no reason to think it can't or won't in the future.

Published on: January 24, 2020

•  Fox Business reports that Walmart is "rolling out gym memberships to its 1.5 million U.S. employees and their families starting a $9 a paycheck, which is about $234 a year based on 26 paychecks annually."

The story quotes Adam Stavisky, Walmart's senior vice president of U.S. Benefits, as saying, "We’re committed to providing associates and their families access to high-quality medical coverage along with tools and resources to manage their health and well-being.  The Walton Life Fitness Pass is another example of how we’re working to help our associates and their families."

Published on: January 24, 2020

•  The National Retail Federation (NRF) is predicting that the close to 194 million people planning to watch the Super Bowl this year "expect to spend an average $88.65 on food and beverages, merchandise and party supplies, for a total $17.2 billion nationwide.

•  In the UK, the Times and Star reports that Morrisons plans to eliminate some 3,000 management jobs even as it plans to hire as many as 4,000 new store employees.

David Lepley, Morrisons group retail director, tells the paper that "this proposal means more frontline colleagues improving product availability and helping customers."

The story notes that there have been layoffs at a number of the UK's retail grocery companies, including Sainsbury and Walmart-owned Asda Group, as retailers do price-and-margin battle with German discounters Aldi and Lidl.

Published on: January 24, 2020

Jim Lehrer, who co-hosted and hosted the "PBS NewsHour" for decades, putting an emphasis on sober-minded journalism delivered with integrity, informed analysis and an almost studied lack of entertainment value, has passed away at age 85.

Lehrer was perhaps best known to mass audiences for his moderation of presidential debates - he did a dozen of them between 1988 and 2012.

In addition to his career as a newsman, Lehrer wrote some 20 novels, several plays and three memoirs.

Published on: January 24, 2020

…will return.

Published on: January 24, 2020

Digital strategies aren't just about creating alternatives to the bricks-and-mortar shopping experience.  Done effectively, they can actually bring people back to the store, while also eliminating customer anonymity, creating rich and actionable data, and deepen relationships between the store and consumer in a way that transcends the simple transaction.

Our newest Retail Tomorrow podcast, which brings together a terrific panel of experts from a wide range of disciplines, was recorded at Google’s New York City offices during the recent National Retail Federation (NRF) Show.  Our guests:

•  Matt Alexander, co-founder of Neighborhood Goods, an unusual and fascinating take on physical retailing with stores in Dallas and New York.

•  Patrick Flanagan, senior vice president of digital marketing and strategy for Simon,  which has more than 200 properties in 37 states and Puerto Rico.

•  Tom Furphy, CEO and Managing Director of Consumer Equity Partners, a member of the Retail Tomorrow podcast family and a regular contributor to "The Innovation Conversation" on MNB.

•  And Jalna Silverstein, a leader in Ernst & Young’s Transaction Advisory Practice and its Real Estate, Consumer Experience and Retail Strategy.

<b>You can listen to the podcast here.

<a href="https://www.retailtomorrow.org/podcast/online-to-off-line-all-the-lines-in-between" target="_blank"> here</a>.</b>

This Retail Tomorrow podcast is sponsored by the Global Market Development Center (GMDC).

Pictured below are our panel members, from left:  The Content Guy, Matt Alexander, Tom Furphy, Patrick Flanagan, Jalna Silverstein.

Published on: January 27, 2020

by Kevin Coupe

It got a lot of attention last Friday when, at the World Economic Forum in Davos, Switzerland, Goldman Sachs CEO David Solomon said that the company plans to enact a new requirement for companies that it take through an IPO - they will have to have at least one "diverse" board candidate.

"We’re not going to take a company public unless there’s at least one diverse board candidate, with a focus on women,” Solomon told CNBC, saying that the new rule will go into effect on July 1.

It is, however, only a temporary requirement - as of 2021, Goldman Sachs will require two diverse board members.

"We might miss some business, but in the long run, this I think is the best advice for companies that want to drive premium returns for their shareholders over time,” Solomon said.

The New York Times noted that this is becoming a trend, that "money-management firms BlackRock and State Street plan to vote against directors at companies without a female director. And California-based public companies with all-male boards face a $100,000 fine."

Seems to me that this is an important statement, not just because of the specific changes it will require of companies that want to work with Goldman, which last year was the largest underwriter of US IPOs.  

It also send a valuable broader message - that companies with a diversity of views will tend to do better in terms of long-term performance.

There was a story from CNBC late last year that reinforced this message:

"For every female CEO in the U.S. there were 19 male chief executives, while there were 6.5 male CFOs for every woman in the role at the end of 2018, the report said.

"In the two years following a new CEO appointment, the stock price for companies that appointed female chief executives outperformed those that appointed men by an average of 20%, the data showed.

"When women were appointed as chief financial officers (CFOs), companies saw different benefits, the report said … In the 24 months following the appointment of a female CFO, these companies outperformed those with newly-appointed male CFOs by 8% on share price returns, the research said. They also outperformed by 6% on profitability in the same period," because they "drove more value appreciation, better defended profitability moats, and delivered excess risk-adjusted returns for their firms."

The very definition, I think, of an Eye-Opener.

Published on: January 27, 2020

Bloomberg reports that Walmart "is testing out a higher minimum starting wage for certain jobs in hundreds of stores as part of a broader overhaul of roles and responsibilities across its massive U.S. workforce."

The company said that in about 500 stores, "some associates in the fresh, front-end and replenishment areas will see their hourly pay rise from $11 an hour to $12."

According to the story, the raises are a test, and "right now the company has no plans to raise its minimum starting wage across the board to its 1.5 million U.S. employees, the biggest private workforce in the nation. The redefined roles carry more responsibility, Walmart has said, which justifies the higher compensation. Still, the move could be Walmart’s first step toward boosting its starting pay, which it last raised in 2018."

Published on: January 27, 2020

Bloomberg this morning reports that "more than 350 Amazon.com Inc. employees contributed public statements focused on the company’s climate practices, defying company policy and escalating a feud between management and a coalition of concerned workers."

The statements were posted on the Medium website, and come just weeks "after it emerged that Amazon had threatened workers who had talked to the Washington Post with disciplinary action or termination if they continued to speak publicly about the company without authorization."

The employees defying company orders are described as "members of Amazon Employees for Climate Justice, an organization that has been campaigning for more than a year to get Amazon to cut ties with fossil fuel companies and commit to limiting its contribution to greenhouse gas emissions."

In a statement, Amazon says that "while all employees are welcome to engage constructively with any of the many teams inside Amazon that work on sustainability and other topics, we do enforce our external communications policy and will not allow employees to publicly disparage or misrepresent the company or the hard work of their colleagues who are developing solutions to these hard problems."

Amazon has maintained that it is working hard on environmental issues, with CEO/founder Jeff Bezos announcing "an initiative aimed at making his company a net-zero carbon emitter by 2040."

Published on: January 27, 2020

The Wall Street Journal this morning reports that "hundreds of regional grocery stores in cities from Minneapolis to Seattle are closing or selling pharmacy counters, which have been struggling as consumers make fewer trips to fill prescriptions and big drugstore chains tighten their grip on the U.S. market."

The regional chains, the story says, "are too small to wrest competitive reimbursement rates on drugs, they aren’t connected to big medical networks or insurers, and they generally lack walk-in clinics and other health services that draw many customers to CVS and Walgreens locations."

In addition, "Consumers are increasingly getting 90-day supplies of their medicines or getting prescriptions delivered in the mail. Those trends are resulting in a decline in foot traffic to supermarket pharmacies, which were typically located at the back of stores. Meantime, profits are ever harder to come by as the health-care industry consolidates."

Published on: January 27, 2020

The Wall Street Journal this morning has a piece about how retailers' CFOs need to "exercise caution when it comes to investments and expansion, and closely watch the economy," continuing to monitor "freight costs, commodity costs, 'shrink' - also known as theft - and other expenses that could make a dent in profit margins."

While the economy continues to hum along in a lot of sector, there also have been a number of major retailers that "posted disappointing holiday sales"; in addition, there continue to be retailers that are closing many of their stores.  The fact is, the <i>Journal</i> writes, "global trade conflicts, an upcoming presidential election and mixed signals on consumer spending are painting a murky picture for retail finance chiefs."

Experts tell the Journal that "as online purchases make up an increasingly large share of total retail sales, CFOs are making company-specific investments to strengthen their top line and to hold their ground against rivals and e-commerce giants. Companies such as Lowe’s Cos . and Target Corp. have been expanding their internal technology teams to build point-of-sale software and inventory-management systems.

"CFOs will continue to lead initiatives such as loyalty programs, and they will further efforts to allow more shoppers to buy products online and then pick them up in the store."  But they also need to be "especially cautious about expanding their businesses and deciding whether to add or shutter storefronts."

Published on: January 27, 2020

The New York Times has a story about sports apparel company Under Armour, which was "once heralded as the next Nike."  Now, however, "Under Armour has faltered, hurt by slumping sales and unflattering revelations about its corporate culture."

The company, according to the Times, has "faced tough scrutiny, resulting in lawsuits from shareholders, who accuse the company of misleading investors, and media coverage around real estate deals involving the company and (its CEO's) private holdings. Questions have also arisen about a culture that allowed strip club visits to be expensed on corporate credit cards and, more recently, a disclosure by The Wall Street Journal that federal authorities are conducting investigations into accounting practices."

The Times writes that "there is no one cause of Under Armour’s struggles. Some factors, like the bankruptcies of the retail giants Sports Authority and Sport Chalet in 2016, were out of the company’s control.

"But interviews with several current and former Under Armour employees as well as competitors, advisers to athletes, and financial analysts also point to a company that tried to do too much too fast. It expanded into sports in which it had little expertise and failed to articulate a strategy for its expensive tech acquisitions. It eschewed the athleisure trend, which has buoyed sales at Nike and Adidas, and struggled to translate its brand to an international audience."

The story is worth reading here.

Published on: January 27, 2020

Clayton M. Christensen, the Harvard Business School professor who wrote "The Innovator’s Dilemma," which cemented his reputation as superstar management guru, has passed away at age 67.  The cause was complications for leukemia.

An excerpt from the New York Times obituary:

"The Innovator’s Dilemma" … was published during the technology boom of the late 1990s. It trumpeted Professor Christensen’s assertion that the factors that helped the best companies succeed - listening responsively to customers, investing aggressively in technology products that satisfied customers’ next-generation needs - were the exact same reasons some of these companies failed.

"These corporate giants were so focused on doing the very things that had been taught for generations at the nation’s top business schools, he wrote, that they were blindsided by small, fast-moving, innovative companies that were able to enter markets nimbly with disruptive products and services and grab large chunks of market share. By laying out a blueprint for how executives could identify and respond to these disruptive forces, Professor Christensen, himself an entrepreneur and former management consultant, struck a chord with high-tech corporate leaders."

The Times also has this observation about Christensen:

"On the last day of his management class every semester, he wrote, he asked his students to “turn those theoretical lenses on themselves” and answer three questions:  'First, how can I be sure that I’ll be happy in my career? Second, how can I be sure that my relationships with my spouse and my family become an enduring source of happiness? Third, how can I be sure I’ll stay out of jail?'

"He noted that several former classmates, including Jeffrey Skilling, the former chief executive of Enron, had spent time in prison.  'These were good guys — but something in their lives sent them off in the wrong direction,' he wrote.  Ultimately, the realization that his ideas had generated enormous revenue for companies that used his research left him dissatisfied.  'I know I’ve had substantial impact,' he wrote.  'But as I’ve confronted this disease, it’s been interesting to see how unimportant that impact is on me now. I’ve concluded that the metric by which God will assess my life isn’t dollars but the individual people whose lives I’ve touched.

"'Don’t worry about the level of individual prominence you have achieved,' he continued; 'worry about the individuals you have helped become better people'."

Published on: January 27, 2020

At its annual Midwinter conference in Arizona, FMI-the Food Industry Association presented a number of Executive Leaderships Awards.

•  Kevin Davis, president and Co-CEO, Bristol Farms, received the Sidney R. Rabb Award, which recognizes "contributions to the industry, consumers and community."

•  Mark Skogen, president and CEO, Festival Foods, received the Robert B. Wegman Award, lauded for pushing "for new and innovative in-store experiences to better serve the customers."

•  Craig Boyan, president, H-E-B, received the Glen P. Woodard, Jr. Award

for his involvement in public affairs initiatives.

•  Al Carey, PepsiCo's retired North America CEO, received the William H. Albers Award, "for sparking collaboration between brands and retailers, as well as front-line associates that trickled directly down to the consumer."

•  Henry Johnson, the retired president of W. Lee Flowers & Co., received the Herbert Hoover Award, for having "embedded his humanitarianism and passion for philanthropy in his leadership."

•  Natalie Menza-Crowe, RD, MS, director of health and wellness, Wakefern Food Corp, received the Esther Peterson Award for creating "dynamic programs that educate and inspire consumers and associates to embrace the importance of healthy eating to make balanced nutritional decisions."

Published on: January 27, 2020

•  The Wall Street Journal this morning reports that "new warehouse construction across North America is expected to outstrip demand over this year and next, according to a new report that suggests a yearslong boom in industrial space fed by e-commerce growth may be shifting in favor of tenants."

The numbers are clear:  More than 300 million square feet of warehouse space is expected to be opened this year, and another 272 million square feet next year, but tenants are expected to lease only 272 million and 218 million square feet, respectively.

The Journal writes that "tight space has driven down vacancy rates and driven up rental prices, but companies said last year that the industrial real-estate market was getting closer to a balance between supply and demand."

Published on: January 27, 2020

•  USA Today reports that Walmart-owned e-commerce business Hayneedle, which sells specialty home products, has begun a series of layoffs that will result in some 200 people being out of work.  The move comes as Walmart integrates Hayneedle's operations into those of its own website, though it will continue to operate Hayneedle's separate website.

Published on: January 27, 2020

…with brief, occasional, italicized and sometimes gratuitous commentary…

•  In Oregon, the Malheur Enterprise reports that a federation of Oregon retail employees is circulating a petition that would call for a state ballot initiative that would "limit each grocery store to two of the checkout kiosks."

According to the story, "The AFL-CIO contends self-checkout kiosks make customers feel socially isolated, particularly elderly people, and that the kiosks let stores rely more on part-time workers and leaves workers “feeling devalued.” They also claim self-checkout stands make it easier for minors to buy alcohol and for people to steal from stores."

“We have been consistently concerned about the impacts of technology and automation on the livelihoods of working people, especially when they have no voice in how technology is used in their workplaces,” said Graham Trainor, president of the Oregon AFL-CIO. “You can see expansion of self-checkout machines in stores across the country and in Oregon.”

What a crock.  This likely is less about keeping elderly people connected and keeping people employed (especially at a time of such low unemployment) than it is about helping the AFL-CIO maintain some power and leverage.  But it may pass … Oregon, after all, is one of two states (the other is New Jersey) that doesn't allow people to pump their own gasoline.

Published on: January 27, 2020

•  Hy-Vee announced that longtime executive Jay Marshall, the company's EVP and co-COO, has been named vice chairman.

The company also said thatCraig Clasen, senior vice president of Retail Business Development, and Brett Bremser, executive vice president and CMO, have retired.

Current Executive Vice President Darren Baty has been named the new CMO.

Published on: January 27, 2020

From the Los Angeles Times, about  basketball star Kobe Bryant, who died yesterday in a helicopter crash that also killed his 13-year-old daughter, Gianna, and seven others:

"By the end of his 20-year career - all of it spent with the Lakers - Bryant was a five-time world champion, two-time Olympic gold medalist with the U.S. team and 18-time All-Star. He ranks fourth on the NBA’s all-time scoring list; he was surpassed just this weekend by Laker star LeBron James.

"In a manner befitting both his sophisticated background and the city where he spent his adult life, the 41-year-old had transitioned from athletic stardom to a post-basketball career that included an Oscar for the animated short <i>Dear Basketball</i>, a series of children’s books that became New York Times bestsellers and a growing business empire."

Magic Johnson called Bryant "the greatest Laker of all time."

Published on: January 27, 2020

We had a story the other day about how Delta gave out the equivalent of two months' salary to employees as a bonus, with the CEO saying that they get "all the credit" for the company's superior performance.

One MNB reader wrote:

Good for Delta and American to achieve record profits and employee bonus payouts. Wish they invested some of that money in offering a better product !…For those of us lucky enough to travel overseas, it is sad 

that none of the USA airlines rank in Top 10 globally in terms of service and “product”.

Singapore Air, Cathay Pacific, Emirates, Etihad, British Airways etc…….  all “much better”.

It’s not that USA airlines couldn’t match or surpass other global airlines …..USA airlines choose to focus on profit.

In many other industries, USA companies are leaders in service and innovation, our airlines are mediocre on the global playing field.

MNB reader Monte Stowell wrote:

Being a million miler on Delta Airlines, I would like to recall a wonderful Delta experience.

I had several years ago. I was flying to Honolulu from Portland, OR, through LAX to Honolulu. This trip was going to earn me this coveted million miler status. About an hour or so, the stewardess came on the inter-com and mentioned that I had just earned the million miler status. They broke out champagne for everyone on the plane, and there was a round of applause from many of the passengers. The stewardess gave me a congratulatory letter from Delta and told me I would be receiving the gold card later in the mail. Customer service at its finest. Small gestures make a big difference, as this story was told by me to many of my fellow employees. Great employees make a big difference to their customer and also to the culture of a company. Count me in for what Delta is doing to share their good fortune.

I think I saw this in a movie…wasn't Sam Elliott the pilot?

Published on: January 27, 2020

Digital strategies aren't just about creating alternatives to the bricks-and-mortar shopping experience.  Done effectively, they can actually bring people back to the store, while also eliminating customer anonymity, creating rich and actionable data, and deepen relationships between the store and consumer in a way that transcends the simple transaction.

Our newest Retail Tomorrow podcast, which brings together a terrific panel of experts from a wide range of disciplines, was recorded at Google’s New York City offices during the recent National Retail Federation (NRF) Show.  Our guests:

•  Matt Alexander, co-founder of Neighborhood Goods, an unusual and fascinating take on physical retailing with stores in Dallas and New York.

•  Patrick Flanagan, senior vice president of digital marketing and strategy for Simon,  which has more than 200 properties in 37 states and Puerto Rico.

•  Tom Furphy, CEO and Managing Director of Consumer Equity Partners, a member of the Retail Tomorrow podcast family and a regular contributor to "The Innovation Conversation" on MNB.

•  And Jalna Silverstein, a leader in Ernst & Young’s Transaction Advisory Practice and its Real Estate, Consumer Experience and Retail Strategy.

You can listen to the podcast here.

This Retail Tomorrow podcast is sponsored by the Global Market Development Center (GMDC).

Pictured below are our panel members, from left:  The Content Guy, Matt Alexander, Tom Furphy, Patrick Flanagan, Jalna Silverstein.

Published on: January 28, 2020

by Michael Sansolo

In 1894, London faced an emerging problem of stunning concern. At the time, the streets of the city were clogged with horse-drawn conveyances of all types. The roughly 50,000 horses in London all had digestive systems, which meant that the streets of London also were being clogged by horse waste.

The problem wasn’t confined to London, of course. New York was estimated to have 100,000 horses producing 2.5 million pounds of manure daily not to mention the added problems of horse urine and dead horse corpses. The Times of London captured the concern of the day by predicting that by 1944 the streets of the city would be constantly buried under nine feet of manure.

Obviously that didn’t happen.  The automobile was invented.  And while automobiles weren't invented specifically to address the horse manure problem, this averted crisis can be seen as a good example of how even the most dire problems can be mitigated by smart solutions.

It also reminds us of how important it is to look forward and see where the storm clouds are massing, so we can come up with solutions sooner rather than later.

Supply Chain Drive.com recently reported on a similar coming crisis, which got me thinking about those horses in London.  Thanks to the explosion of delivery services, cities around the globe are just beginning to grapple with the challenge of what to do with all the traffic that entails. As Supply Chain Drive explains, New York is a prime (pardon the pun) example. As customers increasingly turn to delivery of goods, companies need find ways of handling that treacherous last mile.

It’s easy to see this already. The last two apartment buildings where my daughter has lived both remade their lobbies to accommodate the flood of packages arriving every day. Supply Chain Drive extrapolated what all those deliveries are going to mean to already-crowded city streets and projected that endless gridlock is in our future.

The website quotes a New York-based professor who pointed out that this rush to delivery makes it clear that old fashioned shopping trips done one shopper at a time are actually more efficient. So too is the notion of finding new ways to consolidate shipping to permit drivers to make many deliveries in a single trip.

For the moment, there is no solution at hand. Shoppers increasingly like and rely on delivery services and those services, in turn rely on roads and drivers - two commodities that are increasingly in short supply.

Rather than simply look at the London manure crisis as a model for hope, we would be better served to consider the likely realities of this situation. Increasingly congested roads will only lead to additional delivery problems at all parts of the supply chain and will only increase the pressure from existing driver shortages. So it behooves all of us to focus on logistics and how to possibly wring even more inefficiencies out of the system.

Go figure, it might even give stores an ability to provide environmentally aware shoppers with an important reason to do their own shopping rather than outsource it to, say, Amazon. 

But most importantly, it reminds us to keep looking to the horizon for the problems and opportunities coming at us in tomorrow’s world and to find solutions that work for both our customers and us.

Michael Sansolo can be reached via email at <A HREF="mailto: msansolo@mnb.grocerywebsite.com "> msansolo@mnb.grocerywebsite.com </A>.  His book, “THE BIG PICTURE:  Essential Business Lessons From The Movies,” co-authored with Kevin Coupe, is available here.

And, his book "Business Rules!" is available from Amazon here.

Published on: January 28, 2020

by Kevin Coupe

Interesting piece in the Washington Post about "the differences between millennials’ financial trajectory and those of earlier generations: In 1990, baby boomers, whose median age was 35, owned nearly one-third of American real estate by value.

"In 2019, the millennial generation, with a median age of 31, owned just 4 percent."

The story makes the point that "millennials, many of whom are entering their prime home-buying years, are likely to make up some of that gap by the time they see 35. But they’re not likely to reach 30 percent of the housing market — or even the 20 percent attained by the smaller Generation X at the same point in their lives."

The big factor in this shift, the <i>Post</i> writes, is debt:

"Millennials’ massive debt burdens also make it difficult to them to save for a down payment at any housing price. For households headed by someone younger than 35, median debt ballooned from $21,000 in 1989 to $39,000 in 2016. During that same time period, the percentage of under-35 households with student loan debt more than doubled, from 17 percent to 45 percent, and their median debt more than tripled, from $5,600 to $18,500."

And, even as "baby boomers slowly age out of homeownership," making available a "projected $13.5 trillion in housing inventory," the fact is that "millennials and younger generations might not be able to afford them."

The question that retailers need to ask themselves:  What else will these folks be unable to afford?

This trend, of course, will raise other questions.  Like, what will happen to an economy that largely depends on consumers for growth if a significant percentage of the population cannot afford to purchase the item that for most people becomes a major way to build wealth?  What will happen when these factors run headlong into an economic recession?

How will retailers - many of them already in economic distress because of changing consumer habits and the requirement that they invest more and more capital just to keep up and remain relevant - adjust and compensate?

I have no answers for these Eye-Opening questions.  But I think they are worth asking, and beginning the search for the different answers that will work for different retailers.

Published on: January 28, 2020

The Wall Street Journal this morning has a story about how grocers looking to be more effective in e-commerce fulfillment "are testing micro-fulfillment systems that can spit out as many as 4,000 orders a week but can still be housed in the back of stores or in urban areas where space is at a premium. The store owners are evaluating whether automation can help tamp down costs while speeding up deliveries and they are turning to a new set of startups aiming to make e-commerce fulfillment more efficient in a small footprint."

The story notes that while e-grocery sales are still relatively small - about 3.5% of overall food and beverage sales - they are growing, which leaves retailers "scrambling to retool operations" that will be appropriate to what consumers seem to need and want - whether it be click-and-collect, delivery, or both, using store-pick or central-pick, and then adapting those solutions to the specific requirements of fresh food while maintaining some level of profitability in a low-margin sector.

Micro-fulfillment centers are seen as being a fast and relatively economical way of addressing these problems.  For example, Takeoff Technologies’ 10,000-square-foot systems "cost around $3 million and can be up and running in about four months … The centers hold some 15,000 different products and require about a dozen workers to operate, including some manual picking."

This approach is finding favor with some major players - Albertsons, Wakefern and Ahold Delhaize all are working with Takeoff to develop micro-fulfillment centers.

Published on: January 28, 2020

Bloomberg has a story about Lavka, described as Russia's answer to Amazon, which is delivering groceries to Moscow consumers within 15 minutes of them being ordered.

Owned by Yandex, Russia's largest technology company, Lavka has "spread small warehouses across the capital stocked with about 2,000 items and uses bike couriers to deliver orders. Its strategy is to build market share by being a digital convenience store—the place consumers turn to for ingredients, toothpaste or even a packet of condoms delivered straight to their door."

The story notes that Yandex has "upended the local taxi market and launched a variety of other digital services, including restaurant deliveries, as it surpassed 127 billion rubles in sales ($2 billion). The latest push comes as Russia’s once-slow embrace of e-commerce  accelerates. While many companies offer delivery of online grocery orders, consistently doing it this quickly breaks new ground."

Bloomberg writes that Lavka has not made a profit yet, but the company is hopeful that this will change as usage becomes more common and volume increases.

The story notes that "each warehouse is about 150 square meters (1,600 square feet), roughly the size of a small convenience store, and serves an area within a radius of about a mile, facilitating quick deliveries. By comparison, online supermarket Perekrestok.ru fills Moscow orders via truck from three distribution centers ranging from 4,000 to 18,000 square meters."

Published on: January 28, 2020

The Orlando Business Journal reports that "Publix Super Markets has confirmed it is under contract to buy five Lucky's Market leases in Florida; and German discount grocery chain Aldi has confirmed it is in negotiations for several of the locations in the state, as well."

The news comes as Lucky's filed for Chapter 11 bankruptcy yesterday and said it would close its Colorado headquarters.

The Denver Business Journal reports that Lucky's yesterday said it owes about $30  million to its 50 biggest creditors, has between 10,000 and 25,000 creditors in total, has assets worth between $100 million and $500 million and liabilities between $500 million and $1 billion.

The story notes that Kroger, "which announced late last year was selling its stake in the company, is listed as holding 55% of the equity interests in the Lucky Market Parent Company. Lucky's Founder Holdings LLC owns the remaining 45% stake in the parent company."

Published on: January 28, 2020

Fast Company has a story that starts by pointing out something that is common knowledge:  "It’s true that in the coming decades, the U.S. will indeed get browner—a shift that is already well underway. In 2018, non-Hispanic white Americans accounted for about 60.4% of the population, as per Census Bureau estimates. That’s a notable drop from 2000, when they comprised 69.1% of the American populace.

"In two decades, we’ll be on the cusp of a demographic milestone: the advent of a white minority. According to 2018 census projections, the non-Hispanic white population will fall to about 49.7% by the year 2045."

If indeed the American population will look markedly different, Fast Company writes, "a similar transformation will likely follow in the workplace. In recent years, the corporate world has had endless conversations about the importance of diversity, first positioning it as a moral imperative and then making the business case. Many companies and executives have repeatedly pledged their commitment to diversity and inclusion efforts, often with little to show for it. Soon they’ll have no choice but to act."

It will be critical, the article suggests, to act with the knowledge that a non-white population is not monolithic in any way.  Greater diversity also won't just be about color - there will be more women in the workplace than ever, and more older people.  And research suggests that a prosperous America will, maybe more than ever, be dependent on the immigrant population.

"All this means that in the coming decades, businesses that have given lip service to promoting diversity will likely have to widen their hiring pipelines, out of sheer necessity," Fast Company writes.

You can read the story here.

Published on: January 28, 2020

The New Yorker has a lovely piece about Fairway Market, the iconic New York City that has entered bankruptcy, the victim of some combination of greed and mismanagement and neglect that lasted just long enough to make it almost impossible for the current owners to rescue it, making a sale of some stores and a closure of others inevitable.

Fairway, the story says, was "one of those odd original New York institutions that grew up organically, on the sidewalk, unlike the Whole Foods and Trader Joe’s stores that have competed with it in recent years, which were dropped down on the street from a retail empire headquartered elsewhere. No less a magus of social history than Simon Schama once wrote of Fairway that it if it were possible to award the congressional Medal of Honor to a food market, Fairway would already have won one for its service to appetite, and that its cheese department alone turned 'Rabelaisian excess into a stationary New York festival of aroma, color and texture'."

The "democratic energy" at Fairway, the story says, "was so extraordinary that someone coming home to New York from a place like, say, Paris - where the division between the gastronomic and the generic, the élite and elementary is still strong - would be knocked sideways by the coexistence of those seemingly contradictory principles."

"Such private enterprises, from coffeehouses and grocery stores to high-end department stores, with their vast common spaces … create the social capital that supports our common life - the possibility of bumping into people with whom we share a common citizenship but don’t often share a common space or pursuit. The accumulated social capital of such spaces becomes our common life. The single man buying cheese and the family buying paper towels in bulk stand in line together."

In the end, Fairway's bankruptcy "seems likely to cost the employees far more than it will the investors - not to mention the customers."

It is a thoughtful piece, and you can read it here.

Published on: January 28, 2020

•  The Associated Press reports that Chipotle has been fined $1.3 million by the Massachusetts Attorney General because of more than 13,000 child labor violations at its restaurants in the state.

According to the story, "The fine detailed that Chipotle had employees under the age of 18 working past midnight and for more than 48 hours a week. Teenagers told investigators their hours of work were so long that it was preventing them from keeping up with their schoolwork. The company also regularly hired minors without work permits … The violations also include failure to keep accurate records and pay timely wages. Lastly, the company was ordered a voluntary $500,000 payout to a state youth worker fund dedicated to education, enforcement and training."

•  The Wall Street Journal reports this morning that the US Department of Justice is looking into a possible merger of bankrupt Dean Foods, the top-selling US milk processor, and Dairy Farmers of America, the largest U.S. dairy cooperative by membership.  The two were said to be in deal discussions after Dean Foods filed for bankruptcy protection late last year, but antitrust regulators reportedly are "discussing with farmers and retailers the potential impact of such a deal on milk prices and competition in the dairy business."

The story says that "some farm groups have raised concerns that a tie-up between Dean and DFA might lead to an excessive concentration of milk buyers in parts of the country. As U.S. milk consumption has fallen about 40% over the last four decades, fluid-milk production has shifted to a smaller number of bigger plants."

•  The Washington Post reports that while Kellogg's "made a commitment to phase out by 2025 wheat and oats on which farmers have used glyphosate as a drying agent," the company "neglected to tell the industry groups that support wheat and oat growers."

Those groups are not pleased.

Caitlin Eannello, the director of communications at the National Association of Wheat Growers, says that her organization maintains that "glyphosate is very safe, and there’s no real alternative. If it were to be totally eradicated, producers would probably stop growing. [Kellogg’s] made an announcement without talking to us."

The story points out that "glyphosate is the active ingredient in Roundup, the Bayer-Monsanto weedkiller that is the most heavily used herbicide in the United States … A 2018 study by the Environmental Working Group found glyphosate in all but two of 45 samples of products made with conventionally grown oats, most at higher levels than what EWG scientists consider protective of children’s health. They also found a third of the 16 samples made with organically grown oats had glyphosate, but at much lower levels."

Published on: January 28, 2020

•  Charles “Chuck” Fry, co-founder of Fry’s Food Stores, which is now owned by Kroger, passed away last week.  He was 92.

Published on: January 28, 2020

…will return.

Published on: January 28, 2020

Digital strategies aren't just about creating alternatives to the bricks-and-mortar shopping experience.  Done effectively, they can actually bring people back to the store, while also eliminating customer anonymity, creating rich and actionable data, and deepen relationships between the store and consumer in a way that transcends the simple transaction.

Our newest Retail Tomorrow podcast, which brings together a terrific panel of experts from a wide range of disciplines, was recorded at Google’s New York City offices during the recent National Retail Federation (NRF) Show.  Our guests:

•  Matt Alexander, co-founder of Neighborhood Goods, an unusual and fascinating take on physical retailing with stores in Dallas and New York.

•  Patrick Flanagan, senior vice president of digital marketing and strategy for Simon,  which has more than 200 properties in 37 states and Puerto Rico.

•  Tom Furphy, CEO and Managing Director of Consumer Equity Partners, a member of the Retail Tomorrow podcast family and a regular contributor to "The Innovation Conversation" on MNB.

•  And Jalna Silverstein, a leader in Ernst & Young’s Transaction Advisory Practice and its Real Estate, Consumer Experience and Retail Strategy.

You can listen to the podcast here.

This Retail Tomorrow podcast is sponsored by the Global Market Development Center (GMDC).

Pictured below are our panel members, from left:  The Content Guy, Matt Alexander, Tom Furphy, Patrick Flanagan, Jalna Silverstein.

Published on: January 29, 2020

Content Guy's Note: The goal of "The Innovation Conversation" is to explore some facet of the fast-changing, technology-driven retail landscape and how it affects businesses and consumers. It is, we think, fertile territory ... and one that Tom Furphy - a former Amazon executive, the originator of Amazon Fresh, and currently CEO and Managing Director of Consumer Equity Partners (CEP), a venture capital and venture development firm in Seattle, WA, that works with many top retailers and manufacturers - is uniquely positioned to address.

This week, Tom Furphy and I decided to do our Innovation Conversation via Skype;  Tom was at the FMI Midwinter Conference in Arizona … and I had a conflict that kept me from attending.  But we had what I think was an engaging conversation about the energy and determination that Tom detected among retailers in attendance, as they face off against new and often harsh competitive realities.

One note:  A slight glitch in the wifi service caused one small part of Tom's comments to be garbled.  The reference he made was to Karen Short of Barclay's Investment Bank, and a report she wrote that was highly critical of Instacart.  You can learn more about that report here.

Published on: January 29, 2020

Fast Company writes about Bond - not the fictional spy, but rather "a new urban shipping company that wants to make online shopping both more sustainable and less annoying for customers."

Some context:  "When someone in the neighborhood places an order in the morning with one of the brands working with the service, they can get a delivery the same afternoon—and schedule the time that the local bike courier will arrive with the package, chatting in real time with the courier, if needed. If someone misses a delivery, the package will go back to the storefront rather than a more distant distribution center. Returns can also be scheduled for pickup."

The system is enabled by a "growing network of 'nano distribution centers,' serviced by the electric vehicles."  This network "means that delivery inside the neighborhood can be much more efficient. At night, when roads are clear, trucks make larger deliveries to the distribution centers. During the day, when streets are crowded, the small cargo trikes can avoid the pollution of trucks or vans stuck in traffic, and can operate more nimbly, making deliveries faster. The company has calculated that one of the logistics companies that it works with has reduced its use of trucks by 22%."

Bond, the story says, "grew out of an online grocery service in Tel Aviv called Shookit. At first, the delivery company was struggling with the cost of its delivery … Shookit decided to experiment with storing its inventory directly inside neighborhoods instead of using more traditional warehouses and then use electric trikes, and saw that it worked: deliveries were more efficient, and customers were so much less frustrated with delivery times that customer retention increased 60%. The founders decided to spin off Bond to work with other brands that were struggling with the typical problems of online delivery, like missed packages.

"Bond can deploy its distribution centers in basements, unused space in office buildings or parking garages, or, somewhat ironically, storefronts that may now be empty because neighborhood stores were pushed out of business by online shopping."

Published on: January 29, 2020

BoiseDev reports that Albertsons has "brought its pre-packaged meal kits back to local stores," positioning them as "a reworked brand" that remains "largely the same. A bundle of ingredients along with a recipe to prepare a meal at home. The company did tweak one component: ingredients now come pre-chopped."

It is just the latest twist in Albertsons' meal kit journey.  It bought meal kit company Plated in 2017 for $200 million, started rolling its products out to stores in several markets, but then pulled them.

Published on: January 29, 2020

From Fortune:

"Who knew that the rise of Amazon would turn out so well for Walmart and Target?

"It was only a few years ago that both of those titanic big-box retailers were in peril, losing customers in droves to the e-commerce giant. But the past decade’s radical reshaping of how Americans shop, a change fueled by Amazon’s inexorable ascent, has paradoxically resulted in Walmart and Target - along with a few other big U.S. retailers - evolving to become stronger and more successful companies than ever. The massive shock of e-commerce’s encroachment, analysts agree, gave them the jolt they needed to reinvent themselves."

The story characterizes this as "a stunning return to form for both Walmart and Target," which, perhaps implausibly, are "getting more shoppers to come to their stores."

You can read the entire story here.

Published on: January 29, 2020

H-E-B has a Super Bowl commercial this year, featuring "Desperate Housewives" star Eva Longoria, designed to publicize its My H-E-B mobile application.

The gimmick:  a sweepstakes that will allow one person to win a lifetime of free groceries from H-E-B.  To enter, all people have to do is download the app.

The ad will run in more than a dozen Texas markets during the second half of this Sunday's Super Bowl between the San Francisco 49ers and the Kansas City Chiefs.

A teaser commercial can be seen above.

Cory Basso, H-E-B's group vice president of marketing and advertising, said in a statement that "at H-E-B, we’re always looking for ways to go big and show our appreciation for our amazing customers."

Published on: January 29, 2020

The BBC reports that Starbucks has closed some 2,000 of its China stores, or roughly half its fleet there, "to protect its staff and support government efforts to contain the coronavirus."

The coronavirus, which has symptoms that include fever, cough, shortness of breath and sometimes pneumonia, has caused China to close down more than a dozen cities as a way of containing spread of the disease, which reportedly has lead to the deaths of more than 130 people.  There have been some 6,000 reported infections.

China represents about 10 percent of Starbucks' annual revenue.

Published on: January 29, 2020

Bloomberg reports that in "a rare setback" for Beyond  Meat and the faux meat business in general, Canadian doughnut chain Tim Horton's has "stopped selling Beyond Meat products at its coffee and donut shops across two of Canada’s biggest provinces," Ontario and British Columbia.

In an official statement, the company said that "we introduced Beyond Meat as a limited time offer. We are always listening to our guests and testing new products that align to our core menu offerings. We may offer Beyond Meat again in the future."

The Bloomberg story notes that "the chain had been serving the Beyond Burger and a Beyond Meat breakfast sandwich made with the company’s imitation sausage products. After an initial launch starting in June at nearly 4,000 Canadian locations, the items were scaled back to the provinces of Ontario and British Columbia in September."

Published on: January 29, 2020

The Washington Post this morning reports that Gojo Industries, which sells Purell hand sanitizing products, has been ordered by the US Food and Drug Administration (FDA) to stop making "unproven claims that the hand sanitizer can prevent diseases like Ebola, norovirus and MRSA."

The warning extends to all ways in which Purell is marketed, including "social media materials, blog posts and frequently asked questions on the product and corporate website."

Purell, the story notes, has been claiming that its use can reduce student absenteeism by 51 percent, and, in "germ-infested athletic environments … could help to reduce MRSA and VRE by 100 percent."

FDA's response:  Not so much.

Gojo put out a statement pointing out that the FDA's criticisms were aimed at its marketing efforts, not the safety or quality of its products.

The contretemps come, the story notes, "as the United States is bracing for one of its worst flu seasons in decades and worldwide concerns grow amid a coronavirus outbreak that has killed at least 100 people in China, where the outbreak originated."

Published on: January 29, 2020

•  Forbes has a piece that elaborates on rumors that Amazon plans to launch "a luxury platform," with a dozen "luxury brands" involved, as well as a dedicated warehouse and a $100 million ad campaign … The new elevated fashion platform will reportedly give brands more control of their listings and presentation on Amazon."

One of the likely results of this program will be that "third-party sellers offering one of those yet unidentified dozen brands can basically close up shop since Amazon’s algorithms will give special preference to those featured brands."  Which is one way of dealing with the counterfeit problems that Amazon continues to have.

This all happens as Amazon has "continued to expand its third-party marketplace, which in 2018 accounted for about half of its retail sales and currently 87% of its fashion listings. It launched Amazon Fashion, which includes styling-service Prime Wardrobe and Personal Shopper by Prime Wardrobe, as an answer to Stitch Fix. Amazon also introduced The Drop for curated limited-edition streetwear styles and developed over 100 of its own private-label fashion brands.

"With its fingers in many fashion pies, Amazon quietly became the nation’s leading apparel retailer, topping $30 billion in sales, according to estimates by Wells Fargo and seconded by Morgan Stanley."

Published on: January 29, 2020

•  From Fox Business:

"Walmart has asked the 9th U.S. Circuit Court of Appeals to reconsider its Jan. 6 decision to uphold a ruling to give California truck drivers $55 million in back pay … A California federal jury in November 2016 ruled the retail giant must pay $55 million for failing to pay about 850 California truck drivers their full compensation including $5.8 million for pre- and post-trip inspections, $3.9 million for mandatory breaks and $44.7 million for layovers, violating state law … Walmart argued in a Jan. 21 filing with the appeals court that the court made inaccurate rulings on several key issues, specifically regarding the issue of whether Walmart is responsible for its drivers during breaks and layovers."

Published on: January 29, 2020

•  The Globe Gazette reports that Hy-Vee "will acquire six former Shopko locations in Iowa, which will re-open under its Dollar Fresh brand by late summer.  In the upcoming weeks, the former Shopko locations are set to undergo renovations," including those in Hampton, Cresco, Oelwein, Waukon, Dyersville and Vinton.

Hy-Vee says that the Dollar Fresh banner is "designed to offer customers in smaller communities a fresh, new product selection at low prices. Customers will find a full selection of grocery items, a bakery section with a full range of fresh-baked items, a dollar sections, a Wall of Value, ready-to-eat meal offerings and other services."

Published on: January 29, 2020

We had an Eye-Opener the other day about what happens when consumers' desire for convenience (like same-day delivery) runs headlong into their interest in sustainability initiatives (which would not include same-day delivery).

MNB reader Charles Davis wrote:

Regarding your Friday "Eye Opener" and your quote, "Shoppers are calling the shots. And unless we start putting our money where our mouth is, we’ll all be dealing with more boxes, more delivery trucks, and the long-term environmental effects of our decisions today.

"Ultimately, the Eye Opener from the story is this: "Consumers - indeed, citizens - are pretty much able to rationalize anything.

"Which is true. And ultimately a little depressing."

I completely agree and it makes me sad as well. It made me think of the famous Pogo quote, "We have met the enemy and he is us". Unfortunately, fundamentally humans are the problem. Fortunately, we are also the solution. Which gives me some hope to go with my sadness.

From MNB reader Molly Renaud:

Great eye-opener today.   To add to our depression did you hear about the Doomsday Clock being set 100 seconds until midnight?

But as a consumer, I am here to say I am trying to put my money where my mouth is when it comes to sustainability.  I’m focused on source reduction.  I’ve stopped wish-cycling and I am trying to buy less.  Things I’m focusing on this year – reducing my addiction to fast fashion (good bye stitch fix but yes, I am still rationalizing one more in six months). I’m trying to get my husband to stop using paper towels or at least buying recycled ones.  He uses Prime but I do not.  I’m starting to make my own cleaning and beauty care products.  I have time to think about this—let’s be clear.  A lot of people don’t.  But once you start looking at your own habits you start asking how the entire system works.  Maybe just maybe manufacturers/producers should be making things or putting things in things that can actually be recycled? Or maybe packaging should be made from recycled content so we create markets for this stuff and aren’t using virgin resources?  What makes something recyclable isn’t because it has a symbol on it—there needs to be an infrastructure to handle it and a market for it.  Maybe if we get better at recycling it will off-set our addiction to free shipping.  As I am sure source reduction is not for everyone.

Keep your eye on Maine and California as it relates to Extended Producer Responsibility for Printed Paper and Packaging (PPP).

California failed to pass EPR for PPP last year, but the Senate in CA just pushed through some EPR elements for their struggling bottle bill this past week and will most likely take on PPP again.

Maine may be the first state to pass an EPR law for PPP based on what the legislature advanced this week.

The trade association of producers forming a sustainability coalition last week that you wrote about—hopefully, as you stated, they are looking at ways they can improve recycling in America/lessen the impact of their packaging but they are probably looking to fight or get out ahead of EPR for Printed Paper and Packaging (PPP).

I am gradually changing my consumption habits but given climate change I should be moving faster.  We all should.   Brands may want to ease gradually into product stewardship, but they could be forced suddenly if states start passing EPR laws. 

Time will tell… if the clock stays ticking, that is!

From another reader:

I think it is really interesting to think about how the younger generation will begin to think about the convenience of fast shipping. I listen to a podcast with my children from NPR called "Wow in the World" that puts an entertaining lens on today's scientific discoveries and realities. Your article brought to mind an episode we listed do a while ago where Mindy, the main character, orders a whole much of stuff she doesn't need because it was a good deal and Guy Raz helps her understand the environmental impact of her purchases. Not only were my children entertained, but it gave me pause. I started to ask myself some critical questions, namely, "Do I need this?" and "What is an alternative solution to this need that is more sustainable?" I have since scaled back on my Amazon purchases and only place orders now once I have a number of different items in my cart that can hopefully ship together. It is worth a listen if you have the time.

MNB reader Rich Heiland wrote:

I cannot recall anything I ever ordered from Amazon or anyone else where next day delivery was life or death. I can live without it without batting an eye. I also can live without a lot of the “packaging inside of packaging inside of packaging” that seems to accompany a lot of orders.

The reality of sacrificing for sustainability is that if each one of saw a five percent drop in “lifestyle” to contribute we all still would have lifestyles the envy of a lot of the planet.

Published on: January 29, 2020

Digital strategies aren't just about creating alternatives to the bricks-and-mortar shopping experience.  Done effectively, they can actually bring people back to the store, while also eliminating customer anonymity, creating rich and actionable data, and deepen relationships between the store and consumer in a way that transcends the simple transaction.

Our newest Retail Tomorrow podcast, which brings together a terrific panel of experts from a wide range of disciplines, was recorded at Google’s New York City offices during the recent National Retail Federation (NRF) Show.  Our guests:

•  Matt Alexander, co-founder of Neighborhood Goods, an unusual and fascinating take on physical retailing with stores in Dallas and New York.

•  Patrick Flanagan, senior vice president of digital marketing and strategy for Simon,  which has more than 200 properties in 37 states and Puerto Rico.

•  Tom Furphy, CEO and Managing Director of Consumer Equity Partners, a member of the Retail Tomorrow podcast family and a regular contributor to "The Innovation Conversation" on MNB.

•  And Jalna Silverstein, a leader in Ernst & Young’s Transaction Advisory Practice and its Real Estate, Consumer Experience and Retail Strategy.

You can listen to the podcast here.

This Retail Tomorrow podcast is sponsored by the Global Market Development Center (GMDC).

Pictured below are our panel members, from left:  The Content Guy, Matt Alexander, Tom Furphy, Patrick Flanagan, Jalna Silverstein.

Published on: January 30, 2020

This commentary is available as both text and video; enjoy both or either ... they are similar, but not exactly the same.  To see past FaceTime commentaries, click here.

Hi, I'm Kevin Coupe and this is FaceTime with the Content Guy.

I was fascinated by a story in USA Today the other day that talked about how some CEOs - despite the fact that there seems to be less concern about a 2020 recession than there was just a few months ago - are already getting ready.

Some examples…

•  "Choice Hotels plans to announce Monday that it’s launching a new mid-priced extended-stay hotel chain called Everhome Suites that it says can perform well even if the economy slows or heads south – a big drawing card for franchisees."  The average room rate will be $85 a night, and the entry is seen as having real potential in a business where close to "20% of hotel stays are at least seven nights but just 9% of all rooms are in extended-stay properties."

•  "OC Facial Care Center of Orange County, California, recently began offering a 30-minute version of its most popular 60-minute facial. The streamlined service cuts the price to $99 from $130 for members and to $150 from $350 for nonmembers."

•  "Experi, a tour operator in Bainbridge Island, Washington, typically raises prices 5% to 10% a year … But the firm, which is now selling tours for 2021, is holding prices steady or reducing them in some cases."  The reason?  The company got killed in the last recession, and management - understanding that this particular boom has lasted 10 years - doesn't want to get caught again with its metaphorical pants down.

There are other companies cited in the story, from realtors to wifi providers, all of whom are working to be prepared.

I think this is smart, and not just because we talk a lot here on MNB about getting ready for the inevitable downturn that is coming.

I'm not trying to be Chicken Little here.  Just realistic about how recessions are cyclical, and the current up cycle has been going on for some time.  Add to that the enormous amount of student debt that has been racked up by younger consumers, and how this is affecting their ability to spend, and you have the potential of a real economic perfect storm just over the horizon.

One of the things that the companies mentioned in the piece seem to have in common is an understanding that even if the economy starts to wilt, their customers are going to continue to have aspirations.  They're still going to want to travel or get facials or whatever.  Consumers may have less money in a down economy, but they'll still have expectations, and the retailers that will be rewarded may well be the ones that have an aspirational approach to marketing their products and services.

I think this could be especially powerful for food retailers, who, if they're smart, will figure out ways to curate great food and great wine in a way that caters to reduced disposable income while still catering to great expectations and aspirations.

That's what is on my mind this morning.  As always, I want to hear what is on your mind.

Published on: January 30, 2020

by Kevin Coupe

The New York Times reports that Atari - the video game pioneer that came up with Pong and Asteroids - is getting into the hotel business.

The story says that Atari soon will "begin construction on its first-ever video-game themed hotel," promising "a lodging experience that combines a one-of-a-kind video-game themed destination with immersive virtual and augmented reality experiences."

There will, apparently, be more than one of them.  The first will be in Phoenix, with additional properties planned for Las Vegas, Denver, Chicago, Austin, Seattle San Francisco, and San Jose.

The company says that the plan is "to create an 'ecosystem' in which players could 'eat, sleep and play,' though the size of the hotels would vary depending on the market and region."  Some rooms with be futuristic and some will be retro;  "some locations will have state-of-the-art venues and studios to accommodate e-sports events."

Three comments:

First, I have to be honest - a video game-themed hotel sounds pretty much like hell to me.

Second, I'm surprised that Atari is still around, much less expanding into new areas.  (If you'd asked me, I would have bet that Atari went out of business years ago.  Who knew?)

Third … I'm guessing that this may end up being very successful.  (In part because I find it so foreign to my existence.)  The video game and e-sports world is large and, best I can tell, getting larger … and so it makes sense for Atari to find new ways to cater to its customers, new ways to build enthusiasm for its ecosystem.

It is an interesting approach … identify your sweet spot - that place where your brand equity has the greatest currency with customers - and figure out ways it can be expanded into new and potentially lucrative categories.

It'll end up being an Eye-Opener.  But as Dorothy Parker once said, "What fresh hell can this be?"

Published on: January 30, 2020

Bloomberg has a story about FedEx founder/CEO Fred Smith, who reinvented the parcel delivery business but now is "getting disrupted himself by e-commerce and the rise of online shopping. He’s taking a pounding from Wall Street for FedEx’s disappointing performance, while analysts praise archrival United Parcel Service Inc. for reversing a decline in profit margins."

And now, he is deliberately steering his company away from the e-commerce  lanes that Amazon has dominated, "drawing the battle lines, positioning FedEx as a kind of anti-Amazon ally for big-box retailers and pledging that his strategy will soon enable FedEx to overtake UPS."

It hasn't been a great couple of years:  "FedEx’s international business has been plagued by setbacks, including a 2017 cyber attack and a costly air-fleet expansion that was undercut by Donald Trump’s trade wars. Back home, a falling out with Amazon.com Inc. drained $900 million off the courier’s top line."

It is hard to say which company Smith sees as FedEx's primary enemy:  "The two biggest parcel delivery companies in North America are forging dramatically different paths as they adjust their business models to the tsunami of e-commerce. Their success will help decide the market war between Amazon and Walmart Inc., and perhaps the future course of the entire retail industry.

"While UPS is deepening its ties to Amazon, FedEx has broken away, instead working to strengthen its relationship with brick-and-mortar retailers to help them win at e-commerce. While UPS wants to stay neutral with customers, Smith is banking on an us-against-Amazon mentality."

Part of what FedEx is doing is taking more control over its business processes:  "UPS is relying more on the U.S. Postal Service, especially for Sunday deliveries, while FedEx is taking back about 2 million packages a day that it had been handing off to the government agency for final delivery. With the increased volume, FedEx can better leverage its more than 600 sorting and delivery facilities around the U.S. to help retailers with shipments from stores to residences."

You can read the entire Bloomberg story here.

Published on: January 30, 2020

Great piece from Bloomberg, filed from the Patagonia region of South America, where, on the Los Condores ranch - a place described as vast, treeless, with vistas of the snow-capped Andes' and "star-studded, bone-chilling nights" - there is an experiment taking place.

They've planted grape vines.  "One row is all chardonnay, the next riesling and the next pinot noir — 150 vines in all."

There's no reason to think that they can grow wine in such an inhospitable place.  But the owners are making a bet, albeit a "bold" and "ominous" one - that the "wicked effects of global warming" will eventually mean that "a world-class vineyard can flourish here."

And in this case, "eventually" means perhaps as long as 50 years.

In a world where short-term plans and profits often seem to be all that matter, this is a piece really worth reading, if only for a sense of perspective.  You can read it here.

Published on: January 30, 2020

The Harvard Business Review has a story about how, after a time when independent bookshops seemed like an endangered species - first because of the emergence of big box competitors such as Barnes & Noble, and then because of the runaway success of Amazon - something "miraculous" has happened.

Starting in 2009, HBR writes, "after falling for decades, the number of independent bookstores started to rise, climbing 49 percent in the next decade to nearly 2,500 stores nationwide."

Ryan Raffaelli, a professor in the Organizational Behavior Unit at Harvard Business School, tells HBR that there are lessons in the resurgence for other retail sectors under threat.  It all comes down to three factors, he says:  Community, Curation, and Convening.

Some specifics:

•  "Community: As longtime community stalwarts, bookstores have been at the vanguard of the 'buy local' movement, pioneering events such as Small-Business Saturday, and making their customers feel virtuous about spending money in their own neighborhoods … The notion goes beyond a bond with customers to include other important community actors, such as schools, chambers of commerce, and civic organizations, reinforcing the social fabric and engendering a strong sense of customer and community loyalty."

•  "Curation: Despite the increasing sophistication of online algorithms, online platforms have been unable to replicate the knowledge and passion of indie bookstore employees, says Raffaelli … By contrast, he says, Amazon’s reputation as 'the everything store' can sometimes work against it, overwhelming consumers with too many options and an impersonal experience."

•  "Convening: Indie bookstores are increasingly serving as points for convening, expanding beyond author events to host book groups, children’s story hours, birthday parties, music events, knitting circles, culinary demonstrations, and other events … bookstore owners are increasingly seeing their competition not as Barnes & Noble, but as Netflix and other entertainment apps that tie people to their couches."

Published on: January 30, 2020

•  MoviePass, which tried to reinvent the economics of going to the movies - allowing moviegoers to see multiple movies in a month for s flat fee - is no longer.

The company filed for Chapter 7 bankruptcy protection, which will dissolve the entity and use the assets to pay off creditors.  Helios and Matheson Analytics, which owns the business, "listed its total assets at $396.5 million and total debts $276.8 million in its bankruptcy filing," according to Variety.

The story says that "ultimately, MoviePass’ cash-burning business model proved unsustainable … Originally MoviePass launched with a one-movie-per-day plan for $30-$40 per month then cut that to the too-good-to-be-true $9.95 monthly for a daily movie. Then in August 2018, MoviePass switched that to just three movies each month for $9.95, prompting a wave of cancellations. Last year, it rolled out a refashioned 'unlimited' option, for $14.95 per month, to again allow customers to see one movie daily but warning that movie choices would be restricted based on system-wide capacity'."

Published on: January 30, 2020

•  The Coloradan reports that "Lucky's Market founders Bo and Trish Sharon plan to buy back seven specialty grocer stores, including the Fort Collins and north Boulder locations that remain open following the corporation's Chapter 11 bankruptcy filing Monday … The company announced last week it would close many of its stores. On Monday, it voluntarily filed for Chapter 11 bankruptcy protection and agreed to sell six Florida stores to Aldi and five Florida stores to Publix Super Markets."  The Sharon, Aldi and Publix transactions support nearly 2,000 jobs. 

According to Scott Moses of PJ Solomon, which is acting as M&A investment banking advisor to Lucky’s on the transactions, the Sharon bid is a stalking horse in the Lucky’s Chapter 11 process.  There are active discussions taking place with other potential buyers.

•  The Washington Post reports that Nordstrom is getting into the business of selling used clothes.

According to the story, "Nordstrom will begin selling secondhand apparel online and in its New York flagship store this week, the latest attempt by the 119-year-old company to appeal to changing consumer tastes and capitalize on one of the few bright spots in retail. It joins Macy’s, J.C. Penney and Madewell, among others, in carving out a place for used clothing, shoes and handbags alongside new ones.

"Resale sites such as ThredUp, Poshmark and the RealReal have become destinations as eco-friendly alternatives to fast fashion. As resale becomes mainstream - the market is expected to triple in three years - department stores are a natural next step."

•  Add McDonald's, Ikea, Pizza Hut and Ikea to the list of retailers temporarily closing down stores in China because of the coronavirus outbreak.

USA Today reports that "McDonalds's has closed all of its restaurants in Hubei Province, home to the city of Wuhan, the epicenter of the outbreak. While that represents hundreds of locations, roughly 3,000 McDonald's restaurants throughout China remain open."

And CNN reports that Ikea is "shutting down" all of its 30 stores across China, saying hat it will "pay close attention to the epidemic situation."  Ikea's e-commerce operation will remain online.

The CNN story notes that "in China,  Ikea is a popular place for shoppers to nap and hang out for long periods of time on the many bed, sofa and furniture displays. Such shopping habits would be counterproductive to containing the coronavirus, as experts and officials advise people to avoid crowded areas."

From the New York Times this morning:

"The World Health Organization is meeting again on Thursday to decide whether to declare the coronavirus epidemic an international public health emergency, as China said that another 38 people had died from the virus.

"The global health agency met twice last week but was split about whether to declare an emergency, saying it did not have enough information to decide. Such rulings can rally a global response, but also put countries at the center of any outbreak under even greater scrutiny.

"China said Thursday that the total number of deaths from the coronavirus had risen to 170, with cases now confirmed in every province and region in the country. More than 7,700 people have been sickened in mainland China, while 68 cases have been reported around the world."

Published on: January 30, 2020

Michael Wright, a University of Minnesota football star turned lawyer who became CEO of wholesaler Supervalu in 1981, has passed away.  He was 81, and died of complications from pneumonia.

The <i>Star Tribune</i> writes that Wright was CEO of Supervalu "until 2000 and oversaw an acquisition spree that built Supervalu to $20 billion in annual revenue. It was the nation’s largest food distributor at that time and the tenth-largest retail grocer, with Cub Foods as its flagship."

Published on: January 30, 2020

…will return.

Published on: January 30, 2020

Digital strategies aren't just about creating alternatives to the bricks-and-mortar shopping experience.  Done effectively, they can actually bring people back to the store, while also eliminating customer anonymity, creating rich and actionable data, and deepen relationships between the store and consumer in a way that transcends the simple transaction.

Our newest Retail Tomorrow podcast, which brings together a terrific panel of experts from a wide range of disciplines, was recorded at Google’s New York City offices during the recent National Retail Federation (NRF) Show.  Our guests:

•  Matt Alexander, co-founder of Neighborhood Goods, an unusual and fascinating take on physical retailing with stores in Dallas and New York.

•  Patrick Flanagan, senior vice president of digital marketing and strategy for Simon,  which has more than 200 properties in 37 states and Puerto Rico.

•  Tom Furphy, CEO and Managing Director of Consumer Equity Partners, a member of the Retail Tomorrow podcast family and a regular contributor to "The Innovation Conversation" on MNB.

•  And Jalna Silverstein, a leader in Ernst & Young’s Transaction Advisory Practice and its Real Estate, Consumer Experience and Retail Strategy.

You can listen to the podcast here.

This Retail Tomorrow podcast is sponsored by the Global Market Development Center (GMDC).

Pictured below are our panel members, from left:  The Content Guy, Matt Alexander, Tom Furphy, Patrick Flanagan, Jalna Silverstein.

Published on: January 31, 2020

by Kevin Coupe

There are a lot of issues that retailers have to deal with, but here's one that could challenge a commonality to a lot of business models - the ability of people to drive to their local store.  (And, if you think about, the growing need for retailers to deliver products to customers via cars and trucks.)

Let me explain…

Fast Company is a terrific source of interesting and provocative information, such as the story currently online about how "the automobile is such an important part of American culture, life, and commerce that it can be hard to really grasp all the negative externalities of our driving habits: Commuters in Los Angeles now spend 119 hours each year stuck in unmoving traffic … There are as many as 2 billion parking spaces in the U.S. (eight times more than there are cars), often on valuable urban land that could otherwise be used—along with excess road space—for housing or parks. Pollution from tailpipes is linked to hundreds of thousands of deaths globally each year. SUVs, alone, now emit more than 700 megatons of greenhouse gases annually, more than the total emissions of the U.K. and the Netherlands. More than 1.25 million people are killed in road crashes each year."

Yikes.

But, the story points out, even the most vexing and entrenched problems have solutions … if communities are willing to invest in them.  (Investments, one should point out, that have to be cultural as well as economic.)

Which is why "some cities and neighborhoods are beginning to rethink where cars can go—and redesigning streets to prioritize other uses, from public transportation to parks. It’s happening around the world, including on major streets in cities like San Francisco and New York, but happening at the largest scale in several European cities. Here are a few of the most interesting examples."

In cities such as Paris, Amsterdam, Barcelona, Brussels and Helsinki, officials are testing various approaches to developing car-free spaces and times.  (You can get more specifics here.)

But the point is that if cars are choking a wide variety of communities,  those same communities are beginning to respond.  And not just cities.  There are also are suburbs where we are beginning to see urban-style, multi-use campuses emerging, where people will be encouraged to walk or ride their bikes, as opposed to drive their cars.

Is the car going away?  Of course not.  Certainly not anytime soon.

But it seems likely that the trend is going to grow, and every retailer - from the single-store operator to behemoths like Amazon, Walmart and Kroger - probably needs to start thinking and planning for such a world.

Just considering the possibilities could be an Eye-Opener.

Published on: January 31, 2020

As it released its Q4 results, perhaps the most impressive number touted by Amazon yesterday was this one:  it now has 150 million Prime members worldwide.

CEO/founder Jeff Bezos said yesterday that more people joined Prime during the fourth quarter last year than in any other quarter - apparently driven by faster delivery guarantees, including same-day in many markets.

Variety writes that "in addition to free shipping on products, Amazon Prime members get access to thousands of titles on Prime Video, including the company’s originals. According to Bezos, Prime members watched twice the number hours of original movies and TV shows on Prime Video in Q4 compared to the year prior, though the company would not provide more info on viewing."

Q4 sales reached $87.4 billion, up 21 percent from the same period a year ago.

Net income increased to $3.3 billion in the fourth quarter, compared with net income of $3.0 billion in fourth quarter 2018.

For the full year, net sales increased 20% to $280.5 billion, compared with $232.9 billion in 2018.  Net income increased to $11.6 billion, compared with net income of $10.1 billion in 2018.

MarketWatch writes that Amazon returned "to growth after a decline in the previous quarter broke a streak of more than two years without a profit drop. After slowing down its spending in 2018, following the acquisition of Whole Foods Market Inc. and other efforts, the company enjoyed record annual profit of more than $10 billion.

"In 2019, however, the company resumed spending to halve delivery times to Prime members and bolster its workforce, which harmed earnings in the third quarter."

Amazon Prime is available in addition to the US, in Canada, the U.K., Ireland, Germany, Austria, India, Japan, Italy, Spain, France, Mexico, Singapore, Australia, the Netherlands, Luxembourg, the United Arab Emirates, Brazil and Australia.

Published on: January 31, 2020

The Los Angeles Times has a story about ghost kitchens now serving Southern California, describing them as "shared commercial kitchen spaces for rent (that) primarily serve online customers and are a new category of commercial real estate that looked sexy to investors when the concept piqued widespread interest two years ago as a promising growth opportunity."

The story notes that the concept has not taken off to the degree that some would've expected just a few years ago, but that seems to be more because of the economics of delivery as opposed to the efficacy of shared commercial kitchens.  There seems to be no hesitancy about the concept in the investment class - hundreds of millions of dollars have been raised by entrepreneurs who still believe in it.

The advantages of ghost kitchens seem clear - the kitchen facilities are cheaper to run than it would cost to retrofit a restaurant's kitchens to deal with take-out and delivery of food.  There is the advantage of sharing space with like-minded businesses, with the ability to lend and borrow items when necessary and/or appropriate. Landlords handle a lot of the infrastructure issues, and they are relatively easy and fast to move into. 

And, there is the ability to test new concepts with low risk.  For example, the Times writes that Canter's delicatessen, which has been operating in LA for some nine decades, is using its ghost kitchen to test a new online-only brand called Grilled Cheese Heaven, which also serves burgers, salads and quesadillas.

 “You’re already paying rent and labor,” Marc Canter tells the Times. “Why not?”

Published on: January 31, 2020

From the New York Times:

"In letters to state regulatory boards and in interviews with The New York Times, many pharmacists at companies like CVS, Rite Aid and Walgreens described understaffed and chaotic workplaces where they said it had become difficult to perform their jobs safely, putting the public at risk of medication errors.

"They struggle to fill prescriptions, give flu shots, tend the drive-through, answer phones, work the register, counsel patients and call doctors and insurance companies, they said — all the while racing to meet corporate performance metrics that they characterized as unreasonable and unsafe in an industry squeezed to do more with less … State boards and associations in at least two dozen states have heard from distraught pharmacists, interviews and records show, while some doctors complain that pharmacies bombard them with requests for refills that patients have not asked for and should not receive. Such refills are closely tracked by pharmacy chains and can factor into employee bonuses."

One Texas pharmacist wrote the following chilling words to the state's regulatory officials:  “I am a danger to the public working for CVS."

The Times writes that the chains say that "patient safety was of utmost concern, with staffing carefully set to ensure accurate dispensing. Investment in technology such as e-prescribing has increased safety and efficiency, the companies said. They denied that pharmacists were under extreme pressure or faced reprisals."

And the National Association of Chain Drug Stores (NACDS) trade association says that “pharmacies consider even one prescription error to be one too many” and “seek continuous improvement," adding that it is inaccurate to “assume cause-effect relationships” between errors and pharmacists’ workload.

You can read the story here.

See who and what you believe.

Published on: January 31, 2020

Walmart's first-ever Super Bowl commercial will air during the big game on Sunday - and the focus is on the company's e-commerce business, with a focus on its click-and-collect functionality.  

As Ad Age writes, it "is a licensing bonanza for entertainment companies with scenes or characters from a dozen movie or TV franchises, led by Disney's "Star Wars" and "Toy Story," plus extended appearances from NBCUniversal properties that include "Bill & Ted’s Excellent Adventure" and "Back to the Future." Scenes from or allusions to the films "Arrival," "Blade Runner," "Star Trek," "Guardians of the Galaxy," "The Lego Movie," "Mars Attacks," "Marvin the Martian" and "Men in Black" are also included. All are united by an interest in picking up curbside orders from Walmart."

You can watch it at left.

Published on: January 31, 2020

•  Fox Business reports that when the winning coach in Sunday's Super Bowl gets a Gatorade bath in the closing moments of the game, the Pepsi-owned brand is the real winner.

The story says that "since 1987, Gatorade baths that aired on television during the Super Bowl have generated more than $20 million in equivalent advertising value across television, radio and other mediums, according to calculations by Apex Marketing, an analytics firm. The Pepsi-owned company paid nothing to gain the additional exposure."

The story notes that the first championship Gatorade dunk occurred in January 1987, when the New York Giants' Harry Carson doused head coach Bill Parcells after the Giants beat over the Denver Broncos in Super Bowl XXI by a score of 39-20.  Gatorade execs, the story says, were almost as surprised as Parcells.

•  From the Los Angeles Times:

"Plant-based burgers sizzled last year, boosting sales at fast-food chains such as Burger King and Carl’s Jr. Now, KFC wants to see if it can replicate that effect with fried faux chicken.

"The nation’s largest fried chicken chain announced Wednesday that it had struck a deal with Beyond Meat to sell plant-based nuggets in more than 60 restaurants in the Charlotte, N.C., and Nashville markets. If the three-week test is successful, the plan is to offer the menu item at KFC’s roughly 4,000 U.S. outlets."

Published on: January 31, 2020

•  SpartanNash announced that it has hired David Sisk, the president/COO of OSC-WEBco, a sales company serving military and government channels, to be a corporate vice president and president of its $2.1 business serving USA military commissaries.

Published on: January 31, 2020

Fred Silverman died yesterday at age 82.

If you don't know Silverman, the fact is that if you are of a certain age, you are familiar with his work - he is the only person who ran programming for all three major broadcast networks at a time when there were only three broadcast networks.

Among the shows that got on the air during his various tenures at CBS, ABC and NBC, for better or worse:  “All in the Family,” “The Mary Tyler Moore Show,” “Happy Days,” “The Waltons, " “Roots," Matlock,” “In the Heat of the Night,” “Jake and the Fatman,” “Diagnosis Murder,"  “Maude,” “The Bob Newhart Show,” “Mannix,"  “Hawaii Five-0," “Rich Man, Poor Man,” “Roots,” “Charlie’s Angels” and “Starsky & Hutch.”

Published on: January 31, 2020

Got the following email from an MNB fave, Julie Lyle:

I enjoyed your commentary and agree that CPG companies are facing tough  challenges today, as they have been too far removed from consumers for decades.  To be fair, big brands have been beholden to their retailer intermediaries who "own" the customer relationship (especially in the consumable sectors).  These retailers are often not forthcoming with shopper insights - or they themselves have not mastered a holistic view of their buyer personas and shopper journeys.

As retailers accelerate growth of their own private label brands, which are often knockoffs of their CPG partner products, the CPG companies find themselves in a tough position.  They are sandwiched between competing with their own distributors as well as competing with digitally-enabled upstarts like Harry's and so many others.  It's time for CPG companies to find innovative ways to form meaningful relationships directly with consumers, and thereby capture the insights they need for product innovation, promotional efficacy, increased speed-to-market, and more.

Which could lead to something often discussed but not acted upon - a concerted effort to disintermediate traditional retail.

We had a piece the other day about the financial issues faced by many young people, which leaves them without the disposable income that helps to drive economic growth.  One MNB reader responded:

Great discussion piece. I see many of the Democratic candidates offering to wipe away student debt as part of their campaign giveaways. Others have responded with how is that fair to all those students and/or parents that have sacrificed and saved to pay off their loans as they committed when they took out the loans.   We hear about the multitudes of students remaining living at home years after their graduation because they can’t afford to pay rent. And a large % of renting today because they can’t seem to save enough for the down-payment.

Rather than target wiping out student debt why aren’t these candidates looking to solve the housing crisis. How about offering no down-payment loans for starter homes and reduced interest rate for the 1st five years. How about creating  affordable housing options like modular homes which have to be cheaper than some of the rents that are being charged in urban locations. My first condo was subsidized by our local bank offering 4% interest rates for the 1st 10 years when rates were as high as 14%. I found a way through my local bank to buy early on in my career when I had different barriers - exorbitant interest rates.

Interesting idea.

Responding to the comments here about the inevitability of a recession and the challenges retailers will face, MNB reader Matt Nitzberg wrote:

Whenever the next recession comes, retailers who have been paying close attention to customer (shopper) data will be much better prepared to manage the belt-tightening that will inevitably accompany it. In the ~10 years since we shook off the worst of the last recession, these retailers have developed 3 advantages:

•  They've developed a much deeper understanding of their price-sensitive shoppers as well as shoppers who have become more sensitive over time.

•  They are 10 years further along in understanding which shoppers respond to which activations (by channel, content, incentive, etc.).

•  They've used the data to help create a more stratified approach to private label brands, which are likely to capture market share from national brands as shoppers trade down on price points while retaining their aspirations for high quality products.

On a different subject, I got the following note from an MNB reader:

I applaud Kellogg’s for there move to ban the use of glyphosate in the production of grain for use in their products. However in my opinion they should do it immediately and not wait until 2026. This product is dangerous and is purported to be cancer causing.

The list of countries banning the use of this product is long and growing longer each year. Most of the Glyphosate restrictions or bans throughout the world were introduced following the 2015 IARC report on Glyphosate. The IARC report concluded that Glyphosate is a “probable human carcinogen.” With this knowledge why are American companies allowing farmers to spray their crops with this product? As far as the comment from the National Association of Wheat Growers that this product is safe and that if totally eradicated “producers would stop producing” is ridiculous. 

Wake up folks !!!! This is serious. Get this product out of our food chain now. Why is most of Europe and many other countries taking action and the US is doing nothing. Its time to stop the use of Glyphosates in this country in the production of our foodstuffs.

Regarding what retailers can learn from the independent bookstore resurgence, one MNB reader wrote:

Often times the Independent Book store is really the “beating heart” of the community.  I offer you Bookshop Santa Cruz which is a family owned Book store that has been serving the community for nearly 50 years.

In 1989 when the Loma Prieta Earthquake hit Santa Cruz the original building was destroyed along with much of Pacific Ave which is the “Main St.”  Bookshop Santa Cruz had one opportunity to retrieve the books that were hidden in the rubble of the building.  They reached out to the community and dozens of volunteers brought their trucks, red wagons and the like to save the books for the tent that they operated out of until the facility was rebuilt.  The support from the Santa Cruz community has never wavered.  I suspect that many other communities have similar stories!

And, responding to our story about the new Atari-themed hotel chain, MNB reader Scott Nelson wrote:

What’s next, a Pokemon themed hotel?  That would be a worse hell.  Pikachu, Pikachu, Pikachu …

In the words of my ancestors…Oy.

Published on: January 31, 2020

Digital strategies aren't just about creating alternatives to the bricks-and-mortar shopping experience.  Done effectively, they can actually bring people back to the store, while also eliminating customer anonymity, creating rich and actionable data, and deepen relationships between the store and consumer in a way that transcends the simple transaction.

Our newest Retail Tomorrow podcast, which brings together a terrific panel of experts from a wide range of disciplines, was recorded at Google’s New York City offices during the recent National Retail Federation (NRF) Show.  Our guests:

•  Matt Alexander, co-founder of Neighborhood Goods, an unusual and fascinating take on physical retailing with stores in Dallas and New York.

•  Patrick Flanagan, senior vice president of digital marketing and strategy for Simon,  which has more than 200 properties in 37 states and Puerto Rico.

•  Tom Furphy, CEO and Managing Director of Consumer Equity Partners, a member of the Retail Tomorrow podcast family and a regular contributor to "The Innovation Conversation" on MNB.

•  And Jalna Silverstein, a leader in Ernst & Young’s Transaction Advisory Practice and its Real Estate, Consumer Experience and Retail Strategy.

You can listen to the podcast here.

This Retail Tomorrow podcast is sponsored by the Global Market Development Center (GMDC).

Pictured below are our panel members, from left:  The Content Guy, Matt Alexander, Tom Furphy, Patrick Flanagan, Jalna Silverstein.

Published on: January 31, 2020

If you've never watched "The Good Place," the NBC-TV series that ended its four-year run last night, I'm going to urge you to catch up with it - I'm sure you can binge watch it on some streaming service.  Created by Michael Schur, "The Good Place" in many ways was the perfect TV series;  each of its seasons was only 13 episodes long, and the producers decided to end it way before it ever could wear out its welcome, much less its enormous originality.

The premise was simple.  Four people - played by Kristin Bell, William Jackson Harper, Jameela Jamil and Manny Jacinto - find themselves in the afterlife, in "the good place," except that they all think they are there by accident, and that they should be in, well, the other place.  Their guides are played by Ted Danson and D'Arcy Carden, and the series starts out with the four not-very-good dead humans desperately doing everything possible not to be found out.

From there, "The Good Place" went in unexpected directions, as the series ended up being a smartly written, very funny existential meditation on the difference between good and bad, about life and death and and the challenge of behaving ethically.  Sounds dry, I know, but it was anything but.  It had style and grace and a piercing intelligence, with elements of "Lost" and 'The Prisoner," but never losing sight of the fact that it was a comedy.  And the performances - they were never less than pitch perfect.

Last night's finale - which built on everything we've seen in the 51 previous episodes - was as perfect an end note as I can imagine.  In its own way, it was a good as the storied finales of shows like "Cheers," "M*A*S*H," and "The Mary Tyler Moore Show" … I found myself simultaneously laughing and tearing up as I saw where things were going.  (That's all you're going to get from me.  No spoilers here.)

"The Good Place" is going to stick with me for sometime, I think.  If you haven't watched it, I encourage you to do so - it will remind you that there is good in the world, and good in the afterlife.

Joker.  I finally caught up with this much-lauded movie the other night, and I'm going to be honest with you - I cannot remember the last time that I found a major studio film, one that has gotten a lot of awards and nominations, to be so utterly, completely loathsome.

I get what they were trying to do in creating a fresh origin story around a character known from the Batman mythology as the Caped Crusader's greatest enemy.  And I cannot deny that most of the performances - especially Joaquin Phoenix in the title role - are excellent, as are the production values showing a Gotham City that looks a lot like New York City in the seventies.  (Robert De Niro, essentially playing Johnny Carson, actually does something unusual for him - he is awful.  And awfully miscast.)

But in showing us the mental and emotional decline of someone who goes from being simply troubled to being a cold-blooded murderer, I found myself wondering what the point was.  Is it society's fault?  Is it that the filmmakers wanted to deconstruct parts of the Batman legend?  Is it supposed to be a treatise on mental illness, and society's indifference to it?

I have no idea.  I mostly found it to be troubling, gratuitous, and an ethical mishmash.  And by making the character the Joker instead of a criminal by some other name, it is like they are trying to give it a sheen of comic book accessibility, which I found kind of offensive.  The thing about Joker is, he needs Batman … their battle is what creates dramatic balance.  (You also could argue that Batman needs Joker.)  But a movie with just Joker?  Unbalanced, in every meaning of that word.

I do not understand why so many people like this movie.  I hAted virtually every moment of it.  Joker will remind you of all that is bad in the world.   All I know is that it was two hours I'm never going to get back, and I felt like I needed a shower when it was done.

I have a wine to recommend to you this week - 2012 Signature Cuvée Pinot Noir from Oregon's Willamette Valley Vineyards, which is a complex and richly structured wine - a blend of pinot grapes from a number of WVV's fields - that is versatile enough to be perfect with a great steak or a nice spicy salmon.  Wonderful. 

That's it for this week … have a great weekend, and I'll see you Monday.

Slàinte!

Published on: February 3, 2020

Earth Fare announced this morning that it is closing its 50 stores, and has begun running going-out-of-business sales at each of its locations.  The announcement comes barely after a year after the company, apparently in a  fit of wishful thinking, was saying it planned to double its store count.

The Wall Street Journal this morning reports that Earth Fare said that "its efforts in recent years to expand and to improve customer service haven’t been enough to overcome its problem."

“While many of these initiatives improved the business, continued challenges in the retail industry impeded the company’s progress as well as its ability to refinance its debt. As a result, Earth Fare is not in a financial position to continue to operate,” the company said in a statement.

The Journal says that even as it sells off inventory and fixtures, Earth Fare is continuing to try to find a buyer for its stores.

Context from the Journal story:

"At least two other grocery chains have also started major restructurings in recent weeks.

Fairway Market filed for bankruptcy last month with a $70 million offer to sell all five of its Manhattan stores and a distribution and food preparation center to the Village Super Market Inc., which operates stores under the ShopRite banner. Village Super Market could shrink its bid to just three stores in Manhattan.

"Lucky’s Market, which has been backed by Kroger Co., filed for bankruptcy last week and is trying to close or sell about three dozen stores. Interested bidders include Aldi Inc. and Publix Super Markets Inc."

Published on: February 3, 2020

by Kevin Coupe

Inspiration can strike anywhere at any time.  It also can be a matter of responding to circumstances.

In this case, the circumstances include the need for greater sustainability.  And the inspiration has to do with ice skating rinks.

The company involved is called Glice, based in Switzerland, and essentially what it did was come up with a concept for skating rinks that don't require cold.  According to the New York Times, The "ice" on the rinks are made up of "polymer panels that simulate the slip and feel of ice."  The rinks require "no cold weather, special blades, electricity or water (other than for cleaning). When skating season is over, the panels can be stacked and stored. In fact, Glice makes skating season a year-round affair."

Not only that, because the panels are basically plastic, they have more "give" than real ice, and so when you fall down, it doesn't hurt as much.

Glice rinks are "arguably more ecologically conscious and certainly more convenient than traditional ice rinks, which require large amounts of water and electricity, as well as noisy, cumbersome machines including refrigeration systems and compressors."  While "critics argue that Glice rinks are still bad for the environment because they are made of, well, plastic …  the company replies that this plastic is durable, with panels lasting 12 years, after which you can flip them over, and use them for another 12."

Not being an ice skater, I can't comment on the efficacy or desirability of the Glice technology.

I'm just intrigued by the idea that these entrepreneurs saw an opportunity where a lot of us never would;  I drive by an ice skating rink almost every day, but it never occurred to me to think about the sustainability implications, especially as the world gets warmer and puts greater demands on our society.

The Eye-Opening question it raises for me is, how many other opportunities are there that a little original thinking might identify, and in doing so, open up potentially game-changing business models?

Published on: February 3, 2020

New York Times columnist Ginia Bellafante had a piece over the weekend that examined the social and cultural impact of e-commerce, and she was not encouraged.

The title of the column:  "What We Lose by Hiring Someone to Pick Up Our Avocados for Us."

An excerpt:

"The incursion of technology into every aspect of consumption has meant that only the indolent or pathologically tolerant wait for things.

"Starbucks seems to prioritize mobile orders. So if you choose to order in person, you might find yourself walking straight to the cashier and then lingering for a bafflingly long time as one drink after another — none of them yours — lands in the mobile pickup area, waiting for whatever very busy person made an advance purchase he is late to claim.

"At the same time that physical retail culture remains ostensibly in crisis, it seems to create fewer reasons to engage with it."

Bellafante goes on:

"The act of turning grocery shopping into an occupation threatens something larger — we are losing a way to bridge differences in a world already collapsing from its stratification. The guy who walks into a Starbucks to pick up his pre-ordered flat white as he conference calls into his AirPods doesn’t have to exchange a single word with the worker behind the counter or really even acknowledge her. He grabs his drink and gets on with it."

She doesn't argue that e-commerce is all bad; she acknowledges that it can be useful for those who are "housebound, to single parents, to others paralyzingly constrained by time."  But she also suggests that e-commerce is turning us into a nation in which basic socialization takes place less often, which is not for the better.

You can read the entire column here.

Published on: February 3, 2020

The Wall Street Journal has a story about how one trend - the growth of so-called ghost kitchens that handle delivery functions for existing restaurants - is matching up with another - the growth of vacant space in America's malls.

Developers, the Journal writes, are saying that ghost kitchens "can create new interest in retail and warehouse space vacated by merchants that have struggled to compete with e-commerce."

The story notes that "delivery now accounts for roughly 9% of the $282 billion U.S. fast-food sector and is growing faster than dine-in and drive-through sales, according to a recent Bernstein analysis … Restaurants are expanding their delivery offerings to generate sales despite the impact those orders often have on their operational efficiency and profits. The remote kitchens can reduce their real-estate costs while expanding their reach."

Published on: February 3, 2020

From the Washington Post:

"The prospect of hotter summers, warmer winters, drought and violent weather events have caused experts to warn of coming wine shortages and price increases, changing varietal character and, in some dire predictions, the extinction of some wines altogether.

"Maybe there’s a fix, says a research paper in the journal Proceedings of the National Academy of Sciences.

"The scientists’ computer models show that if we do nothing, global warming of 2 degrees Celsius would wipe out 56 percent of current wine-growing land; increase that to 4 degrees and an estimated 85 percent of grapes won’t be viable.

"This team of researchers investigated whether using more heat-tolerant grapes would allow vineyards to adapt. They found that by reshuffling where certain grape varieties are grown, potential losses at 2 degrees of warming could be halved, and cut by a third if warming reached 4 degrees."

The study says that if global warming proceeds as scientists expect, the wine industries likely to be most impacted will be "in Spain, Italy and parts of California that are already quite warm. But there are winners in warming scenarios: In Germany, northern Europe and the Pacific Northwest of the United States, where in some years they struggle to get enough sun hours to facilitate budding, fruit set and ripening, a warming trend might produce dramatically better wines."

Published on: February 3, 2020

From the Boston Globe:

"The floor-to-ceiling aisles of Post-its, pushpins, pencils, and printer ink? History. The endless rows of three-ring binders and hanging file folders? Gone.

"Instead, there are light-filled co-working spaces with snack-stocked kitchens, digitally tricked-out meeting rooms, and podcasting studios. There are workshops on mindful organizing and 'Finding Your Customer.'

"Meet the new Staples: It’s not just an office supply superstore anymore, it is, the company puts it, a 'destination dedicated to continued curiosity, growth, and development'."

The fact is that Staples is dealing with the fact that e-commerce in general and Amazon in particular have had a big impact on its business model;  if you can order file folders and paper (if you actually need file folders and paper) online rather than going to the store, or can put printer ink on a Subscribe-and-Save automatic replenishment list, why do you need to travel to Staples?  On the other hand, if the retailer can appeal to "freelancers, small entrepreneurs, and others who work outside big corporations, including many young people who increasingly look to work - as opposed to religion or organized social groups - for community and affirmation," then maybe it has an outside shot at survival.

“It’s not about product anymore. That’s something you can buy anywhere online,” says Michael Motz, chief executive of the Staples US Retail group.  “It’s about, how can we provide solutions for you? It’s the connection to your everyday life.”

Published on: February 3, 2020

The New York Times reports that "the Wuhan coronavirus spreading from China is now likely to become a pandemic that circles the globe, according to many of the world’s leading infectious disease experts.

"The prospect is daunting. A pandemic — an ongoing epidemic on two or more continents — may well have global consequences, despite the extraordinary travel restrictions and quarantines now imposed by China and other countries, including the United States.

"Scientists do not yet know how lethal the new coronavirus is, however, so there is uncertainty about how much damage a pandemic might cause. But there is growing consensus that the pathogen is readily transmitted between humans.

"The Wuhan coronavirus is spreading more like influenza, which is highly transmissible, than like its slow-moving viral cousins, SARS and MERS, scientists have found … The mortality rate for known cases of the Wuhan coronavirus has been running about 2 percent, although that is likely to drop as more tests are done and more mild cases are found."

The story makes the point that, not surprisingly, countries with more advanced health care systems are likely to be less hard-hit than those with m ore fragile medical infrastructures;  there also is some question about how warmer weather might tamp down on the disease's spread.  But it also is going to take time to find a vaccine, which means enormous percentages of the global population could be at risk.

Published on: February 3, 2020

…with brief, occasional, italicized and sometimes gratuitous commentary…

•  From the Wall Street Journal (though it might as well be from the National Enquirer:

"Michael Sanchez, the brother of Jeff Bezos ’ girlfriend, sued the Amazon.com Inc. founder for defamation, alleging his representatives spread false rumors to news outlets that Mr. Sanchez provided graphic nude photos of Mr. Bezos to the press.

"The lawsuit, filed Friday in California state court in Los Angeles, also names as a defendant Gavin de Becker, a security consultant hired by Mr. Bezos. Mr. Sanchez, a talent manager, claims Mr. de Becker worked with Mr. Bezos to spread false statements about the public disclosure of Mr. Bezos’ affair with Lauren Sanchez, Mr. Sanchez’s sister."

The story goes on:  "Mr. Sanchez’s lawsuit acknowledges that he helped publicize the relationship in an attempt to get out in front of news about the relationship.

"His lawsuit concerns what he says was a campaign by Mr. Bezos and Mr. de Becker to blame Mr. Sanchez for turning over graphic nude photographs, which Mr. Sanchez denies doing. People familiar with Mr. Sanchez’s dealings with the tabloid said he showed a below-the-belt selfie of Mr. Bezos to the Enquirer, without providing a copy, but turned over other images."

Three things.

First, Bezos probably will be okay.  He reportedly made about $8 billion last week when Amazon's stock went up seven percent.

Second, this is going to make Thanksgiving this year at the Bezos household kind of interesting.Third, wouldn't we all be better off if we lived in a world where nude selfies didn't exist, or at least did not become a matter for public discussion?  (You know.  Like what I'm doing right now.)

Published on: February 3, 2020

•  Fast Company has a story about retired baseball star Alex Rodriguez, who has just invested in  AB InBev’s Dominican Republic-based beer brand Presidente, becoming not just a minority shareholder but also chairman of the division, "tasked with working to grow Presidente’s presence in the United States, including the release of new products and materials."

Rodriguez describes Presidente as a brand that in the Dominican Republic "is like Coca-Cola, like Pepsi, like Google, like the Yankees are here in America … When you are Dominican in this country - there’s almost 2 million Dominicans here, and almost 60 million Hispanics - we get to come to this great country where dreams come true, lifting a Presidente is like lifting the Dominican flag."

The goal:  turn Presidente into the next Red Stripe, a Jamaican beer that has evolved into a global success story.

Published on: February 3, 2020

Mary Higgins Clark, who wrote more than 50 suspense novels and sold more than 100 million copies - the vast majority of them after she became a widow with three children in her late 30s - has passed away.  She was 92.

She had a simple goal in her books:  "You want to turn the page," she told the Associated Press in 2013.  "There are wonderful sagas you can thoroughly enjoy a section and put it down. But if you’re reading my book, I want you stuck with reading the next paragraph. The greatest compliment I can receive is, 'I read your darned book ‘til 4 in the morning, and now I’m tired.'  I say, 'Then you got your money’s worth'."

Published on: February 3, 2020

Got this email from MNB reader Jesse Sowell in response to Friday's "OffBeat"…

I always look forward to your culture notes on Fridays. I, too, have loved "The Good Place" - haven't seen the finale yet…

I expected to hate Joker, but it turned out to be near the top of my list of the best movies I saw in 2020. For the first 2/3 of the movie, I found Joker to be a great individual acting performance in an underwhelming, even slightly boring, film. Then the final act moved into the public sphere, and, for me, became a brilliant reflection on the state of the world today. Joker acts out what you get when the world divides so starkly: into haves and have-nots, right vs left, the vulnerable vs the bullies, and all the other us-vs-them's we are devolving into. The movie should have ended in the streets and not gone on to the last scene, which was the only part of the movie that felt comic book-ish to me. In the end, Joker may not be "the movie for our times", but I think it may be the movie we deserve.

But I also totally get why you hated it. I think I could have seen Joker on a different day or in a different mood and felt the same way. Last year I hated Dunkirk, much beloved by everyone I know. To each their own.

We'll just have to agree to disagree.   I loved Dunkirk.  (Which, by the way, was made by Christopher Nolan, who gave us a much more intriguing Joker, courtesy of Heath Ledger, in The Dark Knight.)

Published on: February 3, 2020

In Super Bowl LIV, the Kansas City Chiefs defeated the San Francisco 49ers 31-20, capitalizing on a fourth quarter comeback engineered by quarterback Patrick Mahomes, who became the youngest player named Super Bowl MVP just a year after he was the youngest player named league MVP.

Published on: February 3, 2020

Digital strategies aren't just about creating alternatives to the bricks-and-mortar shopping experience.  Done effectively, they can actually bring people back to the store, while also eliminating customer anonymity, creating rich and actionable data, and deepen relationships between the store and consumer in a way that transcends the simple transaction.

Our newest Retail Tomorrow podcast, which brings together a terrific panel of experts from a wide range of disciplines, was recorded at Google’s New York City offices during the recent National Retail Federation (NRF) Show.  Our guests:

•  Matt Alexander, co-founder of Neighborhood Goods, an unusual and fascinating take on physical retailing with stores in Dallas and New York.

•  Patrick Flanagan, senior vice president of digital marketing and strategy for Simon,  which has more than 200 properties in 37 states and Puerto Rico.

•  Tom Furphy, CEO and Managing Director of Consumer Equity Partners, a member of the Retail Tomorrow podcast family and a regular contributor to "The Innovation Conversation" on MNB.

•  And Jalna Silverstein, a leader in Ernst & Young’s Transaction Advisory Practice and its Real Estate, Consumer Experience and Retail Strategy.

You can listen to the podcast here.

This Retail Tomorrow podcast is sponsored by the Global Market Development Center (GMDC).

Pictured below are our panel members, from left:  The Content Guy, Matt Alexander, Tom Furphy, Patrick Flanagan, Jalna Silverstein.

Published on: February 4, 2020

by Michael Sansolo

If necessity is the mother of invention, it is interesting to think about the parentage of reinvention because frankly, that’s exactly what a large number of businesses need to focus on today.

Should you doubt this at all, let me suggest you re-read Monday’s MNB for just the right inspiration. Especially focus on three pieces featured by Kevin: the articles about the recasting of Staples office supply stores into solutions centers, the resurrection of increasingly irrelevant shopping malls into “ghost” kitchens and more, and even the <i>New York Times</i> article bemoaning the shift to shopping to e-commerce.

I think there’s a common thread in those stories that take us back to the notion of reinvention.

The Staples story is the easiest link. As much as any retailer, Staples is in the cross hairs of electronic commerce. After all, there isn’t much romance in buying reams of paper or dry-erase markers. Yet, I’d argue that Staples is worth a visit. The store closest to me now features a widening array of products that can find their way into my office, including snacks and drinks. Plus, Staples allows me to return used printer cartridges, which I find both useful and hopeful.

But what I liked most about Kevin’s story was the notion of a solution center, something Staples has played with for a while.  We talk a lot here about the need for stores to supply more than products - and that leads to experiences and solutions. Sure people need to buy groceries, but they really want menu ideas that fit with their lifestyles. Likewise, they need those reams of paper, but they also want ideas that make workplaces more effective. 

Staples may be on to something and that’s worth considering and possibly mimicking.  It isn't hard to imagine how this notion could be adapted by food stores.

And that’s why the article about the increasing incursion of e-commerce in our lives needs also be part of our discussions. The author might or might not be right with her concerns about the soulless nature of shopping remotely, but it’s a challenge to traditional retailers to make the traditional shopping experience soulful. In other words, you cannot out-convenience e-commerce, so instead it is critical to find ways to make stores, displays and everything else so compelling that it trumps convenience.

That’s no simple lift, but it’s absolutely essential. It requires marshaling all of assets, most especially our people and helping them become, to borrow from Staples, “solutions providers.” They need help shoppers find the answers and experience they seek.

Lastly, reconsider the article on ghost kitchens popping up in shopping malls. The sad reality is that most malls are already experiencing the “ghost” part pretty well, thanks to ghost stores and shoppers who have disappeared. Once again, if necessity is the mother of invention, maybe desperation is the mother of reinvention. In order to have any viability malls are clearly looking for ways to reinvent by including supermarkets, gyms, health clinics,  senior housing , community colleges and lord knows what else. (The mall closest to me has recently added a bowling alley and a flight simulator. We briefly also had a shooting gallery, but that disappeared in weeks.) 

Desperation is a terrible place to be unless it gets us thinking about “what ifs” in entirely new ways. Maybe it becomes the mother of some creative offspring.

Michael Sansolo can be reached via email at <A HREF="mailto: msansolo@mnb.grocerywebsite.com "> msansolo@mnb.grocerywebsite.com </A>.  His book, “THE BIG PICTURE:  Essential Business Lessons From The Movies,” co-authored with Kevin Coupe, is available here.

And, his book "Business Rules!" is available from Amazon here.

Published on: February 4, 2020

by Kevin Coupe

Digital Trends reports that Amazon has added a new capability to its Echo Show device, which includes video along with its smart speaker capabilities.  The new feature - the ability to scan item bar codes by holding it up in front of the Echo.

According to the story, "To get started, all you need to do is say, 'Alexa, scan this to my shopping list.'  Then, just hold the bar code on the package up to the screen. Alexa may have some problems recognizing some private label products, but that isn’t a problem. You can still add the product to your list using voice commands."

And then, Prime members can place their orders at Amazon and/or Whole Foods via the Echo, and even get free two-hour delivery in many markets.

It is going to take a lot of time and people to make this a mainstream function … but I have to admit that I think it is pretty cool.  I tried it this morning on my Echo Show, and while it is a little glitchy, it inevitably will get smoother … and I can see getting into the habit very easily.

It is what I call an Eye-Opener.

Published on: February 4, 2020

Bloomberg has a fascinating story of the behind-the-scenes maneuvering when Amazon decided to seek out enormous tax incentives when it was looking for a location to build a second headquarters, dubbed HQ2.  According to the story, the search for incentives originated because CEO-founder Jeff Bezos was envious of the $1.3 billion in incentives that Elon Musk for for building a gigantic battery plant in Nevada.

An excerpt:

"And so, when Amazon launched a bakeoff for a second headquarters in September 2017, the company made plain that it was looking for government handouts in exchange for a pledge to invest $5 billion and hire 50,000 people. The splashy reality-television-style contest generated breathless media coverage, attracted fawning bids from 238 cities across North America and ended with Amazon deciding to split the so-called HQ2 between New York and Virginia. Then progressive politicians attacked the $3 billion in incentives offered by New York, and Bezos pulled out.

"Amazon was widely ridiculed for its failure to court New York politicians. To understand why that happened, Bloomberg interviewed 12 people familiar with Amazon’s effort. Their story, outlined here for the first time, depicts a team that became the victim of its own hubris. Bezos’s frustration with what he deemed meager government largess prompted executives to scrap lessons learned through the years in favor of an unapologetic appeal for tax breaks and other incentives."

You can read the entire story here.

'

Published on: February 4, 2020

The Kansas City Business Journal reports that single-store independent McGonigle's Market there has been sold to 122-store, Iowa-based Fareway Stores.  Terms of the deal were not disclosed.

In a letter to customers posted on his website,.  owner Mike McGonigle, who started working in his dad's store when he was 12, wrote, in part, "I have no regrets. I am proud of the business that I built. I am proud of the employees I have supported and who have supported me. I am proud to have survived as an independent retailer in the age of box stores and internet groceries. But, in this highly competitive world, it has become more and more challenging to keep it going and after some health issues in 2015, I centered my thoughts on an appropriate transition for the store.

"As I contemplated the future of McGonigle’s, I felt the need to keep the family owned, independent aspect intact. I wanted to make sure my customers and my people were well taken care of. This is where the new owners fit in. Fareway is family owned and operated. Their core values align well with my commitment to quality, integrity and personal service. I am confident they will be good stewards of the McGonigle’s legacy."

A liquidation sale has begun.  McGonigle's will be closed on February 21, and reopened in early March under the new ownership.