Virtual wine tastings became a common occurrence during Covid. There's a lesson there for after the pandemic - and not just for wineries. KC explains.
Virtual wine tastings became a common occurrence during Covid. There's a lesson there for after the pandemic - and not just for wineries. KC explains.
Delivery service Instacart announced yesterday what it called the "first phase of the company’s next-generation fulfillment initiative designed to bring automated technology solutions to retailers across the U.S. and Canada," saying that it will work with automation partner Fabric to build warehouses for its retail partners, using them to make the fulfillment process more efficient and effective.
According to the press release, Instacart and Fabric "will integrate leading software and robotics solutions … to create new e-commerce services for retail partners and an even faster, more effortless online grocery shopping experience for customers.
"As part of Instacart’s new next-gen fulfillment initiative, the company will pair Fabric software and robotics with Instacart technology and shoppers to power a new fulfillment process within dedicated warehouses and existing retailer locations. The new process will marry the speed of robotics with the human touch and attention to detail of Instacart shoppers, enabling faster fulfillment of customers’ full grocery shop from packaged goods, household essentials and produce to deli items, frozen food and alcohol. Once orders are carefully packed, shoppers will deliver orders to customers’ doors or place them in staging areas for curbside pickup."
Pilots are slated to begin in various locations later this year, the company said.
Bloomberg writes that "Instacart announced the partnership as it looks to revamp its labor-intensive model, which currently depends on 500,000 gig workers. The pandemic catapulted Instacart from a startup to delivery giant as store-avoiding consumers stampeded online. After Walmart Inc., the company is now the second-largest grocery delivery and pickup company in the U.S., with 45% of the market as of June, according to Bloomberg Second Measure data. Instacart doubled its valuation to $39 billion in a March funding round where it raised $265 million from investors."
The Wall Street Journal chimes in: "Instacart added more than 250 retailers in the U.S. and Canada last year and now delivers from more than 600 businesses. It raised nearly $700 million of new capital over the past year amid a boom in business and has a valuation of $39 billion. The company is planning to go public and has beefed up its leadership team."
However, as the Journal points out, "Many grocers remain worried that they are sharing customers and earnings with Instacart––which takes a commission cut for each order––and say they have more options as delivery companies pitch favorable deals to stand out."
They should be worried. Instacart is like heroin - and I say that with grudging admiration - in that it is building a system that will relieve retailers of many of the responsibilities of fulfilling e-commerce demands, while simultaneously creating a mechanism that won't need retailers. It has the customers, delivery systems, and now it is going to have warehouses - which, by the way, will be able to operate as dark stores, selling directly to those shoppers, should relationships go asunder.
Instacart doesn't need to pick its retail clients' pockets - those clients are simply emptying their pockets and handing everything over to it.
From the Wall Street Journal:
"Faced with rising costs for materials, transportation and workers, companies are charging more for products from metal fasteners to Oreo cookies, helping fuel inflation like the U.S. hasn’t seen in more than a decade.
"As customers accept the price hikes, some big companies said they expect to raise prices even more. Others are more cautious, unsure if U.S. consumers have the appetite to absorb additional increases.
"What companies decide will go a long way to answering a question that has surged to the top of executives’ and economists’ agendas this year: Is the recent jump in inflation transitory, as the Federal Reserve predicts, or persistent, as some executives warn?"
Some examples cited in the Journal story:
• "Conagra, which makes Birds Eye frozen vegetables and Slim Jim meat snacks, among hundreds of other food products, couldn’t raise prices enough in the most recent quarter to make up for its own rising costs, including for cooking oils, packaging and transportation. It expects price increases and other measures to offset its costs later this year, and said it might need to raise prices further."
• "Snack giant Mondelez International Inc. raised prices on Oreo cookies and other snacks this year, and told investors last month it is considering price increases for 2022 based on the commodity cost inflation it expects. That could mean smaller packages bearing the same price tag, or less discounting, both of which serve to raise the company’s average selling price."
• "Price increases by Hormel Foods Corp. for products including its Jennie-O ground turkey and Skippy peanut butter so far haven’t covered the company’s higher costs for peanuts, oil and plastic containers, among other inputs, the Austin, Minn., company said. It expects more price increases later this year."
• "General Mills Inc. CEO Jeff Harmening, whose company makes Betty Crocker cake mixes and Cheerios cereal, said unusually high consumer savings might make Americans less sensitive to price increases than usual."
My sense from talking to a number of retailers is that there is some level of skepticism about some of these price increases. There's no doubt that the cost of some raw materials is going up, but there's also a suspicion that in many cases, companies are taking advantage of the moment.
Coin Telegraph reports that Bitcoin Depot announced "that more than 700 of its Bitcoin ATM machines had already been installed at Circle K convenience stores in 30 U.S. states as part of the new partnership. The crypto ATM distributer said the expansion could provide underserved communities with financial access tools and attract more people to the crypto space."
According to the story, "The company claims to have more than 3,500 crypto ATMs in operation across the U.S. and Canada allowing customers to purchase more than 30 different types of cryptocurrencies including Bitcoin (BTC), Litecoin (LTC), and Ether (ETH). Alimentation Couche-Tard, the Canada-based operator of Circle K, reports that its brand operates roughly 7,150 stores in the U.S. and 2,111 in Canada."
• Senator Amy Klobuchar (D-Minnesota) has introduced a bill designed to "strip online platforms such as Facebook Inc. and Twitter Inc. of their liability protections if their technologies spread misinformation related to public-health emergencies, such as the Covid-19 pandemic," the Wall Street Journal reports.
"The bill … would create an exception to the law known as Section 230, which shields internet platforms from lawsuits for content generated by their users and other third parties."
The Journal writes that "the Health and Human Services Department would face the task of issuing guidance related to whether the internet posts at issue constitute health misinformation. If HHS determines that they do, the platforms would be more vulnerable to litigation accusing them of spreading misinformation because they would no longer have the broad protections against liability for user-generated content under Section 230."
The Journal suggests that the bill has a long way to go before becoming law.
• The New York Times reports that Amazon no longer will require customers to go to arbitration to resolve legal complaints, a change in its terms of service that will require complaints to be pursued in the court system.
The Times writes that "Amazon has been hit with roughly 75,000 arbitration claims alleging that devices, such as the Echo, that feature the company’s voice-operated assistant, Alexa, were recording customers without their consent. Amazon faces potentially tens of millions of dollars in fees that it will have to pay the private arbitrators to have those cases heard."
The arbitration requirement, the story notes, reflects a strategy that typically allows companies to avoid class action lawsuits being brought against them. Amazon has not explained why it decided to drop the arbitration requirement.
• The Washington Post reports this morning that "another massive Internet outage along the East Coast struck significant online platforms Thursday, causing the high-traffic websites of companies such as Amazon, Airbnb, FedEx and Delta Air Lines to go dark.
"According to the tracking website Downdetector, the websites of UPS, USAA, Home Depot, HBO Max and Costco were also among those affected. The websites of British Airways, GoDaddy, Fidelity, Vanguard and AT&T were among those loading slowly.
"The cause of the outage, the latest major Internet outage this summer, was linked to Akamai Technologies, the global content delivery network based in Cambridge, Mass. Oracle, a cloud service provider, said its outage was the direct result of the Akamai disruption. Akamai, which works with some of the world’s biggest companies and banks, said on its website that it was aware of an 'emerging issue.' The company later said, 'We have implemented a fix for this issue, and based on current observations, the service is resuming normal operations'."
With brief, occasional, italicized and sometimes gratuitous commentary…
• C&S Wholesale Grocers said yesterday that it has purchased Albertsons' frozen service contract from Burris Logistics.
"C&S's legacy is innovating ahead of market trends and this agreement is the next step in our transformation journey. It will further strengthen our service with Albertsons in the frozen product, as well as support a new relationship with Albertsons' mid-Atlantic division," said Rick Cohen, Chairman, C&S Wholesale Grocers, in a prepared statement. "We have always had tremendous respect for the strong customer relationships that Burris has developed over the years. We are committed to continuing a high standard of customer service."
No player to be named later? No draft picks?
• Fast Company reports that "Shake Shack will be committing $10 million to its restaurant teams, including $9 million in wage increases … The funds will be dispersed over the next 12 months, with nearly $1 million going toward hiring bonuses and an additional amount toward leadership development programs for employees, as well as equity grants for managers."
“We are committed to doing the right thing for our teams, guests and communities during the good times and especially the tough times, and the tough times brought on by the COVID-19 pandemic have shown us the resilience of our people,” the company said in a statement.
It is worth noting that every retailer is competing for people in the current environment, and that when companies like Shake Shack institute programs like this one, it raises the bar on what everybody else has to do in order to find and keep their people.
• The St. Louis Business Journal reports that Save-A-Lot CEO Kenneth McGrath is leaving the company to rejoin Lidl International in Europe as its deputy chairman.
McGrath had worked for Lidl in various executive capacities until 2017, when he came to the US to replace Eric Claus as Save-A-Lot's CEO. No successor has been publicly identified by Save-A-Lot.
Random and illustrative stories about the global pandemic and how businesses and various business sectors are trying to recover from it, with brief, occasional, italicized and sometimes gratuitous commentary…
• Here are the US Covid-19 coronavirus numbers: 35,213,594 total cases … 626,172 deaths … and 29,478,173 reported recoveries.
The global numbers: 193,557,076 total cases … 4,154,549 fatalities … and 175,837,854 reported recoveries. (Source.)
• The Centers for Disease Control and Prevention (CDC) says that 65.9 percent of the US population age 12 and older has received at least one dose of vaccine, with 57.1 percent being fully vaccinated. In addition, 68.6 percent of the population age 18 and older has had one dose of vaccine, with 59.7 percent being fully vaccinated.
• Newsweek reports that "four states are seeing a major spike in coronavirus cases as the highly transmissible Delta variant continues to spread across the nation. Alaska, Florida, Mississippi and Arkansas have all seen a substantial upward trend in new cases over the past two weeks, according to data from Johns Hopkins.
"Over the last two weeks, new cases in Alaska have increased fourfold and fivefold in Florida."
• The Washington Post reports the morning that federal health officials are saying that the "hyper-transmissible variant of the coronavirus is posing new challenges for the nation’s health system, urging millions of unvaccinated Americans to get shots to protect themselves and their communities.
"The delta variant, first detected in India, now represents more than 83 percent of cases circulating in the United States, according to the Centers for Disease Control and Prevention. People infected with the variant appear to carry a viral load that is more than 1,000 times that of those infected with earlier forms of the virus, allowing the virus to spread rapidly among unvaccinated people, scientists have found.
"'The delta variant is more aggressive and much more transmissible than previously circulating strains. It is one of the most infectious respiratory viruses we know of and that I have seen in my 20-year career,' CDC Director Rochelle Walensky told reporters.
"'We are yet at another pivotal moment in this pandemic, with cases rising again and some hospitals reaching their capacity in some areas,' Walensky added. 'We need to come together as one nation, unified in our resolve to protect the health of ourselves, our children, our community, our country and our future with the tools we have available'."
• Axios reports that the National Football League (NFL) is encouraging players to get vaccinated by threatening forfeits and loss of game checks.
According to the story, "If a game can't be played due to an outbreak among unvaccinated players/staff this upcoming season — and the NFL can't find 'a suitable date to reschedule' — the team responsible will forfeit and both teams will lose their game checks.
"The NFL was able to reschedule all of the games it postponed in 2020, but it seems the league might not be willing to go to the same extremes — like playing on a Tuesday — this time around.
"If a forfeit occurs, the forfeiting team will be responsible for any shortfall in the league's revenue-sharing pool, and will also be subject to additional sanctions from the commissioner."
The bottom line, Axios writes: "The NFL can't force players to get vaccinated, so it's doing the next best thing in an attempt to avoid outbreaks: making the lives of unvaccinated players very uncomfortable."
Regarding out story about how liquor-to-go remains a good business for restaurants, many of which hope it will remain legal in post-pandemic days, one MNB reader wrote:
Liquor regulation is a patchwork of insanity left over from the Prohibition era now a full century past.
In a moment when understanding history and the context of things is very much up for debate, it is fascinating to watch this play out.
Following up on Jeff Bezos' trip into space this week, MNB reader Kelly Dean Wiseman wrote:
Jeff Bezos may be a genius at making money, but he sure doesn’t understand much about publicity.
Instead of the small donations he sometimes gives out, think about the branding coup he could have with his own company name.
Last year the Amazon was on fire, and it is shrinking rapidly every year. Bezos has enough money to buy a huge portion of the rainforest and make it into a park or wilderness.
He could employ those miners and timber cutters as guides and support staff.
He could create Amazon International Park and be known as the rich guy who literally saved the lungs of the planet.
And his company name would be attached to it.
I think he needs new PR people.
Can I tell him how to reach you if he shoots me a text or email?
And responding to his $100 million donation to José Andrés, the chef and co-founder of World Central Kitchen, a nonprofit that helps feed and support people in disaster-stricken areas around the world, one MNB reader wrote:
Tell Jose Andres to thank Mackenzie (Bezos' ex-wife). She was definitely setting the bar in donations and Jeff had to catch up... or he'd be in trouble! Can't believe no one has mentioned this ~!
I think a number of people have commented that Mackenzie Scott could end up being one of the most important philanthropists of the 21st century.
Regarding Foxtrot's ambitious expansion plans, one MNB reader wrote:
Specialty Retail: the antidote to One Stop keyboard shopping! Go Foxtrot, and others!
And, on another subject, one MNB reader wrote:
Concerning the vaccine/mask mandates, etc… “They told us not to eat raw cookie dough, now let us live our lives.”
Sorry. I want to let this go. But I can't.
You eat raw cookie dough and get sick, that sickness isn't communicable. You get Covid because you didn't get the vaccine and didn't wear a mask, you could spread it.
Sure, you can go live your life. But I'd prefer you didn't take anyone with you - especially not people who are immunocompromised and cannot be vaccinated, or people who are too young to qualify for the vaccines at the moment.
One other thing. Check out how many people have died from eating raw cookie dough in the last 18 months. Hell, check out how many have died from eating raw cookie dough in the last 18 years.
Then compare it to the more than 600,000 people in the US who have died from the coronavirus. So far.
I know I am not going to convince anyone of the rightness of my position, nor am I likely to persuade anyone to accept science that they'd rather ignore.
But … Give me a freakin' break.
I have a couple of wines to recommend to you this week.
One is the 2020 Occhipinti SP68, which is a delicious blend of Frappato and Nero d’Avola, best served slightly chilled. We had it with pizza, but I suspect it would be wonderful with just about anything.
One note: in his CNN series, "Searching For Italy," Stanley Tucci went to Sicily to visit winemaker winemaker Arianna Occhipinti, and he came away impressed with both a wine and its creator. "I could take a bath in this wine," he said. And he was right - though I'd rather drink it.
From a little closer to home, let me recommend the 2019 Evolution Pinot Noir from the Sokol Blossom Vineyards in Oregon's Willamette Valley; the wine is fresh and jammy and just fruity enough, and it tastes like my home away from home, which is good enough for me.
That's it for this week.
I hope you have a great weekend, and I'll see you Monday.
Stay safe. Be healthy.