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    Published on: November 12, 2003

    In a story yesterday about Wal-Mart, it was noted that about 90 percent of the company's associates are covered either through Wal-Mart or through a family member or Medicare…and we asked if being covered by Medicare qualifies as having company health insurance. We wrote, "Being covered by Medicare means that taxes being paid by US citizens are going to help cover the health costs of Wal-Mart employees not being covered in other ways."

    This raised a few hackles. (We did a lot of that yesterday…)

    One MNB user wrote:

    Lots of Wal-Mart employees are older citizens, trying to augment their retirement, or just having something to do besides sitting home and doing nothing. They are over 65 -- many beyond 70. That is where Medicare comes in. Because I am over 70, my primary coverage is now Medicare, followed by a poor structure of Medigap that hardly picks up anything in medications, etc. For a company to cover me, the monthly costs would now run $1200 a month or more. Don't blame Wal-Mart for not wanting to pick up that kind of expense for its older workers.

    This is where the BIG picture comes in and where all the fuss is about better care in our old age through Government help, etc. Today's Medicare doesn't begin to cover today's medical expenses for this countries older citizens. I can speak from experience.

    Another MNB user - a Wal-Mart employee - wrote:

    I've paid Federal taxes for, in the least, over 47 years.

    Are you saying that just because I work for Wal-Mart I'm not entitled to Medicare just the same as any other 68 year old in the USA?

    Sure sounds like that's what you are saying.

    I think you better reword your thoughts on this. You appear to be getting too involved in the anti-Wal-Mart mud slinging to see the forest for the trees. I'll be the first to admit there are many things at Wal-Mart I would change if I was running the show, but overall, being what it is and where it is in terms of the primary business it's in, I'd have to say it's doing a much better than adequate job in conducting its business and business practices. Much better and in a much, much larger sense and under much different business conditions than many of its predecessors ever faced. And I believe it will be around much longer.

    And, regarding the broader subject of Wal-Mart's business practices, MNB user Bob Vereen wrote:

    Read your comments about Wal-Mart, wages, etc., and a few comments as a longtime observer of the retail scene:

    (1) Many of Wal-Mart's employees are older people, some undoubtedly on Medicare. The greeters often are, and I know I have a retired friend who has worked there for half a dozen years, so she probably is on Medicare.

    (2) There have been so many actions mentioned about Wal-Mart that I think Scott needs to publicly address them, simply to set the record straight and/or explain the company's position so the other side can be heard. But
    they'll probably not do it.

    (3) I read where their employee turnover is about 50%. With 1.4 million employees, I would think that is admirable. What do you think?

    (4) Isn't a waiting period for employees common (especially in turnover-prone retailing) common for benefits? I know it was for the association for which I worked.

    We got a number of emails on the subject of drug reimportation from Canada.

    MNB user Rock Wight wrote:

    I am really tired of hearing about drugs from Canada being unsafe. I saw a news report on MSNBC about a month ago where it was stated that only five drugs were found in Canada that did not have the exact same manufacturer that provides the drugs in the United States.

    I don't know how much pressure the FDA receives from drug manufactures,
    I am really having trouble believing any of them on this subject. The sorry truth is that we pay more for our drugs than any other country on earth, not just Canada. Finally, Canada is not some third world country and I believe the Canadian authorities when they say that their rules are just as stringent as ours.

    Another MNB user wrote:

    From a consumer perspective I would find it both helpful and interesting if the FDA and the drug manufacturers would somehow in a combined or individual effort,( I'll take it either way) tell the average US citizen purchasing drugs here in the United States the primary reasons drug costs are so much higher here than in Canada and Mexico too as I understand it.

    I realize there are certain controls in effect in Canada not in effect here, like no advertising or promotions. But...what else is there to tell us, there must be a better way to communicate these cost/retail differences. I'm not at all sure we would want universal health care here as in Canada....But, the fact is ,I just don't know.

    Is that one of the reasons Canada retails are lower?

    A little communication might help.

    We agree. There have been a lot of scare tactics, but precious little real information.

    And another MNB user wrote:

    People need to look at this word carefully - reimportation - as in bringing back what has already been imported (to the country which is now exporting it back to where it came from in the first place). This has no reflection at all on what may or may not be produced in the country from which it is reimported but every reflection on what was imported by them in the first place. If the drugs originate in the US, how can the FDA, drug companies or courts question their efficacy or quality without impugning the efficacy and quality of the drugs which are not being exported?

    Good point.

    On the subject of Giant of Landover combining some functions with Stop & Shop (both are owned at Ahold, which is looking for efficiencies wherever it can find them), one MNB user wrote:

    No mention of lost jobs does not mean that no jobs will be lost. Here's the history of the Tops/Giant (Carlisle) "Shared Services."

    In October of 2000, "shared services" was announced. We were told that these were cost savings only and would not touch the customer. Tops accounting and IT departments were laid off...that's 250 people.

    In January of 2001, the Pharmacy department was merged as well. That's another 10 people. Our merchandising department was also re-structured to bring us to a similar structure as Carlisle...that was another 30 people.

    In 2002, Human Resources was also combined. No jobs lost then...but the big news shortly followed...

    January 6 2003, the expansion of shared services to include marketing and merchandising...another 150 people from Tops.

    That's almost 450 professional jobs lost to Buffalo. Not to mention the hundreds of brokers and vendors who also were affected. I also leave out the jobs lost by the sale of distribution to C&S and Ahold's centralized procurement of perishables.

    The result is that Tops is starting to look more and more like Carlisle. The ad format has changed and the pricing structure is starting to look like EDLP.

    Ahold has always preached that its chains are "A stable of thoroughbreds. They share benefits from being together, but they race alone." The mergers of Tops and Giant, Bi-Lo and Bruno's have already begun and now the "big guys" is not consistent with the foundations of Ahold's growth.

    But really, this is just one more inconsistency that has been leading to their downfall. When the chains operated without influence from Ahold, they were profitable and productive. The scandals and poor chain performance should give Ahold a hint to back off. As long as they continue to manage the stock price and not the supermarket business, things will only get worse.

    I know the people involved at Giant Landover are scared...they should be.

    In a piece about a GEMCON presentation about Advertising, Promotions & Marketing (AMP) initiatives, we observed that it was sort of like having a lot of different companies holding different pieces of the puzzle…and nobody really knowing what the puzzle is supposed to look like at the end.

    To which one MNB user responded:

    Your observation on AMP solutions was dead on. Different companies do hold different pieces of the puzzle. The cost for these systems can be very
    substantial and retailers should be wary of investing in a solution that promises to do everything.

    We got the following email from an MNB user regarding some of the problems that Winn-Dixie is having:

    The word among the vendor community is that most of the new stores Winn-Dixie has opened over the last two years are absolute duds with underwhelming sales and lots of red on their bottom lines. Many of the remodels supposedly have marginal ROI's. One can surmise that if the Save Rite banner was working then the Bargain Depot experiment would not be necessary. Management going mum on guidance is a disservice to stockholders - many of them current and retired employees. It's a shame that the Davis family has let their business get to this point. Is anyone steering the ship? Wish I had sold my stock years ago!

    MNB user Trish Bellrose wrote:

    So, Winn-Dixie thinks it can out Wal-Mart Wal-Mart by adding value oriented chains? This sounds like a hair-brained idea if you ask me. Why not be what Wal-Mart isn't? Quality, Service, Selection? I seriously doubt this will turn the tide on this troubled retailer.

    And yet another MNB user wrote:

    A couple of months ago, I went to a Winn Dixie/Save Rite store with the intent of purchasing a weeks worth of groceries. Instead, I got only enough items to get me through the next day because their fruits and vegetables were of such poor quality.

    Last night, I stopped at a different Save Rite again intent on getting a large amount of groceries. This time, they were lacking several produce items I was looking for (grape tomatoes, sliced mushrooms, celery hearts, broccoli crowns) and what they had was not very appealing. I don't know what the rest of the store was like. I returned the two items that were in my cart and went to Kroger.

    Service and price are important, but not as important as selection and quality.

    We continue to get email about self check-out systems.

    One MNB user wrote:

    Not sure how common (or interesting!) this is, but I recently noticed that the local library now has self check-out. As well as the regular full-service option. The number of people in line for each was pretty equal. Didn't try it out myself. Afraid of scanning the book incorrectly and setting off the security thing at the exit.

    You have nothing to fear but fear itself. It's a library, for goodness sakes…

    Another MNB user wrote:

    My local Home Despot is run by the Self Check Out Police, who try to herd the teeming masses into those two designated lanes, then stand there looking amused when things go wrong.

    Often when I visit the Despot, I buy plants. Plants do not work well in self check out, because the weight varies by how much water they have been given, but do you think that they have adjusted the computer system to account for that? No. So I make a break for it, trying to get to a lane where there is a living, breathing person, and always I am intercepted by the Police, who want me to try self check out, herding me back with garden tools. Guess what? I've tried it, it stinks, so can I have a person take my money please?

    The only thing I hate more than self check out is supermarket loyalty cards. Let's not even go there…

    MNB user Denise Remark added:

    To the reasons why some consumers are hesitant to use self check-out, I'd like to add embarrassing. I waited in the self check-out line for about 7 minutes while two customers, each at different lanes, attempted to check out. They each fit the demographic (at least in appearance) of the most typical user: younger (mid 30's), smarter (professional appearance), higher income (again based on appearance), white males. Each had problems with the scanner either recognizing items/prices or of telling them that there were unscanned items in the checkout area (assumption: you slipped an extra item into your bag with out scanning). The CSR was going between both resetting the system several times. They seemed to maintain a sense of humor about it, but you could tell they were flustered.

    Now imagine that scenario with older folks who aren't techno-savvy. If they even do get beyond the intimidation factor, being embarrassed one time by a machine telling you that there are inappropriate items in the bagging area, or telling you to remove your bagged items while attempting put money/credit cards away, reinforces the desire to never use self check-out again! Not only do consumers have zero-tolerance for technologies that do not meet their needs, people do not like being made to look foolish & will avoid that situation in future!

    And another MNB user wrote:

    Personally I would like to see retailers take the labor money saved with self checkout and invest it in customer service in the selling space. I'll trade the warm fuzzys of personal contact at the register, which is usually not that warm and fuzzy, for in-store cooking tips, sampling, improved service sections for deli and meat... places where interaction really helps me. At Home Depot, give me more in store demonstration stations, more people in the aisles that know about DIY projects, more people at the planning desks (which are usually undermanned) .

    Self check out. Bring it on. Just don't use it to make quick gains on the bottom line without adding anything back....which is what I have seen so far. Still, given a choice, I would shop at a store that has self checkout rather than one that does it the old fashioned way. I'll be on my way faster.


    And yet more on self-checkout…

    Just read your thoughts on self checkout and the need for personal contact in retailing as the reason you question the implementations.

    Well, your experience, and your daughter's, at Home Depot must be different than mine. whenever i use the self checkout there i have a very personal experience with a person because the freaking thing always fails to work properly. from my observations, I'd say it malfunctions 30% to 50% of the time. and the most frustrated person is not the customer but the store associate who must handle the same problem minute after minute, hour after hour, day after day...sounds like a mental carpal tunnel syndrome to me.
    KC's View:

    Published on: November 12, 2003

    MNB reported yesterday on the debate taking place in scientific, business and legal circles over whether obesity should be officially classified as a disease. Such a classification, could take much of the stigma away from being severely overweight, make it easier to get treatment, and change the way insurance coverage deals with the obese. Opponents of such a move say that obesity is just a risk factor, not a disease and that classifying it as such would actually divert resources from legitimate diseases.

    Our position in this matter is that obesity seems to have crossed the line from being a simple cosmetic or psychological problem, and that classifying it as a disease probably makes sense. But to us the more important issue is getting away from finger pointing; parents, teachers, the medical establishment, the food industry, the government - all have a role to play in dealing with this serious issue. Sure, it is an issue of personal responsibility…but that doesn't mean there shouldn't be multi-layered support systems in place to help people who are suffering from serious weight problems.

    This story - and our commentary - prompted a lot of email during the past 24 hours…so we thought we'd give the issue an airing in a section all its own. Especially since almost nobody agreed with us.

    MNB user Bob McMath wrote:

    If people think that obesity is really a disease and it should be treated that way, just wait until we get the newest rate increases in health insurance. Among other factors as we already know, people hop from one "answer" or fad to another, and even after losing weight, they gain it back and do something again to bring it down. Usually when one has a disease, there is, hopefully, a cure. Personal responsibility is the only cure for obesity, couples with common sense. Tie obesity into health issues which the insurance companies will have to support in trying to combat it, and our health system will break down under the burden. Yes, the results already burden the insurance question, but making them responsible for footing the bill trying to combat it and nobody will be able to afford insurance! Period!

    Good point.

    But can we ask a question about the people who lose weight and then gain it back? Couldn't you call it a kind of remission, followed by a relapse?

    MNB user Joe Potts wrote:

    We all control 100% of the calories that we ingest and of the time that we spend exercising. If I carry too many pounds, it's my choice, but not a disease.

    Another MNB user wrote:

    Obesity is not a disease or the result of any addiction it is simply the result of poor choices, poor food and lifestyle choices. Those like Weight Watchers and Jenny Craig stand to benefit hugely when medical insurance starts to pay for their products. Do you think the lobbyists are involved?

    Once again the push is on the shift the cost of largely self-inflicted problems to everyone else. Obesity of itself is not a disease, it is a condition brought on by the free choice to overeat.

    MNB user Al Kober wrote:

    I need to disagree with you. Blaming the obesity problem on food manufacturers is like blaming the ladder manufactures if people fall off it, or blaming the manufacturer of a bicycle because it didn't come equipped with a light when someone rides at night and run into a car. Misuse of many good things can produce bad results Just because it is there or possible, doesn't mean we all have to do it. The current spirit of this age "it is not my fault" syndrome, has gone far enough and it is time for people to become personally responsible for their own actions, even when it comes to eating.

    Please understand, we're not blaming the problem on manufacturers. We do think that companies that have sold fat-laden products have culpability, but certainly the final responsibility lies with the people actually doing the eating.

    But some people can't help themselves. (Could this be considered an emotional disorder, as opposed to a physical one? Wouldn’t that still qualify as a kind of disease?) All we're arguing for are broad and coordinated efforts on all fronts to deal with both the causes and effects of obesity…thinking that if this helps the customer, it also helps retailers and manufacturers.

    Another MNB user wrote:

    Obesity is not a “disease”…it is a product of confusion and misinformation. Can people lose weight? Yes…

    People do not have to helplessly die of obesity as they would die of a real disease such as cancer. Messages about healthy nutrition are hopelessly mixed. What “healthy” guidelines should an obese person (or a food manufacturer) follow? Is it:
    The LOW FAT message? You still eat lots of carbs and protein
    The LOW CARBOHYDRATE message? Cut back on carbs! Fat and protein are ok
    The GOVERNMENT STANDARDS message? Follow the food pyramid and you’ll be ok…wait…no! We’ve changed our minds. What should this dang thing look like?...
    So which message do we choose? Which message should an obese person choose? Which message will the litigious choose to hang their food manufacturers on?

    I agree that obesity is epidemic but it is reversible. If it were to be classified as a disease, I think patients will medicate the problem rather than making the changes that lead to their own wellness.

    Yet another MNB user wrote:

    The thought that all of society and the institutions that support it including government, health providers, and insurance companies, should be a safety net for those who cannot resist Big Mac's and doughnuts is ridiculous. Everyone will bear the cost if obesity is considered a disease and it would detract from the focus and funding for real diseases. I am sympathetic to those that are overweight because for me it takes great discipline as I was overweight at one time. This seems to be more of an educational and cultural issue. Society needs more education, information (on packaging and restaurant menus), and healthy alternatives. The awareness and publicity that this issue is receiving right now is a step in the right direction because public demand for healthy alternatives will create a supply of new products and services. To simplify the issue, society needs to exercise, eat a balanced diet, and we need the information and alternatives to make the right choice.

    And another MNB user wrote:

    Your comment that manufactures and retailers are "wrong" to think the obesity problem is not their problem may be true, but it is troubling.

    Obesity is the manufacturers' and retailers' problem in the sense that consumers can vote with their wallets and start buying healthier foods - manufacturers and retailers of unhealthy foods would then have the problem of declining sales. However, it is not their problem that people become obese because they don't exercise the good sense to limit their intake of unhealthy foods.

    I'm not sure that anyone eating a bag of cheese puffs or a fast food burger really thinks that their food choice is the healthiest option. Manufacturers and retailers have not duped them into believing that the road to healthy living is in that cheese puffs bag. While this may sound absurd, I imagine that I could reach an unhealthy state if I ate nothing but carrots - but no one is going to start a "stop the carrot farmers campaign." If I don't have the good sense to diversify my diet and eat foods in moderation, why should carrot farmers be held responsible for the fact that I don't eat properly or
    exercise self-control? Lets encourage education on diet and obesity issues - lets not attempt to "fix" the problem of low/no self-control by regulating food providers.

    And finally, in our favorite email on the subject, one MNB user wrote:

    I am stuck on reading your articles everyday...can I write off my habit as "Morning News Beat" disease?

    Thanks for the sentiment…though we're not sure you can get insurance coverage for that.
    KC's View:

    Published on: November 12, 2003

    Art Carney, best known as Ed Norton on "The Honeymooners," died yesterday at age 85.

    If you want to see a wonderful movie in which Carney starred in his later years, find a copy of "The Late Show," co-starring Lily Tomlin and directed by Robert Benton. Carney plays Ira Wells, a retired private eye who finds himself embroiled in one last case. Lovely movie, the kind they never make any more.
    KC's View:

    Published on: November 12, 2003

    We got a number of emails yesterday about our spelling of the losing team's name in Monday Night Football…obviously it was the Green Bay Packers.

    We wish we could blame it on the editor…but that's us, too.

    We screwed up. We were covering Gemcon, we were speaking at Gemcon, we were trying to "network," and we wrote MNB on about three and a half hours sleep. And we screwed up.

    Sorry about that.
    KC's View:

    Published on: November 12, 2003

    • 7-Eleven, Inc. reported total sales for October 2003 of $964.9 million, an increase of 10.1 percent over the October 2002 total of $876.5 million. Total merchandise sales for October 2003 were $673.1 million, an increase of 9.6 percent over the October 2002 total of $614.1 million.

      US same-store merchandise sales for October 2003 increased 8.1 percent.

      Gasoline sales for October 2003 were $291.8 million, an 11.2 percent increase compared to $262.4 million in the prior-year period.

    KC's View:

    Published on: November 12, 2003

    • Published reports say that the Penn Traffic Co. is considering the sale or closing of its 60-store Big Bear division in Ohio and West Virginia. The company wants the approval of the U.S. Bankruptcy Court to sell 11 Big Bear supermarkets in central Ohio to Kroger Co. for $20 million, but also plans to conduct an auction for all Big Bear's assets.

    • Supervalu Inc. announced that its Advantage Logistics operation will provide third- party logistical services for The Kroger Co.'s dry grocery distribution center in Denver, Colo. The announcement was part of an earlier transaction, which included the sale of four Cub Foods stores and the Aurora distribution center to The Kroger Co.

    • The Seattle Post-Intelligencer reports that Whole Foods Market acquired Select Fish, a Seattle-area seafood distributor and processor, for an undisclosed amount. Select Fish has provided seafood to Whole Foods for four years and currently supplies about half the grocery store chain's 145 locations.

    • The UK's Tesco has spent $124 million (US) to acquire a majority stake in Kipa, a Turkish supermarket chain.

    • Rite Aid Corp. is suing Timothy J. Noonan, its former COO and president, who recently cooperated with prosecutors and pleaded guilty is an accounting irregularities case.

      Noonan left the company in 2000, and the chain wants Noonan to repay legal fees he was advanced and money he was paid under deferred-compensation and separation agreements, saying that he violated his agreements when he issued a guilty plea.

    KC's View:

    Published on: November 12, 2003

    • Safeway Inc. announced the appointment of Scott Grimmett to be president of the company's Denver Division, which operates 143 supermarkets in five states -- Colorado, Wyoming, South Dakota, Nebraska and New Mexico.

      Grimmett has just been replaced by Randall Onstead Jr. as president of the company's Dominick's division in Chicago.

    KC's View:

    Published on: November 12, 2003

    • Internet retailer reports that, the Minneapolis-based Internet grocery business, has managed to generate a lot of extra sampling through the aggressive marketing of its "Simon SOS" feature - a button in the middle of the site that allows more tentative shoppers to arrange an at-home visit by a company employee who will help people navigate the site for the first time.

      "SOS" stands for "Simon's Offline Service," and the goal is to make people more comfortable with Internet grocery shopping - even if it requires extra care and attention in the early stages.

    KC's View:
    Sounds like basic, smart marketing to us. If more brick-and-mortar supermarkets went one step extra to help people navigate the store (or, heaven help us, create a store with a compelling and differentiated offering), there wouldn't be as many retailers worried about Wal-Mart.

    Published on: November 12, 2003

    The Vatican has convened a conference to consider the ethical and moral issues surrounding genetically modified food.

    However, opponents of the technology say that the city-state that is the seat of power of the Roman Catholic Church is weighting the deliberations in favor of pro-biotech advocates, saying that the Church is looking to biotech as a way of alleviating world hunger. The conference's organizer is Cardinal Renato Martino, who has frequently spoken out about the potential benefits of biotech foods.
    KC's View:
    Somehow, we can't imagine that this is going to clarify and simplify the situation. This is a matter of science, not faith, and we would be concerned that this will simply serve to polarize different sides of the issue more than they already are polarized.

    Besides, doesn’t the Vatican have a few other things to worry about?

    Et ne nos inducas in tentationem. Sed libera nos a malo.

    Published on: November 12, 2003

    Four McDonald's stores in the Washington, DC, area have decided to shut down a test of automated Redbox units - 18-foot-wide, 130-item vending machines that carried everything from milk and eggs to sandwiches and toilet paper, and that some believed were a reflection of the future of retailing.

    The company would not comment on their specific performance, but only said that they didn’t fit into McDonald's long-term strategy. However, McDonald's continues to have a dozen DVD dispensing vending machines at various stores.
    KC's View:
    So much for the rise of the machines…

    Published on: November 12, 2003

    The New York Post reports that Wal-Mart is considering a move into the digital music download business, which would be modeled on Apple Computer's successful iTunes Music Store that allows customers to download songs for 99 cents each.

    Wal-Mart already controls 14 percent of global music sales through its enormous CD business.

    Other competitors in the online music business include Roxio's Napster, and RealNetwork's Rhapsody, as well as free music sites such as Kazaa and Grokster.

    If Wal-Mart makes this move, it would be similar to its decision to compete with Netflix in the online DVD rental business.
    KC's View:
    We can assume that Wal-Mart will try to underprice Apple…which will create new price competition in the business.

    We saw a study recently (can't remember where) that said the primary users of these online music services are young, and that middle-aged baby boomers still tend to buy CDs. Wal-Mart's move into the online music biz would give it yet another foothold with younger shoppers, capturing their business at an early age.

    Published on: November 12, 2003

    Even as negotiators representing Southern California's top three supermarket chains and 70,000 striking members of the United Food and Commercial Workers (UFCW) union returned to the bargaining table, lawyers for Kroger, Safeway and Albertsons filed an unfair labor practice charge with the National Labor Relations Board against one of the Southern California union locals.

    The chains allege that United Food and Commercial Workers Local 324 has been threatening employees who were considering crossing picket lines to return to work.

    The union characterized the complaint as "desperate measures."

    As the legal wrangling continues, Safeway has begun running ads on Northern California radio stations to battle a series of ads being run by the UFCW urging shoppers not to patronize Safeway's stores there. The UFCW is asking residents of both San Francisco and Sacramento to boycott Safeway stores - believing that this move could increase pressure on the chain to capitulate to union demands.

    The Safeway ad stresses that nobody is on strike in Northern California, and that the package being offered to its workers in Southern California is one of the most generous in the nation.

    Last month the UCFW launched a strike against Safeway Inc.'s Vons and Pavilions stores in Southern and Central California. The next day Kroger Co.'s Ralphs and Albertsons locked out their union workers in a show of solidarity.
    In all, about 70,000 workers at 859 stores are affected by the strike and lockout.

    The current negotiations represent the first time that they have met since the strike/lockout began more than four weeks ago.

    The face-off is over the union's desire to preserve or improve current wage and benefit packages, while the chains are looking for a wage freeze, cuts to health and pension benefits for current employees and a substantially lower wage and benefit package for new hires.

    As often is the case in these disputes, much of the conflict is being driven by the arrival of new Wal-Mart Supercenters, which are non-unionized and therefore boast lower cost structures, and therefore lower prices.
    KC's View:
    It sounds like both sides are living lives of not-so-quiet desperation…as the hole they dig for themselves gets deeper and deeper with every passing day.

    Published on: November 12, 2003

    CNBC reports that Wal-Mart is embroiled in yet another controversy - being accused by gas station owners of selling gasoline below cost and setting into motion a chain of events that they believe will eventually put many of them out of business. Suits have been filed in states including Florida, Alabama and Oklahoma to prevent the company from selling gas below cost.

    Wal-Mart told CNBC in a written statement, “We have never priced our gasoline below our own cost. We seek only to provide our customers with the lowest price on gasoline.” On the other hand, the network notes, Wal-Mart has appealed a preliminary injunction issued in Oklahoma preventing it from selling gas below cost there.

    Wal-Mart reportedly has gas pumps in 855 locations, with industry observers predicting that it plans to install them at another 350 stores before the end of the year.
    KC's View:
    While CNBC notes that a further controversy could hurt Wal-Mart's image even more - especially since it is facing lawsuits and immigration controversies. On the other hand, since we all dealt with increased gasoline prices last summer, we suspect that most consumers won't blink at gasoline below cost…unless, of course, it is proven that Wal-Mart said one thing and did another.

    Published on: November 12, 2003

    In an attempt to avoid the labor strife that has disrupted other markets around the country, Kroger Co. and the United Food and Commercial Workers (UFCW) agreed to an indefinite contract extension in Indiana yesterday, averting a possible strike and keeping negotiations on track.

    The agreement keeps 4,000 grocery workers at 58 Kroger stores in central Indiana on the job, though the agreement can be rescinded by either side with 72 hours notice.

    The existing contract was to expire at 12:01 this morning, and unionized workers were prepared to walk off the job.

    "This is outstanding news. It demonstrates to everyone how committed all of us are to finding an agreement that meets the needs of our associates while allowing us to compete," said Lisa Holsclaw, president of Kroger's central marketing area.

    Kroger is enduring strikes at its Southern California Ralphs division, as well as by 3,300 of its workers in Ohio, Kentucky and West Virginia.

    The major sticking point in all these disputes is health care costs.
    KC's View:
    At least they're talking and not striking. That's progress.