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    Published on: January 26, 2004

    We got a number of emails in response to our story last week about Dream Dinners, a franchise operation that sells people the ability to come to specific locations and prepare a month's worth of meals, which then can be frozen and kept by shoppers until needed.

    MNB user Art Turock wrote:

    Here are two more Seattle based operations similar to Dream Diners, with the shopper preparing their months meals at the cooking school. Both have been in business for at least a year. One is Cuizam! Cook and Carry Cuisine and the other is Month of Meals.

    I've been speaking to retailers for years, to rethink their assumption that a meal solution is for a single meal, rather than thinking a week, two weeks, or a month's supply. And rather than disintermediation, why not have this cooking facility compliment the supermarket, featuring foods available from the supermarket and being in close proximity.

    I'm not sure if this is a national trend but it's catching on in Seattle.

    As in so many things gastronomic, Seattle leads the way…

    MNB user Bob McMath chimed in:

    I just want to remind entrepreneurs that are considering ways to get consumers to buy a weeks worth of food -- especially frozen food -- that Campbell's tried it with its special diet meals you purchased and they shipped to you at one time -- a week's worth at a time. One of the reasons it failed was that the consumers didn't have a big enough freezer capacity to keep all the meals for a week at a time -- especially as the week ran down and a new shipment overlapped the last week with a lot of new packages.

    This sort of thing is easy to forget in this environment of bright young executives trying to be inventive who may not have ever heard of Campbell's big trial -- and failure with the attempt.

    Another member of the MNB community wrote:

    Last night my wife and I were both running late and needed to pick up a meal. We discussed our options and decided the highest quality and fastest meal to pick up was from one of the National restaurant chains that now offer curbside delivery service. From the time my wife and I made our decision and called in the order, we were enjoying our various choices with our family within 25 minutes. The point is, by the time you park in a grocer's lot, stroll into the store and walk to the very back where the Deli is located, make your choices, wait in line( even self check out) and get back in the car, dodge the carts and traffic, come home and reheat our meal and finally sit down to dinner, we are exhausted.

    I have been working with various grocers through the years to help them with the HMR programs , but there is one issue they continue to ignore. CONVENIENCE! Until our local retailers get rid of the old layouts of their store ( living with the motivation to make EVERY customer walk several aisle just to pick up fresh products) and focus on the convenience that HMR is supposed to represent, the restaurants will continue to win. (We will leave quality aside for another day!)

    And yet another MNB user offered the following scenario:

    I don't see why Wal-Mart with its 3000 stores…couldn't offer this right out of its stores today. It would require a reworking of its deli kitchen/food preparation area to do so but that should be a minor problem should this become a desirable feature to enough customers.

    That ought to give our supermarket readers nightmares…

    The whole issue of obesity and low-carb dieting and nutrition and the confusion/opportunities inherent in these issues continues to prompt tons of email from MNB users. (There are also was some reaction to an email we published last week from an MNB user from the Physicians Committee for Responsible Medicine.) A generous sampling of these emails follows…

    MNB user Bobbie Randall wrote:

    I learned long ago not to argue with fanatics. As a registered dietitian, I am already planning methods to pick up the pieces of the Atkins Alumni.

    This fad will die out sooner than the Low Carbiz would like. Within six months, those who lost pant sizes will be searching in the back of their closets for their 'fat' clothes once again. I don't mean to be pessimistic about the fad dieters but only realistic.

    MNB user Julia Hidy wrote:

    Millions go on diets each year; drink orange juice; others don't. Free and choice are musts, especially in the privacy of my own home. So whether it's the cattle ranchers, or Oprah, the OJ pushers or OJ naysayers, they all have a right to their opinions.

    And about diets and the "new scientific review" drawing "a clearer link between low-carb diets and cardiac arrhythmia" noted by MNB reader Patrick Sullivan of the Physicians Committee for Responsible Medicine: compromised electrolyte, potassium and magnesium levels -- which directly influence a heart's ability to function properly -- can occur before someone starts a new diet. Did Rachel Husky, the 16 year old alleged to have died because of a low carb diet, confer with her physicians before beginning her dietary program? I doubt it. Do Rachel's parents, peers, schools or even her local supermarket manager's displays play a role in determining or swaying Rachel's earlier eating patterns? Likely. How many people have proper blood work done before they begin a new diet so they know if their electrolyte levels are low or they are at risk to undertake the diet? How many diets are truly adequate nutritionally? They all say they are, including the Government's. And we all know what kind of resistance there is to removing milk and other modifications from the US' food guidelines.

    With cultural issues reinforced by an oft visual and sensory culture and a profound need to be thin, who eats to live? We keep justifying the "live to eat" and then wonder why diabetes, obesity, heart disease, cancers and low energy levels grip 75% to 80% of us. Wonder when a nutritionist will sit at the end of my grocery aisle, rather than a paid sales person hawking the latest convenience or gourmet foods? Perhaps sooner vs. later might be better. While they're at it, how about having the average physician take more than just one mandatory course in nutrition to gain their M.D. status?

    Another MNB user wrote:

    FYI about quoting PCRM as a "reliable" source. Even if it is the opinion of a reader, what that reader quotes from his own organization might be construed as an actual fact - when it could be based on misleading information. Since the tragic story of Rachel's death, very little else has been reported of a connection between low-carbs and cardiac arrhythmia in her case.

    And MNB user Katherine Johnston wrote:

    Please note that PCRM is part of PETA. This does not make them advocates of “responsible medicine” but for vegetarianism.

    MNB user Joan LaBelle chimed in:

    Low Carb diets are a trend. Carbs fuel our bodies and it has been stated that 130 grams of carbs a day is the minimum required for brain function. I believe there is going to be a significant number of health issues that are going result from this one sided diet. It has always been stated that the best way to take it off and leave it off are to watch your fat, calories, and carbs and to exercise daily. It takes longer and that's why most people will not take that route. I've done it that way and believe me it works but it takes time. I'll stick with staying healthy, getting all my food groups and nutrients.

    And MNB user Rosemary Deahl wrote:

    Your paragraph about not realizing that food was fuel and then going on to say that referring to it as fuel understates it power and mystery is a great example of how much trouble we are all in as a culture. Food can be as you said, art music and poetry, but we are in a crisis mode in our country right now. That requires people to stop making jokes, and take this issue very seriously. More that 60% of our population is overweight. There are more overweight children suffering from diet related diseases that ever before. We are talking about astronomical health care costs, which as a society we will all pay for .

    We already view food in romantic terms, which is why we do ads and TV commercials to sell it - both to children and adults. This approach takes us all out of the realm of reality and puts us into the world of magical thinking. In that world no one looks at the true cost of not dealing with the food issue head on. They simply look at the romantic view (which also includes art, music, etc..) and none of the consequences.

    For most people to throw up their arms and say, "no one agrees and therefore I am confused so I will just continue to do what I am doing" is flawed thinking at best. If we stay in the state of confusion we step out of personal responsibility. It is in that nebulous state that we do not have to acknowledge it our responsibility as individuals to control our bodies.

    We also do not need to wait until the scientific community comes to any agreement. We need to act now. Any person who decides to follow a "diet" will discover they do not work in the long term. The reason they work in the short term is the person is focusing on their intake of food and usually doing some exercise. As soon as they fall off the diet (and they all do) they put on the pounds again and then go back to their unconscious ways around food.

    So why not realize that what is necessary here is nothing short of a revolution. Stop allowing your children to watch TV without you being their to help them sort through the mountains of commercials aimed at getting them to buy their unhealthy products. Take the soda and snack machines out of schools. Put the gym programs back in. Put more than a few million dollars into the budgets of American Cancer Society (where they spend about 1% of their total budget to let people know that more than 30% of all cancers are diet related), put more money into the federal budgets to promote eating more fruits and vegetables and run those ads on Saturday morning TV.

    And last, but not least, acknowledge that we do not need any new "diets" we need a change in our lifestyles, which would include eating responsibly and exercising.
    KC's View:

    Published on: January 26, 2004

    Though he was 76 years old when he died, it still came as something of a shock to many baby boomers when the news came over the weekend that Captain Kangaroo had died.

    Actually, it was Bob Keeshan who passed away after years of heart problems. But Keeshan was better known as the character he invented in 1955 and portrayed for almost three decades - a gentle man with big pockets and an enormous mustache who never patronized those of us who grew up watching him.

    Before Mr. Rogers unveiled his neighborhood, and before there was a Sesame Street…there was Captain Kangaroo.

    We had the chance to meet him back in 1973 when we were working as a production assistant on a TV show in New York City. He was kind and serious and absolutely committed to treating children as intelligent, thoughtful human beings. Which was why the news of his death over the weekend was something of a shock.

    More people should treat other people as intelligent, thoughtful human beings.
    KC's View:

    Published on: January 26, 2004

    • A dot-com landmark of sorts was achieved over the Christmas holidays, when on one weekend in mid-December, catalog retailer LL Bean did more business online than it did over the phone.

      Now, part of the reason was that bad weather in Maine had the phone banks understaffed, so a recording directed shoppers to the company's website. But The New York Times notes that this shift was part of a broader strategy employed by the retailer, using a multitude of channels to sell products.

    KC's View:

    Published on: January 26, 2004

    Published reports say that the UK's third-ranked supermarket chain, Sainsbury, plans to bid the equivalent of more than $200 million to acquire TM Group, a company that controls three small c-store chains.

    The move would follow Tesco's decision to add to its c-store network through the acquisition of the Administore c-store company.
    KC's View:
    The question would seem to be when Asda will make its move, not whether Asda will buy a c-store company.

    Published on: January 26, 2004

    A Florida judge has denied a request to give class action status to a lawsuit against Wal-Mart charging that it forced employees to work overtime without compensation.

    The plaintiff lawyers wanted to include up to 230,000 Wal-Mart employees in Florida, but the judge said that it would be an enormous and unreasonable burden on the state court system.
    KC's View:
    Yeah. There's a presidential election coming. Got to keep the Florida court system free and clear.

    Published on: January 26, 2004

    Reuters reports that US Secretary of Health and Human Services Tommy Thompson said at the World Economic Forum in Davos, Switzerland, that the Bush administration agrees with major food companies that a "fat tax" is not necessary to get them to develop healthier products.

    "Taxation can have a negative impact on the progress we're making now," he said, noting that companies such as PepsiCo now are generating 60 percent of revenue from healthier products.

    Unilever chairman Antony Burgmans said, "This is serious. It's a problem. The food industry is prepared to work on a solution. But I don't think taxation (of junk food) is going to sustain it." Burgmans did say that better labeling of products is an area where the industry can improve.
    KC's View:
    We'll go along with that. Better labeling. No taxation.

    Published on: January 26, 2004

    Reuters reports that the US Food and Drug Administration (FDA) has warned three Texas-based companies that they should stop importing medicines from Canada for employees and retirees in Montgomery, Alabama.

    The FDA demanded a response within 15 days. A spokesman for the three companies said that the FDA was mistaken, and that the companies are not engaged in illegal activity.

    This is just the latest contretemps over the practice of "reimporting" drugs from Canada, where prescription medicines often are much less expensive than in the US. While the FDA and US law say that such medicines are unsafe because they are no subject to US regulatory processes, 25 states and 15 municipalities are using or looking into the practice as a way of closing budget gaps.
    KC's View:

    Published on: January 26, 2004

    Two separate bills that would protect food and beverage companies from so-called "obesity lawsuits" are working their way through the Ohio state legislature.

    Sen. Larry Mumper, who is sponsoring of one of the bills, said it is designed to promote "personal responsibility," not protect Ohio businesses.
    KC's View:
    While we hate frivolous lawsuits as much as the next guy, we are even more opposed to legislation that prevents the justice system from doing its job.

    Published on: January 26, 2004

    The Washington Post reports that the US Department of Agriculture (USDA) plans to revise the regulations covering genetically engineered crops, with a specific focus on their impact on the environment.

    The USDA says that the revised regulations will not necessarily be stricter, but will at the very least reflect the current science and technology.

    The Post reports that "among the changes proposed are an expansion of the department's regulatory authority to include certain plants and insects not previously covered, as well as an overhaul of the system for granting permits to run field tests on genetically engineered crops."
    KC's View:

    Published on: January 26, 2004

    Crain's Chicago Business reports that one of the options being considered by Kraft CEO Roger Deromedi as he looks to improve the company’s profitability is a 10 percent cut in the company’s workforce, which would amount to some 6,500 employees.

    Kraft is not commenting on the report.

    The move would follow by less than a month the decision to move co-CEO Betsy Holden out of the co-CEO position and give the whole job to Deromedi. Since then, Holden has been named Kraft's president, global marketing and category management.
    KC's View:
    For a Monday morning, all these layoffs are getting us depressed.

    Published on: January 26, 2004

    Last week in Denver, more than 400 people gathered for the first "LowCarbiz Summit," a conference designed to examine (and exploit) the $15 billion-and-expanding low-carbohydrate business that has been popularized by the Atkins Diet and its brethren.

    If the results of a study released at the conference is to be believed, this remains a big opportunity for retailers. After all, 84 percent of those queried in a poll said they knew something about low-carb diets…and only 81 percent said they knew something about Weight Watchers, In addition, the poll said that some 59 million people in the US are watching their carb intake.

    Notes from the conference:

    • The general agreement was that for low-carb products to be successful, better packaging and marketing are critical.

    • There was considerable debate (and no conclusion) as to whether low-carb products should be integrated with mainstream food items or segregated into their own section.

    • Experts seem to feel that the low carb business will grow 90 percent this year and next.

    KC's View:
    Ninety percent growth this year and again next year? Is that a prediction or wishful thinking?

    We've been amused the last few days over the controversy that erupted in New York when Mayor Michael Bloomberg joked that he didn’t think that Dr. Robert Atkins had died because he'd fallen, but rather that it was a result of his being overweight…and that when he'd eaten food at an Atkins party, it had been inedible.

    This joke - which seemed to go over about as well as Hillary Clinton's Gandhi remark, or Howard Dean's primal scream - outraged Atkins' widow, and Bloomberg finally had to apologize and offer to take the widow Atkins out for a steak.

    You gotta love it.

    The only thing about this that didn’t surprise us was that an Atkins party served inedible food.

    Published on: January 26, 2004

    Starbucks CEO Orin Smith said last week that the company has ramped up its test of a hot foods program to 80 stores and is seeing "very positive results" so far.

    "We expect that will influence not only the sale of the morning product which will be brought closer to its fresh state with the warming process, but will also have a lot of relevancy for the sandwich program," Smith told analysts in a conference call.

    The company also said it has increased a lunch program to 900 stores, and that it is gaining "traction."

    It was about three years ago that Starbucks suspended a lunch program and pronounced the results disappointing.
    KC's View:
    If at first you don't succeed, try, try again.

    The thing about Starbucks is that, once it has stores on virtually every street corner in the civilized world, it's gonna have to find new stuff to sell.

    A sophisticated and quality foodservice program isn’t just a smart move, it's inevitable. And you have to admire the company’s willingness to test, to pull back when things aren’t going well, and then give it another shot.

    Published on: January 26, 2004

    The Los Angeles Times also reported that "Safeway Inc. recently awarded 11 senior and executive vice presidents millions of dollars in stock grants and options under a new compensation plan that is drawing fire from labor leaders and others."

    According to a Safeway spokesman, the compensation arrangement was necessary because of a number of high-level defections last year, and the desire to keep the existing management team in place and attract new and capable people. Safeway has a two-year policy of wage freezes and undersized bonuses, according to the LAT.

    The UFCW has criticized the timing of the move by Safeway, coming at a time when the company is looking for wage and benefits concessions from store employees and when earnings have been down.

    "Executives should not be rewarded for losing money," said Rick Icaza, president of UFCW Local 770 in Los Angeles. "It is obscene to reward executives with fat bonuses when more than 20,000 employees have given up their own paychecks."

    Safeway CEO Steven A. Burd reportedly wasn't included in the stock-and-option reward plan.

    Of course, it is unlikely that the UFCW is going to scream and moan too much, considering how much its officials make.

    The LAT also reports today that Icaza earned $273,404 in 2002, 10 percent more than the previous year, out-earning even John Sweeney, the national president of the AFL-CIO, who made $247,500 that year. Icaza also out-earned by $56,000 Richard Trumka, the AFL-CIO official who has been brought in to create a national campaign to support the UFCW in the strike.

    UFCW International President Douglas Dority makes a whopping $329,792 a year, which the LAT says makes "him the best-paid president among the AFL-CIO's 64 member unions in 2002."
    KC's View:
    While we would agree that paying executives more money while howling about losses isn’t the smartest political move for Safeway, we think that Icaza has some serious questions to answer about his own income. After all, his members are losing money every day, are in far more dire straits with almost every passing hour - and he's still raking in the big bucks.

    Published on: January 26, 2004

    The Idaho Statesman reported that three dairy cows have been found in Idaho that were part of the herd from which the cow infected with bovine spongiform encephalopathy (BSE), better known as mad cow disease, emanated.

    One of the three cows died last March, and was not tested for mad cow disease…though to this point state officials say they have found no indication that it was infected with BSE. The dead cow reportedly was sent to a rendering plant and not put into the food supply.

    The Idaho Department of Agriculture has put a "hold order" on the farm where the cows were identified, though officials there went to great pains to reassure consumers that there was no reason to worry about the food supply.

    Until this announcement, the US Department of Agriculture (USDA) reportedly had identified and located 23 of the 81 cows that came from Canada in the herd that included the cow infected with mad cow disease. When that cow was found to have BSE, it was the first discovery of mad cow on US soil.

    Meanwhile, The Wall Street Journal reports this morning that the federal government plans to implement rules that would prevent potentially contaminated materials derived from cattle to be fed back to cattle and other livestock. The Bush administration is also considering a ban on the inclusion of high-risk materials such as cows' small intestines in human food or supplements.

    It is generally perceived that the government is making these moves under pressure to do something in response to the mad cow crisis, though it is resisting calls for broader testing of cattle in the US.

    And for its part, the beef industry is launching a $3 million advertising campaign to get people to eat meat, though the ads reportedly will not mention mad cow disease.
    KC's View:
    They can be as reassuring as they want…if cows from that herd keep popping up in more and more states, it certainly is going to create issues and questions about what else is out there.

    Published on: January 26, 2004

    There were numerous published reports over the weekend about the testing of mid-calorie colas _more than zero-calorie diet sodas, but less that regular sodas) from both Coca-Cola and PepsiCo, companies that are looking at this new category as a potential source of fresh sales growth.

    Coke, for example, reportedly has been testing a "Coca-Cola Ultra." Pepsi has trademarked the name "Pepsi LS" (for "low sugar"). Reports are that it could be months before any rollout plans become known.

    Cadbury Schweppes also reportedly is considering the development of a mid-calorie soft drink.
    KC's View:
    We generally try to avoid making prognostications on products like these. After all, when we were working for our college newspaper as a movie reviewer back in the mid-seventies, we saw some press materials for what appeared to be a cheesy science fiction flick and openly opined that Alec Guinness's career clearly had gone downhill for him to be appeared in such stuff. The movie, of course, was "Star Wars." So, we're aware of our fallibility in such matters.

    That said, it seems to us that the risk in this category is being seen as neither fish nor fowl. The challenge for the companies investing in mid-calorie drinks is to identify the benefits for the consumer without somehow diminishing the values that are associated with either the full-calorie or no-calorie segments.

    Published on: January 26, 2004

    Sometimes the media (MNB included) gets so wrapped up in the anti-Wal-Mart drumbeat that we can hear in various places around the country that it is worth paying attention to some of the different drummers out there.

    For example…

    • There was an interesting piece in The Columbus Dispatch last week that chronicled the opening of a new supercenter in London, Ohio. According to the paper, "London has, for the most part, been free of the 'no big-box store' campaigns, like those in Newark, Westerville and Liberty Township. The land on which the 197,000-square-foot Wal-Mart sits in London has been zoned for such a store since the mid-1990s."

      And when the store opened, consumer showed up in droves, a local high school band played "Louie, Louie," the mayor cut the ribbon, and Wal-Mart served pieces of patriotic-themed cake, even though its was 7:30 a.m. It all, the Dispatch reported, "was designed to generate goodwill for the retailer, which often is derided as a killer of downtown shopping and a contributor to urban sprawl."

    • The San Francisco Chronicle reported that the anti-Wal-Mart feelings in Contra Costa County are hardly unanimous. Contra Costa is the place where the board of supervisors approved a ban on supercenters and bog box stores - a ban that will be voted on in a referendum in March.

      But now, Wal-Mart reportedly has found a number of local politicians in Contra Costa towns and cities who are against the ban. The Chronicle reports that "the names of more than a half-dozen elected officials from Antioch, San Ramon, Walnut Creek, San Pablo and Oakley appear on letters sent to registered voters by Contra Costa Consumers for Choice."

      While the proposed ban charges that supercenters cause traffic and overcrowding, the argument isn’t subscribed to by some local politicians. San Ramon Vice Mayor Dave Hudson, for example, who is running for county supervisor, said, "To protect open space by not allowing a big-box store is just wrong." Hudson also said that the taxes generated by such a store would far outweigh whatever traffic issues might crop up.

      The Chronicle notes that the opposition to the ban is being organized by the Contra Costa Consumers for Choice, a group "heavily funded" by Wal-Mart.

    KC's View:
    Of course, Wal-Mart still manages to kick up controversy for a variety of reasons.

    In Madison County, Alabama, for example, there is a bit of an argument going on because a proposed Wal-Mart would obscure a cemetery containing the graces of Revolutionary War soldiers.

    Which is deemed to be more significant than the graves of all the retailers the store is likely to put out of business…

    Published on: January 26, 2004

    As first reported here on MNB Friday morning in a "Breaking News" story, Michigan-based Meijer is engaged in substantial layoffs as way of streamlining its operations to be more competitive.

    The company is eliminating some 1,900 jobs in its 158 stores as well in its corporate headquarters and distribution centers. The job cuts are largely from the company’s managerial and administrative ranks.

    Meijer spokesman John Zimmerman said, "As part of our continual transformation, we have been studying the industry's best practices. As a result, we have determined we need to streamline our stores' supervisory structure in each store. These are hard decisions to make but they're necessary decisions."

    It is not known if any stores will be closed by the company, though MNB has learned that it is likely that Meijer is considering not building a long-planned store in Hoffman Estates, Illinois, which has been the subject of some court battles.

    This is Meijer's third round of significant cost cutting in less than three years, though it is by far the farthest reaching. The company eliminated 400 office jobs, mostly through attrition, back in July 2001, and then cut about 350 white-collar positions in December 2003.

    There was heart-wrenching coverage of the layoffs in the Bay City Times, which quoted one laid-off department manager as saying that "it was very, very cold and unfeeling. I didn't expect a hug, but just the day before we were given a video presentation by (Meijer Co-Chairman and Chief Executive Officer) Hank Meijer himself, a videotape prepared ahead of time, telling us how great a year Meijer had in 2003 in terms of profitability.

    "He thanked us for our excellent work, our dedication and our professionalism, and then it's 'Oh, by the way, over the next few weeks we'll be making some changes.'"
    KC's View:
    It is ironic that Meijer, which pioneered the supercenter concept four decades ago, now is being pushed into these major cuts in part because of competition from Wal-Mart's supercenters.

    Life ain't fair.

    That said, we have to say that we believe Meijer is serious about its efforts to reinvent itself. Hank Meijer, the company's CEO, has been very public about the organization's need to be less insular in its approach to the business, and more open to the sharing of information and strategies with vendors.

    Meijer has called the current environment "the new normal." This reality is an unpleasant one for the almost two thousand people and families affected by this round of cuts.

    And once again, we see evidence of what is becoming popularly known as the "jobless recovery." On the Sunday morning political shows, there was some discussion about this "jobless recovery," and the irony that despite the economic problems that would ordinarily be associated be unemployment issues, the stock market seems to be leading the charge of people saying that the economy is on the rebound.

    Stories like Meijer's and last week's enormous layoffs at Kodak in New York State, certainly create questions about the quality of the recovery. In Western Michigan alone, 700 workers at an Electrolux recently found out that their manufacturing jobs will head to Mexico next year. And Steelcase, the area's biggest manufacturer, is believed to be readying yet another in a series of restructuring/layoff announcements.

    After all, it isn’t just that these are 1,900 people from Meijer who just are out of work. It is 1,900 people who are very shortly are going to start having trouble buying food for their families, clothes for their children, and the other kinds of necessities normally associated with life in a robust and prosperous environment.

    On the other hand, if they don't have much money, they always can shop at Wal-Mart. And since the conventional wisdom is that "as Wal-Mart goes, so goes the country," maybe we're not in such bad shape after all.