retail news in context, analysis with attitude

MNB Archive Search

Please Note: Some MNB articles contain special formatting characters, and may cause your search to produce fewer results than expected.

    Published on: November 29, 2004

    Fascinating story in Sunday’s New York Times about the two-year old Vermont Alliance of Independent Country Stores, which was formed as a kind of support group for owners of the small, resolutely independent retail units in the state that were built before 1927; there are 100 such stores in Vermont, of which 55 have joined the Alliance.

    While such stores “have long been a Vermont way of life,” the NYT reports, many are “threatened by the minimarts and large grocery chains that have driven some of them out of business in recent years,” and have decided to band together for emotional and business support and for strategic and marketing heft that they might otherwise not have.

    “The alliance, started with state grant money and sustained by annual dues of $50, holds meetings every few months and is supported by the Vermont Grocers Association, a lobbying group,” the paper writes. And the Alliance also is moving in the direction of developing its own proprietary brand that would only be sold in Vermont country stores.

    “They represent, both in terms of the present and past, Vermont's communities," Dennis Bathory-Kitsz, executive director of the alliance, tells the NYT. “They contain things that people want to buy, and they are a place that people want to go talk and meet friends. They are just a real example of those traditions in Vermont that survive not because they're cute but because they're necessary.”

    As necessary as the tradition might seem, the NYT notes that these retailers have to remain both current and relevant if they are to survive, and that this is an ongoing struggle within the economic framework that defines modern retailing.
    KC's View:
    The folks at the Vermont Alliance of Independent Country Stores ought to reach out to the folks at Raise The Bar, a California-based organization that is doing much the same thing for independent grocers there – providing support, developing proprietary brands, and helping its membership meet the demands of modern consumers.

    The most important thing that the folks in Vermont seem to have realized is that simply being traditional and historical isn’t enough – you have to be aggressive and ambitious, and provide consumers with a compelling reason to shop your store. Such a reason isn’t always price…but as we’re find of saying, “compete” is a verb. You have to empower yourself in these situations, not wait to be empowered by others.

    By the way, y’think it is just a coincidence that earlier this year, the National Trust for Historic Preservation placed the entire state of Vermont on its 2004 list of the most endangered historic places in the United States? Clearly, these independent retailers aren’t depending on such moves to protect them…and they are actively working to defend their turf.

    Published on: November 29, 2004

    The National Retail Federation (NRF) reports that over the past Thanksgiving weekend in the US, the average shopper spent $265.15, bringing total weekend spending to $22.8 billion. – roughly 10 percent of total projected 2004 holiday sales.

    Of those who shopped, many headed out on Friday (64.6%) but consumers were also shopping on Saturday (54.1%) and Sunday (25.3%). In addition, nine million people got a head start on the crowds by shopping on Thanksgiving Day.

    According to an NRF survey, the majority of shoppers headed to discounters (61.8%) though department stores (44.3%) and specialty stores (40.5%) also saw strong traffic. As expected, online retailers also had a solid weekend, with nearly one in three consumers (29.3%) choosing to do some of their holiday shopping over the Internet.

    Reuters noted in a separate report that “Black Friday used to be the biggest shopping day of the year, but now it competes with the Saturday before Christmas for top sales.” According to some data, Black Friday sales were up more than 10 percent over a year ago.

    Not all the news was good, however. Wal-Mart – which several weeks ago said that for the first time it would not release specific Black Friday sales figures – announced that November same-store sales were up just 0.7 percent compared to last year, less than half the increase previously projected.
    KC's View:
    We have to admit that Mrs. Content Guy went out with a friend at 6:30 a.m. Friday, hoping to catch the early holiday sales at the mall.

    As for us, we slept until about 8:30 a.m., then started the coffee, went for a jog, brought back doughnuts for the kids, then relaxed with the paper.

    Who had the better Friday?

    Despite her best efforts, though, we have to say that her experience runs contrary to another statistic generated by NRF – that as of yesterday, the average person has completed 36.8 percent of their holiday shopping, and that one in 12 consumers is completely done.

    They’ve gotta be kidding.

    Published on: November 29, 2004


    • Following last week’s announcement that it would not resist the unionization of its stores in China, Wal-Mart further clarified that position by saying that its “global policy is to work within the laws of individual countries," as opposed to a change in its anti-unionization stance.


    • A report in various Florida media suggests that while military exchange stores can be as much as nine percent cheaper than Wal-Mart, military families believe that, in fact, Wal-Mart is cheaper…and go out of their way to shop there.

      The result? Military exchanges reportedly looking for ways to economize, including the streamlining of back-office operations, that will allow them to be even more competitive.


    • In Florida, an appeals court has ruled that a lawsuit there against Wal-Mart – charging that the company forced employees to work off the clock – should not be awarded class action status, which would have allowed attorneys in the case to represent some 230,000 Wal-Mart employees in Florida.

      The judges said that the group listed in the class action was too broad, but left the door open for a different ruling if the group is pared down.


    • There’s an interesting meeting on tap for northern Quebec later today – Wal-Mart is scheduled to sit down with union negotiators for employees at its store in Saguenay, who succeeded in organizing earlier this year.

      While Wal-Mart may be meeting with the union, its mind will also be elsewhere in Canada because of concerns that the unionization movement there could begin to gain momentum. Wal-Mart already has made noises about the Saguenay store not being profitable, and that it might be necessary to shut it down.


    • Sometimes, there is a tendency to over-simplify the debate that can surround the building of a Wal-Mart Supercenter…not just among the citizenry, but also among politicians and the mainstream media. (MNB may even be occasionally guilty of that, though we try hard to always consider context.)

      A story in the Salt Lake Tribune strikes us as a good example of how complicated these situations often can be. (We see dozens of these kinds of stories each week, and can’t possibly report on every debate taking place over a Wal-Mart…but this one caught our eye and attention.)

      In Sandy City, Utah, there is a debate taking place over a proposal for a 100-acre development that will include a Wal-Mart Supercenter and a Lowe's home improvement store. While there are a number of residents that are unhappy about the development, fearing lowered property values and stresses on the area’s infrastructure, there also are economic concerns at play – the city’s tax revenues are down, and some are worried that if the new development isn’t approved, Wal-Mart, Lowe’s and their ilk will choose to move out of town and take their tax revenues with them.

      And that’s what really complicates the issue: Wal-Mart and Lowe’s apparently already have stores there, and opponents wonder why their existing units aren’t enough.

    KC's View:
    We have a simple answer for the Wal-Mart opponents in Sandy City.

    The word “enough” really isn’t in the American vocabulary. It’s in dictionaries, but nobody uses it, and few people believe in the concept of “enough.”

    It isn’t just Wal-Mart.

    Published on: November 29, 2004

    A new survey, conducted by Opinion Research Corp., says that 75 percent of those questioned said that they feel that if only one name is to survive the Sears-Kmart merger, it should be Sears.

    The feeling seemed to be that while Sears represents definable marketing equity because it is linked with brands such as Craftsman and Die-Hard, Kmart doesn’t really represent anything much at all.
    KC's View:
    Doesn’t really matter. Neither will exist for very long as soon as majority shareholder Fast Eddie Lampert figures out how to unload all the retail real estate he owns.

    Published on: November 29, 2004

    The New York Times reports that toymaker Little Tikes has created a new toy, the MagiCook Kitchen – which uses radio frequency identification (RFID) technology that can stimulate a robotic voice to offer cooking instructions. The unit is pricey - $90 for the hardware, plus another $60 for RFID-equipped food packs – but designed to appeal to both the computer nerd and cook in any child.
    KC's View:
    Nice to see that toymakers are doing their best to get kids interested in cooking…since the food industry, from our perspective, seems to be doing very little in this area.

    Published on: November 29, 2004


    • The Arizona Republic reports that new draft guidelines are being published by the US Food and Drug Administration (FDA) that encourage “voluntary safety evaluations of bioengineered food crops that sometimes drift and cross-pollinate with plants in nearby fields.”

      While the biotech industry endorses the approach, consumer advocates and environmental activists prefer enforced and rigorous testing and call the FDA approach a “band-aid.”


    • The Washington Post reports that as Toys R Us prepared to compete this holiday season – in what could be its final holiday season as a toy retailer if things don’t go well – it “is betting its survival on the proposition that not all consumers are happy fending for themselves amid a glut of stuff and that when it comes to toys, even diehard bargain hunters want the right item, not just the cheapest one.”

      The Post reports that “Toys R Us has spent the past year systematically changing just about everything it does. The company is coaching employees to spend more time with customers, making toys easier to find with bigger displays and color-coded store maps, and even pressing manufacturers for exclusive rights to hot items such as the Barbie Fantasy Tales collection -- which it got.”

      "To succeed, we have to bring more to the party than low prices," Toys R Us vice president of in-store marketing Greg Ahearn tells the Post.


    • The Wall Street Journal this morning reports that “retailers such as Guess Inc., Staples Inc., Sports Authority Inc., and Limited Brands Inc. are among those using software called Verify-1” that “helps retailers decide whether to deny returns or exchanges using a program that monitors a shopper's track record of bringing items back.”

      The goal is to solve the problem of so-called “serial exchangers” who abuse return and exchange policies.


    • PlanetRetail.net reports that Germany-based Aldi plans to spend the equivalent of almost $900 million (US) to almost double the number of stores it has in the US from 278 to 450 within the next five years…and that the company has along-term goal to expand its UK fleet to 1,500 units.


    • There are reports in the British media that Marks & Spencer plans to sell half of its Simply Food convenience stores, saying that the division is poorly performing.


    • UK retailer Tesco reportedly is launching a private label line called Carb Control that will be made up of some 180 items.

    KC's View:

    Published on: November 29, 2004

    For folks looking to order the hottest holiday gifts online over the next few weeks, Amazon.com has come up with a virtual guide – a list of the top three products, broken out by category, sold by the online retailer between November 1 and 23.

    They are:

      Gourmet Food
      1. Cranberry Fool, 11 Ounce Jar, by Caramel Sin, $8.95
      2. Holiday Cheer Gift Basket, by Wine Country Gift Baskets, $31.90
      3. Ghirardelli Tower Gift Basket, by Wine Country Gift Baskets,
      $25.90

      Apparel & Accessories
      1. UGG Australia 'Classic Short' Boot, $109.95
      2. Boston Red Sox 2004 World Series Champions Adjustable Cap, $19.99
      3. Geoffrey Beene Wrinkle Free Sateen Solid Dress Shirt --
      Point Collar, $24.99

      Beauty
      1. Britney Spears Curious Fragrance, $20.00-$49.50
      2. DuWop Lip Venom, $15.00
      3. Philosophy The Gingerbread House (includes gingerbread man body
      souffle, foaming gingerbread bubble bath, shower gel, and kiss me
      lip balm), $35.00

      Books
      1. "America (The Book)" by Jon Stewart, $14.97
      2. "The Perricone Promise" by Nicholas Perricone, $16.77
      3. "The Polar Express" by Chris Van Allsburg, $11.37

      Computer & Video Games
      1. Halo 2, $47.98
      2. Halo 2 Limited Edition, $48.99
      3. Game Boy Advance SP, $79.95

      DVD
      1. "The Lord of the Rings -- The Return of the King" (Pre-Order;
      Platinum Special Extended Edition), $23.99
      2. "Harry Potter and the Prisoner of Azkaban"
      (Fullscreen/Widescreen), $17.97
      3. "Star Wars Trilogy" (Widescreen Edition), $41.99

      Electronics
      1. SanDisk SDSDB-512-A10 512 MB Secure Digital Card, $53.89
      2. Philips DVP642 DivX-Certified Progressive-Scan DVD Player, $63.94
      3. Netgear MR814 802.11b Wireless 4-Port Cable/DSL Router, $34.99

      Home & Garden
      1. Calphalon Commercial Hard-Anodized 12-Inch Everyday Pan with Lid,
      $24.95
      2. Fire and Ice Thermos Grill by Char-Broil, $148.00
      3. Matfer Exopat Nonstick Baking/Roasting Sheet, $9.99

      Jewelry & Watches
      1. Sterling Silver and Swarovski Crystal Heart Pendant on Satin Cord,
      16", by Paris Hilton, $35.00
      2. Floating Heart Pendant With Diamond, by Samuel Jewelers, $39.99
      3. Freshwater Cultured Potato Pearl 9.0-10.0mm Necklace and
      9.0-9.5mm Stud Earring Set, by Amazon.com Collection $29.00

      Music
      1. "How to Dismantle an Atomic Bomb", U2, $10.99
      2. "Stardust...The Great American Songbook: Volume III", Rod Stewart,
      $13.49
      3. "Merry Christmas With Love", Clay Aiken, $13.99

      Sports & Outdoor
      1. 500-Piece 11.5g Clay Composite Poker Chip Set, by Cheapcues Poker,
      $79.99
      2. Ab Lounge 2 Abdominal Exerciser, by Fitness Quest, $89.99
      3. "Hey New York, Who's Your Daddy Now?" T-Shirt, $19.99

      Tools & Hardware
      1. Porter-Cable Finish & Brad Nailer Combo Kit, $299.99
      2. Toro 38360 Electric Power Shovel Plus, $119.99
      3. HyLoft Overhead Storage System, $49.99

      Toys
      1. V-Smile Electronic Learning System, $49.99
      2. Cranium Hullabaloo Game, $19.95
      3. Fridge Phonics Magnetic Letter Set, $17.99
    KC's View:

    Published on: November 29, 2004


    • Ahold’s Bi-Lo/Bruno’s group has promoted Michael Yakovsky, who has been in charge of the company’s meat/seafood operations, to the position of group v.p. of perishable marketing.

    KC's View:

    Published on: November 29, 2004

    MNB reported on Wednesday that a new study suggests that many shoppers are strapped for cash as the holiday shopping season commences, which could lead to less than robust sales between now and the end of the year.

    To which one MNB user wrote:

    Hmmmmm…maybe this is further indication that the middle class continues to drift towards the lower end as more and more new jobs are at the lower end of the scale. Will a Wal-Mart full time employee be as likely to have cash for Christmas spending as a Costco full time employee?



    And responding to our story about Wal-Mart being willing to work with trade unions in China, another MNB user wrote:

    Is it just me or does the idea that Wal-Mart workers in China have more workers rights than the same workers in the US and Canada do seem a little odd?

    We’d be a little careful there. Wal-Mart’s employees in China may be unionized, but they likely don’t have more “workers’ rights” than their US counterparts, who, after all, still work in a democracy.




    We had a story on Wednesday about a new study from the US Department of Agriculture (USDA) suggesting that next year, for the first time in fifty years, the United States could import as much food as it exports.

    We noted that America used to be known as the “breadbasket of the world,” and that one of the things that made us special was the fact that we could feed not only our own people, but also millions of people around the world less fortunate. If somehow the US has squandered that advantage, we mused, then has the US lost something more?

    One MNB user responded:

    Kevin -- you make the comment that "But we hope that somehow we haven't squandered one of our greatest advantages as a nation - the ability to fill people's bellies, and to teach them to feed themselves."

    Remember that a fair amount of what we ship overseas as food is free – to fill people's bellies. These generally are either shipped at no value, or at the minimum value possible to minimize taxes and duties. It's terrific and necessary, but it also skews the export numbers significantly.

    AND ...it's also an arithmetic issue for another reason. We are still one of the largest producers of a wide variety of grains (read raw materials). By definition, the value of the raw materials will be less than the value of the finished good -- with a bargeload of wheat, there's no processing, no additional ingredients, no packaging, no ad campaign, and comparatively little sales budget. (And that bargeload of wheat will sell for far less than a containerload of whatever is made from it -- to possibly be sent *back* to the US!)

    I think that for a lot of us, US mass-market suppliers have gone for the lowest common denominator -- they fill people's bellies, but that's about all. There *are* exceptions (like the wonderful dairy products put out by Vermont's Cabot Creamery...I'll name names for that kind of quality), but for the most part, so much is homogenous and, well, just BORING (tasteless spongy white bread, process cheese food, those square pink things that they call tomatoes -- what kind of demand is there for those!) that imported foods add some longed-for variety and FLAVOR. HobNobs, Argentinian malbec, a find old Stilton, New Zealand lamb, and a silky, very old tawny Port -- all are examples of things that simply are not available from US suppliers – and would NOT be considered luxury goods (at least not at Costco prices!). Keep that in mind the next time you have Thai, or Italian, or Mexican food – and take a look at how much of it is imported...then try to find that same ingredient produced *entirely* in the US...good luck.

    Remember, too, that there is an *enormous* population of people who have come here from other places. They miss and prefer the products that come from home, wherever that may be. It's only savvy marketing to bring the products to the people -- thus as our foreign-born population increases, so likely will the importation of "foreign" foods.

    And how wonderful for the rest of us! How better to become aware of other cultures and ways of life than to eat what is common THERE, then let curiosity expand that interest into the rest of the lifestyle? (And for the not-so-adventurous, wouldn't it make you a little less hesitant to visit somewhere if you knew you at least like the food?)

    This is another case where imports are not necessarily an evil thing, nor a bad reflection on us -- it is what it is...

    Sorry to get long-winded -- imports and exports are my main concern most days -- and just like every other field, it's a game of numbers played for one's own advantage...


    We think we feel better now.

    MNB user Dave Wiles wrote:

    You wrote "we hope that somehow we haven’t squandered one of our greatest advantages as a nation – the ability to fill people’s bellies, and to teach them to feed themselves."

    Have you considered that with all of the years of aid and knowledge we have been giving to other countries, that just maybe, we have taught a few of them to feed themselves and they don't need the exports from us but can finally grow there own. Now they are exporting too.

    "Teach a person to fish and they can feed themselves for life". We did this in farming.


    Okay. We do feel better now.

    Our reaction was based on our long-term conviction that in a world where the US always has sought to influence other nations, our food was our best bargaining chip. Maybe we’re wrong, but we’ve always been a “swords into ploughshares” kind of guy…
    KC's View:

    Published on: November 29, 2004

    In Week 12 National Football League action…

    Tampa Bay 14
    Carolina 21

    Cleveland 48
    Cincinnati 58

    Tennessee 21
    Houston 31

    San Diego 34
    Kansas City 31

    Jacksonville 16
    Minnesota 27

    Philadelphia 27
    NY Giants 6

    Washington 7
    Pittsburgh 16

    New Orleans 21
    Atlanta 24

    Baltimore 3
    New England 24

    NY Jets 13
    Arizona 3

    Miami 24
    San Francisco 17

    Buffalo 38
    Seattle 9

    Oakland 25
    Denver 24

    Indianapolis 41
    Detroit 9

    Chicago 7
    Dallas 21
    KC's View: