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    Published on: October 26, 2007

    Excellent piece in the new Fast Company by Alex Frankel, an excerpt from his new book about his experiences working in retail. By far, Frankel writes, the best experience he had was working at the Apple Store. Some excerpts:

    • “You can only learn so much about frontline employees as a customer, or even as a reporter. I knew that to find out how the best companies train and indoctrinate employees, I'd have to become one myself. In what wound up as a two-year undercover project, I took a series of entry-level retail jobs, becoming that critical employee who represents the company's face. I did it to better understand the world of commerce and the corporate cultures that drive it. In the process, I learned that Apple Stores, with their aura of cool, were in fact living up to their mission to ‘reinvent retail’ and setting a high bar for other companies in the retail world.”

    • “I knew I'd have competition when I applied at the Apple Store, but I also knew store managers hire from the ranks of the brand's fans. Apple is surely a rare bird—few companies have such a broad and committed following, let alone frontline employees who revere its CEO…”

    • “Apple does a lot of other things well. Employees are taught how to work together because customers notice when employees don't get along. Apple floods its retail zone with staff because the bottom line suffers every minute customers wait for help … Apple requires staff to wear tasteful company-issued T-shirts and lanyards. Employees also hand out business cards as in high-end clothing stores, an act that calls them out as individuals in a way not typical of traditional retail.”

    • “…in my Apple Store interview, I talked about all the Apple products in my life: from iPods to iMacs, AppleCare to Safari.

    “Once on staff, I learned the difference between a gigahertz and a gigabyte, but more important, I saw that, like the iPod's user interface, training of Apple Store employees has been carefully designed. A series of podcasts I listened to and watched showed that selling was all about the approach. I shadowed other workers as they executed the company's three-step sales process. They explained to customers that they had some questions to understand their needs, got permission to fire away, and then kept digging to ascertain which products would be best. Position, permission, probe.

    “All this sets the employee's on-the-job attitude. At an Apple Store, workers don't seem to be selling (or working) too hard, just hanging out and dispensing information. And that moves a ridiculous amount of goods: Apple employees help sell $4,000 worth of product per square foot per month. When employees become sharers of information, instead of sellers of products, customers respond.”
    KC's View:
    Read that sentence again:

    “When employees become sharers of information, instead of sellers of products, customers respond.”

    How many of your employees can answer any customer question, other than perhaps telling a shopper in which aisle a particular item may be located?

    This Fast Company piece ought to be required reading for anyone in the retailing business.

    Published on: October 26, 2007

    There is a great piece on Salon.com about Alice Waters, the founder of Berkeley’s Chez Panisse, an author, and a champion of local eating and organic cooking.

    Waters, to put it mildly, is an extremist:

    “Alice Waters is not content for you to simply eat organic produce,” Salon writes. “No, no. It's got to be organic and local and seasonal, and really, for it to be any good at all, you have to get it from the farmer who pulled it out of the earth. And ideally that farmer would be a friend of yours. You and he would discuss the soil and seasons and his search for heirloom varieties, and he would give you tips for your own garden, where, of course, you'd spend many of your weekends.

    “Alice Waters doesn't want you to use store-bought stock, or mayonnaise from a jar, anything frozen (even peas!), or salad that comes in a bag. She would rather you stay away from nearly every kitchen appliance, including a blender -- a food mill or a Japanese mortar and pestle called a suribachi is wholly preferable.

    “Consider the eggs Alice Waters wants you to buy, the eggs she serves at Chez Panisse: eggs from chickens raised on a pasture, chickens who enjoy, among other humane conditions, freedom from having their beaks trimmed by their handlers. This is a practice performed at nearly every egg farm in the country, including the ones that sell the $4-a-dozen eggs you buy at so-called responsible stores like Whole Foods. Even in the San Francisco Bay Area, it is extremely difficult to find Waters-approved eggs – for long periods of the year, production is so low that farms impose rationing and stop supplying most stores; you have to wake up very early even to find them at the farmers' market.”

    Waters’ new book, "The Art of Simple Food: Notes, Lessons, and Recipes From a Delicious Revolution," lays out some basic gastronomic principles. And this is where some of what she says seems somewhat less extreme: “Eat locally and sustainably, eat seasonally, eat together with friends and family, and most important, to remember that ‘food should never be taken for granted’.”
    KC's View:
    First of all, I had one of the best meals of my life at Chez Panisse, so she gets points for that.

    Essentially, her gastronomic principles are good ones, and certainly could form the core of a differentiated marketing strategy. She’s a little out there for my tastes in terms of her purism about where foods come from, but it is hard to argue with her essential premise that the American focus on speed and quantity as opposed to quality and nutrition certainly has hurt our national approach to food.

    And while Waters may be something of a prophet in the wilderness, I think she reflects an approach to food that has a small but growing list of disciples. Food retailers need to think seriously about these issues – not because they plan to adopt all of her views, but because thinking seriously about food and quality and sustainability and the their relative importance to how we live our lives seems like a smart thing to do.

    Check out this story and interview with Waters over on Salon.com.

    Published on: October 26, 2007

    The Baltimore Sun> reports that Ahold-owned Giant Food plans to “overhaul a majority of its stores in the most aggressive strategy yet to fend off the growing competition that has caused the company to lose some of its footing as the region's largest grocery chain. The grocer said it would remodel or replace 100 stores during the next three years. It's the largest investment made in the 185-store supermarket chain since Dutch food company Royal Ahold bought it for $2.7 billion in 1998.”

    The strategy comes after a period of time during which the company has been closing underperforming stores, cutting prices and consolidating operational functions with
    Ahold’s Boston-based Stop & Shop division.
    KC's View:
    From everything I’ve heard, the biggest challenge that Giant faces in trying to convince customers that it is a local supermarket chain, no matter what company owns it. That’s the position that Giant always occupied, and that is the position that it has lost over the past few years, and not just because of the consolidation with Stop & Shop.

    Though, it is hard to convince people that you are a local company when Giant does things like it did yesterday – sending out as press release saying that it was announcing “sweeping price reductions for dairy, frozen and coffee products,” in line with previous price reductions that it has announced. The problem is that the press release was almost word-for-word identical to one sent out by Stop & Shop at the same time. I understand about operational efficiencies, and I understand that Ahold has abandoned its previous strategy of allowing its divisions a certain amount of autonomy. But it is this new approach that seems to be hurting Giant.

    Even with the store overhaul, the problem is that a lot of people may not believe Giant, and a lot of people may not remember that Giant once dominated the market to an extent that nobody else really could make any headway there. That’s not the case anymore. Giant is perceived as weakened and against the ropes, and I’m not sure that announcing this overhaul of 100 stores is going to frighten anybody.

    Published on: October 26, 2007

    Forbes reports that in the wake of the devastating damage done to New Orleans by Hurricane Katrina, Winn-Dixie has managed to use the situation to its own advantage. “While competitors reeled, the chain last year - even as it reorganized under bankruptcy protection and closed hundreds of stores - netted big sales gains in neighborhoods that remained sparsely served,” Forbes reports. “Having reopened three stores in New Orleans during the past month alone, Winn-Dixie has replaced Wal-Mart Stores Inc. as the No. 1 grocer inside the city limits.”

    However, the story also notes that Winn-Dixie remains in third place in its home state of Florida, where it has most of its stores, trailing behind both Wal-Mart and Publix.

    According to the piece, “Winn-Dixie's turnaround would have brighter prospects if it had begun it a year or two earlier, but Florida's troubled economy will drive shoppers to bigger chains with the resources to charge lower prices for meat and produce of the same or better quality, said Burt Flickinger III of Strategic Resource Group, a New York-based supermarket consultant.

    “Warehouse clubs, including Wal-Mart's Sam's Clubs, Costco Wholesale Corp. and BJ's Wholesale Clubs Inc., continue to expand in the region, Flickinger notes.

    “Accordingly, he likens Winn-Dixie CEO Lynch to Gen. Robert E. Lee, who led his small, scrappy Southern army to a series of impressive victories before eventually succumbing to a bigger, better-equipped adversary.

    "’Winn-Dixie looks like it may be heading for its own business version of Gettysburg,’ Flickinger said.”
    KC's View:
    As usual, Burt Flickinger finds exactly the right words to describe the Winn-Dixie conundrum. The retailer may have been able to use one disaster to revive its fortunes in one place…but it may be facing a much bigger and unavoidable disaster down the road.

    Published on: October 26, 2007

    • Tesco said yesterday that the fires in Southern California have not disrupted its plans to open its first Fresh & Easy Neighborhood Markets there on November 8. “It ‘s very much business as usual,” a spokesperson told Dow Jones, the Wall Street Journal reports.

    • The Arizona Republic reports that Tesco plans to open five Fresh & Easy Neighborhood Markets in the Las Vegas market on November 14, less than a week after opening its first stores in Southern California.

    The story also notes that Tesco plans to open its first stores in Phoenix during November, though no date has yet been announced.
    KC's View:
    Considering the devastation of Southern California by the fires, Tesco may want to avoid the phrase “business as usual,” even if all its openings are going to come off as planned. Just a thought.

    Published on: October 26, 2007

    The Philadelphia Inquirer reports that the Pennsylvania Department of Agriculture has ruled that the state’s retailers and milk processors cannot label dairy products as not being from cows treated with artificial growth hormones.

    According to the story, the state’s change in labeling guidelines “is part of a broader effort … to crack down on labels that highlight what is not in a product, such as ‘antibiotic-free’ and ‘pesticide-free’.” State officials say that “the problem with the claim that cows are not treated with synthetic hormones is that there is no way to distinguish between the natural growth hormone in milk and the artificial version,” the Inquirer writes.

    One company surprised by the announcement by c-store chain Wawa, which, the paper writes, “just last week joined the rush of retailers and milk processors that say their milk will not be produced with the aid of artificial growth hormones, which are used to boost production … Wawa's label says that the farmers it buys raw milk from have pledged not to use rBST, or recombinant bovine somatotropin.”
    KC's View:
    I think this is a crock.

    Just because federal and state officials say there is no difference between milk from cows that have taken artificial growth hormones and those that have not, I don't think that consumers should be denied this sort of information. People who take words like “natural” and “organic” seriously ought to be able to find out if the cows producing their milk are on artificial “juice,” and it seems completely unreasonable to deny them that information.

    This strikes me as the same sort of logic that forbids meat processors from running their own, government-approved tests for mad cow disease and then labeling their products “certified BSE-free.”

    Just who gets protected by such rulings? Certainly not the consumer…

    Published on: October 26, 2007

    The New York Times reports that New York City Mayor Michael Bloomberg has reintroduced a regulation that would “force chain restaurants to display calorie information on their menus or menu boards, after a federal judge struck down a similar measure last month … The regulation would require the calorie counts to be posted as prominently as the price of each menu item. For many fast food outlets, that means the information would be added to the big signs behind the cash registers that list food items and prices.”

    According to the story, the last version of the law was struck down because it only applied to those restaurants that already provided some nutritional information, which the city said it did because it did not want to make the rules too onerous. The judge in the case, however, said that this provision violated federal law … though he essentially invited the city to redraft the regulations in such a way that they would meet federal statutes.

    Which essentially is what the city has done. The Times writes that “the new regulation would apply to about 10 percent of the city’s 23,000 restaurants,” a group that serves approximately one third of all the food in New York City eaten outside the home.

    A public hearing is scheduled for late November, after which the city’s Board of Health is expected to adopt the regulations.
    KC's View:
    After which, I presume, there will be some sort of legal challenge.

    I’m not nuts about government turning into a big nanny, but I’m not sue that this is the case here. This is about transparency and truth in advertising…and companies that want to sell enormous 900-calorie burgers ought to be compelled to put that information in boldface.

    Published on: October 26, 2007

    The Boston Business Journal reports that Stop & Shop is projecting that during the course of the current World Series, in which the Boston Red Sox are playing the Colorado Rockies, New England fans and Stop & Shop customers are expected “to purchase 40,000 pounds of hot dogs, 30,000 bags of Cracker Jack, 90,000 gallons of ice cream, 280,000 gallons of soda and 250,000 pounds of chicken wings.”

    And that’s just the people who are more worried about Manny Ramirez and David Ortiz than they are about nutrition.

    Stop & Shop also reportedly projects that more health-minded shoppers will “munch on an estimated 40,000 pounds of veggie burgers, 20,000 fruit platters and 100,000 pounds of salad.”
    KC's View:
    I know this is going to get me in trouble at home, and probably with my internist, but I think I’d rather hang out with the people eating hot dogs and chicken wings.

    Published on: October 26, 2007

    • The Financial Times reports that Wal-Mart’s Sam’s Club membership warehouse division plans to test an online grocery sales model, offering non-perishable grocery items shipped via outside services such as UPS and FedEx, which is the model being used by Amazon.com.
    KC's View:

    Published on: October 26, 2007

    • The California Grocers Association (GCA) issued a statement yesterday praising a tentative court ruling that the City of Los Angeles’ Grocery Worker Retention Ordinance is unconstitutional.

    The ordinance essentially said that when certain kinds of chains change hands, the retailer is required to retain workers for a period of time. The judge’s ruling will stand unless appealed by any party.
    KC's View:

    Published on: October 26, 2007

    • Ahold this morning announced that its third quarter sales were up 1.1 percent to the equivalent $8.4 billion, with its Stop & Shop/Giant of Landover sales up 0.3 percent to $3.7 billion (US). Same-store sales at Stop & Shop were up 1.7 percent, and down 1.6 percent at Giant. Giant of Carlisle’s sales were up 13.1 percent to $1 billion (US), with same-store sales up 2.5 percent.
    KC's View:

    Published on: October 26, 2007

    On the subject of Delhaize and a much-speculated about acquisition of Ahold, MNB user David Livingston wrote:

    I remember Hannaford was for sale in the late 90s and working on the project visiting stores. I was so impressed going from one store to the other. I thought to myself whoever buys this chain is getting a good company. All the employees I talked with had such positive things to say about the company. That is so rare with publicly held supermarkets. Delhaize ended up buying it. Now when I visit Ahold stores I can't say the same. Morale at store level is terrible. This past year I've worked on several acquisition projects involving Tops in Ohio. The only way they were doing so bad is that someone wanted them to on purposes. … Ahold has become this incredible shrinking company, much the same way A&P has been getting smaller over the years. Delhaize seems to have too much class to buy a company that is spiraling downward.

    It’s during such a spiral that deals are made, isn’t it?

    But I agree with you about Delhaize and all of its US operations – first rate all the way.




    On the subject of Haggen and its food orientation, MNB user Ted File offered:

    Under the leadership of Dale Henley and his entire staff, rest assured that the program will work and be profitable. When you visit with people from Haggen's most of them have grown up in the industry and many have worked with and for Haggen's their entire life. They are visionaries, are a profitable company, and willing to take a

    Agreed on all counts.




    Regarding Wal-Mart store opening plans for next year, one MNB user wrote:

    Isn't it amazing how 140 new Wal-Mart supercenters opening in 2008 has everyone thinking Bentonville is losing its edge, while 7, count 'em 7, Tesco markets opening next month with the combined square footage of less than one supercenter has everyone concerned? One thing's for sure - Tesco's public and media relations staff appear to be much more savvy than Wal-Mart - and if they're that good at pre-opening media and advertising (we've been hearing about this for over a year now), what will the stores be like? Hmmmm....like the man said, "the times they are a'changin'."

    There’s a reason they call it news




    I got a number of emails responding to my brief sports report about the World Series yesterday.

    One MNB user wrote:

    Why not join Rudy Giuliani and root for the AL team? Those of us who live in NY, but grew up in Boston would enjoy the company of your rooting for the (soon to be) winning team!

    I have no doubt that the Sox will win, and living in Connecticut, I have a regional interest in seeing a New England team triumphant. However, “rooting” probably would be too strong, and I address some of these issues below in OffBeat. (besides, I’m a Mets fan, and the pain hasn’t gone away yet…)


    And MNB user Tom Murphy wrote (after Game One):

    Nice win by the BoSox! As a Rockies fan, hope the hitting cools off!

    It did…though the result was the same….
    KC's View:

    Published on: October 26, 2007

    The second game of the World Series was a real nail-biter, but it yielded pretty much the same result – a Boston Red Sox win over the Colorado Rockies, this time by the score of 2-1. The series picks up on Saturday, as it moves west from Boston’s Fenway Park to Denver’s Coors Field.
    KC's View:

    Published on: October 26, 2007

    If you have a job like mine, you tend to get inundated with stories and press releases about studies that have reached this conclusion or that. Some of these studies are genuinely revelatory, and some are just patently absurd. And some of them are just plain fun to read…

    For example:

    HealthDay News reports that a new study says that up to two glasses of alcohol a day – beer, wine, or hard liquor – not only is good for the heart, but also may be good for the lungs, helping to prevent diseases such as asthma and emphysema.

    It doesn’t get any better than this.

    In fact, the only downside of the study is that the consumption of alcohol seems to help the lung function even of people who smoke – which I suppose some idiot will use to push for bars to allow smoking yet again.

    Still, it is nice to know that we can all breathe a little easier for having had a glass or two of wine or beer with dinner.




    And there’s another couple of studies out, one from the University of Chapel Hill in North Carolina and the other from Glasgow's Caledonian University in Scotland, saying that there are two ways to prevent obesity. One is to chew gum. And the other is to stay single.

    I write these words as someone who never chews gum, and who has been married for more than 24 years.

    Explains a lot.




    Just as a change of pace – and it seems appropriate since we’re right smack in the middle of the World Series – I have a couple of beers to recommend this week. Both of them are from the Ommegang Brewery in Cooperstown, NY, which is, of course, home to one of the world’s great museums, the Baseball Hall of Fame.

    The two I’d recommend are:

    • Witte Ale, which is a pale golden wheat ale with just a touch of citrus, perfect for the unseasonably warm days we’ve been having this October.

    • Hennepin Farmhouse Saison, a wonderfully rich golden ale that is a little heavier and spicy than the Witte, but is great with anything from a thick, juicy hamburger to a nice, rich cioppino.

    Enjoy. You can thank me later.




    Normally, I like Subway’s TV commercials, mostly because they have the courage of their commitment – long before most companies were talking about obesity issues, Subway decided that being anti-obesity and pro-nutrition was its ticket to the fast food big time.

    However, Subway has a new commercial out that I find profoundly offensive – it has a father literally throwing a temper tantrum in front of his wife and small son because they don't want to go Subway and get a particular sandwich.

    I am so tired of fathers being portrayed as idiots and big kids…

    Okay, a lot of us are, in fact, big kids. But portraying us as having temper tantrums over a Subway sandwich? That stretches credibility way past the breaking point.




    By the way, if Rudy Giuliani wants to root for the Red Sox in the World Series, despite the fact that he is a lifelong Yankees fan, I’m okay with that. Presidential politics being what they are, I understand that a little pandering can go a long way. (Though he seems to have irritated a number of New Yorkers with his proclamation, and has made it difficult for him to criticize Hilary Clinton for her own baseball waffling a few weeks ago.)

    What I find unforgivable, and illustrative of a total lack of character, is Giuliani’s preference for the American League. They may have better hitters in the AL, but there is no question in my mind that designated hitter-free National League baseball is the purer, superior version of the sport.

    So there.




    Robert P. Parker is out with his 35th Spenser novel, and “Now & Then” (Putnam - $25.95) is a worthy addition to the canon. This one starts with private eye Spenser tracking a wayward spouse, and quickly develops into a case of murder and possible terrorism – with his longtime ladylove Susan Silverman targeted by a bad guy who wants to get at Spenser through her.

    As in all the best Spenser novels, Hawk is a major presence in this one, and their repartee, as always, is some of the sharpest dialogue. Unlike most of the best Spenser novels, Susan also is a big factor in the story – but for some reason she is a lot less insufferable here, perhaps because she – and Parker – are maturing.

    “Now & Then” isn’t densely plotted, but then none of the Spenser books are. They rely on character and dialogue, have a minimalist’s avoidance of adjectives and adverbs, and essentially are stories about the meaning of commitment and loyalty, using the private eye form as the vehicle through which Parker makes his points. It is an extraordinary achievement that Parker has written more than 50 books, and that midway through his seventies he continues to turn out two or three books a year, including the estimable Jesse Stone series of mysteries.

    It also is interesting that Parker has decided to write a number of westerns, a genre that hardly is a hot property these days. (His novel “Appaloosa” currently is being turned into a movie by writer/director/actor Ed Harris, and is being shot right now down in New Mexico.) When you look at the Spenser and Jesse Stone books, they also are a kind of western, even if set in Massachusetts – in some sense they have the lone gunslinger, the evildoers, and the town that needs to be tamed.

    I love this stuff.




    I don't know if you watched the series “Damages,” starring Glenn Close and Ted Danson. The ratings suggest that not many people did…but I saw every episode, looked forward to it eagerly, and was absolutely enthralled by its portrait of high stakes legal poker in New York City and its unwillingness to paint any of its characters in any color other than gray. Until the final minutes of the final first season episode this past week, who did what to whom remained unclear…and yet by the time of the final fade out, it all became clear.

    The whole series is available on iTunes, and I’m sure will shortly will be out on DVD. I’m also pretty sure that if you start with it, you won’t be able to stop watching. “Damages” is a first-rate television series.




    That’s it for this week. See you Monday…

    Sláinte!!
    KC's View: