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    Published on: June 13, 2008

    Members of the MNB community who rail about excessive government intervention may want to sit down for this one…

    The New York Times this morning reports on a two-month old law in Japan that requires companies and local governments to “measure the waistlines of Japanese people between the ages of 40 and 74 as part of their annual checkups. That represents more than 56 million waistlines, or about 44 percent of the entire population.

    “Those exceeding government limits — 33.5 inches for men and 35.4 inches for women, which are identical to thresholds established in 2005 for Japan by the International Diabetes Federation as an easy guideline for identifying health risks — and having a weight-related ailment will be given dieting guidance if after three months they do not lose weight. If necessary, those people will be steered toward further re-education after six more months.

    “To reach its goals of shrinking the overweight population by 10 percent over the next four years and 25 percent over the next seven years, the government will impose financial penalties on companies and local governments that fail to meet specific targets. The country’s Ministry of Health argues that the campaign will keep the spread of diseases like diabetes and strokes in check.”

    The goal of the law isn’t just to improve the health of Japan’s populace, but also to stem the tide of rising health care costs, described by the Times as “one of the most serious and politically delicate problems facing Japan today.”

    KC's View:
    Sounds awfully draconian to me … like something out of “1984.”

    I would agree with at least some of the critics of the program that if the Japanese government really wanted to have an impact on its population, it would do something about many Japanese people smoke. If you think about it, if the government brought the same level of intensity to an anti-smoking campaign that it has to measuring people’s waistlines, Japan could end up being the first nation that I know of to actually ban tobacco usage.

    Published on: June 13, 2008

    The Newark Star Ledger reports that under its new A&P ownership, Pathmark is returning to its low-price roots. Newly remodeled stores in Irvington and Edison, NJ, illustrate the concept, described by the paper as reminiscent of the chain’s approach three decades ago – “lower prices on many items with weekly sales that include significant price cuts on certain products.”

    Burt Flickinger III tells the paper that “it's the perfect format at the perfect time … particularly for Pathmark, which had been the price leader for its first 30 years and has lost price leadership in the past decade.”

    And Eric Claus, CEO at A&P, says, "This will be the template for a massive Pathmark refresh to be rolled out between now and the end of 2009.”
    KC's View:
    I’ve always been taught that it can take years to create a low-price image, and about two minutes to lose it. The latter happens when a retailer isn’t consistent and relentless in making sure that both the perception and reality of low prices are evident in its stores.

    That’s what happened with Pathmark, if I recall correctly. I’m sure it is a lesson of which A&P is extremely aware.

    Published on: June 13, 2008

    In Minnesota, the Star Tribune reports on the opening of a new Family Fresh Market in Hudson, Wisconsin, by owner Nash Finch.

    According to the story, “After two years of planning, the first-of-its-kind Family Fresh Market opened its doors Friday with a new name and a new aim: to help shoppers make healthier and more nutritionally balanced choices.” The new store, the paper reports, has “a meat and organic-produce section that is nearly twice as big as those at most supermarkets, and rivals the quality and selection of upscale grocers such as Byerly's or Kowalski's.

    “The middle of the store offers values that are on par with Wal-Mart and SuperTarget and often beat out grocers such as Cub and Rainbow, according to Nash Finch officials. The strong push into organics and national foods is new for Nash Finch, which owns 59 supermarkets in nine mostly Midwestern states under the Econofoods, Sun Mart and Family Thrift Center names.”

    KC's View:
    Think it is smart to focus on both health and price…because even as customers look to save money in a tough economic environment, they will not give some of the aspirational impulses they’ve developed over the past few years. The tough thing is finding the right balance that makes both click without canceling out the impact of either.

    Published on: June 13, 2008

    Food Lion announced yesterday two initiatives designed to support local suppliers in the markets where it operates.

    The company said that it is supporting the Certified South Carolina program, a cooperative effort among producers, processors, wholesalers, retailers and the South Carolina Department of Agriculture to brand and promote South Carolina products. A promotion will be running in Food Lion, Bloom and Bottom Dollar Food stores from June 11-24, and the goal is to build consumer awareness and help customers to easily identify, find and buy South Carolina products. South Carolina grows many different types of fruits and vegetables, in addition to its animal, forestry, greenery and specialty products.

    Food Lion also said that it is running a “Got To Be NC Products” promotional campaign during the same time period, which also is designed to bolster loyalty to the state’s suppliers. During the promotion, sales fliers will feature North Carolina products and some stores will have local vendor in-store samplings and wine tastings, and be visited by the 2008 North Carolina Watermelon Queen, 19-year-old Brittany Mae White.

    KC's View:
    Doesn’t get any better than that. If transparency and traceability are as important as I think they are, then more and more, local products are going to have an edge.

    Published on: June 13, 2008

    Interesting promotion by D&W Fresh Market…which is looking for consumers to help them choose the design for the company’s reusable shopping bags.

    According to the chain’s website, shoppers who vote are entered into a drawing for a $100, $50 and $25 D&W gift cards.

    KC's View:
    Smart. Get people involved at every opportunity, and you create community.

    Published on: June 13, 2008

    • The Wall Street Journal this morning reports that the US Centers for Disease Control and Prevention (CDC) believes that “the rare salmonella strain that has sickened 228 people in 23 states may have contributed to the death of a Texas cancer patient,” and that “there could be more illnesses to come. States are still reporting new cases from the salmonella outbreak that began April 10 and has been linked to fresh tomatoes.”

    Government investigators have not yet figured out what has caused the salmonella outbreak.

    USA Today reports this morning that “six more states — Florida, Georgia, Missouri, New York, Tennessee and Vermont — reported illnesses related to the outbreak, bringing the number of affected states to 23 … With the latest known illness striking on June 1, officials also are not sure if all the tainted tomatoes are off the market.”

    KC's View:

    Published on: June 13, 2008

    Forbes reports that Winn-Dixie does not expect the impending acquisition by Publix of 49 Albertsons LLC stores in Florida to have any discernible impact on its performance since only 10 of them are within two miles of a Winn-Dixie.

    • The Wall Street Journal reports that Anheuser-Busch has begun talking to Mexican brewing company Grupo Modelo about a possible merger, which, if completed, would have the effect of short-circuiting the $46 billion unsolicited bid for Anheuser made by Belgium-based InBev.

    Anheuser already has a 50 percent stake in Grupo Modelo.
    KC's View:

    Published on: June 13, 2008

    In commentary yesterday about the InBev bid to acquire Anheuser-Busch, I bemoaned the notion that such an American icon could be acquired by a foreign company, and wondered how come US firms aren’t out there buying foreign icons.

    Got a lot of responses to that one.

    One MNB user wrote:

    It’s a result of the weak dollar, along with a number of our other current economic woes.

    Another MNB user elaborated:

    Our country is already selling “American Icons” to foreign countries. NY infamous Flat Iron Building was sold to the Italians. The Chrysler Building is next…. If Americans don’t stand up for what is ours and if this countries economy does not straighten up, American owned icons and businesses will become a rarity. The most important thing for us to do right now is to become less dependent on foreign oil. We have our own!

    Americans need to realize that they as consumers eventually bear the entire brunt of all costs – (duh! Rising costs of food, fuel, goods, services….. ). Without tapping into our own resources, we are allowing our country to decline and be consumed by foreigners.


    It isn’t just oil, in my view. It also is developing alternative energy sources. Because oil is, by its very nature, a finite resource.

    MNB user Bob Warzecha wrote:

    You probably forgot the hullabaloo the arose last year when PepsiCo launched overtures to acquire Groupe Danone. The French government quickly declared that no one but another French company would be allowed to merge with their "cultural icon". The politicians began to launch talks into legislation that would not only prohibit this foreign acquisition but also to not allow Pepsi products to be sold in France. It started to pick up so much steam that PepsiCo quietly went away.

    Do you think that this would ever happen here in the U.S.?


    MNB user Bob Wheaton wrote:

    Well, first of all let's start with the cheap dollar. "America is having a 25 % off sale" based on the Euro/Dollar valuation. History lesson: Late 80's/90's same thing only then it was the Japanese yen. (Pebble Beach, Rockefeller Center, etc) Quoting a great mind from years ago...."it's the economy, stupid."....but you knew all of this already because you're not stupid.

    MNB user Ray Hrovat wrote:

    Perhaps you don't remember American Malcolm Glazer (who also owns the Tampa Bay Buccaneers) purchasing the UK's Manchester United soccer team in 2005. I know you're not a soccer fan. Neither am I, but even I know that ManU is an icon. Maybe this will make you more optimistic about the US's place in the world?

    Gonna need more than that, I’m afraid.




    The economy – and concerns about the future – also was the subject of yesterday’s MNB Radio rant…and led one MNB user to respond:

    The current economic climate is cyclical just like weather. Remember 2008 is an election year which brings uncertainty to the economy. Also, keep in mind the Democrat-controlled Congress and the Federal Reserve have the power to set monetary and fiscal policy. However, they want the electorate to believe the economy is in the tanks throughout the remaining campaign season in order to place blame at the White House door. It’s too bad the electorate doesn’t realize the economy would react quicker if the marketplace was allowed to manage its own supply and demand, including the energy and mortgage industries. Once the elections are over, the economy will rebound.

    Y’think? I’m not so sure. I think a year from now we’ll be paying $8 a gallon for gas (if we’re lucky), and that discontent among the electorate will be at an all-time high.




    On another subject, MNB user Phil Censky wrote:

    Yesterday I was listening to the Marketplace (American Public Media) report on poor performance of Gap stores. They pointed to over-saturation of the brand because of their 31,000 stores (under various banners). What struck me is their guidance for a turnaround: they want to be the Trader Joe's of clothing. Only a company that has a clearly-defined, targeted strategy can be aspirational across industries. The question other food retail execs have to ask is "What is aspirational or compelling about our model?" because it's only compelling to other businesses if it resonates with consumers.




    And MNB user Lisa Pawlik had these thoughts about an email posted here yesterday:

    I was struck by this comment

    All in all what this means is what the hell do we need approximately 199,698 varieties of tomatoes for?

    We need a wide variety of species and not a monoculture in order to protect the food supply. If you take nothing else away from Darwin it should be that diversification of the species helps to ensure their survival. Monocultures can lead to things like the Irish Potato blight, coffee rust, corn leaf blight, etc., etc.

    I just get my hackles up when I see the promotion of a single species that’s supposed to be “the perfect (fill in the blank)”. It just means we’re doomed and it will soon be a tasteless specimen of that species.





    And MNB user David Carlson wrote:

    I was surprised to see your comments on the story New York and California bills which would require nutrition information on restaurant menus. What has happened to our Champion of Transparency? When the regulations were aimed at fast food, haven't you always come down in favor of more information?

    Specifically, on 10/26/07 you said:

    "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."

    Why should it be any different for Emeril's gumbo and banana cream pie?


    Oh, sure…throw my own words back at me. Expect me to be consistent. Like that’s fair…

    I could argue, I suppose, that a four-star restaurant is in fact different from a fast food joint. And I could argue that I do want these restaurants to be transparent, but that consumers ought to have a choice about reading the information…but that would be inconsistent with my position on fast feeders.

    So I’m going to have to think about this one. Because it feels different, even if I’m having trouble rationalizing why it is.

    I hate it when that happens.

    KC's View:

    Published on: June 13, 2008

    I’m a little weary this morning, having gotten home at about 12:30 am from attending the annual Jimmy Buffett concert at Madison Square Garden.

    Weary, but very, very happy.

    “The Year Of Still Here Tour,” as the current incarnation is being called, is wonderful, especially if you have any Parrothead tendencies. All the usual songs are done by Jimmy, who wanders around the stage barefoot in shorts and a t-shirt, grinning with the kind of self-assurance that can only be felt by a man with a $440 million business empire built around having a good time at the beach. And he has a new song, ‘We’re Still Here,” that is terrific – it hasn’t been recorded yet, to my knowledge, but it is destined to be an instant Buffett classic.

    This concert, more than past shows, featured a lot of video showing Buffett wandering around the far side of the world, through places like Cambodia – seeing the sights, interacting with the locals, and strumming his guitar. ‘Music is the universal language,” Jimmy said more than once during the concert…and the video makes his point.

    The “Buffett brand,” if you will, is a powerful and compelling thing. I was talking to my buddy Jim last night as we wandered into the concert (two middle-aged guys seeking a little fantasy, growing older but not up), and I mentioned that I’d read the Buffett’s business was worth $440 million, and I wondered if I’d gotten the number wrong. Then I looked down the corridor and saw all the people lined up for his Landshark Lager beer and to buy t-shirts…and I realized that $440 million seemed perfectly reasonable.

    I bought four Landsharks (my new summer favorite beer), three t-shirts and a beach towel.

    Rock on.




    There no doubt will be a lot of discussion in coming days about the relative merits of InBev’s $46.4 billion bid for Anheuser-Busch.

    And that’s fine. But how about the other major beer story that’s been in the news, the one that threatens the very integrity of beer drinking?

    I’m talking about the piece in the Wall Street Journal the other day reporting that as bars and restaurants, like everyone else, deal with rising costs, some are replacing their 16-ounce “pint” glasses with 14 ounce version, referred to by at least one bartender as a “falsie.” And in other establishments, patrons are complaining that bartenders are building up the heads of their beers, which means that people are getting more foam and less of what they are paying for.

    There are, I think, two lessons here.

    One is the issue of transparency, illustrated by a paragraph from the Journal story: “Dedicated beer drinkers are fighting back, with extra vigilance about exactly how much beer they get for their buck. They are protesting ‘cheater pints’ and ‘profit pours’ by outing alleged offenders on Web discussion boards and plugging bars that maintain 16-ounce pints, in hopes peer pressure will prevail. And they are spreading the word about how to spot the smaller glass (the bottom is thicker).”

    The lesson: You may think you are getting away with something. But the new world order has created an environment in which you can get away with nothing…and the whole world will know what you were up to. So don't.

    But there is a larger lesson, I think, that goes beyond whether businesses are going to be found out when they do things like shrink the package and charge the same amount. It has to do with both value and values. Charging more for an item may simply be a more honest way of dealing with cost increases than shrinking package sizes but not the price. Shoppers know that everybody’s costs are going up, so it’s not like they aren’t expecting price increases. But wouldn’t it be nice if someone actually said to the shopper, we’ve had to raise our prices…but in doing so, we have redoubled our efforts to make the best XXX that we can…so you know that you are getting your money’s worth.”

    I wonder how consumers would respond to such an approach?




    US News & World Report announced that it will go to a bi-weekly publishing schedule next year, which is its way of coping with coping with the fact that printing and mailing costs are up, and that readers and advertisers increasingly are online.

    But I’m not sure they’ve gone far enough.

    Once again, a radical notion – that they should have said that effective immediately, the whole damn thing is going online. No more paper, no more printing, no more mailing. Just an online publication that is ready for tomorrow, not just reporting on yesterday.

    If newspapers are in trouble, it seems to me that the likes of Time and Newsweek are in even more dire straits. After all, they used to be newsweeklies that summed up the past week’s news…but now, virtually everything you can get in print you can get online first. A week before it shows up in the mailbox.

    US News should have saved itself years of additional pain and just eliminated the print version now. It would have created new economic problems, but at least it would have been a frank acceptance of 21st century communications realities.




    I’ve been reliving my youth over the past week or so, with the happy release of the first season of “Mannix” on DVD.

    I’m in heaven.

    “Mannix” was by far my favorite show when I was a kid, and I can remember many of the series’ episodes with a clarity that is, to be honest, a little scary. The one where he was blinded by an assassin’s bullet (luckily it was psychosomatic so the series didn’t turn into “Longstreet”), the one where he confronted a psychotic killer who had turned an old theater into a series of booby traps meant to kill Mannix, and the one where he returned to his home town to solve a murder and had to deal with his estranged father.

    The first season has been little seen since it debuted 40 years ago – it takes place before Joe hung out his own private eye shingle at 17 Paseo Verde, hired a sexy secretary (Gail Fisher as Peggy fair), wore plaid sport coats and started driving a green Dodge Dart convertible. In the first incarnation, Joe works for Intertect, the world’s biggest computerized detective agency, and constantly butts heads with Lew Wickersham (Joseph Campanella), who prefers neat desks, tidy cases and operatives who do things by the book. Mannix, of course, is better with a left hook than a computer…which creates much of the series’ drama.

    While the show is a little dated – TV shows move a lot faster these days – I am loving every minute – especially Mike Connors’ performance as Joe Mannix, which is just about perfect. The memorable theme music, by Lalo Schifrin, has been bouncing around in my head for days. And the DVD set has lots of commentaries and interviews, which are just an added bonus.

    Many of you probably have never heard of “Mannix,” but for those of you who remember the show fondly, I heartily recommend the DVD set.

    Great stuff.




    That’s it for this week.

    Have a great weekend…and make sure you call or see your Dad on Sunday. It may be a made-up holiday, but it is a good reminder that occasionally the old man likes to be remembered.

    And Happy Father’s Day to the three Dads in my life – my own Dad, Mrs. Content Guy’s Dad, and Richard Coulter, who always has been like an extra father but never has been extraneous.

    Sláinte!!

    KC's View: