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    Published on: June 19, 2008

    MUNICH – The CIES World Food Business Summit distinguishes itself each year by reaching beyond the aisles and fresh food departments, beyond supply chain questions and parochial concerns, and considering critical issues from unusual points of view.

    The first day of this year’s summit was no exception, built around the theme of “Growth & Sustainability.”

    What other food industry conference, for example, would offer Patricia Glyn, the South African adventurer and writer, telling the audience about her almost 1,400 mile walk from Durban, South Africa, to Victoria Falls, retracing a trek taken by her ancestors back in the 19th century. But it wasn't just a travelogue. Glyn used the trip as a way of explaining to an audience of blue and gray-suited executives the impact that the industry can have on the natural environment. She spoke of Botswana, a place where the cattle outnumber the people, but that is suffering because of overgrazing that is having an enormous impact on the nation’s ecology. She noted that it takes 100,000 kilos of water to create just one kilo of beef, and that enough water goes into the making of one hamburger for 17 showers, and suggested that if such usage continues it will be unsustainable. “We are robbing our children of their future more through what we eat than what we drive,” she said.

    And what other food industry conference would have an airline industry executive – Andrea Debbane, vice president of strategy and strategic programs at Airbus – to exhort the audience to get ahead of the environmental activists. It is easier to create a positive opinion from the beginning, she said, than to try to change someone’s mind once they have a negative opinion of you. “Establish the facts, and lead the dialogue,” she said.

    Debbane also suggested that the industry has to find its positive story and tell it in compelling terms. In the airline business, for example, she noted that more than 2.2 billion passengers flew by air last year, and that the industry was responsible for 32 million jobs and eight percent of global GDP. The food industry has to find its own narrative, and tell it in compelling terms.

    (One tangential note here. Debbane showed a slide in which she demonstrated where all the growth in airline travel came last year – it was up 177 percent in China, up 154 percent in India, and up 144 percent in the Middle East. And up just 25 percent in Europe and a mere eight percent in the US. That alone is a vivid illustration of where the economic power is in 2008.)

    Robert Pickard, director general of the British Nutrition Foundation, offered a definition of dynamic equilibrium, saying that “nothing remains stable passively,” saying that stability only comes when opposite forces affecting something do so equally – but that there is nothing passive about it.

    And one other comment that pointed to how the world is changing. Alex Thomson, the British newsman who is serving as the summit’s moderator, noted that he recently was talking to a friend in Afghanistan who raises opium (something everybody does in Afghanistan, he said). But this friend is changing his cash crop, Thomson said, and shifting much of his acreage to wheat – because he can make more money that way.

    Now there’s a story you wouldn’t hear at many food industry conferences.

    More tomorrow…

    KC's View:

    Published on: June 19, 2008

    In the New York Times this morning, technology columnist David Pogue offers his assessment of the Ikan system now being piloted by D’Agostino’s.


    • “The mission of this $400 device is to eliminate trips to the grocery store. The hardware component is a bulbous bar code scanner, dressed up in Any-Décor White and mounted on a countertop stand, an undercabinet bracket or a wall mount. It offers a color screen on the front, a laser scanner underneath and a Wi-Fi antenna inside that connects to your home wireless network.

    “Each time you’re about to throw away an empty container — for ketchup, cereal, pickles, milk, macaroni, paper towels, dog food or whatever — you just pass its bar code under the scanner. With amazing speed and accuracy, the Ikan beeps, consults its online database of one million products, and displays the full name and description … After a few days of this, you can review the list online at - and if everything looks good, click once to have everything delivered to your house at a time you specify.

    • “Reactions to this gizmo are all over the map. Old-school homemakers may consider it a silly redundancy. How much more effort is it, they ask, to maintain a handwritten list? And isn’t going to the grocery store more than just a time drain? Isn’t it also a little outing, a small source of pride and accomplishment, an opportunity for social interaction?

    “Other people can’t believe the amount of time this system saves. You’ve just compressed a two-hour weekly errand into about 10 minutes. All you have to do is approve the illustrated, error-proof online shopping list, and then let somebody else battle the traffic, haul the bags and pay for the gas.”

    • Saying that the service is not quite as well integrated as Peapod’s, nut nevertheless calling it the food equivalent of Netflix, Pogue writes: “Most of the Ikan’s weaknesses stem from its fledgling status, not from design or concept problems. It’s incredibly solid and speedy in performing its central functions: recognizing your home network, identifying products you’re scanning and transmitting them instantly to the Web. Even teenagers won’t forget to add things to the list, since it’s so much fun to scan them.

    “But the Ikan’s appeal will grow as the company develops partnerships with more store chains, as the features grow and as the steep price goes down.”

    And, he writes, “the time savings are truly gigantic. For a delivery charge of $6 to $8, you save a couple of hours a week and you gain incredible convenience. At the very least, you can use the home delivery option for staples — the stuff you always buy — and visit the actual store just for the elective items, or things you want to hand-pick.”

    KC's View:
    In other words, the future.

    To quote a famous movie line, “Maybe not today, maybe not tomorrow, but soon…”

    The question is, if you are a retailer or a supplier, how do you begin preparing for this kind of inevitable technology, and the shifts in consumer behavior that it will bring? Because you cannot afford to ignore it.

    Published on: June 19, 2008

    MSNBC reports that federal health officials “have learned of 106 more cases of salmonella linked to tainted tomatoes, putting the outbreak’s toll at 383 on Wednesday and counting … Most of this newest influx of cases were people who got sick weeks ago but hadn’t been counted yet. Some states began doing a better job of checking for salmonella as the outbreak has dragged on, while part of the surge comes from test results that had been backlogged in jammed laboratories. Earlier today, six new illnesses connected to tainted tomatoes were confirmed in New York City.”

    Federal health officials also are saying that it may be impossible to trace the source of the salmonella, and that the longer the probe last the less likely it is that investigators will solve the mystery. Mexico and Florida are suspected to be where at least some of the salmonella originated, but at the moment that is just speculation.

    KC's View:

    Published on: June 19, 2008

    Now available on iTunes…

    To hear Kevin Coupe’s weekly radio commentary, click on the “MNB Radio” icon on the left hand side of the home page, or just go to:

    Hi, I’m Kevin Coupe, reporting from Munich, Germany, for MorningNewsBeat Radio…brought to you by Webstop, experts in the art of retail website design services.

    I’m here covering the annual CIES World Food Business Summit, but for the moment I’d like to take note of something that, on the surface at least, has nothing to do with this always-excellent conference.

    Anytime I come to Europe, one of the things that I always notice is how different the infrastructure is when it comes to getting around. This is top of mind these days in the US because we’re kvetching nonstop about how high fuel prices are. In Europe, of course, they’ve been dealing with high fuel prices for years…at some level, they must want to look at Americans and preach the 11th commandment: “Thou shalt not whine.”

    Because they’ve been dealing with high energy prices for so long, most European countries seem to have developed transportation and commercial systems that take these costs into account. Smaller cars that get better mileage. Generally excellent public transit systems, both in the cities and spreading throughout the countryside. (I was amazed last year, for example, how easy it was to get from Paris to Normandy by train…there were plenty of options, all affordable. On the other hand, try to get around the US via train. With few exceptions, it is almost undoable.) And, retailers have developed store systems that cater to different kinds of shopping experiences…Tesco is a wonderful example of this in the UK, with its convenient Tesco Express stores, in-city Tesco Metro Stores, larger Tesco superstores and enormous Tesco supercenters.

    As I look around the streets here and watch the way people get around and shop, I have to wonder how long it will take us in the United States to adjust to the altered states in which we live. I was reading the other day about how Honda and Toyota are increasing their hybrid production for the US…but I don't see the same kinds of stories about US car companies. No…General Motors’ answer to the gas crisis is to sell its Hummer division. Like that will solve the real problem.

    There is no question in my mind that as consumers change their priorities, retailers are going to have to change theirs. We’re going through that in my family. We have one year left on the lease on our Nissan Murano – thank goodness it is a lease, so we don't have to sell the damned thing – and we’re already talking about our small car-high mileage options, from hybrids to Mini Coopers. And we’re already starting to talk seriously about where we are going to move when our kids have all moved out…it seems likely now that it will be some sort of urban environment where we don't need to use a car every day and have access to great public transportation. At least, that’s what we’re thinking.

    I can’t imagine we’re alone in this.

    In the broadest sense, I think this means that retailers in the US may have to start preparing for new times, times when people may change their priorities, will ask more of the stores where they shop, of the trains and buses and cars in which they travel, of the government officials they elect. These changes will take place to varying degrees in different places, but I firmly believe that they will take place.

    As I look around this conference, at all the CEOs from retailer and supplier organizations, I wonder if they are coming to grips with what could be a new world order.

    I hope so. I hate to use a double negative, but they cannot afford not to.

    For MorningNewsBeat Radio, I’m Kevin Coupe.

    KC's View:

    Published on: June 19, 2008

    The Wedge Coop, in Minneapolis, Minnesota, offers suggestions to its members about how to deal with food prices…and the way in which it does so offers a good template on how to create a sense of community with one’s shoppers.

    The piece, carried on the coop’s website, by Elizabeth Archerd, member services manager, includes the following points:

    • “What can we do? Food prices will not drop to previous levels anytime soon, but we can work together to keep increases to a minimum. Managers and buyers negotiate good deals with vendors and keep expenses in line. There are a few ways member-owners can reduce costs for the co-op. This is our business, so its expenses are your expenses.”

    • “Bring your own shopping bags. If you use paper grocery bags for recycling, consider taking cardboard boxes from the front of the store instead. There are recycling stickers for the boxes at Customer Service.”

    • “Consider how you pay for groceries. Feel free to use credit union credit or debit cards. Be aware that rewards cards from commercial banks are the most expensive form of tender.”

    • “Shop our sales, use your coupons and register discounts. And please, let your friends who shop here know that joining the co-op can save them money! We will get through this together.”
    KC's View:
    Not everybody can do this, of course, but I think this is a good example of the kind of approach that more retailers should take. Telling shoppers that “we’re all in this together” – and doing it with some credibility – is a smart approach.

    Published on: June 19, 2008

    • The Santa Cruz Sentinel reports that Safeway has agreed to pay $2.7 million
    “to settle a consumer protection case in six Central California counties, including Santa Cruz. The settlement … dealt with complaints about inaccuracies in pricing and weighing as well as construction violations.” The story notes that “customers who may have been overcharged for a sandwich or a dish of potato salad will not get their dimes and nickels back. The $2.7 million settlement will pay court fees and fund future consumer protection investigations, according to the District Attorney's Office.”

    • The Business Courier of Cincinnati reports that Kroger “has settled a racial discrimination lawsuit dating back to 2001 and involving black employees in six states for $16 million.” According to the story, a memo from Kroger CEO David Dillon “said there was no finding of discrimination by the court, and the money will be placed in a fund and disbursed to black employees who meet certain criteria, according to the story.”

    KC's View:

    Published on: June 19, 2008

    • Published reports in the UK say that Wal-Mart’s Asda Group there plans to launch a new nonfood catalog and online shopping service called Asda Direct sometime this fall. The service will be available via phone or the Internet and will allow customers to pick up products at local Asda stores or have them delivered to their homes.

    KC's View:

    Published on: June 19, 2008

    • Local 338 RWDSU/UFCW has filed eight charges with the National Labor Relations Board against Waldbaum’s, alleging that the company is engaging in unfair labor practices during its negotiations for a new contract for approximately 90 pharmacists employed at 35 area stores.

    The pharmacist’s contract expired April 1, and a contract extension then expired April 30. A strike vote was approved on May 13. Negotiations are scheduled to resume on June 25.

    Waldbaum’s is owned by the Great Atlantic & Pacific Tea Co. (A&P).

    • Rep. Jim Moran (D-VA) along with Rep. Tom Davis (R-VA), Rep. James McGovern (D-MA) and Rep. Michael Castle (R-DE) sent a bipartisan letter, co-signed by 58 House Members, to the Environmental Protection Agency (EPA) calling for the promotion of advanced biofuels that do not contribute to food price inflation or create new environmental concerns.

    According to a statement released by the group, “The letter comes as the EPA continues a reevaluation of the impact the Renewable Fuel Standard is having on the economy and environment. The letter notes that at present, food price inflation in the U.S. is rising at twice the overall rate of inflation, while global food prices have nearly doubled in the past three years. The bi-partisan group points out that there are several factors driving food costs up, emphasizing the importance of finding sources for biofuel production that ‘do not divert food and feed from domestic and international supplies’.”

    KC's View:

    Published on: June 19, 2008

    • The Seattle Times reports that Denny Marie Post, Starbucks’ senior vice president of global food and beverage, has departed the company and taken a job as senior vice president and chief marketing officer at T-Mobile USA.

    There is a certain irony to this move, the Times writes, noting that T-Mobile USA “sued Starbucks this month over its Wi-Fi relationship with AT&T. The companies quickly agreed to resolve the dispute.”

    KC's View:

    Published on: June 19, 2008

    …will return.
    KC's View: