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: October 17, 2008

    BOSTON – After years of being held in Baltimore, Natural Products Expo East moved this year to a new home at the Boston Convention & Exhibition Center, and the annual event had a bustling energy that one doesn’t always see at trade shows these days.

    The economic world outside the show may have been on a roller coaster – on Thursday alone, the stock market went from being down 380 points to closing up 401 points – but the mood inside the show seemed pretty straightforward. No apparent panic here; just an unwavering commitment to the notion that even in tough times, natural, organic and local foods will continue to gain acceptance and marketing strength.

    That’s not to say that the mood is entirely placid. In various conversations, one could pick up on concerns that perhaps the industry has become too mainstream, or that interlopers are somehow diluting the purity that natural, organic and local brands bring to the marketplace.

    Not everyone feels that way, to be sure. For every person who might comment that major manufacturers ought to be legally prohibited from creating natural or organic band names that obscure the fact that they are the product of big agri-business, there is someone who thinks that this is an old argument that needs to be filed away as ancient history. But there remain people who believe that companies like Walmart, which has made a new commitment to carrying natural and organic products, are essentially hurting the “movement.” And, these people say, “all Walmart wants to do is make money.”

    What this argument ignores, I think, is the basic reality that Walmart has the ability to change how people think about food, and how and what they eat, in almost unrivaled fashion. The world’s biggest retailer isn’t going to go away, and the natural/organic/local industry ought to embrace the notion that it has created a market that Walmart now wants to serve. (And the last time I checked, making money wasn’t illegal. Tougher today than in recent years, but not illegal.)

    Does this create problems for the small retailers that now may have to compete with Walmart in categories they used to have all to themselves? Sure, but that’s life. Besides, these small retailers have the ability to do things that Walmart cannot do, understand the commitment of their customers at a level that Walmart does not, and have the ability to differentiate themselves to an extent that Walmart will not.

    Does this create challenges for small suppliers with which Walmart wants to do business? Sure, but they have the choice of whether or not to work with Walmart. It is hard to ignore the lure of lucre when Walmart wants to place a major order (there’s that making money thing again), but there are suppliers at Expo East who have said no to Bentonville because they believed that it would damage their businesses in the long run.

    Perhaps the biggest challenge to the folks at Expo East is deciding whether they are part of a movement or a business. This is a decision being made on an individual basis by suppliers and retailers alike, and not everyone will make the same choice.

    But as I walked the exhibit floor yesterday, it seemed to me that there were more suits than Birkenstocks, and more badges from mainstream companies than I’d seen in past years.

    Other notes…

    Of course, one of the great pleasures of walking such an exhibit floor is the opportunity to eat lots of different products. There is the occasional misfire – I tried some sort of bean sprout bagel that had something on it that looked like cream cheese but definitely wasn’t, and then had trouble getting the taste out of my mouth.

    But there were some very good products out there as well. Some random hits…

    • Ooba Hibiscus Beverage, which claims to have “the healing power of the flower,” is 100 percent natural and is high in antioxidants and Vitamin C. It was sparkling, delicious and extremely refreshing.

    • WorldCatch, a frozen food company, has some wonderful crab cakes and sesame-rusted salmon patties - moist and delicious.

    • Alexia Foods, one of my favorite frozen food companies, is coming out with a new product – Spicy Sweet Potato Fries with Chipotle Seasoning. This is a wonderful item – loaded with spice and flavor.

    Purists will point out that Alexia is owned by ConAgra. I don't care. The fries are terrific…and at the end of the day, taste ought to be the bottom line.

    KC's View:

    Published on: October 17, 2008

    The Canadian Press reports that Walmart has done it again – the retailer has closed down a Quebec store’s automobile center where the employees recently voted to form a union and seek a collective bargaining agreement.

    Walmart said yesterday that the five employees who wanted to unionize were seeking salary increases that would have forced it raise prices by 30 percent, which it deemed unacceptable and that it said would make the automotive center unprofitable.

    According to the story, the five employees may not lose their jobs because they could be transferred to another department or another store. But observers say that a clear and unambiguous message has been sent by Walmart.

    This is the second such closing by Walmart in the face of union activity. In 2005, the company closed an entire Quebec store that had voted to unionize, saying that the store wasn't profitable and that higher wages would make it less so. Some of the employees who lost their jobs in that move have appealed the decision on legal grounds, and the case has made its way all the way to the Canadian Supreme Court.

    The United Food and Commercial Workers (UFCW) expressed outrage at the Walmart move, saying that the company had “blatant disregard” for worker legal rights.

    KC's View:
    Walmart, which has spent so much time and money and effort trying to rehabilitate its reputation, doesn’t do itself any favors with moves like these. It mans that the folks in Bentonville have decided that they have to draw the line right here, no matter what the PR consequences.

    Though it is interesting that unionization has been allowed in China, where apparently authorities may be better at hardball than even Walmart.

    Published on: October 17, 2008

    QSR Magazine has an interesting piece about a new marketing innovation undertaken by fast feeder Pizza Hut – it is creating an application that will be available to its customers who are on, allowing people to order food without ever leaving the popular social networking site.

    "We are moving fast to put our online customers in charge--any way they want to order from us, we'll be there for them," Bob Kraut, vice president of marketing communications, tells QSR. "FaceBook is the next logical step for Pizza Hut. As FaceBook's popularity grows among younger socially connected consumers we have the opportunity to provide a pizza experience they will love--our convenient ordering combined with FaceBook's relevance."

    Not only will customers be able to order food while on FaceBook, but Pizza Hut also is developing an interactivity functionality that will allow customers to learn about promotions and deals, post stories and reviews, and develop a sense of community around the brand.

    KC's View:
    This is smart on so many levels. If this where the customers are, that’s where the retailer has to go. And in doing so, embrace the sense of community that can be created by these new technological applications.

    Published on: October 17, 2008

    USA Today this morning reports that The US Food and drug Administration (FDA) plans to open its first office in China before the end of the year, a move that follows more than a year of questions about the safety of products ranging from dog food to dairy products exported by various Chinese companies to the US.

    According to the story, “FDA Commissioner Andrew von Eschenbach on Thursday laid out a plan to place more than 60 food and drug regulators worldwide over the next year, with a particular focus on India, Latin America and the Middle East. The staffers will inspect foreign facilities, provide guidance on U.S. quality standards, and eventually train local experts to conduct inspections on behalf of the FDA.”

    KC's View:

    Published on: October 17, 2008

    USA Today reports this morning that Grupo Modelo, Mexico’s largest brewer and an investor in Anheuser-Busch, is saying that A-B’s deal to sell itself to Belgian brewer InBev for $52 billion actually violates its investment agreement with Anheuser. Grupo Modelo maintains that it has consent rights over the deal.
    KC's View:

    Published on: October 17, 2008

    • Spartan Stores reported that its second quarter net income was up 22 percent to $11.1 million, from $9.1 million during the same period a year ago. Q2 revenue was up almost five percent to $626.8 million, from $598.1 million a year ago.

    KC's View:

    Published on: October 17, 2008

    …will return.
    KC's View:

    Published on: October 17, 2008

    In a thrilling Game Five of the American League Championship Series, the Boston Red Sox staved off elimination by the Tampa Bay Rays with a series of late-game rallies that won the game 8-7.

    The Rays now lead the best-of-seven series 3-2. Game six is scheduled for Tampa on Saturday night.

    KC's View:

    Published on: October 17, 2008

    Did you see the story this week about how Ringo Starr has informed his fans that as of October 20, he no longer will respond to fan mail and that all such correspondence will be thrown in the trash?

    “I'm warning you with peace and love I have too much to do,” the former Beatle wrote on his website. “So no more fan mail. Thank you."

    Talk about having a tin ear.

    Apparently Ringo has forgotten that people like him only have careers because they got by with a little help from their fans. You know – those folks who continue to download songs and buy CDs and even purchase concert tickets.

    Besides, exactly how much fan mail could Ringo possibly have been getting? It isn’t like he’s…I don't know, Paul McCartney or somebody with exceptional talent and staying power.

    And you don't see McCartney saying stupid things like that. No, McCartney just keeps playing concerts and making new albums and working to be relevant.

    I saw “Religulous,” the new Bill Maher documentary about organized religion, and will be upfront with you. I liked it. A lot.

    Now, not everyone will. Many will find blasphemous, and will be scandalized by its very existence. I have a suggestion for people like that: Don't see it.

    The fact is that “Religulous” asks a lot of legitimate questions about organized religion, and makes a point with which I admit I tend to agree – that asking questions is an act of humility, and that blind faith can be arrogant.

    But again, if you don't agree with this approach, don't see the movie.

    “Religulous” doesn’t look just at Christianity, or Catholicism, or Judaism. It also looks into Islam, as well as some far moiré obscure corners of religious belief, and finds them wanting.

    This isn’t to say that “Religulous” is a perfect documentary. It isn’t. Maher and the director, Larry (“Borat”) Charles, are so assiduously anti-religion that there isn’t a lot of compassion in their approach. One can poke at scabs without ripping them off…and sometimes the poking can be a lot more revelatory.

    Besides, when it comes to religious choices, I’m far more of the “whatever gets you through the night” persuasion. I have a feeling that Maher has a level of contempt for all religious choices, and that tends to undercut the movie’s message.

    But if you like your comedy and commentary scathing and challenging, you may like “Religulous.” Just be forewarned.

    My wines of the week…

    • The 2005 Kelley Creek Merlot. I’m not a huge Merlot fan, but this one has a little backbone, stronger than the average version of this wine. Liked it a lot.

    • The 2005 Penley Estate ‘Condor,” a Cabernet/Shiraz blend from Australia that has a real spicy thing going for it – I had it with a thick, rich tuna burger the other night, and it was perfect.

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


    KC's View: