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    Published on: November 7, 2008

    Wegmans announced yesterday that it is responding to two current trends – the economic strife hitting so many families, and anticipated lower costs for raw materials – by imposing price cuts on hundreds of items in its 72 stores. The cuts are in such departments as bakery, meat, produce, deli and grocery, with many of them in Wegmans’ private label lines.

    According to the announcement, “the price cuts are not one or two-week promotional specials; in line with Wegmans’ consistent, low price strategy, these prices will be in effect for an extended period of time.”

    Danny and Colleen Wegman released the following statement: “During difficult times like these, it’s okay with us if we make a little less money. And, as always, we are committed to offering the lowest price in the market on the items most important to families.”

    “Though the lower costs we expect in 2009 haven’t arrived yet, we think it’s necessary to lower prices now,” added Jo Natale, Wegmans’ director of media relations. “As a family-owned business, we can accept leaner profits in order to put employees’ and customers’ needs first.”

    Natale said that based on anticipated sales of these products, the total value of price cuts to consumers would amount to $12 million on an annualized basis. For an average consumer shopping for a family, the savings could amount to as much as $40 to $60 a month.

    KC's View:
    This is a perfect example of what I’ve been talking about a lot here on MNB in recent weeks – the importance of both value and values, and of communicating both to customers with clarity and consistency.

    It also correctly anticipates the likelihood that a lot of shoppers are going to wonder why, if costs are going down for raw materials, prices are not coming down for a lot of products. Like it does so often, Wegmans is getting ahead of the curve.

    Published on: November 7, 2008

    The Wall Street Journal notes that the FDA is likely to come in for increased oversight and criticism once the Obama administration takes office early next year and Democrats formalize their expanded hold on Congressional power.

    According to the story, the agency is certain to “get new leadership that is likely to be tougher on drug makers on a range of issues from approving new drugs to policing advertising directed at consumers. Senate Democrats could seek support from across the aisle to push several bills opposed by industry, and use hearings and investigations to shine the spotlight on drug companies and the FDA.”

    KC's View:
    The FDA has made so many missteps over the past few years that it’ll be lucky if all it gets is increased scrutiny, The Democrats will say that the FDA has abrogated its responsibility to look out for consumers…and it may be hard to make any other argument at this point. And the FDA will have only itself to blame.

    Published on: November 7, 2008

    People For The Ethical Treatment of Animals (PETA) announced yesterday that it is calling on Publix Super Markets “to report any progress it has made toward adopting animal welfare policies that pertain to the purchase of eggs and pig, chicken, and turkey meat.” PETA maintains that at the present time, “the limbs of chickens and turkeys purchased by Publix are often broken, and the birds are conscious when their throats are cut during slaughter. The company buys most of its eggs from suppliers that cram hens into cages so tightly that the birds can't even stretch a wing, and it buys pig meat from companies that immobilize pregnant sows in tiny ‘gestation crates’ for months at a time.

    The demand for information comes via a PETA member who also is said to be a Publix shareholder.

    KC's View:
    The problem with statements like these is that it is hard to know the objective truth, especially when one has the sense that the people putting out the statement have their own agenda. Not sure if it can fairly be called a radical agenda, but it certainly is out there on the fringes and some of PETA’s membership pretty much defines the phrase “lunatic fringe.”

    On the other hand, it is hard to read that description of animal treatment and not feel something like revulsion for the situation as it is described…if indeed it is the objective truth.

    Seems to me that it is up to Publix to come up with a crackerjack defense, or start figuring out how to satisfy PETA’s demands at some level.

    Published on: November 7, 2008

    The Austin Business Journal reports that the Federal Trade Commission (FTC) lawsuit against Whole Foods, which endeavors to somehow void the retailer’s $565 million acquisition of Wild Oats, its largest competitor, will go to trial in February in a Washington, DC, federal court.

    The FTC argues that the merger is bad for consumers because it creates a near monopoly that will allow the combined companies to raise prices without significant competition.

    KC's View:
    Which would be a pretty good argument if Whole Foods/Wild Oats had not been trying to cut prices to appeal to economically stretched shoppers, hadn’t seen a precipitous drop in sales recently, and hadn’t completed the merger more than a year ago.

    Published on: November 7, 2008

    • Tesco said that as part of its overall environmental strategy, it will install recycling bins at its stores for wire clothes hangers – which are, in fact, in short supply and in desperate need of recycling. The hangers reportedly will be returned to Tesco's suppliers in Asia, and the company believes that this will keep more than 1,000 tons of hangers – or a whopping two millions pounds worth of hangers – out of landfills and garbage dumps.

    The good news for Tesco is that it expects the recycling program will save it as much as 25 percent in packaging costs by 2010.

    KC's View:

    Published on: November 7, 2008

    Conde Nast Portfolio has a good piece entitled “The Other Buffett's Recession Strategy,” in which it looks at how the Buffett not named Warren is dealing with economic hard times.

    Jimmy Buffett, described as “the king of easy living, is set to do well in this recession. He's the first to tell you he sells escapism, allowing his audiences to forget their job insecurity, slumping home values, the market, and instead parachute into paradise for a little while.”

    His advice? “In down times like these, with companies laying people off, it's important for people to find and focus on their niche, he said.” And, "If life gives you limes, make margaritas."
    KC's View:
    “Find and focus on your niche.” Doesn’t sound like much of a lyric, but it sure does sound like good advice.

    Published on: November 7, 2008

    • In Ireland, the Herald reports on rumors that Dunnes Stores there may be about to be sold after more than six decades in business. The reasons seem to be the tough economy and even tougher competition from Walmart’s Asda Group, Tesco, Aldi and Lidl.

    Wal-Mart is mentioned in the story as a likely – or at least possible – buyer of Dunnes.

    HealthDay News reports that a new study suggests that people who eat whole grains and reduce their egg consumption and high-fat dairy products stand a better chance of not suffering from heart failure.

    According to the story, “The study, which looked at more than 14,000 people over 13 years, found that participants had a 7 percent lower risk of heart failure (HF) per one serving increase in whole grain consumption. The risk increased by 8 percent per one serving increase in high-fat dairy intake and by 23 percent per one-serving increase in egg consumption. Other food groups did not appear to directly affect risk of heart failure.”

    KC's View:

    Published on: November 7, 2008

    • Walmart reported that its October sales rose 2.3 percent to $28.57 billion, on same-store sales that were up 2.4 percent for the month.

    • Target Stores said that its October sales dropped nearly 1 percent to $4.42 billion.

    KC's View:

    Published on: November 7, 2008

    • Starbucks reportedly has named Troy Alstead, senior VP of global finance for the company, to be its new CFO, succeeding Pete Bocian, who is departing to join Hewlett-Packard as chief administrative officer.
    KC's View:

    Published on: November 7, 2008

    This week, Argentina…next week, Spain. (And maybe Paris. I’m not sure yet.)

    Which means that once again, the delivery times for the MNB Wake Up Call and the actual posting of MNB may be a little off-schedule – especially on Monday. Again, just FYI, I’m traveling for the production of a video project that will be shown at the CIES Food Safety Summit, scheduled for Barcelona, Spain, next February.

    I thank you in advance for your patience….and hope that it won’t actually be necessary.

    KC's View:

    Published on: November 7, 2008

    …will return. Next week.
    KC's View:

    Published on: November 7, 2008

    Random notes from days spent in Argentina this week…

    In a crystal clear night sky, I actually saw the Southern Cross for the first time…

    I was surprised by the terrain in the part of Patagonia that I visited. Expecting mountains, instead I found something that looked like I’d always imagined the Australian Outback to be – flat desert, with seemingly endless roads running as far as the eye can see, and reaching right down to the shore of the cold gray Atlantic Ocean.

    The food was wonderful.

    One lunch was at a restaurant called Siga La Vaca, which is an enormous restaurant down by the river that features meat, more meat, and even more meat. It is a pay-one-price deal, costing about $12 per person, and you grab a plate and walk up to where a bunch of cooks are grilling hunks of steak, pork and sausage. All of it succulent and melt-in-your mouth good and washed down with a Malbec that was strong enough to stand up to everything they served.

    Another night, we stopped into a little wine bar, where I enjoyed a petite truffle mushroom risotto made with sheep’s cheese and mascarpone, and white salmon served with a tomato and rosemary fondeau, sweet corn warm pudding, guacamole and tomato salsa. The wine that night was a Fin Del Mundo 2007 blend of Malbec, Syrah and Cabernet Sauvignon…which was smooth enough to work with the fish.

    While we drank plenty of wine, the local beers also were fantastic. I particularly enjoyed the three kinds of Quilmes that I tried – the lager, the negro, and the stout. The Isenbeck also is excellent, and there is a strong red ale made by Otro Mundo that was extraordinary.

    It was an odd week to be away since Tuesday was not just Election Day, but also my birthday, and I was spending it more than 5,000 miles away from my family on a day when my country was making history.

    That night, I found myself sitting in the hotel café with my laptop open, sipping a Bodega Del Fin Del Mundo 2005 Malbec Reserve and trying to monitor the election via the Internet while simultaneously researching and writing MorningNewsBeat. It was one in the morning local time when the presidential race was finally called, but I simply could not go to bed before a winner had been declared.

    The day of my birthday, I went with business associates from the seaport city of Puerto Madryn to the tiny village of Puerto Pyramides for the most astonishing whale watch I ever have been on. And I will never forget the trip there – being driven through the desert on a two-lane road, surrounded by brush and shrubs, seeing wild horses and sheep grazing on either side, the car going about 100 miles an hour while the driver, Carlos, who spoke little English, blasted the Rolling Stones and James Brown on the CD player.

    Unbelievable. Unforgettable.

    I loved Argentina. The people are friendly and patient with someone like me who speaks little Spanish, the country – what I saw of it – is spectacular, and the food and wine and beer are more than I could have asked for.

    I can’t wait to return. To perhaps hunker down in Puerto Pyramides for a time to work on a novel, or maybe rent a motorcycle and head south to party at the end of the world.

    I can dream, can't I?




    By the way, I need to thank the dozens of you who sent birthday wishes earlier this week. I am touched and flattered that you remembered…




    That’s it for this week. Have a great weekend…and I’ll see you Monday.

    Sláinte!!

    KC's View: