Published on: December 23, 2008
Excellent question from MNB
user David R. Schools…In the last two MNBs you have advocated laws against the use of plastic bags, laws mandating the listing of calorie content in restaurants, laws prohibiting the selling of tobacco in stores with a pharmacy, yet you also advocate the Bentonville Behemoth's right to crush small business with a survival-of-the-fittest mentality. How come the market gets a chance to work on behalf of the BB but not when it comes to pet peeves?
Well, if you’re going to ask for consistency…
Seriously, though, I think you make a good point that requires me to consider my own points of view.
Regarding Walmart’s Chicago expansion efforts, I think my position is more related to the fact that we’re in a recessionary economy that is short on both jobs and new revenues, and that this makes it harder to reject Walmart’s efforts to build…especially since one store in Chicago has generated more than $10 million in sales taxes over two years.
Over the years, I think I’ve been a little conflicted about the whole notion of communities rejecting certain retailers. On the one hand, I think voters/taxpayers ought to have the right to determine the shape of commercial development in their communities…but I also think that it is incumbent on smaller retailers to find new ways to compete against big box stores, and that too much time is spent whining about level playing fields. This may be harsh, but “compete” is a verb…it requires retailers of all shapes and sizes to find ways to differentiate themselves in the marketplace. That’s harder to do now that the nation is in an economic decline and “always low prices” sounds irresistible to so many people. Bu it remains a critical component in the competitive wars.
As for the other issues, you make a fair point…though, in fairness to me, I think I’ve said over the years that I would always prefer a non-legislative response to these issues. In the case of plastic bags, there is a larger environmental cause that needs to be addressed…and in the case of nutritional postings, there is a public health issue that requires some sort of public policy solution. Both have long-term economic implications, I think…and it becomes the responsibility of government to address them, I think.
The San Francisco law, which bans the sale of tobacco in stores with pharmacies, is a different issue. I’m not sure that the law is even constitutional…but I do think that there are legitimate marketing questions being posed here. How can a store that sells products presumably health-oriented also sell tobacco? Is this a marketing disconnect? But you’re right about this being a case where market forces ought to determine the outcome…and my bias against tobacco probably made my thinking less clear.
By the way, the general feeling in the MNB
community seems to be that the tobacco ruling in San Francisco is unlikely to survive various appeals.
user wrote:This local ruling will not stand. I don’t see how government can prohibit some retail stores from selling a product while allowing other stores to sell. Either all sell or none sell.
user chimed in:It seems to be a noble idea, I suppose the local government has all the other problems solved, like the homeless problem, potholes, crimes---and has nothing better to do.
Why not throw in artificial sweeteners, high fructose corn syrup, caffeine, caffeinated drinks, energy booster drinks, wine, beer, liquor, candy bars and peanuts. Some other locale might want to outlaw condoms that contain latex since someone might be allergic.
Grocery Stores should only sell meat, produce, food; no soda pop, no GM, no DVDs, no money transfers, no lottery tickets and certainly no tobacco. After all, you are redeeming/selling items on the Women, Infant, & Children (WIC) program, and pregnant or nursing women should not be exposed to tobacco items. Oh yeah, since you redeem Food Stamps, you should only sell edible, food stamp-eligible food items.
And so it goes, soon, why would anyone want to do business in San Francisco?
Well, I’d move MNB
World Headquarters there in a second…mostly because it is one of the world’s greatest cities. Even with all the restrictions, regulations and laws.
user wrote:It's the government picking winners and losers--driving customers away from drug stores and into supermarkets or wherever else tobacco products are available. Does that really seem fair to you?
Not when you put it that way.
And another MNB
user wrote:Tobacco today. “Unhealthy food” tomorrow…
I’m not sure that this is true or fair. There is a difference between food that isn’t good for you and a product that has been chemically engineered to addict and kill you.MNB
user Don Brandt wrote:Twenty-five years ago, the Breeze Family, owners of 3 central Illinois pharmacies, decided that selling tobacco was contrary to their mission to help heal their customers, so they just stopped selling any tobacco products. They took a tremendous amount of grief over their decision and it cost them a lot of money; but they stuck with their principles. I had and still have a tremendous amount of respect for the Family and the courageous stand they took in a small Illinois town so many years ago.
The same decision has been made in recent months by a number of food retailers. And this is probably the way the decision ought to be made.
However, there was one email supporting the San Francisco legislation:In response to the numerous e-mails you will receive suggesting this is somehow in infringement on Constitutional rights or property rights, I wanted to offer this response in advance.
The sale of certain items requires a license. For the sale of alcohol these may include limits on hours of operation, where a store can be located and to whom an operator may sell. All these are reasonable. Bars and restaurants have licenses allowing the public to eat food and drink alcoholic beverages on their premises. Reasonable conditions include requiring sanitary standards and not giving those same customers exposure to certain dangers like over-capacity and airborne carcinogens.
Dispensing pharmaceuticals is certainly a licensed activity. If a government body has a say in the issuance of that license, it seems clear to me that tobacco products run contrary to the mission of a pharmacy. Not allowing those sales in such an establishment that is licensed for purpose of health and wellness is clearly reasonable.
Well, when you put it like that…I may have to rethink my position yet again.
user Greg Seminara had some thoughts about Walmart efforts to acquire Chile’s largest supermarket chain:D & S represents a long-term opportunity for Walmart, because now is a tough time to be in the retail business in Chile. Copper accounts for 56% of Chile’s exports. In recent years the price of copper has skyrocketed and created a wonderful sense of affluence in Chile. Anyone who visits Santiago will tell you of its beauty and great stores run by D & S and Cencosud (Jumbo). The price of copper has collapsed by more than 50% and Chile faces a grueling recession.
Walmart would be better off striking a deal with Cencosud, (which) also maintains a strong #2 position in Argentina where WM is small, and a strategic presence in Brazil, which is Walmart’s latest success story. Walmart and D & S have been talking for years, maybe the pain in the marketplace is finally forcing D & S to sell. Latin America is prone to “Boom/Bust” cycles, so an opportunity to buy D & S is an investment in the future for Walmart.
And finally, one email came in about yesterday’s story noting that the editorial staffs of Progressive Grocer
and Gourmet Retailer
are being trimmed and merged, which I said was yet more evidence of the encroaching death of traditional media.Another great example of the real world -- Adapt to the needs of your customer or you go away.
Which brings us back to the Hemingway line quoted by Michael Sansolo above.
When this happens, it happens “two ways. Gradually and then suddenly.”
It is the great question facing every business
as we move from 2008 to 2009.
What are the great and fundamental changes taking place in society, in culture, in government, and, most importantly, in the consumer population, that will affect how and where they will buy products, and what they will buy, and how much they will spend?
Yes, it is important to think about tomorrow’s coupon and next week’s sale and next month’s new product introduction.
But there are bigger things occurring that we have to thinking about and acting upon.
They are happening gradually. And suddenly, they will have happened.
Companies need to decide where they will be, and what kinds of businesses they will run, in order to be relevant to these new consumers.