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    Published on: October 30, 2009

    It was just about a year ago that Wegmans announced that it was lowering prices on hundreds of items - even though in some cases manufacturers were not lowering their prices - saying that the deepening recession demanded an aggressive response on behalf of its shoppers.

    Today, according to the Rochester Democrat and Chronicle, Wegmans is saying that those cuts have saved its shoppers about $20 million - and it plans to highlight those savings in a series of print ads and in-store signage.

    The story reports that Danny Wegman “says that aid the company made the decision expecting its then-high fuel, commodity and other costs to decline, but Wegmans couldn't guarantee the low prices would remain.

    “But Wegmans' sampling of product categories this week suggests the low prices stayed put or dropped further. The company reports that average retail prices declined 26 percent for pork and milk, 20 percent for packaged breads, 17 percent for beef, 11 percent for cheese and 7 percent for chicken.”
    KC's View:
    This is called being an advocate and agent for the consumer, and then communicating that fact effectively to shoppers. Just one more thing at which Wegmans is expert.

    Many of the headlines in newspapers today seem to be about the economy surging. Whether it is or not, and now long it will last, Wegmans’ approach has been focused and canny.

    Published on: October 30, 2009

    A new program designed to encourage shoppers to use reusable bags for shopping and bring plastic bags back to the store for recycling has begun in California under the name ‘Got Your Bags?” The promotion is being supported by n-profit, government and business groups; for example, 68 Albertsons stores in the Los Angeles area are featuring "Got Your Bags?" reminders in the form of decals on their front doors, buttons for employees and select stores are placing stencils at store entrances.

    "Our goal with this campaign is to give consumers that extra reminder so they translate good intentions into action," said Christine Flowers-Ewing, Executive Director of Keep California Beautiful, in a prepared statement. "We all play an important role as individuals by using reusable bags and increasing the recycling of plastic bags and wraps. California's residents need to get the message that they can recycle all types of clean plastic film, such as dry cleaning bags, newspaper bags, and wraps covering paper towels, drinks or other retail items.”

    The announcement noted that California state law requires grocery stores and pharmacies with more than 10,000 square feet of retail space to provide bins for the collection and recycling of plastic shopping bags, “yet research shows that consumer awareness remains low, and shoppers often forget to bring their bags back to the store. The same holds true for reusable bags.”
    KC's View:
    This is the best approach. No legislation involved, but an intelligent and broad-based program that tries to cover all the bases. Reusable bags plus recycling. If it works, it helps solve the problem of planet-abuse. Or at least takes a small step in that direction.

    Published on: October 30, 2009

    Got the following press release yesterday:

    “Grocer Food Lion LLC and refrigeration manufacturer Kysor//Warren unveiled the grocery industry's first cascading refrigeration system with naturally occurring carbon dioxide (CO2) to keep frozen and fresh foods cold.

    “Food Lion demonstrated the system during an event held for industry peers and members of the U.S. Environmental Protection Agency's (EPA) GreenChill Advanced Refrigeration Partnership, a cooperative alliance working to reduce the use of ozone-depleting gases and curb greenhouse gas refrigerant emissions. The College Park store, located at 5432 River Station Blvd., is Food Lion's fourth GreenChill advanced refrigeration store and its third store to incorporate the use of CO2, a natural compound that reduces the amount of refrigerants needed to keep products cool or frozen by more than 30 percent.

    “The system is Food Lion's first ‘cascading’ CO2( )refrigeration cycle, which uses a single system and just one condensing unit to refrigerate and freeze foods. Before Kysor//Warren developed this system, grocers incorporating CO2 refrigeration systems needed two condensing units as well as a freezer-specific system and a refrigeration (medium temperature) specific system. This is Kysor//Warren's first CO2( )advanced refrigeration system in a retail grocery store setting."
    KC's View:
    Going to be perfectly honest here. I have absolutely no idea what any of this means. You wouldn’t need a thimble to hold what I know about refrigeration systems.

    Except that it sounds cool. (Pun intended.) And it is the kind of stuff that retailers can do to create an environmental halo around their operations, which has more and more resonance for a growing number of shoppers. Which is smart.

    Published on: October 30, 2009

    Reuters reports that Walmart.com has been experiencing technical glitches that have been preventing some people from actually making purchases. They can browse the site and add items to their virtual shopping cart, but not check out. No word on when the problem will be resolved, or whether the problem was created by traffic generated by its price war with Amazon.com over best-selling books and recent introduction of caskets and cremation urns for sale on its site.
    KC's View:

    Published on: October 30, 2009

    The Wall Street Journal reports that even as Amazon, Walmart.com and Target fight a price war using best-selling books as cudgels - they all have cut prices on certain books to around $9 - they all are limiting how many people can buy - apparently concerned that other retailers will use them to build up their own inventories and then resell them.

    On certain books, Walmart is imposing a two copy limit, while Amazon has a three copy limit and Target is limiting sales to five per title.

    According to the story, “The retailers are losing money on each copy sold because publishers charge them about 50% of a book's hardcover price. The prices for the 10 books involved in the promotion are also lower than the wholesale price independent booksellers pay for the merchandise.”
    KC's View:
    As authors with a new book coming out, Michael Sansolo and I can only hope that bookstores start fighting over the number of copies that can be sold. We’re willing to pledge right now that there will be enough for everybody.

    Published on: October 30, 2009

    • The Colorado Springs Gazette reports that “unionized grocery workers in Colorado are questioning why their international union has not yet approved a strike against Safeway despite assurances last week by a top international official that it would be granted ‘in a day or two’.”

    Talks between management and labor broke down about 10 days ago after unionized employees rejected what Safeway and Kroger-owned King Soopers said was their final offer. The union members then authorized a strike against Safeway.”

    • The Los Angeles Times reports that three former Ralphs executives - Patrick McGowan, a former regional vice president, and Scott Drew and Karen Montoya, former zone managers - are suing their former employer and Kroger, its parent company, “alleging that the companies wrongfully terminated and scapegoated them after the bitter 2003-04 Southern California supermarket strike and lockout.”

    The three former executives were acquitted in the June of charges that they conspired during the labor action to hire locked out employees and pay them using fake Social Security numbers.
    KC's View:

    Published on: October 30, 2009

    • Procter & Gamble said yesterday that its first quarter profit was down one percent to $3.35 billion, compared to $3.31 billion, during the same period a year ago. Q1 sales fell six percent to 19.8 billion.

    The Kellogg Co. said that its third quarter earnings were $361 million, up 5.6 percent from $342 million a year earlier. Q3 revenue was down down 0.3 percent to $3.28 billion.

    • Fast feeder Burger King said that its Q1 profit was down six percent to $46.6 million, from $49.8 million during the same period a year earlier. Sales for the period were down five percent to $636.9 million.

    • Rite Aid said that its October sales fell 1.7 percent to $1.96 billion, on same-store sales that were down 0.5 percent.
    KC's View:

    Published on: October 30, 2009

    • Starbucks has hired Kalen Holmes, most recently the human resources general manager for Microsoft’s Entertainment and Devices division, to be its new head of global human resources.
    KC's View:

    Published on: October 30, 2009

    Responding to a survey the other day about when it is to early to start advertising for Christmas, I rather crankily said that Christmas is like presidential elections - it goes on way, way too long.

    Which led MNB user Stephanie Allen - who sounds irrepressibly sunny - to write:

    Even as materialistic as the Season has become, our American tradition still incorporates the values of giving, family, peace, togetherness, good cheer, and overall feelings of childlike-nostaglia. All year long we’re pummeled with garbage & nastiness on TV (whether it’s trashy reality shows or horrific news events) - so when my TV chimes with Santa’s bells a tiny bit of excitement stirs inside of me…

    And have you ever noticed that during the “holiday season” (even in October!) that cashiers, bankers, DMV employees, etc seem happier to help? And then to finalize a sale or transaction, the chipper “Happy Holidays!” or “Merry Christmas!” many times isn’t so much a habit of speech, but actually a connection between two strangers saying “I don’t know who you are, or what your situation is, but I wish for you to be happy, at least for this season.”




    MNB reported yesterday about a new line of private brand fresh salads from Kroger that includes innovative new technology on the packaging that enables customers to learn where the produce was grown as part of the retailer’s "Quality You CanTrace" program. I waxed rhapsodic about it because the program promotes transparency, but not everybody was impressed. One MNB user wrote:

    I read MNB every day and really enjoy your point of view, comments and even your rants.

    Regarding your Kroger CanTrace program piece, this seems like only a first but very inadequate step.

    A customer has to buy the product, take it home look up its origination on the web and then take it back to the store if he/she is not satisfied.

    I guess this is not something you can buy and eat at the park!

    Doesn’t look transparent to me! Put the origination on the package and then we have transparency and actionable information.


    And another MNB user chimed in:

    OK... let's see....... we have just added a nice chunk of overhead costs and added costs to run the program and answer questions and concerns and challenges by a vast minority of customers. We all have to pay the costs when the majority want what you described is a trust factor from the company we buy from. Oh my god!!! The iceberg is from California but the onions are from Peru!!! I can't eat this..... because I don't trust Peru. What does the consumer do then... stop buying from the store (whole chain?) what does the retailer do .... stop buying from the supplier? Most of us want the trust factor to be with the exchange ..... money for a product that is guaranteed by the seller. So if overhead is to be added I would rather see it go to food safety at the retailer to supplier level not consumer to supplier.
     
    PS- family so busy with work and raising kids checking out the computer for product source. Then having to follow up if they have a question/concern ..... boy that is realistic!!! I think you need to get away from your nice restaurants and fine wine perspective and do a segment on the average middle class American family perspective. Puulllleeeease ........ getting on the computer to check a 16 digit code!!!!  "Kudos to Kroger for getting ahead of the transparency wave. It will serve the company well in the long run." The people I am talking about just want to trust Kroger with their families health and well being NOT transparency.


    For many people, trust is equated with information. While I understand your skepticism, there are limits to what can be put on labels, and providing this kind of information via the computer is a smart move. Eventually, it’ll be available via smart phones or some other mobile technology tool. But to underestimate the power of this kind of program - especially its value to young consumers - is a mistake.

    Incidentally...you don’t have to use the system if you don’t want to. But you shouldn’t trust Kroger any less because of it, and in fact its food safety systems will have to be better because of the transparency factor.

    BTW...one other thing. I had to laugh when I read about my “nice restaurants and fine wine perspective.” For the record, I spend most of my time working and raising kids...just like most people. And we only have a butler come in four times a week; it is, after all, a recession.




    Regarding the ongoing World Series, MNB user Tom Devlin wrote:

    Well at first I thought that there is nothing worse than being a Met fan for this World Series. Until... The starting pitching for Game one as both EX- Cleveland Indian pitchers  were the starting for the Yankees and Phillies.... OUCH !!  THAT hurt even beats the Mets faithful..... Well at least they still have Lebron James....

    At least until he goes to the Knicks...
    KC's View:

    Published on: October 30, 2009

    The New York Yankees defeated the Philadelphia Phillies 3-1, evening the best-of-seven series 1-1.
    KC's View:

    Published on: October 30, 2009

    Wow!

    Michael Sansolo and I want to thank you for the overwhelmingly positive reaction we got to yesterday’s announcement that our new book, “THE BIG PICTURE: Essential Business Lessons from the Movies,” will be available exclusively to MNB readers in time for Christmas. (It’ll be available to the general public in early March 2010.)

    We’re very excited about this project, and have been working on it for over a year - it is an extraordinary feeling to come to the home stretch on a process like this, and we’re thrilled to share it with the MNB community, which has been so supportive over the years.

    In case you missed yesterday’s email, in THE PICTURE we look at the plots and characters in more than 50 movies - ranging from The Godfather to Young Frankenstein - to explore lessons that can be learned in leadership, management, marketing, and surviving the workplace. If you’re interested in getting a copy, just go to:

    http://www.brigantinemedia.com/bigpicture >

    And, to respond to queries that Michael and I have gotten...yes, we’ve developed a killer presentation based on the book that we’re already scheduled to do at a couple of conferences next year. We’d love to do it for you...if you’re interested, just shoot me an email for details: kc@morningnewsbeat.com .




    On to other less self-serving subjects...

    Maybe I haven’t been paying attention, but this report from National Public Radio caught me by surprise:

    “European astronomers have found 32 new planets outside our solar system, adding evidence to the theory that the universe has many places where life could develop. Scientists using the European Southern Observatory telescope didn't find any planets quite the size of Earth or any that seemed habitable or even unusual. But their announcement increased the number of planets discovered outside the solar system to more than 400.”

    More than 400 planets have been discovered outside our solar system? That’s extraordinary...

    Back when I was in school, we only knew about the planets in out solar system, and even that information was wrong, as it turned out, since Pluto wasn’t actually a planet. When it came to other planets, we had only our imaginations and Star Trek as reference points. We could dream that one of those planets could be Vulcan or Kronos, but it was all dreams...

    Now, not only do we know of more than 400 other planets, but that information is shared with not even a shred of wonder. It is all so matter of fact.

    The really cool thing is that we don;t even have pictures of these planets. We only know of their existence because of the magnetic pull of these planets on distant stars, which can be measured by instruments here on earth. (How amazing is that?)

    But since we don’t have pictures, our imaginations can still run wild. Which is wonderful, because even in a time when we know so much, there is so much more than we do not know. Maybe there is a Vulcan out there somewhere...




    Michael Connelly’s new Harry Bosch novel, “9 Dragons,” is a worthy addition to one of the best recent series in American mystery fiction. This one finds the Los Angeles detective dealing with unfamiliar physical and emotional terrain - he has to travel to Hong Kong to rescue his daughter when she appears to have been kidnapped as a way of getting him to curtail a murder investigation in LA.

    Bosch always has been better at unraveling mysteries than dealing with the intricacies of his own emotional life, and “9 Dragons” finds him in a vulnerable and unfamiliar position. Connelly, as always, writes with brisk and detailed authority. And “9 Dragons” is definitely worth picking up. Or downloading. Whatever is your pleasure.




    Wines of the week:

    • 2007 Cimicky Trumps Shiraz from Australia’s Barossa Valley - a wonderfully fresh and spicy wine that Mrs. Content Guy says is one of her new favorites. (About $20.)

    • 2007 Cline Cashmere, which, as befits its name, is oh so smooth. (About $15.)

    Enjoy.




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

    Sláinte
    KC's View: