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    Published on: December 18, 2009

    Ukrop’s, the Richmond, Virginia-based, family-owned supermarket chain, is being acquired by Dutch conglomerate Royal Ahold for $140 million.

    Store managers were informed of the transaction yesterday at a 2 pm meeting, and then were sent back to their stores to inform employees and show them a video made by Jim and Bobby Ukrop, according to the Richmond Times Dispatch.

    The deal, which according to the Washington Post includes all inventory, equipment and leases, marks a major turning point in the history of both companies. Ukrop’s, which was founded in 1937, has been a bastion of the local community and a company with specific cultural touchstones - its stores were closed on Sunday and did not sell alcohol. Until recently, Ukrop’s seemed to be almost unassailable in its markets, but a toughening economy seemed to make it vulnerable; at the same time, expansions into new markets such as Roanoke did not go well, and rumors have been flying around for months that the company was on the sales block.

    As for Ahold, the decision to buy Ukrop’s seems to send a strong message that the company is back, and completely recovered from the financial scandal that roiled its ranks just a few years ago. Ahold sold its Tops stores in western New York three years ago and was the focus of investor pressure to sell all of its US operations; at times, it seemed like management was uncertain about how to operate the company;s various divisions, especially the Stop & Shop and Giant-Landover divisions, where operations were centralized and more recently seemed to be going through something of a decentralization process.

    The Washington Post reports that Ukrop’s “will become part of Ahold's Giant-Carlisle division based in Carlisle, Pa., which also includes the Martin's supermarkets in Virginia.”

    According to the Times Dispatch, “Under its new ownership, Ukrop’s will retain its name for a couple of years and be open on Sunday, according to company sources. The stores, which have been closed Sundays and do not sell alcoholic beverages, will begin selling alcohol but only after the Ukrop’s name is removed, the sources said.

    The sale is expected to close in the first quarter.
    KC's View:
    Inevitable and sad news, if only because it is a shame when people of an independent mind get out of the business. Real innovation almost always comes from smaller players that have less bureaucracy to deal with, that are more in touch with their customers needs and wants. The death of Ukrop’s - and no matter how this plays out, this is the death of one of America’s preeminent independent retailers - is not good for the business.

    This also is a strong statement by Ahold, saying that the company is back...and means business. One has to assume that it will be able to grow Ukrop’s sales just by opening on Sunday...though it also should take pains to preserve what is special about the customer-focused culture at the company.

    If Ahold forces Ukrop’s into its way of doing things, going for efficiencies at the expense of effectiveness, it will be a mistake. Addition can actually be multiplication of you do it right.

    Published on: December 18, 2009

    The Chicago Sun Times this morning reports that in order to open more stores there, Walmart would accept a wage minimum stipulated by the city of Chicago - but only if it applied to all of the city’s businesses.

    "If there is a minimum wage ordinance that applies to everybody, and every business in Chicago is held to that ordinance, then the answer would be yes," says Rolando Rodriguez, vice president and regional general manager for Walmart. "There's no need for Wal-Mart to be singled out. Why is it all other retailers are allowed to build in Chicago and we are not?"

    The conditional concession by Walmart comes a day after Chicago Mayor Richard Daley said that it was critical for divergent interests in the city to come together to allow new stores to be opened by Walmart; he said that new stores would give middle class residents a low priced shopping option, as well as providing jobs in a city that needs them.

    Walmart only has one store within the Chicago city limits, with further expansion opposed by smaller retailers and organized labor.

    It would not be the first time that Walmart accepted such a wage stipulation; according to the Sun Times, “Earlier this year, Santa Fe, N.M., passed a minimum wage of $9.85 an hour that applies to employees of all city contractors, city-licensed businesses and nonprofits, including part-time and temporary workers. Wal-Mart went along with the ordinance. It has one store thriving in Santa Fe, and it's about to break ground on a super-center that sells groceries.”
    KC's View:
    The irony here is that by the time the various constituencies in Chicago figure this all out and come to some sort of accord, the recession probably will be over and prosperity will reign yet again.

    At least, we can hope.

    Published on: December 18, 2009

    No, this isn’t some sort of April Fool’s joke.

    The UK Payments Council ruled yesterday that the use of written checks will be phased out there, with checks no longer being accepted in the UK as of November 1, 2018. The reason: so many people are using debit and credit cards, and shopping online, that checks have been deemed to be on the road to obsolescence.

    According to reports, 20 years ago there were more than 11 million checks a day written in the UK, a number that has dropped to four million. And now that the death knell has been sounded, it is expected that use of checks is likely to plummet.

    Opponents of the decision say that it is better for big banks and big retailers than for small banks and independent retailers, not to mention charities and schools; the elderly, who may not trust debit and cards, also are seen as being disadvantaged by the initiative. Furthermore, since banks in the UK have gone through a bailout similar to the one in the US, it is argued that they are taking an anti-consumer position at the precise moment when they should be grateful to the public sector for getting them through a difficult period.

    Backers of the move, however, say that it simply formalizes something that was happening anyway.
    KC's View:
    Hand in hand with this decision, banks also ought to be simplifying their rates and fees, making them more transparent and, quite frankly, lower. That way, the savings that are seen by going to a completely electronic system are actually seen by consumers, and not just in the dividends earned by shareholders and the bonuses awarded to fat cat senior executives.

    On the face of it, though, I have no problem with this change, especially because it is nine years out - it isn’t like people are being forced to adjust their habits overnight. And I wouldn’t worry so much about the elderly...because nine years from now, some of the people who would hate the change may not be around anymore, and the “elderly” demographic will made up of people who are more used to the use of cards rather than checks.

    There is a word for this kind of shift. It’s called “change.”

    Resistance is futile.

    Published on: December 18, 2009

    • 7-Eleven said that it will acquire New England Pantry, which operates 58 White hen Pantry convenience stores in the Boston area, where 7-Eleven will now have a total of more than 170 units. Terms of the deal were not disclosed; the White Hen stores will be rebranded as 7-Eleven units.
    KC's View:

    Published on: December 18, 2009

    • Unified Grocers said that its 2009 net sales were $4.051 billion, for the 2009 period, compared to $4.105 billion for the previous year. Earnings for the year were $14.8 million, as compared to earnings of $17.4 million for the previous fiscal year. Both declines were blamed on “general economic conditions.”

    • Rite Aid Corp. said that its third quarter sales were were $6.35 billion, down 1.8 percent from revenues of $6.47 billion in the prior-year third quarter; same store sales were down 0.5 percent. The company had a third quarter loss of $83.9 million, a significant improvement over the previous year’s Q3 loss of $243.1 million.
    KC's View:

    Published on: December 18, 2009

    • The Denver Business Journal reports that Chris Sherrell, the COO of Sunflower Markets, has added “president” to his title. Founder Mike Gilliand remains as the company’s CEO.
    KC's View:

    Published on: December 18, 2009

    MNB user Debra K.W. Topham had some thoughts about yesterday’s radio commentary...

    Thank you, Kevin, for closing your commentary today with a basic premise to improving health:  teach people to cook!  We all took driver’s education and a driving test before getting our licenses….even though there are traffic lights that could tell a kindergartner how to stop go.  Why does any government think that a simple front-of-pack label or icon will change a population’s health status or eating habits if we don’t teach them how to use the label in context?

    Any of these icons only serve to categorize individual foods as good or bad - they leave out the context that cooking and nutrition classes can accomplish with lifestyle management.  I believe there must be a correlation that cooking classes left our educational curriculum when microwave ovens became affordable household staples.

    Don’t rush to judgment: I am a huge fan of microwave cooking just about everything from produce to casseroles to rice dishes—not just pre-packaged meals.  (Still can’t do steak in a microwave!)  Now my college-bound kids are celebrities amongst their peers because they know how to cook fast and also save money.   
     
    Another benefit to cooking: We shouldn’t forget that cooking is a great way to math and reading literacy, too.  
     
    Keep up the diverse and perplexing dialogue!


    Perplexing - that’s my middle name.




    Regarding the vote in the US Senate not to allow the import of cheaper prescription drugs from places like Canada, one MNB user wrote:

    The only reason that we are not allowed to bring in drugs from Canada is Lobbyists.

    “Counterfeit drugs” is a bogus objection since many drugs are not manufactured in this country anyway. One can get drugs on the internet by talking to a doctor over the telephone and you certainly know why the drug companies don’t care who is BUYING. You are absolutely correct that our current and previous congresses have been dysfunctional. Who elects those guys anyway?


    Another MNB user wrote:

    Couldn’t agree more with the dysfunctional comment. But, FYI…drugs throughout the world are made by global drug companies…and they sell their products to Americans at a higher cost than they sell their drugs to other countries because our insurance pays for it.  So, Americans are paying a higher percentage for the R&D of new drugs sold globally.

    Are you suggesting that we need insurance reform?

    How hard can that be? Maybe we could do basic health care reform while we’re at it...

    Yet another MNB user wrote:

    I firmly believe that I am smart enough to recognize that the Health Care system in America is a mess.  I am smart enough to recognize what this country has today, just isn't working.

    That said, I believe there is an easy solution.

    I am smart enough to understand, that whatever is good for my Congressman, Eric Cantor, is going to be good enough for me.  Sight unseen, I'd be four-square in favor of the Congressional Health Care Plan as an option for every citizen.  You wouldn't even have to throw in private gym privileges and an emergency medical staff on site at my work place.  I'd sacrifice those sections.

    If you want to keep the plan you have, fine.  If you want "Eric's" plan, it's available.  It's a free country, take your pick.


    You just have to run for office.

    I think I’d rather have a colonoscopy.
    KC's View:

    Published on: December 18, 2009

    In Thursday Night Football action, the Indianapolis Colts retained their undefeated status with a 35-31 defeat of the Jacksonville Jaguars.
    KC's View:

    Published on: December 18, 2009

    There was a really interesting story in the New York Times the other day about a meeting that was taking place in Indianapolis concurrent with the annual Major League Baseball winter meetings - the Working Women in Baseball conference, at which “female baseball employees, mostly from the minor leagues, attended the 90-minute seminar to exchange ideas, offer support and encouragement, and build a growing network of women in the sport.”

    The women’s conference isn’t a complaint session, but rather an opportunity to compare notes on the challenges inherent for women working in a male-dominated sport.

    I would guess that it won’t be long before a woman is hired as a general manager for a major league baseball team - there is no reason in the world that they can’t make the same kinds of judgements - or better judgements - than a male executive.

    After all, it wasn’t that long ago that it was believed that only white males could make those decisions, that blacks and Hispanics didn’t have the intellectual equipment to do so ...and that certainly has been proven to be wrong.

    What struck me about the Times story was the intrinsic metaphor at work - the women’s meeting was across the street from the regular baseball meetings.

    If I were in charge of baseball, the first thing I’d do (after eliminating the designated hitter) would be to make sure that not only is the Working Women in Baseball conference taking place in the same location as the winter meetings, but make sure that I attended it...because by listening to this new source of information and discussion, I might actually learn something.

    Sort of like life.




    Good news and, in some ways, bad news on the life expectancy front.

    HealthDay News reported yesterday that the US Centers for Disease Control and Prevention (CDC) announced that American life expectancy continues to improve, with women born in 2007 likely to live until they are 80.4 years old, and men likely to make it to 75.3 years. Since 2000, life expectancy has increased 1.4 years, according to the story.

    Which all is great. (Interesting, isn’t it, that average life expectancy keeps going up despite the obesity crisis...?)

    But sometimes, my inner Woody Allen comes out, and I wonder what’s in this news for me. After all, having been born in 1954, my life expectancy is only around 70...which means I’ve only got 15 years or so left. Correct me if I’m wrong on this, but that’s not a long time...




    Talk about life expectancy...news came this week that the original Orient Express - the train that runs from Paris to Istanbul, upon which James Bond romanced Tatiana Romanova and engaged in lethal hand-to-hand combat with Red Grant, and where Agatha Christie set one of her most memorable mysteries - no longer will run.

    According to National Public Radio, the Orient Express is “a victim of high-speed trains and cut-rate airlines.”

    Somehow, it seems like something important has been lost...something that puts us in touch with a more romantic and civilized past. It also means that my bucket list is one item shorter.




    Jimmy Buffett is out with his first studio-produced album in three years, called “Buffet Hotel,” a lovely, low-key affair made up of songs written and recorded during some of his world travels. other than “Summerzcool” and the great “A Lot To Drink About,” which came out as singles earlier this year, I’m not sure there is a signature tune here...but I like the CD a lot nonetheless and find myself playing it over and over, picking up a phrase here and a wistful sentiment there.

    My favorites at the moment include “Wings,” “We Learned To Be Cool From You,” and “Turn Up The Heat & Chill The Rose”...but that could change.




    I found something out about MorningNewsBeat this week that I didn’t know - apparently, I am in the “content curation” business.

    Wendy Marx, who writes the “Brand U” blog for Fast Company, wrote this week that “content curation (love the mellifluous sound) is aggregation under the watchful eye of an expert. It’s a collection of digital content that someone with authority says is worth reading. Call it a Web 2.0 version of Reader's Digest in multiple flavors for the web ... Curation needs to add value. And it needs to provide some perspective on the article or at least summarize it for easy reading.”

    I’d not heard that turn of phrase before, but I like it a lot ... especially because it reinforces the central mission of MNB.

    The nice things is that Marx pointed to MNB as an “engaging” example of content curation.

    Thanks.

    BTW...you can read her blog by clicking here .




    Embarrassing to say at this point in my life, but I’d never had babka before...until a company called Aunt Ida’s - which uses as its slogan “tradition with chutzpah” - sent me chocolate babka and apricot almond babka. It’s really good...and really rich,...but really good.

    Chalk up another educational experience.




    My wine of the week: the 2007 Ferraton Crozes Hermitage La Matiniere, a French Syrah that is great with a spicy pasta dish...and goes or about $17. Wonderful stuff...



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

    Slainte!
    KC's View: