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    Published on: May 13, 2011

    Supervalu announced yesterday that that Bill Shaner, a 27-year company veteran who has been running its Save-A-Lot division since 2006, is leaving the company, to be replaced by Santiago Roces, most recently a senior vice president and general manager at Walmart.

    Roces also worked for Walmart as senior vice president of new business development and customer experience, president/CEO of Wal-Mart Korea, and chief merchandising officer of Wal-Mart Argentina.

    Craig Herkert, the Supervalu CEO, also is a former Walmart executive.

    The move is replete with irony, since presumably Shaner’s Save-A-Lot efforts were sufficient to lead Herkert to say that he wanted to build much of Supervalu’s turnaround process around the division, which combines low prices, limited assortments and mostly private label products. There are some 1,200 Save-A-Lot stores currently, and the company has said it wants to double that number in the next few years.

    Shaner has not commented on the situation. Supervalu only said that it appreciated Shaner’s work and that he was moving on to other opportunities.
    KC's View:
    From what I’ve been told, shock waves rippled through Supervalu yesterday when this announcement was made ... and there reportedly is a fairly severe morale problem that Herkert and Roces now have to grapple with.

    Nobody I know is buying the “he’s leaving to pursue other opportunities” line. The feeling is that for some reason, Herkert and Shaner simply did not see eye-to-eye on Save-A-Lot’s strategy; one bit of speculation is that Shaner resisted Herkert’s desire to raise prices so that he could improve margins and, as a result, the division’s contribution to the bottom line.

    I’m also not sure that Walmart’s grocery store performance to this point has been so strong that it would be the best breeding ground for grocery industry executives.

    I’m also wondering how come Walmart did not have a non-compete clause in place with Roces; that seems curious, at least.

    There is a lot of chatter that Herkert, faced with a ticking clock on his stewardship of Supervalu,, is making desperation moves ... and that this could end up being the one that sinks him.

    Finally, I can tell you this. In conversations I have had with a wide range of people about Supervalu’s current situation, the name that often comes up is “Fleming.” There are a lot of people out there who believe that Herkert is driving Supervalu off the same cliff that Mark Hansen drove Fleming. (In fact, have we ever seen Herkert and Hansen together? Coincidence? I think not...)

    Published on: May 13, 2011

    by Michael Sansolo

    DALLAS -- If there is one topic likely to provide the world of future leaders with different challenges than the present it is certainly the explosive growth of social media.  So it made sense that the Food Marketing Institute (FMI) Future Connect leadership conference concluded with an examination of the Facebook, Twitter, etc. phenomena.

    Consultant Jeff Molander offered the closing day audience his views on the world of social media with three key directions.  First, retailers need to focus on the basics and use social media to supply customer focused solutions, much as they have always tried to do in stores.  Second, retailers need to think like designers and find ways to prompt customer interaction, such as creating ways to generate questions and dialog.  Third retailers need to translate those customer desires into solutions they can provide.

    Molander was actually the penultimate presenter, followed by inspirational speaker Desi Williamson, who energetically urged the crowd to get ahead of change in both themselves and their companies.

    The meeting’s concluding day featured the final round of breakout workshops.  In the strategic management track, which I moderated, Marcus Nicholls talked about how companies need to shift their culture away from blame avoidance and finger pointing to a more focused approach on goals and resolution.

    Michael’s View: All in all, FMI produced a successful conference of more than 1,500 people and near constant discussion.  It’s hard to overstate the visual impact of top CEOs such as David Dillon of Kroger, Ric Jurgens of Hy-Vee and Colleen Wegman of Wegmans (among many others) sitting at the discussion tables that filled the breakout rooms.  As one CEO told me, that personal participation makes the entire event work for their team.

    But I do have to make one disagreement.  In his closing session speech, Molander referred to social media as an evolutionary, not revolutionary force.  If world events have shown us anything recently, it’s that social media connects people for good and bad in previously unimaginable ways and that portends untold opportunity and challenge for all industries.  We might want to think of it as evolutionary, but the steps companies will have to take and the new attitudes that social media will make necessary are anything but evolutionary. 

    If the attendees of Future Connect are indeed the future leaders of the food industry, they will need to understand the power of social networking in a very different way than evolution suggests.
    KC's View:

    Published on: May 13, 2011

    by Kevin Coupe

    There are a lot of In-N-Out hamburger fans in the MNB community, so it won’t come to a major surprise to many readers that when In-N-Out opened its first Texas units this week, there reportedly were people camping out overnight, and a mile-long line of cars waiting to get in once the place opened.

    There’s even video on YouTube that shows a young woman being moved to tears by eating an In-N-Out burger.

    Just goes to show you. A lot of companies talk about loyalty programs and data compilation and utilization, but in the end the best loyalty program is a product that is really, really good.

    That shouldn’t be an eye-opener. But it is.
    KC's View:

    Published on: May 13, 2011

    Kroger Expanding Ban On BPA
    The Columbus Dispatch reports that Kroger is getting rid of Bisphenol A (BPA) from “cans it uses in its store brands and the paper on which its receipts are printed.” This follows the retailer’s decision to eliminate it from all baby products it sells.

    The move will be made as quickly as possible, the company said.

    “BPA has been used for years in bottles, canned-food linings and numerous household products,” the Dispatch reports. “Companies use it to guard against contaminants and to extend a product's shelf life.

    “But some studies have shown that BPA can leach into food from the cans. In fact, 93 percent of consumers have detectable levels of BPA in their bodies, according to the U.S. Centers for Disease Control and Prevention.

    “A study this month found that exposure to the chemical during fetal growth affects the development of reproductive systems and, in babies, can lead to neurological problems. Other studies have linked BPA exposure to breast and prostate cancer, infertility, obesity, early puberty in girls and attention deficit hyperactivity disorder.”

    However, some in the scientific community have said that there is no evidence that BPA is harmful, and that such moves are unnecessary.

    Some 20 states have banned or are considering banning BPA in certain instances.
    KC's View:
    The people defending the use of BPA are in denial. At this point, there seems to be more than enough evidence out there to suggest to consumers that this is bad stuff, and that it can be responsible for bad things. “BPA-free” is a selling tool ... and to continue to fight this battle strikes me as pointless.

    Published on: May 13, 2011

    DuPont is out with a new survey saying that “the need to package food, consumer and industrial products in a more sustainable and affordable way dominates the worldwide packaging industry ... More than 500 packaging professionals were surveyed and over 40 percent sited sustainability as the toughest challenge while 33 percent named cost as a major factor.”

    The report goes on: “Meeting sustainability challenges requires multiple strategies, according to survey results.  Of those respondents working on sustainable packaging, 65 percent say their efforts are focused on design for recyclability or use of recycled content; 57 percent are focused on weight reduction; 41 percent rely on renewable or bio-based materials and 25 percent say they are focused on compostable materials.”
    KC's View:

    Published on: May 13, 2011

    Bloomberg reports that Walmart is acquiring “a minority stake in the holding company of Yihaodian, an e-commerce company in China.”
    KC's View:

    Published on: May 13, 2011

    Reuters reports that a KPMG survey of retail financial executives suggests that “only 24 percent of retailers around the world expect significant improvement in their financial performance over 2010 ... Fifty-one percent predicted some improvement in financial performance, and 9 percent forecast a decline.”

    The story goes on: “While 18 percent of those surveyed have seen a sustained increase in demand since the economic slowdown, 54 percent expect such a rebound this year and 24 percent do not expect sustained demand before 2012.”

    "There is a feeling that there's going to be growth, but that growth will be muted," Mark Larson, KPMG's global head of retail, said in an interview with Reuters.
    KC's View:

    Published on: May 13, 2011

    • The Charlotte Observer weighs in on Food Lion’s moves to “repair its reputation with shoppers by sprucing up its local stores,” noting that “in a test that has started in the Triangle and Chattanooga, Tenn., the Salisbury-based grocer is cutting prices on 6,000 items, reorganizing shelves, adding shopping carts, increasing staffing and trying to improve customer service.

    “If successful, Food Lion plans to expand the pilot program to nearly all its 1,200 stores by the end of 2012.”

    The paper notes that one of the challenges to Food Lion is that “shoppers have grown fickle and hard to impress after years of price wars and heavy advertising. Food Lion will need to prove the improvements aren't just cosmetic.”

    • The Sacramento Business Journal reports that state statisticians say that Californians recycle 82 percent of their containers - all time state high.

    According to the story, “CalRecycle said recycling rates were strong for the three material types included in CRV recycling. Aluminum rose to 94 percent from 91 percent the previous year, but plastic recycling declined to 68 percent from 73 percent. Glass recycling rose to 85 percent from 80 percent. Other types of plastic, including bimetal cans, combined make up less than three percent of CRV beverage containers.”

    • The Associated Press reports that a new book called “American Wasteland,” by Jonathan Bloom, maintains that “Americans waste an estimated 14 percent to 40 percent of the food produced for their consumption. It happens in fields, in stores and in your kitchen. That’s bad for the environment and it can be very bad for your wallet.”

    The story continues: “Farmers toss imperfect heads of lettuce, grocers chuck bruised tomatoes and, by best estimates, consumers waste about 25 percent of the food they buy — throwing out browned bananas, outdated cheese and unused leftovers.

    “This has all sorts of environmental, social and ethical ramifications. But if you look just at the financial impact on the consumer, that is the equivalent of a family of four tossing $1,500 to $4,000 in the garbage each year. That’s a lot of dough.”
    KC's View:

    Published on: May 13, 2011

    Leo Kahn, who turned his experience at Purity Supreme and Supermarket General Corp. into the launching - with co-founder Tom Stemberg - of the Staples office superstore chain, has passed away. He was 94.
    KC's View:

    Published on: May 13, 2011

    ...will return.
    KC's View:

    Published on: May 13, 2011

    Not too long ago, I mentioned that I was looking forward to reading the new Peter Guber book, “Tell To Win: Connect, Persuade and Triumph with the Hidden Power of Story,” and I can now report that not only was I not disappointed, but that it was one of my favorite business books of the past few years.

    Now, to be honest, I do have a bias on the subject - the importance of narrative is a key theme in a little business book that I co-authored with Michael Sansolo. (I won’t mention the title here, nor how to buy it from Amazon.com, because I may be accused of using this space to hype my own products. Heaven forbid.)

    But Guber - who is a film producer of considerable note, as well as a teacher at UCLA’s film school - takes an approach that goes beyond what we did, looking beyond the movies at how compelling narratives can be woven in various industries to create a compelling customer experience. He’s blunt about his personal successes and failures in this area - he tells a number of stories about how he missed opportunities to tell a great story when pitching a business proposal, and things didn’t work out (and, as in most cases, he learns more from his failures than his successes).

    Guber uses a wide range of examples - ranging from the Los Angeles Olympics to a Papuan tribe in New Guinea - to illustrate his essential premise: “For too long, the business world has ignored or belittled the power of oral narrative, preferring soulless PowerPoint slides, facts, figures, and data. But as the noise level of modern life has become a cacophony, the ability to tell a purposeful story that can be truly heard is increasingly in demand.”

    Institutions - whether corporate, cultural, religious, or political - that lose touch with their core narratives are destined, Guber suggests, to lose the ability to function effectively and communicate their goals and priorities to customers, employees and business partners.

    I cannot agree more. “Tell To Win” is a terrific book, and worth picking up at your local bookstore, ordering via Amazon.com, or downloading to your e-reader.




    We get into a lot of discussions here about old media vs. new media, and while I am a firm devotee of the latter, I have an old time affinity and affection for things like print newspapers. The way I feel was expressed perfectly the other day by Gene Weingarten, who told the story of how because he went to bed early on a recent Sunday night, he learned of the killing of Osama bin Laden the old fashioned way - he walked out to get the paper on Monday morning, unfolded it, and had a “Holy Cow!” moment:

    “I can’t tell you how good it felt – not just the news, which was indeed good -- but the method of delivery.   Yeah, this is weepy nostalgia, but it is righteous weepy nostalgia about an experience I’d almost forgotten and will soon lose forever:  A huge story that arrives on the doorstep as a complete surprise the morning after -- as full-blown news, in a package that hollers its importance, told with a blast of authority, assembled by people more expert than I, and only after time for reflection.  It seemed quick but unhurried – a story well told, deftly contextualized and prioritized.   It literally felt big; the headlines and the layout made it seem etched in stone. This is a journalistic packaging skill as old as the start of the last century -- see here, here, here and here -- and one that has proven impossible to replicate on a computer screen.   Everything whispers now.

    “Online, of course, we don’t get news the way I did yesterday.  Now, we tend to learn things incrementally, the way newspaper wire editors used to:  by trickle of fact.  First, an alert, then a headline, then a story assembles itself piecemeal.  Today, I learn about some news by first reading someone’s shrill opinion about it on Twitter, and then having to catch up on the facts on my own, until eventually the whole thing emerges.

    “Was the old system...better?   Nah.   It was late.   It was limited in its breadth by the unfortunate finiteness of the commodity called ‘paper.‘   All I’m saying is, we should pause a moment to miss it.  In the main, cars are better transportation than horses were.   But horses were...horses.   They had names and personalities, and sometimes they loved you and sometimes you loved them back, and we lost a little something when we put them out to pasture.”

    Speaking as someone who began as a daily newspaper reporter - and who missed that job almost every day after I stopped, at least until I started doing MNB - I can relate.




    Sometimes, personal narratives collide, and we have to sort of muddle our way through. That’s sort of been the case around here, where just two weeks after the death of my father-in-law, we celebrated the college graduation of my son, Brian.

    He’s back home for the time being; Brian’s goal is to go into the wine business, and is hoping to land an entry level job with a winery in Northern California, Oregon or Washington State. Right now, he’s working for a local wine merchant, being trained at the retail level while he conducts his broader job search. It is good to have him home, and I sort of envy him being at the beginning of his career, filled with promise and possibility.

    (The only problem with having Brian home is that he brought his dog, Parker, with him. Now, Parker is a great dog, but is an energy-filled yellow lab-mix puppy, and all Parker does is keep wrestling with our six-year-old yellow lab, Buffett. In fact, they’re doing that right now, underneath my feet, making it almost impossible for me to write. Oy.

    Then again, what were the odds that there would be two dogs living in the Content Guy’s house, one named Buffett and another named Parker? Go figure.)




    In between all this, Mrs. Content Guy and I rode our bikes in New York City’s Five-Boro Bike Tour - a 42 mile tour of the city in which 32,000 people managed to close roads and highways for most of the day. And except for the occasional and probably inevitable traffic jam, it was delightful.

    The funny thing is, she’d done it twice before, and we’d done it once together - about 30 years ago, before we were even married. I’m proud to say that while our memory of the earlier tour is that we were so tired at the end that we had to walk our bikes up the incline of the Verrazano Narrows Bridge (which is where the tour ends), this time we rode the whole way.
    Slowly, to be sure. But we made it.




    My wine of the week: the 2009 Bell Sauvignon Blanc from Northern California, which is wonderful - I had it last night with a salmon burger, and it is a bright, crisp white wine. I loved it.

    BTW...this happens to be one of the May selections from the MNB Wine of the Month Club. For more information, about this new MNB offering CLICK HERE.




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

    Slainte!
    KC's View: