retail news in context, analysis with attitude

Published on: August 17, 2011

by Kevin Coupe

There is an interesting blog post by Carol Kinsey Gorman over on WashingtonPost.com that looks at the differing leadership styles exhibited by men and women.

The posting notes that traditionally, women have been perceived as less qualified or natural at leadership than men, and then, when they “adopt culturally masculine behaviors,” they are disparaged for those efforts.

Now, however, “new business realities usher in the need for a new leadership model, one that replaces command and control with transparency and inclusion.” The story suggests that “the 21st century is seeing the combination of new employees, new technologies and new global business realities add up to one word: collaboration. New workers are demanding it, advances in technology are enabling it, and the borderless organization of the future is dictating that future productivity gains can only be achieved by creating teams that are networked to span corporate and national boundaries.”

And go figure. Women are better at that than men are.

Gorman writes: “Women employ a more participative leadership style, are more likely to share information and power, and have strong relational skills that make them seem empathic to their staffs. In both laboratory studies and observations of real leaders, the opposite was often found with men. Male leaders tend to be more transactional in their business dealings, favor a more hierarchical and directive approach, and appear more typically to convey formal authority ... Generally speaking, female leaders tend to be more interactive, wanting to keep an encounter going until the emotional content has been played out. Conversely, men’s discomfort dealing with emotion (and their brain’s innate response to it) leads them to immediately search for solutions, rather than understanding that sometimes people - including colleagues and employees - just need to be heard.”

And, she continues:

“Not only are women more adept at identifying nonverbal cues, they are better at expressing them—employing more animation, gesture, vocal variety and emotion in their communication behavior.They are more likely to focus on those who are speaking by orienting head and torso toward participants. They lean forward, smile, synchronize their movements with others, nod and tilt their heads (the universal signal of listening, literally giving someone your ear). To a woman, good listening skills also include making eye contact and reacting visually to the speaker. This use of warmer body language signals in turn builds trust and encourages collaboration.

“Male leaders, on the other hand, have been found to send more nonverbal status signals. Men expand into available space: They stand tall or they sprawl, sitting with their legs spread or widely crossed, their materials spread out on a conference table, and their arms stretched out on the back of a chair. In a business meeting, they smile less than women, but employ more facial expressions that come across as intimidating, overpowering or disinterested. Such status and power cues make male executives look like leaders. Or at least they did in a hierarchical, command-and-control setting. But when it comes to leading collaborative teams, status cues can undermine the organization’s efforts. If you behave like the boss who has all the answers, why would anyone else need or dare to contribute?”

Gorman does make an important point: that any leader, regardless of gender, can adopt the attitudes and behaviors that will make them successful at creating sustainable business models in the 21st century. “Female leaders just already do it more naturally,” she writes.

I’ll buy that.

Published on: August 17, 2011

Interesting piece in the Wall Street Journal that the lessons of the 2008 economic downturn suggest that if there is another recession - or even if hard times persist - “online-only stores shouldn't fret as much as their brick-and-mortar counterparts.”

The Journal writes: “Three years ago, Internet retailers stayed afloat as physical stores struggled. That's in part because consumers spent more time comparing prices online as their budgets tightened ... Internet commerce did lose ground in the fourth quarter of 2008 and the second and third quarters of 2009, according to industry tracker comScore Inc. But analysts say online retailers took market share from physical stores in the process.

“Today, analysts say online-only outlets such as Amazon.com Inc. and eBay Inc. may be even better poised to weather another economic slump.”

The suggestion is that as consumer behavior has shifted to include more time shopping online, online retailers have become more efficient, more diverse, and more effective at identifying who their customers are, what they’ve bought in the past, and what they need to buy in the present and future - at least, more so than many brick-and-mortar retailers.

BTW....Forrester Research predicts that online sales in the U.S. would rise 10 percent in 2011 and 9 percent in 2012; while this growth could slow if there is a new recession, Forrester says, online sales as a percentage of total U.S. retail - now about seven percent - could grow.

Published on: August 17, 2011

The Lakeland Ledger writes that “Publix's experiment with curbside grocery service is still going strong a year after it began, but the chain isn't saying whether it will expand the pilot program.

“Lakeland-based Publix Super Markets Inc. began offering the curbside-to-go service last year at two stores in Tampa and Atlanta. A second Atlanta location was added to the test a few months ago. The service allows customers to place grocery orders by phone or online and have the items delivered to their car for a flat $7.99 fee. Orders must be placed at least four hours in advance to give ‘personal shoppers’ time to gather items.”

Published on: August 17, 2011

• Kroger-owned Smith's Food & Drug Stores announced that it has completed the installation of photovoltaic energy panels at two Albuquerque, New Mexico stores. The company says that “the solar energy output from these two store systems is 320,000 kWh, eliminating the need for that amount of energy from fossil fuel sources.  It is estimated this energy savings would heat and cool 30 homes in New Mexico for one year; is the equivalent of planting 57 acres of trees; or removing 40 cars from the road.”

According to the company, “Smith's was selected to be among the first Kroger division stores to install photovoltaic panels because of New Mexico's favorable sunny climate and the economic incentives offered by energy provider PNM towards installation of renewable energy sources. Affordable Solar, based in Albuquerque, designed and installed the panels. Kroger is also developing photovoltaic systems in stores located in Wilsonville, Oregon (Fred Meyer) and Cincinnati, Ohio (Kroger).”

• Food Lion announced that two of its stores “have earned the U.S. Environmental Protection Agency's 2011 Gold-Level GreenChill Store Certification Award, one of the agency's highest honors for refrigeration. The stores are located at 4489 Highway 20 Southeast in Conyers, Ga., and 4760 Hardscrabble Road in Columbia, S.C.

The announcements notes that “Food Lion became a founding partner with the EPA's GreenChill program in 2007. Since that time, the grocer joined other food retailers to reduce refrigerant emissions and decrease impact on the ozone layer and climate change. Food Lion has won GreenChill's Distinguished Partner Award and its Superior Environmental Achievement Award in the past.”

Food Lion said that it “has pioneered various technologies that save energy and reduce harmful refrigerant leaks, from GreenChill to building two Leadership in Energy and Environmental Design (LEED) Certified stores in both North Carolina and South Carolina ... Food Lion has more than half of the nation's ENERGY STAR stores, with 1015 certified stores. In addition, the company has partnered with utilities to evaluate a variety of energy saving opportunities, such as solar power.”

Published on: August 17, 2011

• In his pre-recorded message released along with the company’s second quarter financial results, Bill Simon, president/CEO of Walmart’s US stores division, said the following:

“The economy remains challenging for our core customers. Customers are still consolidating trips due to higher year-over-year gas prices. The swings in sales due to paycheck cycles remain pronounced, and our stores must staff and stock for the volatility, both up and down. We also have seen an increase in the number of customers relying on government assistance for food and necessities....

“Based on the start of August sales, we're confident that our plans are working, and we'll see ongoing sales improvement.... With the ongoing economic volatility, it's as important as ever to deliver on our one-stop shopping promise -- a broad assortment of merchandise backed with everyday low prices.”

Meanwhile, the Wall Street Journal writes that “surveys by retail consultants, analysts and brand experts now find that Wal-Mart's aura of price leadership has faded since the recession, because customers who searched for better deals sometimes found them at competitors such as Dollar General Corp., Aldi Inc. and Amazon.com Inc.”

According to the , “Wal-Mart has responded by returning to its roots. It is cutting the number of ‘rollbacks,’ or planned sales specials, after some customers concluded Wal-Mart was becoming as gimmicky as competitors. Wal-Mart also began restoring thousands of products it had removed from stores as it sought to tidy up cluttered aisles. Yet with the back-to-the-future strategy slow to show improvement, retail experts are questioning whether Wal-Mart can win back its market share...”

• Bloomberg reports that Walmart-owned Asda Group in the UK is ramping up the expansion of the Netto chain that it owns there, and expects to grow it from 147 stores today to 180 by the end of the year and 250 units within five years.

The story says that the Netto stores, “which are between 5,000 and 25,000 square feet, are smaller than the company’s so-called Supercenters and offer a range of items broad enough that customers can buy all the groceries they need for a week at the same prices as at a larger shop.”

Published on: August 17, 2011

Bloomberg reports that Tesco’s UK market share dropped to 30.5 percent during the 12 weeks ending August 7, compared to 30.8 percent the same period a year ago. At the same time, Walmart-owned Asda Group saw its market share drop from 16.9 percent to 16.7 percent.

According to the story, “Sainsbury, the third-largest grocer, fared better than its bigger rivals, holding its share at 16.1 percent ... William Morrison Supermarkets Plc was the only one of the four main supermarkets to increase its share, which rose to 11.7 percent from 11.6 percent.

“German discounter Aldi Group boosted its market share to 3.6 percent from 3 percent a year earlier ... while Lidl’s share climbed to 2.6 percent from 2.4 percent.”

The numbers were generated by Kantar Worldpanel.

Published on: August 17, 2011

• Published reports say that Tesco has introduced a new label in its UK stores - “Just Discovered “ - that is being used to identify and highlight what it calls “new and innovative Tesco products and varieties.”

Published on: August 17, 2011

• The Los Angeles Times reports that “J.M. Smucker Co., the nation's top producer of packaged coffee, is slashing prices on its Folgers and Dunkin' Donuts branded lines an average of 6%.

“The cut is a turnaround from the spring when Smucker and other major producers raised prices after heavy rains in some growing regions pushed up bean costs. In addition to lackluster harvests, high demand from emerging markets such as China and speculative trading in commodity markets helped drive up prices. But over the summer, supply expanded ... causing the cost of beans to go down.”

Published on: August 17, 2011

• Sears Holdings has appointed Robert Schriesheim, the former CFO of Hewitt Associates, as the new Chief Financial Officer (CFO) and Executive Vice President (EVP), effective August 22, 2011. Schriesheim is replacing Bill Phelan, who has been the company’s acting CFO.

Published on: August 17, 2011

Lots of reaction to yesterday’s piece applauding the call by Starbucks CEO Howard Schultz for all American corporations to shut the door on any and all political contributions until President Barack Obama and the US Congress reach “a fair, bipartisan deal ... that sets our nation on stronger long-term fiscal footing.”

Schultz said that as of now, that is Starbucks’ policy. And in fairly short order, he said, 50 other CEOs contacted him and agreed to take the same position - no personal or corporate contributions until Washington gets its act together.

The Schultz proposal came as investment guru Warren Buffett wrote a New York Times op-ed piece suggesting that the government needed to stop “coddling” the super-rich and raise taxes on millionaires and billionaires. “I would raise rates immediately on taxable income in excess of $1m,” Buffett wrote. “And for those who make $10m or more – there were 8,274 in 2009 – I would suggest an additional increase in rate.”

And I commented:

If the theory is that money fuels politics, and politics is becoming increasingly poisonous, then perhaps one way to reduce the vitriol is to cut off the fuel supply.

It’ll be interesting to see if Schultz’s and Buffet’s positions gain any traction. I’m sure there will be plenty of other arguments against it, but here at MNB, the Schultz “a time for citizenship” call is persuasive.

Not that it counts for much - if anything - but MNB is right now pledging to not make any personal or corporate donations until both parties and both ends of Pennsylvania Avenue get their acts together.

So here’s my memo to Schultz: You now have 51 companies to put on your list.

MNB user Garry E. Adams wrote:

Howard has a great point. My company will make it 52....

Another MNB user wrote:

Okay, I may never actually become a coffee drinker.  But, now that I’ve read this from Mr. Schultz, I am going to look a little deeper in to Starbuck’s lineup and see what I do like—and buy it.  Honestly, I’ve probably entered a Starbuck’s less than a dozen times—usually because a friend wanted to meet at one or I was with co-workers.  After reading this, I’ll be heading into our local shop and others on a regular basis.  Thanks for sharing Mr. Schultz’s comments.

Another MNB user wrote:

Schultz will forever be on my own personal bad list for what he did to the Seattle Supersonics, but I appreciate his frustration and his willingness to turn up the heat on our elected so-called leaders.  It’s the only language that they understand and it’s clear that both sides of the aisle have made pandering to their base and trying to discredit the other side their number one objective.  The President is no better.  He talked a good game in 2008, but he’s as divisive as any President we’ve ever had.  Class warfare may be good politics, but divide and conquer is a terrible governing strategy.  Our politicians are all playing win-lose.  They’re even willing to play lose-lose, as long as they thwart the other side.  We need leaders who think win-win.

Which brings me to Buffet.  What’s his game?  Does he or the President really believe that raising taxes on those 8000+ people will solve anything? He’s one of those people, but isn’t he the one who said he pays more in taxes than his secretary?  And why is that?  Because unlike his secretary he has an army of lawyers whose job it is to shield him from paying taxes.  Is that going to change is we raise taxes on the rich?  If he wants to impress me, he can fire the lawyers and pay the taxes he already could and probably should be paying.  Until then, Warren, shut the *(^%$@# up!

I think the big issue is tax reform - and Buffett is using his own example as an illustration for why it is needed.

As for me, I’m becoming more and more convinced that what we need is a progressive flat tax ... no loopholes, no deductions. Everybody has skin in the game, no matter how much or little you make ... though it seems fair that as you make more money you pay a higher percentage, though without deductions and loopholes, it would mean a dramatic rate reduction. I’m not an accountant, but I have to believe that reform would actually be better and maybe even politically palatable.

Then again, these days, who knows?

Another MNB user wrote:

I certainly agree with Schultz that we need to starve them out until they see the light. My concern is that all we are doing is standing aside to allow the unions to have the playing/paying field to themselves, thus making their dollars more powerful and persuasive.

The one thing about Schultz’s proposal is that it will be the center that will take it seriously, while the fringes - on both ends of the political spectrum - have no intention of shutting off the spigot.

From yet another MNB user:

Aren’t political “contributions”  just a nicer way of saying bribes?  I’ve never understood how it’s legal to form PAC’s to funnel cash to select politicians.

While I think the “wealthy” pay enough in taxes, shouldn’t the conversation be about the 48-51% of the people who pay $0.00 in federal income tax?  Everyone should have some skin in the game.

We have huge issues - What is $14,000,000,000,000?  I think we all need to get used to paying a little bit more and getting a little bit less in return, and hopefully our elected officials will learn how to tighten their belts just a little bit.

Another MNB user chimed in:

Gutsy move, I agree wholeheartedly with everything Howard Schultz said, and said so eloquently. It’s one of those things you wish you had said yourself, I certainly felt every word; so many of us share the same feelings & frustrations, but don’t have the words or the audience. I hope this thing has legs, I have just abused my work time to e-mail my reps in the Senate & House, and quoted Schultz to explain why I am personally no longer contributing to the party or my individual representatives. I have no idea whether this will do anything to move those yahoos in DC off their keisters, and start doing their jobs, but man I feel better! Maybe hopeful?

Another MNB user offered:

At last we have men of influence talking publicly about the stupid, stubborn and selfish and "dis-productive" course we are on in our political sphere and who raise and praise the old fashioned concept of STATESMANSHIP!    A rally against modern day policy non-makers who have lost sight of the people they govern while lining their pockets with the wallpaper of self interest!  Kudos to Mr Buffet and To Mr Schultz.  Those two are a thousand times more true leaders than the blindered ME generation saturated hacks in our current government. 

Need more business leaders of conscience to speak up for interests other than their own. 

And still another email:

I mostly agree with Howard Shultz -- where we differ is the fact that now is not the time to raise taxes on anybody.  My company could hire another six people this were it not for the fact that we are subject to a 35% corporate tax rate (the highest in the world, or close to it).  Take that down by half, and there are at least three jobs.  Multiply that by 50M small businesses, and maybe you have some additional private sector employment.  Bump the tax rate and we're cutting back.

And I couldn't disagree more with Warren Buffet (gasp!).  My counter suggestion is that anyone who recommends raising someone else's income taxes should instead be immediately subject to a 50% tax on their net worth and another 50% tax on capital gains.  They can slide on the income tax. That should do a lot more to bring down the deficit or at least keep them quiet for a while.

Not everyone was impressed:

Nice letter…but didn’t say anything…Warren Buffett laid out a plan…Schultz spun spin. It’s not about doing something…movement is not progress. It’s about doing the right thing, and that’s the nub of it! This country is split over the future vision for America. One person’s plan for progress is another person’s perception of the destruction of America? Who is right? Just out of curiosity, why has Starbucks waited so long to invest in America?

I’m not sure that it is fair to say that Starbucks has not been investing in America ... every time it opens a store, it hires people, pays them a fair wage and gives them benefits.

And another MNB user wrote:

Mr. Schultz and these other CEO's might take a gander at the Federalists Papers. If they did they would understand that the government is acting just like the Framers of the Constitution intended.

What we need is a return to teaching Civics. When there is consensus the gov't will act. Let's see how things work out for China down the road.

I haven’t read the Federalist Papers lately, and I’ll assume you have, so I’ll bow to your greater knowledge.

And I certainly agree with what you say about teaching civics. (For a good website about this subject, check out this website.

I do think this - that is hard to imagine consensus at a time when people on the fringes refuse to compromise. And that fuels the discontent and skepticism among many of us.

Published on: August 17, 2011

On Monday night, Jim Thome of the Minnesota Twins hit two home runs against the Detroit Tigers - making him just the eighth person in Major League Baseball history to hit 600 home runs and making him a virtual lock for the Hall of Fame.

The other members of the exclusive 600 home run club: Barry Bonds, Hank Aaron, Babe Ruth, Willie Mays, Ken Griffey Jr., Alex Rodriguez and Sammy Sosa.