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    Published on: November 30, 2011

    by Kevin Coupe

    The issue of childhood obesity comes up here on MNB a lot. But there was a Slate story yesterday that offered a different kind of perspective on the problem.

    In Ohio’s Cuyahoga County, officials made the decision last month “to remove an eight year-old boy from his family's home last month because they considered his mother's inability to get the child's ballooning weight under control a form of medical neglect ... Tipping the scales at over 200 pounds, the third-grader more than triples the 60 pounds that government growth charts deem a healthy weight for boys his age. He is at risk for diseases like diabetes, heart disease, hypertension and high blood pressure.”

    According to Slate, the child’s situation came to light some 18 months ago when his mother took him to a local hospital because of breathing problems; he was diagnosed with sleep apnea, which “can be caused by excessive weight.” Case workers
    monitored the case for a year and a half, then decided that the child was in “imminent danger,” and took the eight-year-old away from his mother, a substitute elementary school teacher who says, “ "Of course I love him. Of course I want him to lose weight. It's a lifestyle change, and they are trying to make it seem like I am not embracing that. It is very hard, but I am trying."

    A hearing is scheduled for next month, on the child’s ninth birthday, to determine next steps in the case.

    Slate writes that “although two million US children are extremely obese, including 12 percent of Ohio third-graders ... this is the first time anyone in the state can recall a child being taken from a parent for a strictly weight-related issue.” And the story quotes the Cleveland Plain Dealer as reporting that the boy in question “is an honor student and participates in school activities.”

    Is this the inevitable result of a nation that has become obsessed with the obesity crisis, but doesn’t seem able to really do anything about it? Is government being unnecessarily intrusive? Or doing its job, protecting the life of a citizen who is unable to protect himself?

    The situation is troubling. Though I’m not sure precisely why.

    But it is Eye-Opening that we’ve reached this point.
    KC's View:

    Published on: November 30, 2011

    The International Council of Shopping Centers (ICSC) has been taking out full page ads in papers like the New York Times and the Washington Post calling for the fair imposition of sales taxes on pure-play internet retailers.

    The ad that ran yesterday had a cartoon showing a balding retail clerk sitting on Santa Claus’s lap, saying, “The only thing I really want is a fair and level playing field for all retailers.” And the ad copy says:

    “While Santa can’t fulfill this wish, Congress can! For too long Internet-only retailers have enjoyed a tax loophole that allows them to undersell their brick-and-mortar competitors by as much as 10%, simply because they don’t have to collect state and local sales taxes. This unfair advantage is pushing mom-and-pop retailers out of business and hurting our local communities that rely on sales tax revenue to fund vital services like schools and infrastructure.

    “The International Council of Shopping Centers is striving to create a fair and level playing field for all retailers whether they sell online, in a mall, or on Main Street.

    “Support S. 1832, the Marketplace Fairness Act and H.R. 3179, the Marketplace Equity Act to end online retailers’ unfair advantage.

    “The federal government should no longer play favorites.”

    The ad is one in a series being run by the ICSC.
    KC's View:
    I’m always amused when people call for a level playing field. It just ain’t true. What they really want is a playing field that tilts to their advantage. A level playing field is just what they’ll settle for...

    But let’s put that aside for the moment.

    I agree that there should be a level playing field, that the time is long past for an e-commerce exemption. The nation’s infrastructure requires a major investment, and these companies use the nation’s infrastructure. Seems pretty simple to me.

    My only observation would be that the imposition of internet sales taxes will not necessarily level the competitive playing field. I maintain that certain retailers - think Amazon and Zappos, for example - offer superior service, quality, and selection ... and often, though not always, lower prices. Their advantage is not only in the numbers, and retailers that convince themselves that it is only a matter of taxation are kidding themselves.

    Published on: November 30, 2011

    The Los Angeles Times reports on how the Conference Board’s October Consumer Confidence Index “jumped to 56.0 after slumping to 40.9 in October, which was the lowest level since the depths of the recession in early 2009.

    “A reading of 56.0 still is very depressed, and is down from the 2011 high of 72.0 reached in February. A typical reading in the mid-2000s was between 100 and 110.”

    The Times notes that this may not be as surprising as it would seem on first blush:

    “Any increase in confidence is a good thing. And the board's report showed that confidence rose this month among all income groups, so it wasn't just the well-heeled who turned more upbeat.

    “But should people really be feeling better about things?

    “Maybe it’s just a coincidence, but many of the U.S. economic reports over the last month have shown improvement, further belying the idea that the economy was at risk of sliding back into recession.”
    KC's View:
    I have to be honest here. When I was writing the headline for this story, I debated with myself about whether I should use the one above, or the following, slight different version:

    Consumer Confidence Rises. Really?

    I’m not sure I share the rising confidence of the American public. (It is hard to be. I’m reading Michael Lewis’s “Boomerang,” which, to be honest, is a lot scarier than the new Stephen King novel that I just finished.)

    Not only do I think that the US is ignoring some of the fundamental issues that need to dealt with, but I see no sign that either political party has any intention of facing harsh realities. And so it is hard to feel real encouraged about where things are headed.

    Published on: November 30, 2011

    Advertising Age has an interesting story about how outdoor clothing manufacturer Patagonia decided to approach a Cyber Monday shopping promotion - by sending out an email recommending that customers not buy a particular jacket.

    The promotion is tied to the company’s support of the Common Threads initiative, which is designed to generate support for a lifestyle that reduces excess consumption and gives “the planet's vital systems a rest from pollution, resource depletion and greenhouse gases.”

    The email links to a page on Patagonia’s site where the company pledges “to build useful things that last, to repair what breaks and recycle what comes to the end of its useful life,” and the shopper agrees “to buy only what I need (and will last), repair what breaks, reuse (share) what I no longer need and recycle everything else.”

    As Ad Age points out, “just in case you think Patagonia is going to use this opportunity to point the finger at some other company, its email talks specifically about what goes into the jacket pictured. The R2, one of its best-sellers, ‘required 135 liters of water, enough to meet the daily needs (three glasses a day) of 45 people. Its journey from its origin as 60% recycled polyester to our Reno warehouse generated nearly 20 pounds of carbon dioxide, 24 times the weight of the finished product. This jacket left behind, on its way to Reno, two-thirds its weight in waste’.”
    KC's View:
    To be clear, it isn’t like Patagonia won’t take your money if you actually want to spend a couple of hundred dollars on a new jacket just because you want one, as opposed to because you need one. They will. Gladly.

    That said, I do think that there is a certain logic to the company’s position, especially because it is in synch with the overall company mission. (I don’t know about you, but as I get older, I find the whole idea of having less to be enormously appealing. I don’t always live up to it, but conceptually I’m in favor of it.) And it certainly runs counter the the commercial exploitation of the holidays that I’ve found to be so annoying this year. (Though there also is the possibility that I’m just entering the “Bah! Humbug!” and “get off my lawn!” phase of my life.)

    Published on: November 30, 2011

    Supervalu-owned Save-A-Lot today will open its new 330,000-square-foot food distribution center in Lexington, N.C. According to the announcement, the new Save-A-Lot distribution center represents a $24 million investment and will employ 35 employees initially with the potential for hiring additional employees once the facility reaches full capacity.

    The company says that “currently, there are nearly 30 Save-A-Lot stores in North Carolina, including one in Lexington. The company plans to open an additional three stores in the state by March 2012. The new distribution center will help support the company’s growth plans in North Carolina and surrounding states, which the company has identified as a key region for its growth. Initially, it will service more than 70 stores within a 150-mile radius.”
    KC's View:

    Published on: November 30, 2011

    Consumer Reports is out with a new study today saying that children may be at risk of health problems, including cancer, because of arsenic levels in juices, and calling for federal standards that would establish strict limits.

    According to the story, “Consumer Reports tested 88 samples of locally-purchased apple juice and grape juice and found that 10 percent of the samples had total arsenic levels that exceeded federal drinking-water standards of 10 parts per billion (ppb) and 25 percent of the samples had lead levels higher than the Food and Drug Administration’s (FDA) bottled-water limit of 5 ppb.  Most of the arsenic detected in Consumer Reports’ tests was a type known as inorganic, a human carcinogen.”

    Consumer Reports notes that the US Food and Drug Administration (FDA) “announced in a November 21st letter to consumer advocacy groups Food & Water Watch and Empire State Consumer Project that it is seriously considering setting guidance for permissible levels of inorganic arsenic in apple juice and that it is gathering data to determine what an appropriate level would be.  The agency also discussed its previously undisclosed test results of eight apple juice samples analyzed around 2008 through 2011 that showed levels of total arsenic of up to 45 ppb.”

    The story goes on: “As a result of this testing and analysis, Consumers Union, the advocacy arm of Consumer Reports, believes that the federal government should establish a standard of 3 ppb for total arsenic and 5 ppb for lead in juice.  In fact, 41 percent of the samples Consumer Reports tested met both thresholds,” meaning that the target is achievable.
    KC's View:

    Published on: November 30, 2011

    • Harris Teeter is scheduled to open its first Baltimore store next Wednesday, a 61,000 square foot, two-story unit that will be the company’s seventh in Maryland.

    According to a company press release, the store is located in an urban mixed-use environment and “reflects the lifestyle and desires of its customers. The company is placing a strong emphasis on fresh foods, items-to-go and perishable items in its McHenry Row location.

    “Architecturally, the store design offers more glass and skylights; an atrium, stainless steel fixtures; and a four level parking garage.”

    Harris Teeter said it is applying for LEED® certification for this location, saying that it “features recycling centers in the lobby and boasts additional energy and environmental design components including freezer cases designed with LED lighting and water-saving devices.  Additional green features include electric vehicle charging stations and an integrated refrigeration and HVAC system that utilizes high efficient condensing and high efficient water source heat pump technology.”

    • The Newark Star Ledger reports that unionized employees at the bankrupt Great Atlantic & Pacific Tea Co. (A&P) are voting today on “whether to approve a deal cutting their compensation and the company’s costs.” The vote is taking place, the story notes, despite the fact that union leadership has kept details of the deal secret until today.

    Union leadership clearly feels that the deal is in labor’s best interests.

    Local 464A President John T. Niccollai told the paper yesterday that voting yes would protect the interests of everyone in the union. "The vote is either yes, we accept the agreement or we vote no, and the company doesn’t get the financing it needs, and ultimately goes out of business," he said.

    • The Austin American-Statesman reports that “Sprouts Farmers Market is shuttering three Austin-area stores, saying that a recent merger left the natural foods chain with too many locations packed too closely together.”

    According to the story, “The stores at 2917 W. Anderson Lane, 2805 Bee Cave Road and 5601 Brodie Lane will all close by Dec. 18, Sprouts President Doug Sanders said. The closures will affect about 120 employees, who were told of the decision Tuesday morning. Though Sanders said a majority will be relocated to other stores in the company, 30 to 40 people will probably be laid off.”

    This is the first time Sprouts has closed any stores, Sanders said, noting that six stores was just too many; Sprouts merged with California-based Henry's Farmers Market, which operated Sun Harvest stores there.
    KC's View:

    Published on: November 30, 2011

    • Krispy Kreme announced that it has hired Kenneth A. May, a former FedEx executive, to be its new president/COO, reporting to CEO Jim Morgan.

    According to the announcement, May “served as President and Chief Executive Officer of FedEx Kinko's Office and Print Centers, and led the integration of Kinko's into FedEx ... Prior to his assignment at FedEx Kinko's, Mr. May held various positions throughout FedEx, including Senior Vice President of U.S. Operations for FedEx Express, FedEx's largest division with over 62,000 employees.  Most recently, he served as President of ES3, LLC, a logistics company that uses advanced robotic technology to make supply chain operations more efficient and profitable for manufacturers and retailers.”
    KC's View:
    I don’t usually comment on executive appointments, except when I know someone or I think a move is a particularly smart one. That isn’t the case here, but the circumstances are such that I cannot help myself...

    First of all, the decision to eliminate the Kinko’s name when the company was acquired by FedEx was, IMHO, one of the dumbest, most boneheaded brand decisions that I can remember. While the FedEx and Kinko’s brands would seem to be complementary, the arrogance of turning Kinko’s into FedEx Office just showed that management had a tin ear. Most people I know still call it Kinko’s ... despite the best efforts of FedEx.

    And so, I have to wonder if the guy who led that effort has the right brand mentality to lead a doughnut company that has done everything possible to screw up a great brand.

    But, since he has the job, I would suggest that he read the chapter on Krispy Kreme in our book, THE BIG PICTURE: Essential Business Lessons from the Movies. (Blatant and self-serving plug: the book is available by clicking here , or on Amazon.com.)

    In that chapter, we write about the movie American Gangster and how its drug dealer protagonist, Frank Lucas, was fiercely protective about the heroin he sold, establishing an efficient supply chain and high quality product that he even gave a brand name - Blue Magic. And heaven help anyone who tried to dilute the power of his brand. And we argue that if Krispy Kreme leadership had the same attitude about their brand that Frank Lucas did about his, then the company might not have gone into a such a steep decline.

    I’m just sayin’...

    Published on: November 30, 2011

    On the subject of Pfizer marketing its Lipitor drug directly to consumers at a discount as a way of protecting its bottom line at a time when it is about to lost patent protection on the product, MNB fave Glen Terbeek wrote:

    Pfizer is forced to go consumer direct so they can compete with lower priced generics.  In a like manner, traditional supermarket CPG manufacturers will be forced to go direct to compete with lower priced private label.  Why this is even more inevitable in the case of food is that the lower priced competition comes from the CPGs' very own customers, not a generic vender.

    Remember, a significant portion of the retail price value of a CPG’s item (think gross margin, trade dollars to mention a few) currently goes to these supermarket "competitors", say 40%.   That would more than pay for going direct.  And of course, the CPG’s would love to create a direct relationship with the shoppers they target, making their marketing dollars much more productive.





    Responding to yesterday’s story about how, if you want to give all the 78 presents mentioned in “The 12 Days of Christmas” for the holidays this year, it will cost you $24,263.18, up 3.5 percent from a year ago, MNB user Mike Luebbers wrote:

    It seems the math is off here.

    “On the first day of Christmas, my true love gave to me a partridge in a pear tree.”

    “On the second day of Christmas, my true love gave to me two French hens and a partridge in a pear tree.”

    By the time the twelfth day is reached, her true love has given her a total of 364 presents. It’s unclear which number was used to price the gifts.


    True. The LA Times story I quoted did it both ways - if you gave all 364 presents, it would cost $101,119.84 this year –- the most expensive total ever, and up 4.4 percent.




    We had a story yesterday about how Amazon and Walmart are teaming up to promote frustration-free packaging, which led one MNB user to write:

    I had to chuckle when I read your article, especially the part "The story notes that “as much as a third of all consumer trash sent to landfills is estimated to be packaging, according to the Environmental Protection Agency. That translates to more than 800 pounds of packaging waste each year per U.S. consumer.”

    Just this morning I was opening one of the packages that I received from Amazon - they packed the earrings that I purchased in a box 5 times the size of the box the earrings came in and stuffed the remaining part of it with plastic bubble packing material.  I would have preferred to see them use an envelope mailer that I would then reuse...

    Don't get me wrong, I love Amazon, but seriously, they need to look at how they package the products they are sending...





    I wrote yesterday about the Black Friday and Cyber Monday hullaballoo that “I know I’ve been harping on this for the past few weeks, but for some reason I find the whole lowest common denominator approach to holiday marketing to be unsettling. Not sure it is much worse than in past years - though maybe the stakes are higher because the economic situation seems more desperate - but it just seems more exploitive. And I’m not sure that marketers, by appealing to desperation and adopting lowest common denominator approaches, are doing themselves any favors in the long run.”

    Which led one MNB user to write:

    Stick to your guns on this one, Kevin.   There are lots of us out there who agree with you.  While we may be in the minority on this one, it’s worth pounding the table to get the point across.  To borrow from an oft used quote, “there’s a reason for the season” and it’s not strictly to increase retail sales over the numbers from the year before!

    Each of us needs to take a step back and remember what that reason is.
     
    KC's View:

    Published on: November 30, 2011

    Bobby Valentine, the colorful former manager of the Texas Rangers and the New York Mets - not to mention the Chiba Lotte Marines in Japan - reportedly has reached a verbal agreement to become the new manager of the Boston Red Sox, replacing Terry Francona.

    The New York Times frames the hiring this way:

    “Valentine, who in six years managing the Mets taunted the Yankees and stoked a rivalry from across town, now will do so from Fenway Park. And he will do so with an expensive, talented team that many predicted would win the World Series last season before it collapsed in historic fashion.

    “The possibility of his managing the Red Sox was hardly considered a month ago, when the Red Sox were examining candidates who did not have Valentine’s experience or charisma. But with the team in a state of upheaval, it was decided a more seasoned and engaging personality was required.”
    KC's View:
    The American League East just got a lot more interesting. And fun.