retail news in context, analysis with attitude

• The Sacramento Bee reports that the Northern California local United Food and Commercial Workers (UFCW) members have called in a strategist from the national organization, hoping that William McDonough can help restart stalled contract negotiations with Raley's, Save Mart and Safeway.

The story notes that Raley's employees have authorized a strike, and a negotiating session last week ended with the two sides "seemingly farther apart than ever." Raley's charged that the UFCW's "latest demands would have inflated ... labor costs by $20 million a year," though the UFCW quickly responded that the retailer was mischaracterizing its proposals.

"As for Raley's," the Bee writes, "the federal mediator who's been overseeing those talks was expected to contact both sides this week in an effort to revive negotiations. Raley's spokesman John Segale said the company will meet only if the union has a new contract proposal. The third union grocer, Safeway Inc., has so far stayed above the fray and hasn't been threatened with a walkout. Talks with Safeway 'are difficult and complex, but they are civil and are progressing slowly,' according to a statement posted online by Roseville's UFCW Local 8."

• The New York Times reports that "Frito-Lay has long dominated the snack-food business by relentlessly focusing on the middle swath of America that eats chips and pretzels and party mix without regard to the effect on the waistline. Now, though, Frito-Lay, a unit of PepsiCo, is building a 'company within a company' to pursue what might be called a 1 percent-99 percent strategy: creating high-end snacks as well as those that appeal to what it diplomatically calls 'value' customers."
KC's View: