retail news in context, analysis with attitude

...with brief, occasional, italicized and sometimes gratuitous commentary...

• The Sacramento Bee reports that members of the United Food and Commercial Workers (UFCW) employed by Save Mart Supermarkets in California's Central Valley have voted to ratify a new two-year contract with the retailer, while their counterparts in the San Francisco Bay Area have rejected the tentative deal, though not by a big enough margin to authorize a strike.

The split decision means that the contract will not go into effect, and that the UFCW will have to sit back down with Save Mart at the negotiating table to figure out what to do next. The UFCW had already gone on record as saying that it believed, based on its analysis of Save Mart's books, that the retailer was losing money at a number of locations and needed concessions just to stay in business.

Not sure if this is good or bad for Raley's and Safeway, the other two California chains negotiating with the UFCW. On the one hand, a Save Mart contract might have given them a template from which to work on their own deals ... though Raley's was said not to be happy with the Save Mart contract, thinking it did not offer enough concessions. On the other hand, maybe this gives them a little more time to make their own plays...

• The Des Moines Register reports on a new Hy-Vee store scheduled to open next week in Urbandale, Iowa - a 95,000 square foot store that is "the grocery store chain’s newest concept store ... likely to wow and overwhelm shoppers all at once."

According to the story, among the innovations in the store are an Italian gelato stand, a lounge with seating for 10 around a stone fireplace, made-to-order sushi bar, an oatmeal bar that features eight kinds of oatmeal and toppings, expanded organic, gluten-free and natural food selections, and a separate wine and spirits department.

• The reports that Starbucks has signed a deal with Crumbs Bake Shop, a 521-unit New York based cupcake chain, that will have the bakery pouring Starbucks coffee.

According to the story, "Crumbs will be the largest chain to serve Starbucks beverages outside the Seattle-based coffeehouse’s 17,651-unit system ... In recent years, Starbucks has been building the foodservice business for its secondary Seattle’s Best Coffee brand, which is brewed by a number of restaurant chains, including Burger King, Subway and Taco Bell."

Terms of the deal were not disclosed.

USA Today reports that credit card debt in the United States "fell 5% to $864.6 billion. That's only 1.6% above the post-recession low reached in April 2011. Americans have been relying less on credit cards since the 2008 financial crisis and Great Recession."

However, "Steady gains in student loans have pushed borrowing back to near-record levels ... Overall consumer borrowing rose because of increases in auto and student loans. The Federal Reserve says total borrowing increased 3% to $2.58 trillion in June from May. That's just below the all-time high reached in July 2008."

What this all seems to add up to is consumers who are spending less because of continuing concerns about high unemployment and stagnant economic growth ... not to mention crushing student debt. I am still amazed at some of the numbers I am hearing from parents and students about debt being carried out of college ... and it confirms for me that one of the best things we've done as parents is making sure that our kids don't have that kind of financial weight hanging from their necks, affecting every decision they make.
KC's View: