retail news in context, analysis with attitude

MNB Archive Search

Please Note: Some MNB articles contain special formatting characters, and may cause your search to produce fewer results than expected.

    Published on: February 1, 2013

    by Kevin Coupe

    Interesting story on Marketplace, on National Public Radio (NPR), about how British Airways and tea company Twinings have worked together "to produce a special tea for high fliers."

    What I did not know until I heard the story (probably because I never paid attention in chemistry class, which I took in 1970-71) was that water boils at a lower temperature at 35,000 feet than it does on the ground, which Twinings says is "not the optimal temperature for making tea." Because British Airways serves 35 million cups of tea a year on its planes, it wanted to do a better job.

    And so, they've produced "a special high-altitude concoction," which Marketplace says, perhaps inevitably, "will take its passengers taste buds to new heights."

    One the one hand, this sounds like such a little thing. But little things can add up to big things for some people.

    Companies have to choose the places where they can create for themselves a differential advantage.

    Sometimes, it's a new plane. Sometimes, it's a better cup of tea.

    Either way, the willingness to improve the consumer experience is an Eye-Opener.
    KC's View:

    Published on: February 1, 2013

    Tesco-owned Fresh & Easy Neighborhood Markets has sent an email to its shoppers assuring them that it does not plan to close stores, even though the company is reviewing its strategic options for its US division.

    The email reads as follows:

    "Thank you for being a Friend of Fresh & Easy. We wanted to reach out to you to address numerous news and online reports about the future of our stores.

    "Our parent company Tesco is conducting a strategic review of Fresh & Easy - they're looking at all options to find the best outcome for the neighborhood market that you - and we - have come to love. While we don't know exactly what that outcome will be, or if Tesco will continue to own the company, we're confident that Fresh & Easy can continue to be your favorite market.

    "We want to assure you: we don't have plans to close stores. We're still committed to providing delicious, wholesome and affordable food every day. We're still Fresh & Easy; open for business with everything that you enjoy about our store, with even more exciting things to come. That's why we're going to keep on fighting the good food fight.

    "Now, more than ever, we appreciate your energy in our stores and being able to share a smile with you. We look forward to seeing you soon and thank you for your continued support."
    KC's View:
    Maybe I'm crazy, but when I read this email I sort of get the feeling that Fresh & Easy was seeing a loss of sales and customers because of all the uncertainty that surrounds it, and management felt it needed to do something to prevent further desertions.

    Published on: February 1, 2013

    The United Food and Commercial Workers (UFCW) yesterday agreed to stop trying to unionize Walmart employees for at least 60 days, "even though it helped coordinate picketing, protests and scattered strikes about wages and working conditions at the retailer last fall," according to the story in the New York Times, which noted that the UFCW made the agreement to avert a likely judgement by the National Labor Relations Board (NLRB) that the picketing was, in fact, illegal.

    According to the story, the NLRB promised to "hold in abeyance any charges against the union and its affiliate, OUR Walmart, for six months to make sure they fulfilled their commitments."

    The charges were brought by Walmart, which said that the UFCW violated federal law that "prohibits worker groups from engaging in more than 30 days of picketing that is aimed at gaining union recognition." While OUR Walmart had at some points said that its picketing goals were purely informational, it also said at other times that its ultimate goal was the unionization of all Walmart's employees - which put it at odds with established law.

    Walmart released the following statement after the agreement was reached: "Today, the National Labor Relations Board and the U.F.C.W. reached a settlement agreement that will bring the union’s unlawful tactics and disruptions toward Wal-Mart, our associates and our customers to an end. Our associates can now move forward knowing that the U.F.C.W. must stop its illegal and disruptive activities."

    In its own statement, OUR Walmart said it "will continue to inform its members and supporters that the organization’s purpose is to help Wal-Mart employees as individuals or groups in their dealings with Wal-Mart over labor rights and standards."
    KC's View:
    This is a temporary truce, nothing more. But it is good news for Walmart, which could use a win to distract attention from the Mexico bribery scandal.

    Published on: February 1, 2013 reports that for 49 minutes yesterday,'s homepage was down. Customers who went there found instead a white page and an error message that read, “Http/1.1 Service Unavailable."

    Only the main webpage was down. Other Amazon pages appeared to be working.

    No word yet about why.

    CNN writes: "The outage was short, but it's extremely rare for to crash. Amazon depends on heavy e-commerce traffic, especially around the holidays, so it has famously massive server capacity to handle traffic spikes. Even a few minutes of downtime can cost the company millions.

    "Its powerful 'elastic' infrastructure, called EC2, is designed to minimize downtime as much as possible. Amazon has so much spare server capacity, in fact, that it runs a sideline business, Amazon Web Services, hosting other websites. Amazon Web Services remained unaffected by Thursday's outage, according to Amazon's status dashboard."
    KC's View:
    Somehow, I'm not surprised. Early afternoon, I sort of staggered backward - I felt a great disturbance in the Force, as if millions of voices suddenly cried out in terror and were suddenly silenced. I feared something terrible had happened.

    Now, I know.

    Published on: February 1, 2013

    The New York Times reports this morning that the US Justice Department is suing to block a proposed $20.1 billion acquisition by Anheuser-Busch InBev of Grupo Modelo, the Mexican manufacturer of Corona beer. According to the story, the concern is that the deal "would cement Anheuser-Busch InBev’s control of the market and enable it to continue to raise beer prices."

    The Times writes that "the lawsuit is the first major roadblock in a decade of consolidation by brewers around the world, which has reduced the industry to only a few major players, primarily multinationals that own a majority of big brands."
    KC's View:

    Published on: February 1, 2013

    Reuters reports this morning that Graco Ramirez, a mexican state governor who has been implicated in the Walmart bribery scandal, has "sued a former lawyer-turned-whistleblower for the company and sought an apology for naming him in connection with the scandal."

    Ramirez was named in news stories suggesting that Walmart has greased the wheels for fast Mexican expansion by bribing public officials, and then suppressed any investigations into the charges.

    According to the story, "Ramirez, the governor of Morelos, was identified in emails released by U.S. lawmakers earlier this month as negotiating a bribe worth 2 million pesos on behalf of Walmex. At the time he was a deputy with the center-left Party of the Democratic Revolution.

    The email detailed allegations provided by Sergio Cicero, a former lawyer for the company, who also provided information to the Times.

    "Ramirez filed a lawsuit against Cicero claiming that email, sent in 2005, hurt his reputation. He asked Cicero to publicly say that what he alleged was not true."
    KC's View:
    Is this a case of legitimate outrage because he's been libeled? Or it is closer to, say, the case of an athlete who denies that he's done steroids only to admit down the line that he actually was.

    No clue. But more than ever, I'm really looking forward to the results of the Justice Department and Securities and Exchange Commission (SEC) probes into this case.

    Published on: February 1, 2013

    • The Waco Tribune reports that discount/limited assortment retailer Aldi is opening a new store in Waco - a 16,000 square foot unit practically in the shadow on an HEB store.

    “They assured me they wanted that hard corner and they wanted to be near H-E-B,” real estate developer Gordon Harriman tells the paper, adding, "They want to be near the main game in town. In Houston, they like to locate near Randall’s locations.”

    Reuters reports that Best Buy is closing 15 Canadian stores and laying off about five percent of its workforce there. The move leaves Best Buy with 245 stores there.

    "The move was based on an extensive review of Best Buy's retail footprint in Canada in an effort to reduce unnecessary costs, eliminate redundant operating systems and optimize its real estate strategy to reflect a changing retail landscape," Best Buy said in a statement.

    As in the US, Best Buy's Canada stores have been under competitive pressure from online retailers such as Amazon, and also has been grappling with the "showrooming" trend.

    • Acosta Sales & Marketing yesterday announced its acquisition of Firebird Foods, a meat and deli sales agency based in Phoenix.   Terms of the deal were not disclosed.

    WineSpectator reports that a new study suggests that not only does the resveratrol found in wine seem to help prevent cancer, but it also "may improve the ability of radiation to kill prostate cancer cells."
    KC's View:

    Published on: February 1, 2013

    • The Kroger Co. announced the retirement of Central Division President Robert "Bob" Moeder, a 42-year veteran of the company.

    Moeder began his career with Dillon Companies Inc. in 1971 working part-time for its Calhoun's clothing division while attending college; he was appointed to lead the Central Division in 2006.

    • The Grocery Manufacturers Association (GMA) announced that Sean McBride has been promoted to executive vice president of communications and membership services.   McBride previously served as senior vice president of communications and marketing.

    • Rite Aid Corp. yesterday said that it has hired Yong Choe, currently the director of Business Outreach and Member Services for the Republican Study Committee, to be its vice president of Federal Affairs and Public Policy.
    KC's View:

    Published on: February 1, 2013

    * Ed Koch, the former three-term mayor of New York City, passed away this morning after several months of health problems. He was 88.

    Koch, who had a pugnacious and confrontational personality, was perhaps best known for putting a relentlessly optimistic face on the city at an extremely tough time in the city's history - 1978 to 1989.
    KC's View:

    Published on: February 1, 2013

    ...will return.
    KC's View:

    Published on: February 1, 2013

    For a variety of reasons, I haven't seen any movies over the past week. (I've been traveling, plus last weekend I saw a not-very-good play, "Stones in His Pockets," at the Yale Repertory Company, which got in the way of going to the movies.)

    I did, however, want to mention that I've seen the first two episodes of "The Following," the genuinely creepy new Fox series about an Edgar Allan Poe-obsessed serial killer who creates a cult that, even while he is in prison, performs ritual killings in his name and honor.

    Kevin Bacon plays the former FBI agent trying to stop the cult. He tracked down and imprisoned the killer (played by the oily and seductive James Purefoy) but in doing so was almost killed; he was stabbed and now has a pacemaker keeping him alive, plus an addiction to booze. Bacon is terrific ... he reminds me of William Petersen's Will Graham in the terrific Manhunter, which preceded Silence of the Lambs and is almost as good; Bacon carries the weight of the world on his shoulders, and we can feel his pain.

    I'm not big on gore, and I found one or two scenes in the first episode to be a little off-putting. The second episodes was actually better - lots of blood, but we didn't see much actual violence. (Though I have trouble with the scenes that show a little boy at risk.)

    "The Following" is sort of Manhunter and Silence of the Lambs crossed with "Criminal Minds," with a little "CSI" tossed in. I'm not sure if they will be able to sustain the tension over many weeks, and it is possible that the violence and gore could go too far, at least for me. But for the moment, I'm intrigued. And coming back for more.

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

    KC's View: