retail news in context, analysis with attitude

Published on: March 11, 2013

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Published on: March 11, 2013

Published on: March 11, 2013

by Kevin Coupe

NBC News reports that while Google Glasses - eyewear that would allow people to access the internet as well as possibly record what they see - are still in development and not for sale, one Seattle bar has already outlawed them from being worn inside the premises.

The bar, the Five Point Cafe, posted the following message on its Facebook page: "For the record, The 5 Point is the first Seattle business to ban in advance Google Glasses. And a** kickings will be encouraged for violators."

The reason? According to owner Dave Meinert, "First you have to understand the culture of the 5 Point, which is a sometimes seedy, maybe notorious place. People want to go there and be not known ... and definitely don’t want to be secretly filmed or videotaped and immediately put on the Internet ... Part of this is a joke, to be funny on Facebook, and get reaction. But part of it’s serious, because we don’t let people film other people or take photos unwanted of people in the bar, because it is kind of a private place that people go."

I think this is interesting.

Sure, it is a bit of a PR play. But it certainly could reflect a privacy issue that could crop up again and again as wearable technology becomes more prevalent and mainstream. Some of this will be played out in the media, some will play out in court (inevitably), and some will probably get worked out in some alley, with offended parties taking the law into their own hands.

I cannot help think of the cautionary signs that sometimes go up at concerts (no recording devices allowed!), or stores (no pictures allowed) - which always sort of amuse me since everyone at the concert has a recording device in their pockets, and virtually every customer in the store has a camera.

We're in a new reality here, folks. Old rules don't apply. Or at least, new rules are required.

It's an Eye-Opener.

Published on: March 11, 2013

Whole Foods Market announced on Friday that it will mandate that all the products sold in its US and Canadian stores be labeled if they contain any genetically modified organisms (GMOs), and it is giving its suppliers a five year deadline to meet this standard.

The move makes Whole Foods the first retailer to require this level of transparency of its suppliers, who reportedly were not consulted before the decision was made and only were told of it shortly before the public announcement.

CEO Walter Robb said that the company is "responding to our customers who have consistently asked us for GMO labeling and we are doing so by focusing on where we have control in our own stores."

And AC Gallo, president of Whole Foods, said that the company has "seen how our customers have responded to the products we do have labeled. Some of our manufacturers say they’ve seen a 15 percent increase in sales of products they have labeled."

According to the Wall Street Journal, "Whole Foods said it now has 3,300 products verified as non-GMO. Its store-brand line, 365 Everyday Value, goes through a verification process.

"Mr. Robb said the company will increase its support of organic products, and work with partners to grow its supply of products without genetically modified ingredients, or clearly label products containing them."

The Grocery Manufacturers Association (GMA) released a statement opposing the policy: "These labels could mislead consumers into believing that these food products are somehow different or present a special risk or a potential risk."

The New York Times notes that "genetically modified ingredients are deeply embedded in the global food supply, having proliferated since the 1990s. Most of the corn and soybeans grown in the United States, for example, have been genetically modified. The alterations make soybeans resistant to a herbicide used in weed control, and causes the corn to produce its own insecticide. Efforts are under way to produce a genetically altered apple that will spoil less quickly, as well as genetically altered salmon that will grow faster.

The Times goes on to report that "the shift by Whole Foods is the latest in a series of events that has intensified the debate over genetically modified foods. Voters defeated a hard-fought ballot initiative in California late last year after the biotech industry, and major corporations like PepsiCo and Coca-Cola, spent millions of dollars to fight the effort. Other initiatives have qualified for the ballot in Washington State and Missouri, while consumers across the country have been waging a sort of guerrilla movement in supermarkets, pasting warning stickers on products suspected of having G.M.O. ingredients from food companies that oppose labeling. Proponents of labeling insist that consumers have a right to know about the ingredients in the food they eat, and they contend that some studies in rats show that bioengineered food can be harmful."

Published on: March 11, 2013

The Washington Post reports that a coalition of "environmental, religious and business groups" is endeavoring to persuade Maryland state lawmakers to impose a five-cent charge for each disposable plastic bag handed out by businesses to consumers, which the groups say "would help the environment and not burden low-income residents."

According to the story, Maryland might actually be the first state to impose such a statewide charge, though "at least five other states — Hawaii, New Jersey, New York, Vermont and Washington" - are contemplating similar legislation.

The story says that "under the Maryland proposal ... shoppers would be charged a nickel for each disposable bag. Merchants would be able to keep about a penny per bag, and stores that offer a rebate to customers who bring their own bags could keep 2 cents for each disposable bag sold."

Published on: March 11, 2013

Leslie Dach, Walmart's executive vice president of corporate affairs and the man that many credit with, as the New York Times puts it, "polishing the company’s image through energy conservation, environmentally friendly packaging and philanthropy," is resigning after seven years with the company.

"When things are going really well, that’s the right time to do it," Dach tells the Times, which notes that "he is leaving as the company deals with international bribery investigations, questions about factory safety among its global suppliers and scattered protests at stores."

Published on: March 11, 2013

Just as a matter of context, the New York Times has a piece about the horse meat scandal in Europe, which has captivated the continent over the past month or so with every new discovery of beef products that contain trace amounts - and sometimes more - of horse meat.

This isn't just a food issue, the story suggests, but something much greater ... and the scandal has spotlighted what some people feel are fatal fault lines in the European Union.

Here's how the Times frames the story:

"The scandal has cast a pall over Europe’s proudest achievement — a vast common market that allows the free flow of goods and services across borders — and even the very idea that Europe’s different nations can somehow work together to set and enforce common rules.

"Consumers are increasingly asking a simple but discomforting question: Why, in a trading bloc notorious for regulating things like the shape of bananas and the font size on food labels, was something as simple as identifying the difference between a cow and a horse so difficult?

"And at a time of immense strains brought on by the euro crisis and Continentwide austerity — when new, anti-European political forces are rising in country after country — the horse meat scandal has brought into the open the deep divisions, cultural and otherwise, that bedevil the European Union. A meat that nearly all Britons consider revolting, for example, is cherished as a protein-rich delight by a small but loyal minority in places like Belgium, the home of the European Union’s Brussels bureaucracy and Europe’s biggest per capita consumer of horse meat. (Italy, with its larger population, eats the most horse over all.)

"For a surging camp of so-called Euroskeptics in Britain, the fact that horse meat has entered the food chain through a host of middlemen and factories scattered across the Continent stands as proof of unbridgeable cultural chasms that, in their view, make the European Union unworkable."

And at least one term has been reintroduced into the debate: country of origin labeling, the Times writes:

"Growing calls for mandatory 'country of origin' labeling on all processed meats sold in Europe have stirred concern in Brussels about a surge" in what one health official calls "veiled protectionism" ... " Until now, only unprocessed meat had to identify its place of origin."

Published on: March 11, 2013

There is a good piece in Fortune about John Mackey and his "conscious capitalism" gospel, which has been getting a ton of play recently because he's been on the hustings promoting a book, "Conscious Capitalism: Liberating the Heroic Spirit of Business," co-written with Raj Sisodia.

Two interesting quotes from the story, which can be read in its entirety here:

• "The first step for such a company is to clearly define its higher purpose beyond maximizing profits. It should then start to design everything it does around creating value for its stakeholders. It should get rid of all metrics that are not connected to value creation for stakeholders. It should then create new metrics that are leading indicators of future performance, measures such as employee passion and customer advocacy."

• "The key point is that when you do something good with the right motives, you make a lot of new and unanticipated connections. You become an 'attractor,' pulling people toward you who are doing similar things. This multiplies and extends what you set out to do in synergistic and serendipitous ways."

Published on: March 11, 2013

A blog posted in the Houston Chronicle reports that "Amazon.com has been granted a patent for a system that allowed for the resale of digital media, including e-books, software, movies and music," which could lead to a "used digital marketplace that would make buying new goods unnecessary."

Of course, this ain't necessarily so, since the posting notes that "a digital object would have to be removed from the original owner’s system before it could be transferred into Amazon’s used store and on to someone else. There would not be an infinite number of used copies, which would maintain scarcity."

Amazon isn't alone in trying to figure out this segment of the business. The story also says that Apple is working along parallel lines, though "Apple’s filing provides for the authorized access to digital content, otherwise known as digital rights, to be transferred from one user to another," as opposed to having to go through its store, which is the Amazon approach.

Published on: March 11, 2013

• Business Insider is out with a study about the "showrooming" trend, in which consumers use mobile devices to compare the prices and attributes of products they see in bricks-and-mortar stores with those available online.

The report suggests that showrooming can have an enormous impact on sales, with Deloitte saying that smartphones affected $159 billion in US store sales in 2012, a number likely to up to close to $700 billion by 2016. The report also suggests that the impact will be even more keenly felt by retailers during the holiday shopping season, when consumers are more likely to comparison shop, less likely to make impulse purchases, and have the time to wait for a delivery.

Published on: March 11, 2013

Reuters reports that "the United States on Friday sought to address a long running trade dispute by proposing stricter rules for labeling meat ... requiring labels on muscle cuts, such as steaks and pork chops, to spell out where the animal was born, raised and slaughtered. All the meat in a package would have to come from the same source."

The new rules proposed by the Obama administration were shaped after a ruling by the World Trade Organization (WTO) saying that previous rules discriminated against imports from Canada and Mexico.

However, Canadian Agriculture Minister Gerry Ritz was not happy with the new proposals, saying, "We do not believe that the proposed changes will bring the United States into compliance with its WTO obligations ... The proposed changes will increase the discrimination against exports of cattle and hogs from Canada and increase damages to Canadian industry. Our government will consider all options, including retaliatory measures, should the U.S. not achieve compliance by May 23, 2013, as mandated by the WTO."

Reuters writes that "The United States has until May 23 to redesign its country-of-origin rules to satisfy a World Trade Organization ruling ... Country of origin labels, referred to as COOL, became mandatory in March 2009 after years of debate. Some U.S. farm and consumer groups said the labels would help shoppers make informed decisions, but meat packers and large livestock groups termed the labels a costly paperwork headache."

Published on: March 11, 2013

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

• United Supermarkets has announced that it is using the occasion of National Nutrition Month to offer "a variety of initiatives aimed to make healthy shopping effortless and gathering nutritional knowledge simple ... Recently launched at Lubbock’s newest Market Street, and soon rolling out in other United communities, is a new shelf tag program featuring 'healthy attributes' that identify products in 10 different categories, such as low-sodium, heart-healthy, organic, gluten-free, etc. The new tagging system is designed to help guests easily spot foods that meet specific nutritional needs.

"Shelf tags also include the NuVal Nutritional Scoring System, which rates the nutritional value of foods throughout the store on a scale of 1 to 100."


• The Boston Globe reports that LL Bean, having had a strong 2012, "plans to give bonuses to about 5,000 full-time and part-time employees" that are "equal to 7.5 percent of an employee’s pay in 2012."

In a statement, L.L. Bean president and chief executive Chris McCormick said: “L.L.Bean has performed very well in a continuing volatile retail environment - with economic uncertainty, political distractions, and shaky consumer confidence. We ended the year with a modest gain in net sales over the prior year, but significant improvement in productivity.”

Just think of what it will do for front-line personnel to know that they are being rewarded for hard work. As opposed to companies where CEOs don't seem to know that hard work by front line personnel is what makes them ultimately successful.

Published on: March 11, 2013

• Publix Super Markets announced that Dave Bornmann, Vice President Grocery/Non-Foods, has been promoted to Senior Vice President, Corporate Purchasing.

In addition, Pete Mowitt, Business Development Director of Grocery, has been promoted to Vice President Grocery/Non-Foods.

And, Publix said that Mike Smith, Vice President of Manufacturing, has been promoted to Senior Vice President, Manufacturing.

Succeeding him will be Jeff Stephens, the current Director of Manufacturing Operations, who will become Vice President of Manufacturing.


• Advertising Age reports that "PepsiCo Global Chief Marketing Officer Salman Amin is leaving the company for S.C. Johnson, where he will serve as chief operating officer for its North America markets."

No successor has been named yet at PepsiCo.

Published on: March 11, 2013

On Friday, as part of a discussion about a proposal to raise the minimum wage, one MNB user was quoted here as saying:

Raising the minimum wage only hurts the less than ordinary worker.  Raising the minimum wage is also a slap in the face to those who have worked hard to get $2-3 above the current minimum wage.  When they see that the most useless among us have been given a raise that nearly matches their wage, just for being alive and showing up, that has to be demoralizing to the people who have chosen to work harder and smarter.

To which I responded:

I have such a problem with the phrase "the most useless among us."

Sure, there are people who are less accomplished, less motivated, less ambitious than others. But useless? That seems so condescending and cruel. It may be that they come from circumstances that did not allow for opportunity, did not nourish their dreams and ambitions, that did not give them a chance. Many people rise above such circumstances, but some don't and some cannot. I refuse to see such people as useless, and refuse to treat them as such.

Besides, your email presumes that the current minimum wage is enough for people to live on. I think in many communities, that'd be pretty tough. Though I guess that in your world, maybe useless people don't deserve to survive.

Well, there were other folks in the MNB community who also wanted to get in on the conversation. One reader offered:

The person who replied "the most useless among us" appalls me. I'm tempted to say that the writer of that comment is the "most useless."

Also, perhaps  he or she should try living on a minimum wage budget for a month before they comment further.

And, from another reader:

Thank you so much for calling out that person referring to those paid minimum wage as “the most useless among us”.  Always so shocking when you realize some people have no ability to see that others aren’t lazy, but may not be capable of the same roles or just might have had some terrible breaks that have put them in an unfortunate situation.  I’m also amazed that many people don’t realize that their own situation could change drastically with a job loss, health crisis, etc.

Have been a long-time subscriber to your site and this is a great example of why – your approach is balanced and thoughtful, so appreciated!

Of course, the person who wrote the email wanted to double-down on his original comment:

Raising or not raising the minimum wage really would make no difference to many low wage workers.  If their pay rises they would lose out on a near equal amount of Food Stamps and Earned Income credit.  Their rent in low income housing would go up because its based on income.  Some might see the premiums rise on their state funded health insurance.  Whether you are making $7 and hour or $20 an hour, you are basically just spinning your wheels and volunteering because the government will always subsidize your income to get to you to about $20 an hour with entitlements.

I'm a little surprised that you see this as a problem.

Seems to me that if the minimum wage goes up, and people making the minimum are suddenly able to go off food stamps and maybe even put more money into the economy in terms of rent, buying groceries and clothes, that's a good thing. Again, I'm not locked into a specific number, but I think that an increase in the minimum wage - especially one keyed permanently to the cost of living - could be good for the economy in the long run. People would be making money, instead of taking public assistance ... or at least this would be the goal. Obviously, nothing is perfect ... but I'm not sure it does anyone any good to have the minimum wage at a place where nobody can live on it. And it certainly does not do anyone any good to have people working at minimum wage jobs being described as "useless."

From another reader:

Increasing the minimum wage polls very well, but in reality it creates more problems for those it should be helping.  In a free market, workers accept the wages paid for a job they are willing to perform.  Businesses can choose what level of pay they offer, and workers can choose to accept that pay or look for something better.  Replacing free market with government wage mandates will always distort the marketplace, and tragically, raising the minimum wage will create much more pain for the majority of those affected.

David Neumark, U of California economist, reviewed over 100 major academic studies on the minimum wage, and concluded that nearly 85% "find a negative employment effect on low-skilled workers."  There's plenty of evidence to support this - when the economy was struggling in 2007 through 2009, raises in the minimum wage were followed by big spikes in unemployment for young black adults, and the loss of 600,000 teen jobs even when the GDP expanded.

Why?  When the cost of labor is increased by non-market forces, the result is excess labor, which results in more unemployment.  Those who qualify for better paying jobs will probably not be affected, and workers who are paid less than the new minimum wage will receive an increase.  But those who have less skill, education and experience will now be competing for a shrinking number of jobs, creating a bigger disparity.

What's unfortunate is that on the surface, this sounds like a great thing to do, but the tragedy is that it is more "feel good" than "do good," and we as a society will suffer for it.

Maybe I'm misreading this email, but it sounds like a justification for no minimum wage at all, with the argument that a totally free market will solve all problems.

Which, I think, sounds a lot better when you actually have a job and are not making minimum wage.




Regarding the work-at-home debate, one MNB user wrote:

I left my last company for losing the work-from-home 3 day/week benefit. For me it was a non-negotiable need with 2 teenage daughters whom I want to keep busy (driving to field hockey, band practice, their jobs) during the teen years. I would sacrifice pay and other benefits before losing that flexibility. Yahoo may have some talented employees who are right now looking for work because of that lose of benefit. Which incidentally does not affect (directly) the company's bottom line.

Agreed.




On Friday, I wrote the following about a new YouTube sensation called "Gallon Smashing"...

It works like this. A young person - usually a male - walks around a supermarket carrying two gallon containers of milk or juice. When they think nobody is looking, they smash the containers against the floor or cases and then fall to the ground. people who rush to their assistance believe that they've slipped on a wet floor ... except, of course, the floor wasn't wet until they smashed the gallon containers.

And, of course, while customers were not looking when they did it, there was someone watching - a confederate with a video camera. And the footage ends up being posted on YouTube.

(Trust me on this. Just go to YouTube and search for "gallon smashing." It is right up there with the Harlem Shake and Gangnam Style.)

Now, there are reports that the guys who started this trend do end up paying for the gallons they've smashed. But that doesn't change the fact that they are committing vandalism, pure and simple. And by posting it online, where it has been seen my millions of people, it encourages other people to do it.

So here's my suggestion.

If you are a food retailer and this happens in your store, help these young men to their feet ... and then hold the little bastards by the scruff of the neck while you call the cops and press charges.

One MNB user responded:

I am in agreement with you on this, these people should be held accountable.
 
I did get a chuckle though of your old school idiom ‘by the scuff of the neck”.  This took me back to my parochial days and the nuns that would use that phrase. 
 
Also, I could not resist since you used a movie title, the following dialogue with a small change:

Jed Cooper: "There'll be no hanging here."

Cowboy: "These men killed my father and brother. They're gonna get what's coming to 'em."

Jed Cooper: "They're gonna get what the law says is coming to 'em.

Funny, isn't it, that I found a way to work movies into that story?

From another reader:

A good old fashion ass wupping is in order….

Blunt, but appropriate.

And another:

I’m with you on this one ... I was absolutely disgusted and angered…  I agree with the you on pressing, charges – right after they paid for the product AND cleaned up the mess to my complete satisfaction – with their parents watching.

Published on: March 11, 2013

Mariano Rivera, considered the greatest closer of all time and arguably on the list of the most accomplished pitchers in baseball history, announced over the weekend that this season, his 19th with the New York Yankees, will be his last.

"I have given everything and the time is almost ending," he said at a weekend press conference. "The thing that I have, the little gas I have left is everything for this year. After that, I'll empty everything. There's nothing left."

Rivera begins the season with a career 2.21 ERA, a record 608 saves, as well as 42 saves and a 0.70 ERA in the postseason.

And most amazingly, he did it pretty much with one pitch - a cut fastball that the majority of the time, nobody could hit, even when they knew it was coming.