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    Published on: April 3, 2013

    by Kate McMahon

    "Kate's Take" is brought to you by Wholesome Sweeteners, Making The World a Sweeter Place.

    For companies grappling with skyrocketing health insurance premiums and overweight, at-risk employees, a new study has reaffirmed what any kid who collected a buck for every A already knows:

    Money talks.

    And cash is an even more effective motivator when employees participate in a weight loss challenge as part of a team or in a “group” program, according to a study released Monday in the Annals of Internal Medicine.

    Current employee health incentive programs range from positive nutrition and cutting edge fitness efforts to a more controversial approach recently implemented by CVS. As reported here on MNB, the pharmacy chain is requiring its 200,000 employees to participate in a voluntary “wellness review,” paid for by CVS, measuring factors such as weight, blood pressure and body fat, or face an annual $600 penalty.

    But the financial carrot-on-the-stick approach has more momentum, as the use of cash, gift-cards and other prizes to reward workers for adopting healthier lifestyles has risen 69% since 2009, according to a 2012 survey of 512 employers.

    And will likely continue to do so as the Affordable Care Act allows employers to use an increased share of insurance premiums to offer workers inducements to improve overall health and lose weight. And starting in 2014, the health care reform act expands employers’ ability to reward workers who meet health status goals through wellness programs.

    This newest study from the University of Michigan followed 105 obese employees at Children’s Hospital of Philadelphia for a five-month clinical trial. The individuals on “teams” who could share a $500 reward lost more weight than those who went it alone on the diet and could win $100. Equally importantly, the “team” members maintained more weight loss three months after the financial incentives ended.

    Critics say that such “Biggest Loser”-type contests can create unhealthy crash dieting competitions, lead to “yo-yo” weight loss and gain cycles and fail to address other health issues such as high blood pressure and smoking. Not to mention cause tension and even sweet-tooth sabotage among co-workers.

    I would counter such criticism by citing an innovative program -- the “Nu-Me Weight Loss Challenge” currently underway in Meijer’s eight divisions and 199 stores across its five-state Midwest footprint. Meijer has teamed up with the nutritional scoring program, NuVal, for a three-month weight loss contest with prize money totaling $15,000. It is Meijer’s fourth challenge, but first with NuVal, the scoring system which calculates and summarizes a grocery product’s nutritional information into a single number on a score of 1-100 (the higher, the better).

    Meijer has 1,004 teams participating – ranging in size from one to 15 members – with all company employees encouraged to be involved and a focus on health. There are weekly weigh-ins and rewards, and excitement throughout Meijer, said Amanda Senecal, the retailer’s wellness program specialist, who oversees a full slate of health and fitness programs throughout the year. “It’s about maintaining a healthy lifestyle, losing weight, and having fun,” she said, noting the partnership with NuVal is an added benefit.

    While I think the term “holistic” is over-used, it best describes the approach employers should use to maintain and promote employee wellness. Such programs are no longer perks but should be part of any company’s strategic business plan to manage costs. The employer and employee need to be on the same side, which will in turn save money, improve productivity and morale, and improve quality of life through health. A team effort, and a win-win for all.

    Comments? Send me an email at kate@morningnewsbeat.com .
    KC's View:

    Published on: April 3, 2013

    by Kevin Coupe

    I get a lot of email. More than 500 a day, on average. Many are notes from MNB users, and, luckily, there often are messages from potential MNB sponsors or invitations to speak at various conferences and meetings. There also are a healthy dose of press releases, new product introductions, and invitations to cover events of various kinds ... and, to be honest, some of these are more compelling than others.

    I've been doing this a long time, and a couple of days ago, I got one of the best emails ever.

    On the face of it, the email shouldn't have been anything special. Just an invitation to the United Fresh annual convention, scheduled for San Diego this May. But in order to garner attention, United CEO Tom Stenzel engaged in a bit of skydiving, leaping from a plane and landing on the deck of an aircraft carrier docked in San Diego.

    You have to watch the video.

    All I can say - and it seems appropriate considering United's value proposition - is that Tom Stenzel has some set of onions.

    KC's View:

    Published on: April 3, 2013

    JC Penney's board of directors, clearly dissatisfied with the direction of the retailer, yesterday announced that its CEO, Ron Johnson, is having his pay cut by 97 percent for 2012. In addition, senior executives with the company are being denied their annual cash bonuses for 2012.

    Johnson probably won;t be in need of financial assistance, however. Even with the reduction, he still had a total compensation packager of $1.9 million.

    According to the New York Times, "Mr. Johnson had earned $53.3 million in total compensation in 2011 for the two months he served as chief executive. Most of the compensation was in stock to replace the stock he left behind at Apple, his former employer. In 2012, his total compensation was reduced to a $1.5 million salary, with no stock awards and no bonus. He was given about $345,000 for personal use of a corporate aircraft, $30,000 for a home security system, and $3,000 for information technology services, for a total of about $1.9 million."

    Since taking over at JC Penney, Johnson has made significant changes, mostly keyed to the elimination of the retailer's promotion-and-sale driven approach to marketing in favor of an EDLP strategy. The problem has been that JC Penny's customers reacted by staying away in droves, causing traffic, sales and profits to plummet. Sales were down $4 billion in 2012, and the company's stock price is down more than 50 percent since Johnson signed on.

    The Times writes that "analysts generally say they believe that Mr. Johnson will be given at least another couple of quarters to turn around the company he was hired a little more than a year ago to revive."
    KC's View:
    Seems entirely appropriate to me that these executives suffer pay and bonus cuts, considering how poorly JCP has been doing. It would have been a crime if any of them got a bonus.

    I still think that Johnson - a guy who I think had the right idea, if a lousy execution - won't last that long. If there is no evidence of progress, they're going to have to make a change. Though I have to wonder if anything is going to save JCP at this point.

    Published on: April 3, 2013

    Internet Retailer reports on the ongoing growth of the smartphone economy:

    "Smartphones have become mainstream technology that a great many people can’t live without. In 2012 there were 155.1 million U.S. smartphone users, 49.4% of the U.S. population, research firm IDC says. In 2013 there will be 181.4 million U.S. smartphone users, 57.3% of the U.S. population, IDC projects. And in 2017 there will be 222.4 million smartphone users, 67.8% of the U.S. population."

    “'For those of us that own a smartphone, it comes as no surprise that these devices have become the central social, communication and information tool for so many Americans,' IDC says in its report. 'Within the first 15 minutes of waking up, four out of five smartphone owners are checking their phones, and among these people, nearly 80% reach for their phone before doing anything else. These statistics alone drive home the utility of and reliance on smartphones'."

    Coincidentally ... or perhaps not ... eWeek reports that Amazon has hired the ironically named Charlie Kindel, who worked for Microsoft managing its Windows Phone Developer Experience.

    The story says that the hiring has reignited speculation that Amazon is yet again working on a smart phone.
    KC's View:
    One can only imagine what Amazon will come up with if it releases a smart phone, especially since its Kindle tablets have been so successful at allowing shoppers to acquire and consume content.

    I do have one question about the IDC numbers, though. They say that "nearly 80% reach for their phone before doing anything else." Could this be because we're all using our smartphones as alarm clocks?

    Just asking.

    Published on: April 3, 2013

    Bloomberg reports that "a former Anheuser-Busch InBev employee who claimed the company sells watered-down beer told a judge the brewer is out to punish his whistle-blowing with a lawsuit alleging he divulged trade secrets."

    The story says that A-B sued James Clark, a former director of operations support, a week after it was accused of watering down its beers and cutting the alcohol level as a way of saving money. A-B has been hit with at least eight lawsuits based on the allegations.

    According to Bloomberg, "Clark worked at Anheuser-Busch from 1998 until June, when he resigned to become a lawyer. He held several quality- assurance positions before rising to director of operations support, according to court papers filed with his request to dismiss the case ... Clark worked at Anheuser-Busch from 1998 until June, when he resigned to become a lawyer. He held several quality- assurance positions before rising to director of operations support, according to court papers filed with his request to dismiss the case."

    The story goes on: "From 2008 to 2012, Clark said, he complained to about 20 senior managers about Anheuser-Busch's practices regarding alcohol content. He became involved in the consumer litigation shortly after his resignation, Clark said in court papers. He denied disclosing company trade secrets to any competitors or in connection with any regulatory approval process."
    KC's View:
    I just don't know what to make of this story. My instinct tells me that A-B is in trouble, and that the new owners decided to cut corners as a way of improving margins. But it is hard for me to believe that anybody would be foolish enough to risk the hit that the brands would take if these charges are proven to be true.

    Published on: April 3, 2013

    The Winston-Salem Journal reports that when Publix broke ground for a its first North Carolina store last week, in the community of Ballantyne, senior executives weren't talking about speculation that the company could be interested in acquiring Harris Teeter, which began exploring strategic options for a sale of the company about six weeks ago.

    Harris Teeter has said that it has been approached only by two private equity groups interested in buying the company. And such a purchase by Publix would be out of character; CEO Todd Jones told the paper that "the company hasn’t made a large purchase of a competitor since it bought a meatpacking company in the 1930s."

    Indeed, Jones suggested that the Publix culture - most senior managers have been with the company since they were in their teens, and Publix stock is all held by employees - works against such an acquisition.

    However, he said, Publix is more than happy to compete against Harris Teeter for customers.
    KC's View:

    Published on: April 3, 2013

    Seattle-based PCC Natural Markets (PCC), the nation’s largest natural foods retail cooperative, announced that it has become "the first U.S. grocer to sell only chocolate made from ethically sourced cocoa ... PCC will sell housemade bakery items, chocolate bars, candy, cocoa powders, and baking chocolate only from vendors that provide assurance that child slave labor is prohibited and follow International Labor Organization (ILO) Fundamental Conventions. These include strict prohibitions against child slave labor, as well as provisions about age, working conditions and fair wages for all workers. Restrictions against child labor and fair treatment of workers are defining tenets of the 'fair trade' movement."

    According to the announcement, "PCC required its chocolate vendors to fill out questionnaires and sign affidavits ensuring their chocolate adheres to the new standard. PCC discontinued the few brands that did not comply. Now, all chocolate sold at PCC is fairly traded. All brands are certified either by an independent third party, or signed PCC’s affidavit ensuring they meet the standard."
    KC's View:

    Published on: April 3, 2013

    • Ahold USA announced that it has "achieved another milestone in (its) commitment to building greener stores. Six newly constructed stores have received Leadership in Energy and Environmental Design (LEED) certification from the U.S. Green Building Council (USGBC), the national accepted benchmark for the design, construction, and operation of high performance green buildings. This marks the largest fleet of LEED-certified stores among grocery retailers within the United States. The six LEED-certified stores include Cranston, RI and Roslindale, MA (Stop & Shop New England division), Arverne, NY and Oceanside, NY (Stop & Shop New York Metro division), Burtonsville, MD (Giant Landover division), and Trexlertown, PA (Giant Carlisle division)."
    KC's View:

    Published on: April 3, 2013

    • Supervalu announced that Mike Stigers, the former president of Shaw's, has been named president of its Northern region, effective immediately. He succeeds Jim Gilliam, who is said to be leaving the company after 31 years "to pursue a new business opportunity."

    In addition, Supervalu announced that Bob “BJ” Jaskolski, currently Northern Western and Independent Business executive vice president, has accepted the role of vice president, Sales, Merchandising and Marketing.

    In the Midwest, Tandy Harvey, currently vice president, Merchandising Midwest and Southeast region, will add the overall Supervalu military business to her areas of responsibility.

    Bill Poirier, currently vice president of Sales and Market Development in the Northern region, has been named vice president, Market Development, Northern region.

    Ed Rawson, currently vice president of Sales and Market Development for Western region, has been named vice president, Marketing, Northern region.

    Scott Morris, formerly group vice president, Merchandising Transformation, has been named vice president, Merchandising, Northern region.
    KC's View:

    Published on: April 3, 2013

    ...will return.
    KC's View: