retail news in context, analysis with attitude

Published on: November 2, 2015

by Kevin Coupe

One of the founding tenets here at MNB has been that many in the food industry don't think enough about food - they are in the efficiency and logistics business, but aren't as focused as they should be on how food tastes and smells and connects to people's lives in fundamental ways. (This is an easy test. Walk into a supermarket. Any supermarket. Sniff. If you can't smell food, if you don't get hungry, then they're not paying close enough attention.)

And so this morning I want to suggest that it is time, in the interest of appropriate salivation, that it is time to read a little Calvin Trillin.

The current issue of The New Yorker has a new bit of classic Trillin - writing about North Carolina barbecue.

An excerpt:

"For some years, I’m now prepared to admit, I somehow labored under the impression that Rocky Mount is the line of demarcation that separates the two principal schools of North Carolina barbecue. Wrong. The line of demarcation is, roughly, Raleigh, sixty miles west. The Research Triangle—the area encompassing Raleigh, Durham, and Chapel Hill—is a sort of demilitarized zone, where someone who’s been concentrating on the barbecue scene, as I was on my most recent visit, half expects to see the distinctive blue helmets of United Nations peacekeepers. Rocky Mount is within the eastern North Carolina sphere of influence, where barbecue means the whole hog, chopped, with a vinegar-based sauce that is flavored with pepper. To the west of the DMZ lies territory controlled by the forces of what is variously called Piedmont- or Western- or Lexington-style barbecue—a version that uses only pork shoulders, chopped (or, sometimes, sliced), with a sauce that is also vinegar-based but has been turned pinkish by the addition of ketchup or tomato sauce. All of that should have been obvious even to somebody who, being from Kansas City, was brought up to assume that barbecue meant ribs or beef brisket, with a thick, tomato-based sauce, and that the presence of chopped-up meat at a barbecue joint would be an indication that a customer of long standing had absent-mindedly shown up without his teeth."

Trillin's prose has plenty of teeth. He's been writing about a wide range of subjects for The New Yorker since 1963, covering crime, racial integration, and even contributing poetry from time to time. But food always has been a specialty for Trillin; he was passionate about local specialties long before it was trendy, arguing, for example, that Arthur Bryant's in Kansas City is quite possibly the best restaurant in the world.

I'd heartily recommend to you that you check out Trillin's new piece, which you can see here.

And you also should check out a collection of his food-related stories, which you can get from Amazon.

Trillin's work always has been an Eye-Opener. Enjoy.

Published on: November 2, 2015

Amazon said this morning that it is launching its "countdown to Black Friday" with its Black Friday Deals store, saying that this year, for the first time, "Prime members can access more than 30,000 Lightning Deals 30 minutes early." The promotion - which essentially sets up two months worth of Prime days, giving early access to people who are members of the $99 a year Prime program - will run through December 22.

CNBC writes that "Amazon said the deals will be for products that are on shoppers' wish lists and include electronics, toys and jewelry. The company received some backlash from shoppers after its first Prime Day in July, when prices were cut on seemingly random items such as hair dryers.

"Regardless, Prime Day set a high bar for Amazon to beat, as more units were sold that day than on its biggest Black Friday ever."

The Washington Post writes that Amazon is making the investment in the hope that people who become Prime members for the holidays will stick around: "Once they’re members, the theory goes, those shoppers will spend more of their shopping budget overall with Amazon if they know they won’t have to pay for shipping. Amazon is thought to have at least 40 million Prime members, but the company has been trying to lard the program up with more perks lately to attract even more members. The company is beefing up its original TV programming for Prime members and, in some cities, is now offering them two- or one-hour delivery."

Published on: November 2, 2015

Stores has a piece suggesting that warehouse clubs have had a more transformative impact on retailing than e-commerce.

The magazine writes that "According to a new working paper published last month by the National Bureau of Economic Research, warehouse clubs, led by Costco and Sam’s Club, have had a greater effect on the retail landscape than e-commerce.

"The researchers compared the relative size and growth trajectories of clubs and e-commerce, determining that the four largest warehouse clubs accounted for 8 percent of retail sales in 2012, nearly 50 percent more than all e-commerce retail sales in that year.
Using Census Bureau data to substantiate their conclusion, the researchers pointed out that the portion of the retail industry that includes e-commerce has grown tenfold from $35 billion in 1992 (including catalogs) to $348 billion in 2013. During that same time frame the warehouse club industry grew from $40 billion to $420 billion, a 10.5-fold increase."

Published on: November 2, 2015

Target has announced that its "Curbside pickup service will expand from 21 to 121 Target stores. The offering, which allows guests to complete their 'Target run' without ever leaving the car, will now be in all Philadelphia and San Francisco Bay area stores, and in select stores in the New York-New Jersey and Chicago areas."

Also next week, Target said, it is expanding its use of grocery delivery service Instacart from Minneapolis to San Francisco.

Target had already announced that it is bringing back free shipping and returns for the holidays. The company also said over the weekend that it "will offer international shopping and shipping to more than 200 countries and territories. In partnership with Borderfree, Target.com will offer guests the ability to pay in almost 60 different currencies and have their orders shipped to themselves or to family and friends who live outside the US."

Published on: November 2, 2015

Reuters reports that Chipotle has closed all of its restaurants in Oregon and Washington State because of concerns about an E. coli outbreak.

"After being notified by health department officials in the Seattle (Wash.) and Portland, Ore. areas that they were investigating approximately 20 cases of E. coli, including people who ate at six of our restaurants in those areas, we immediately closed all of our restaurants in the area out of an abundance of caution," Chipotle said in a prepared statement.

The Reuters story notes that "it is the third outbreak of food contamination at Chipotle restaurants since August. Those earlier cases involved salmonella and the highly infectious virus norovirus ... The 1,700-outlet chain has grown quickly since it opened in 1993 with a single location, distinguishing itself from typical fast-food restaurants by touting its use of healthy and high-quality fresh ingredients in its menu of burritos, tacos and salads.

"There is a growing trend among restaurants, as with Chipotle, to use more fresh, unprocessed food. While that may be good for nutrition, experts say it raises the risk of foodborne illness because cooking kills pathogens that cause illness."

Published on: November 2, 2015

Bloomberg has a story about Toys R Us CEO David Brandon and how he "plans to focus on boosting sales after years of the struggling retailer trying to shrink its way to profitability ... Brandon plans to maintain the bottom line with more of a focus on sales growth, he said. One of the ways he expects to do that is by getting the retailer to take more chances. Becoming too risk-averse often happens at struggling companies because people don’t want to jeopardize their jobs, he said."

One of the ways in which Brandon intends to do that is by investing in e-commerce, he said.

Published on: November 2, 2015

Business Insider reports that Kmart "is bringing back the 'Bluelight Special' in the hopes the iconic marketing approach it pioneered decades ago will breathe life into its stores and online sales. The retailer started sounding the blue sirens used to flag the surprise, 15-minute long deals to shoppers at its 942 stores on Friday."

Published on: November 2, 2015

Seeking Alpha reports that Amazon has decided to shut down its Daily Deals site, which was created to compete against Groupon and Living Social, among others ... though Amazon has an ownership position in Living Social.

Amazon has offered its Daily Deals via its Amazon Local site.

Seeking Alpha also reports that "separately, in a fresh attempt to wrest payments share from PayPal, Amazon is rolling out a 'Pay with Amazon' button for 3rd-party mobile apps. Amazon users can login via existing accounts, and pay via saved billing data; the company had 294M active customer accounts as of Q3.

"Many online merchants have been wary of using a payments service - and thus sharing transaction data - with their biggest rival. Amazon, however, insists it only sees transactions sums, and not the details of a purchase. The company reports Pay with Amazon's payment volume is up 180% Y/Y, but hasn't shared a dollar figure."

Published on: November 2, 2015

Fascinating story in the New York Times over the weekend about how companies are inserting arbitration clauses into contracts with both consumers and business partners, essentially getting them to agree not to sue.

The clause usually says something like, the company “may elect to resolve any claim by individual arbitration.”

Those nine words, the Times writes, "are at the center of a far-reaching power play orchestrated by American corporations ... By inserting individual arbitration clauses into a soaring number of consumer and employment contracts, companies like American Express devised a way to circumvent the courts and bar people from joining together in class-action lawsuits, realistically the only tool citizens have to fight illegal or deceitful business practices.

"Over the last few years, it has become increasingly difficult to apply for a credit card, use a cellphone, get cable or Internet service, or shop online without agreeing to private arbitration. The same applies to getting a job, renting a car or placing a relative in a nursing home ... By banning class actions, companies have essentially disabled consumer challenges to practices like predatory lending, wage theft and discrimination, court records show."

And in doing so, some legal experts tell the Times, corporations have managed to shift the balance of power so that they have it all, and small companies and individuals have very little. While those who favor the clauses would argue that they help companies avoid expensive courtroom fights that clog up the legal system, and also prevent frivolous litigation, the evidence, the Times suggests, indicates that they also may prevent legitimate legal challenges from taking place.

As I said, a fascinating piece ... and you can read it in its entirety here.

Published on: November 2, 2015

• ISN reports that the Ahold and Delhaize continue to work on the merger and integration of the two companies with "great advancement," according to Frans H. Muller, Delhaize president/CEO. Muller says that the merger is expected to be completed by mid-2016.


• Fortune reports that Peet's Coffee & Tea "has bought a majority stake in Intelligentsia Coffee, adding to a buying spree by Peet’s as it looks to capitalize on rising consumer interest in fancy coffees and teas."

The story notes that "Peet’s has been particularly aggressive in acquiring smaller peers lately. Last year it joined forces with a venture-capital firm to buy Mighty Leaf Tea, giving Peet’s a stronger presence in the premium tea industry. And earlier this month, Peet’s Coffee & Tea bought Stumptown Coffee Roasters."

Fortune writes that Peet's plans to allow Intelligentsia to continue to operate and grow independently with the active participation of its founders; at the moment, Intelligentsia only has stores in Chicago, Los Angeles and New York. It is the same philosophy that it says it will use with Stumptown.


• Online coupon website eBates is out with a new study saying that "more than half (55 percent) of Americans plan to shop on Thanksgiving Day—more than those who plan to shop on Black Friday or Cyber Monday. Forty eight percent of Americans plan to shop on Black Friday and 42 percent of Americans plan on shopping on Cyber Monday ... Some 28 percent of the eBates survey respondents plan to eat an earlier Thanksgiving dinner in order to get a head start on shopping, and one in five (20 percent) say they will scope out deals instead of cooking earlier in the day.

"There are even some U.S. consumers willing to forgo Thanksgiving dinner altogether: 9 percent said they would rather eat out to get a head start on Black Friday sales."


• The National Grocers Association (NGA) announced that Lorelei Mottese, Director of Government Relations for Wakefern Food Corp., has been given NGA's highest award for government relations, the Clarence G. Adamy Great American Award, which is presented annually "to an individual or company whose leadership in the food industry best exemplifies active and effective participation in government relations as a citizen and industry representative."


• The Detroit Eater reports that Plum Market - which currently operates one store in Illinois and three in Michigan - is opening its first airport location in Detroit Metropolitan Airports' McNamara Terminal, serving breakfast, lunch and dinner, food-to-go, and a wine bar. The story notes that sandwiches will be made with Zingerman's bread, and says that "Plum Market is the latest in a slew of new dining options recently bestowed on the McNamara terminal. Bigalora is also set to open before Thanksgiving with Corridor Sausage Co. to follow."


• CTV reports that Sobey's is acquiring Pete's Fine Foods, a two-store specialty retail and wholesale grocery business that operates in Halifax and Bedford, Nova Scotia. Pete Luckett, who founded the business 40 years ago, will stay on as a consultant for the coming decade, and the stores will retain their individual branding.

Terms of the deal were not disclosed.

Published on: November 2, 2015

• Mark Bittman, the influential former food columnist for the New York Times, said over the weekend that he is joining Purple Carrot, described by the Times as "one of the many new meal kit delivery services that have sprung up over the last several years ... The Purple Carrot is a vegan version of subscription meal kit services like Plated, Blue Apron, Green Chef and HelloFresh. Mr. Bittman will be involved in helping the company develop menus, as well as writing for its website, doing online chats on Twitter and other social media sites, and taking on other roles as the 'face' of the business."

Bittman is not a vegetarian nor a vegan, bit rather described himself as a "flexitarian," which means that he eats a mostly plant-based diet but does occasionally eat meat.

Published on: November 2, 2015

Fred Thompson - the former minority counsel for the Senate Watergate committee turned character actor turned Republican US Senator turned star of "Law & Order" turned GOP presidential candidate turned TV pitchman for a reverse mortgage company - has passed away at 73, after a recurrence of lymphoma.

Published on: November 2, 2015

...will return.

Published on: November 2, 2015

The 2015 World Series came to an end early this morning in convincing fashion, as the Kansas City Royals completed a four-game-to-one defeat of the New York Mets in the best-of-seven series. The Mets won on Friday night, 9-3, but the Royals won on Saturday 5-3 and again this morning, in a 12-inning game, 7-2 ... showing a relentless force of personality and an ability to "keep the line moving," getting hits, moving runners, and seemingly rarely striking out. It was extraordinary that in every one of the games, the Mets held a lead ... but in only one were they able to close the deal.

I'm a Mets fan, but I really admire the way the Royals play the game, which makes Baseball enormously exciting and entertaining ... I send out my congratulations to them, and their fans (a number of whom I heard from via email in the early hours of the morning). As for the Mets ... wait 'til next year. Let's go, Mets!




In Week Eight of the National Football League...

Lions 10
Chiefs 45

Chargers 26
Ravens 29

Cardinals 34
Browns 20

Vikings 23
Bears 20

Bengals 16
Steelers 10

Titans 6
Texans 20

Giants 49
Saints 52

49ers 6
Rams 27

Buccaneers 23
Falcons 20

Jets 20
Raiders 34

Seahawks 13
Cowboys 12

Packers 10
Broncos 29