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    Published on: February 18, 2016

    This commentary is available as both text and video; enjoy both or either ... they are similar, but not exactly the same. To see past FaceTime commentaries, go to the MNB Channel on YouTube.

    Hi, Kevin Coupe here, and this is FaceTime with the Content Guy.

    One of the things we talk about a lot here on MNB is the subject of generational differences, and why it is important not to allow oneself to engage in epistemic closure, but rather be open to the reality that the way we see things is not always the way things are. We live in the complex and diverse world, and to assume that our reality is everybody's reality is to make a serious miscalculation. Especially if you are a leader, but not only.

    That said, I think it is important to have standards. There are places where one has to draw the line. There are times when one has to say, this is a bridge too far.

    You get my point?

    For example, I'm not a big fan of using things like "LOL" and "IMHO" and "BTW." I'll use them occasionally, but not often ... it seems like cheating to me, especially in emails. (I will use "WTF," but thats because it would be ruder not to use the letters.) Speaking of emails, I'm a big fan of using proper grammar and spelling ... I think it shows respect for the person to whom I am writing.

    At the risk of sounding like one of those old guys who keeps telling people to get off of his lawn, I have identified another such situation. Let explain by using two sentences.

    This is a sentence. This is a second sentence.

    And again:

    This is a sentence. This is a second sentence.

    Do you see the difference? In the first one, I put two spaces between the period and the first letter of the second sentence, and in the second case, I used only one space.

    I'm a two-space guy. And it really, really irritates me when I see only one space between sentences.

    I'm not sure why. Maybe it goes back to the religious folks who would smack me around when I got out of line or didn't do things in the way that they thought was correct. Or maybe it was one of the editors that I've had along the way. It could've been a typing teacher ... though if so, it'd be the only thing I learned, since I've failed three different typing classes in my life. (I'm a two-finger typist. Always have been. It is that same lack of dexterity that frustrated me when I tried to learn to play the guitar.)

    I just think that when starting a second sentence, we all ought to use two spaces. It adds separation. It adds clarity. It is like taking that extra moment to think before speaking. (Which, to be fair, I've never been very good at.)

    And so, I'm taking this on as a cause. A small one, to be sure, but my own.

    I recognize that some would suggest that this, indeed, is epistemic closure ... or worse, old-guy thinking. And I must concede that if this is true, Michael Sansolo only uses one space between sentences when he writes his columns ... which he would no doubt suggest makes him a more youthful thinker than I.

    No matter. I'm hanging in. Two spaces is better than one. The campaign to bring the rest of the world into line with my thinking begins right here, right now.

    That's what is on my mind this Thursday morning. As always, I want to hear what is on your mind. (But when you write, two spaces between sentences would be appreciated...)

    KC's View:

    Published on: February 18, 2016

    by Kevin Coupe

    As I've often said here, I have a good life. I get to travel, meet really interesting people, and eat good food and drink terrific beer and wine.

    Some of it is planned. Like when I visit cities with Major League Baseball teams.

    Some of it is lucky. Like the day earlier this week when I went into a Schnucks store in Des Peres, Missouri.

    Now, Schnucks operates some stores that are as good as any of those in the US food retail business. And this one was best in class - I especially loved the beautifully merchandised and extensive wine selection.

    But what really grabbed my attention was, just inside the front door, a circular grill that was packed with people ordering dinner, drinking beer and wine, and turning the department into a kind of community center. It was clear from listening to the conversation that congregating at Schnucks is a frequent occurrence ... which is the best kind of news for a retailer.

    Here's the great thing. The food was outstanding.

    Brandon was the cook working the counter, and he made a Creole BBQ Shrimp Pasta that was so good and spicy that it brought tears to my eyes. Literally. And I topped it off with a glass of 2013 Martin Codax Albarino, which is one of my go-to wines, and perfect with this dish.

    And the Eye-Opening thing to me was that this was not the lowest-common denominator food that often is served in US supermarkets. It was delicious ... and if I lived in the St. Louis market, I'd definitely go back for more. That's the best a supermarket can do.

    Kudos to Schnucks. Kudos to Brandon. And next time you're in the area, go check out the Des Peres Schnucks. Ask for Brandon. Order the Creole BBQ Shrimp Pasta. Thank me later.

    KC's View:

    Published on: February 18, 2016

    The Wall Street Journal reports that Walmart "is spending heavily to get customers back into its stores," going beyond previously announced decisions to increase employee salaries, lower prices, decrease out-of-stocks and build its online presence.

    For example, the company "plans to expand a service that allows shoppers to buy groceries online and have the order brought to their car in a store parking lot, and offer more exclusive products like a recent best seller, a line of Pioneer Woman brand cookware exclusive to Wal-Mart."

    And, Walmart is in the process of hiring "hundreds of fresh operations managers" who will be assigned to approximately 10 stores apiece, "training store workers how to best present and take care of fresh produce." And, Walmart is opening a "food sensory lab" later this year as away of creating and supporting a food culture within the company.

    Reuters reports that "the move to install a new layer of managers comes as Wal-Mart faces growing competition for grocery shoppers from national and regional supermarket chains like Florida-based Publix Super Markets Inc. and Texas-based H-E-B."

    Reuters also reports that Walmart plans to start offering offering fixed shifts and other planned scheduling changes "aimed at retaining and motivating its rank-and-file workers ... The changes are designed to offer employees greater control over their schedules, addressing an issue that has been a focus of labor activists who say retailers give little notice on shifts and generally exert too much control over worker hours."

    The degree to which Walmart's efforts have been successful to this point will become evident later today when the retailer announces its most recent earnings figures.
    KC's View:
    We're all going to have a better sense of this later today when Walmart releases its recent sales and profit numbers.

    In terms of the future initiatives, I'm not surprised by expanding its click-and-collect service ... in fact, I've been predicting it for a long time. (I'd probably be even more aggressive about the expansion than Walmart plans to be.) I do think that while adding layers of management isn't usually a great idea, the notion of fresh operations managers probably is a good one ... there's no question that Walmart has to get stronger in this segment.

    I also think that creating more fixed schedules makes sense ... Walmart depends on the engagement of its employees, and allowing people to plan their schedules to the degree that most people do - and expect - is quite simply the right thing to do.

    Published on: February 18, 2016

    The San Francisco Chronicle reports that Google will launch "same-day grocery service in San Francisco and Los Angeles as trial markets for their Google Express service, which already provides delivery of some household essentials."

    In diving into the grocery business, Google will be partnering with Costco, Smart & Final and Whole Foods, giving them an alternative to compete more effectively with Amazon Prime Fresh, as well as with companies such as Instacart; ironically, Instacart already delivers Costco and Whole Foods products.

    Google Express will require a $10 monthly membership fee, plus a $3 per-order fee and a $35 minimum order.
    KC's View:
    This is inevitable ... once Google invested in a shopping business, it only made sense for it to expand aggressively into groceries. I'm not sure if they'll be able to lure me away from Amazon, but that'll depend on how the service is marketed; the fees strike me as a little prohibitive, but time will tell.

    I'm mostly fascinated by the decision by Whole Foods, which has been a big Instacart supporter, to also engage with Google on this. I wonder if this points to longer-term problems for Instacart, a service with which I've never been enamored.

    And finally, this points to the necessity for every business to figure the e-commerce segment out. There's no real choice anymore.

    Published on: February 18, 2016

    The New York Post reports that Fairway Market could default on its debt as soon as April, the result of being bloated with debt. The situation has caused Moody’s to downgrade "the grocer on further into junk territory — its second downgrade since September."

    According to the story, "The 15-store supermarket chain has accrued $267 million in debt — and is struggling with declining sales. Revenue declined by 7 percent in the three months ended Dec. 27, to $191.6 million, from a year-earlier period ... Potential suitors have begun to circle the company, according to a source familiar with the situation, but some have been turned off by the high rent on a number of Fairway’s leases."

    Fairway has conceded the problems, "saying that its competitors are 'more experienced at operating multiple store locations' and that it lacks the capital to invest in the kind of marketing it needs to get more customers in the door."
    KC's View:
    I think this thing is going to be sold to someone, and will end up being yet another example of how financial interests managed to kill off a once prosperous and productive retail company.

    Published on: February 18, 2016

    Reuters reports that Amazon "is quietly inviting drivers for its new 'on-demand' delivery service to handle its standard packages, as the online retailer known for low prices and razor-thin profit margins looks to speed up delivery times and tamp down its growing multi-billion dollar logistics bill." It is, the story says, just the "latest sign that the world's biggest e-commerce company wants to control more of its own deliveries."

    According to Reuters, "The expansion appears to be limited so far to select drivers in the Dallas-Fort Worth area ... In order to qualify, Amazon said drivers must have a four-door car that is a 'mid-sized sedan or larger' and that drivers would be paid an introductory rate of $18 per hour. They can schedule shifts between 8 a.m. and 4 p.m seven days a week ... They have less control over their schedule but can receive tips, which is not the case for delivering regular Amazon packages. As contractors, drivers must pay for their own insurance and gas."

    In other Amazon-related news...

    Tech Crunch reports that Amazon "will acquire startup Emvantage for an undisclosed amount to develop its Indian e-commerce site’s payment platform ... Emvantage’s platform includes a payment gateway for online transactions made using credit or debit cards, mobile payment tools that integrate into merchant apps, and a prepaid wallet."
    KC's View:
    I've never been particularly enthused about this initiative. I'm no fan of UPS or FedEx, but the idea of drivers of private cars delivering items I've bought on Amazon to my house is particularly unappealing. All this needs is a couple of bad actors to turn this into lots of negative headlines.

    Published on: February 18, 2016

    The Wall Street Journal reports that "an upsurge of new e-commerce firms are jostling to capitalize on the growing numbers of middle class Muslims who are now spending more than $100 billion a year shopping online.

    Take, for example, Malaysia-based Zilzar, which launched in late 2014 and "believes it can attract more Muslims to its site as it works with various agencies to select and have only those halal certified merchants and products listed on their online store. To non-Muslims it isn’t necessarily clear what’s halal and what’s not. Typically it’s known that pork and alcohol consumption are prohibited in Islam. But it can also include cosmetics and vitamin supplements, which can contain both animal gelatin and alcohol ... The idea behind the e-halal sites is that they negotiate these difficult inspections by hiring halal experts and setting up compliance committees to filter and make sure all the vendors and products listed on their websites meet Islamic standards."
    KC's View:
    One of the great advantages that e-commerce has is the ability to use algorithms to segment products and categories any way they want. This is just another outgrowth of this ability.

    Pay attention.

    Published on: February 18, 2016

    Business Insider reports that "parents are raving about ClickList, Kroger's new online-grocery ordering service ... Many customers are praising the service, with parents in particular calling it a game changer. Articles and reviews of ClickList are popping up all over parenting and mom blogs."

    The story notes that Kroger's ClickList service "is or will soon be available in cities including Nashville, Tennessee, Atlanta, Georgia, Louisville, Kentucky, Cincinnati, Ohio, and Murfreesburo, Tennessee, as well as in central Virginia and central Indiana."
    KC's View:

    Published on: February 18, 2016

    • The Chicago Sun Times reports that Walmart is being sued "in a class-action litigation effort that could create new LGBT workplace protections with the legal precedent it sets."

    The suit is being filed on behalf of 1,200 current and former employees who "have had their same-sex spouses insurance coverage denied, which was company policy until 2014." The issue is whether discrimination against same-sex couples is the same as gender-based discrimination, which is against the law.

    According to the story, "The Equal Employment Opportunity Commission thinks so. While the federal agency neither writes nor rules on law, it has argued that sexual orientation and gender identity are included as forms of sex discrimination under Title VII.

    "The Obama administration would agree as well. The Justice Department has even opened itself up to a federal lawsuit by agreeing that Title VII can and should encompass LGBT protections."

    There seem to be two possibilities here. One is that Walmart settles the suit to avoid a drawn-out legal battle that will generate negative headlines. The other is that the case works its way through the legal system and eventually ends up in the Supreme Court.


    Reuters reports that Walmart could shut down its operations in Brazil and other Latin American markets where business is not what it once was.

    "Brazil, a once-red-hot destination for foreign retailers and other companies ... has turned stone cold. And the lackluster performance in Latin America's largest economy shows how tactics that helped Wal-Mart build success in the U.S. sometimes get badly lost in translation overseas ... Brazil in particular has been dogged by poor locations, inefficient operations, labor troubles and uncompetitive prices -- with some of the problems baked in during an aggressive, decade-long growth surge, according to interviews with a dozen former and current Wal-Mart executives, as well as analysts, shoppers and store employees."

    However, senior executives in the past have said the company has no plans of packing up and going home.

    You can read more about Walmart's Brazilian issues here.
    KC's View:

    Published on: February 18, 2016

    Reuters reports that bankrupt Haggen has "won court approval to settle a lawsuit against Albertsons for $5.75 million after seeking more than $1 billion in damages from the supermarket powerhouse ... The suit had alleged Albertsons undermined the $300 million deal last year in which Haggen acquired 146 stores from its much larger rival to reach new markets far from its home in the Pacific Northwest."
    KC's View:

    Published on: February 18, 2016

    ...will return.
    KC's View: