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    Published on: May 8, 2018

    by Michael Sansolo

    As many of you have long figured out, Kevin and I work in an unusual style. We fly around the country (and world) speaking at meetings and meeting people. We visit all kinds of places and lots of stores.

    Oh, and we have a great time doing it all. Except for one small problem: the flying can be draining as, alas, there is still no MNB corporate fleet. (Heck, we don’t even have t-shirts anymore. We do, however, have customized Yeti tumblers.)

    There’s not that much wrong with it except that the airlines seem intent on constantly providing lessons and examples in bad to failing customer service, which means we need experience those issues. Recently United did this for me again, and this time the lessons to any business are so simple and clear that I need share them.

    Because of all my flying, I have elevated status on United and on this particular flight I was bumped up to first class (sucks to be me, huh?), which is always good. As things worked out, I was the second passenger on the plane and found something stunning. All the overhead luggage compartments in the first class area were already full.

    The reason: United had three employees on the flight, which is fairly common as they need to move pilots and staff around to handle other planes. That makes sense.

    But here’s what got me. First, United hasn’t exactly been blowing people away with its customer service experience of late. (Remember the video of a passenger dragged off a plane recently? And I don’t even want to talk about that poor dog.) You’d think the airline, given the competitive nature of the business, would want to use those first class seats for frequent flyers like me to give us that extra bit of delight.

    Yes, I want pilots to be very comfortable, even if they aren’t flying the plane. I know they have challenging jobs and probably deserve some benefits. But as a customer service move, I would think the passengers would get priority for the upgraded experience because without those passengers, well, nothing happens.

    Secondly, the mere fact that staffers took all the prime luggage spaces is another sign of putting the customer last. Those overhead bins are coveted real estate; yet somehow in United’s culture the thinking is, staff first, customers last.

    I share the story because these are unforced errors that no business can make. I have traveled to countless stores with retailers who make a point of parking as far from the entrance as possible to avoid taking a good space from a paying customer eve when we are visiting a competitor’s store. That small lesson always needs to be reiterated and shared.

    Likewise, we always need to remember that customers are what make everything work. The culture must always be customer first.

    There’s a great scene in the movie The Right Stuff, where the Mercury 7 astronauts school the rocket scientists on what really makes a rocket fly. As the astronauts explain, it’s all about funding not physics: No bucks, no Buck Rogers!”

    Someone at United Airlines needs to remind their folks about what makes those planes fly isn’t fuel or the physics of flight. It’s customer dollars, loyalty and satisfaction. The same goes for every business.

    Michael Sansolo can be reached via email at . His book, “THE BIG PICTURE: Essential Business Lessons From The Movies,” co-authored with Kevin Coupe, is available on Amazon by clicking here. And, his book "Business Rules!" is available from Amazon by clicking here.
    KC's View:

    Published on: May 8, 2018

    by Kevin Coupe

    Politico reports that despite political polarization in the US, more than a year into the Trump administration a food policy rule formulated during the Obama administration is being implemented - the requirement that calorie counts be posted “at thousands of restaurants, grocery stores and movie theaters, representing a milestone change in how the food industry shares information with the American public.”

    This rule, described as “an oft-forgotten” Obamacare provision, “is being pushed over the finish line by a Trump nominee, FDA Commissioner Scott Gottlieb, who says the labeling requirement is simply about transparency.”

    “I do not see these nutrition issues as a right-versus-left issue,” Gottlieb says. “Using information as a vehicle to try to inspire competition is a conservative notion.” Gottlieb says that the obesity epidemic remains a significant public health issue, and labeling is a legitimate response: “I’m quite sure that a lot of conservatives, including myself, have turned over packages in stores to look at the calorie information and the nutrition information and appreciate that that information is there.”

    In addition, Politico writes, the FDA “is moving forward on an update to nutrition labels championed by former first lady Michelle Obama, as well as on voluntary sodium reduction targets, which is hugely controversial to some processed food interests.”

    The story notes that “the menu labeling rule, which was finalized in 2014 after repeated delays during the Obama administration, applies to chains with 20 or more locations that sell prepared foods similar to what you might get in a restaurant — a definition that applies to everything from appetizers to beer and wine listed by the glass. Businesses are supposed to post calories for each food on their menu right where a consumer will see it as they decide what to order … The rule means that everything from the jumbo buttery popcorn at the movies to the taquitos sold at 7-Eleven and Starbucks‘ mocha grandes will have to show calorie counts right on the menu. Many restaurant chains support and are already complying with the new rule, including Dunkin' Donuts, Starbucks, Panera and McDonald’s.”

    Go figure.
    KC's View:

    Published on: May 8, 2018

    The Food Marketing Institute (FMI), National Retail Federation (NRF), and Retail Industry Leaders Association RILA), buttressed by a study done by AT Kearney, have come out against the possibility, raised by the Trump administration, that the US could withdraw from the North American Free Trade Agreement (NAFTA).

    Such a withdrawal, the study says, “would cost retailers and consumers up to $16 billion a year and lead to the loss of 128,000 retail-related jobs over the next three years … The study finds that withdrawing from NAFTA would subject retail imports to $5.3 billion in annual tariffs that would that would most likely be passed along to consumers in the form of higher prices.

    “Food and beverages sold at grocery stores would see the biggest hit at $2.7 billion, followed by apparel and footwear at $501 million, electronics and appliances at $390 million, household goods at $498 million and auto parts at $240 million. The remainder would come from the “flow-through” costs of tariffs imposed on other industries that would drive up retailers’ costs for services such as transportation.”

    “This report helps illustrate how – thanks in part to our expanded trade with Mexico and Canada – U.S. grocery shoppers can wander the produce section in January and take home groceries to allow them to eat like it’s a June day,” says FMI president/CEO Leslie G. Sarasin. “Customers are accustomed to this type of access to fresh products and increasingly demand it in their efforts to make healthy choices.”

    And RILA’s president, Sandra Kennedy, adds: “This report confirms that leaving NAFTA puts American jobs, family budgets and the entire North American economy at risk. We encourage the administration to modernize and preserve NAFTA to support the millions of American jobs along the supply chain that rely upon free and fair trade.”

    CNBC is reporting that NAFTA negotiations are in a make-or-break period, “as ministers from Canada, the United States, and Mexico seek to resolve an impasse in key areas before elections in Mexico and the United States complicate the process.”
    KC's View:
    I agree with the three retailing groups, but I wouldn’t bet any serious money that we’re going to stay in NAFTA. It just doesn’t seem likely, though maybe I’ll be surprised.

    Published on: May 8, 2018

    GeekWire reports that an activist shareholder group called SumOfUs “has put forth a shareholder proposal for vote at Amazon’s annual shareholder meeting on May 30th, which calls for a separation of the CEO and Chairman roles.”

    In other words, it wants Jeff Bezos, the company’s founder, to give up the chairman’s role, arguing that “the combination of these two roles in a single person weakens a corporation’s governance, which can harm shareholder value.”

    Amazon is urging shareholders to vote against the proposal.

    The story notes that “it’s unlikely that the proposal will pass, and Bezos is often lauded as the visionary innovator who makes Amazon tick. Amazon’s stock has increased from about $275 per share five years ago to nearly $1,600 per share today, and the board cited the stock performance in recommending that shareholders reject the proposal.”
    KC's View:
    Seems to me that Bezos is doing a pretty good job at holding down both titles. I wouldn’t be messing with success … though I am sympathetic to the idea that appropriate corporate governance ought to be made a high priority.

    Published on: May 8, 2018

    Fast Company reports that Walmart plans to begin selling Harry’s razors in all of its US stores - a move that it hopes will appeal to millennials who see the disruptive shaving products company as being relevant to their lives.

    According to the story, “For Walmart, selling Harry’s - a hip, digitally native millennial razor brand - fits with a larger pattern … Walmart appears to be interested in winning over the next generation of consumers by offering products and brands that they like. It is also leveraging its status as the biggest brick-and-mortar retailer in America to allow digital brands to dramatically expand their presence across the country.”

    Harry’s co-founders, Andy Katz-Mayfield and Jeffrey Raider, tell the magazine that “the goal of this expansion is to be where Harry’s customers are and since 90% of the U.S. population lives within 10 miles of Walmart, this gives Harry’s a shot at becoming a household name.”
    KC's View:
    What really fascinates me about this is the fact that it always has struck me that companies like Gillette and Schick - which have been significantly disrupted by companies like Harry’s - have been longtime vendors to Walmart, which now feels the need to embrace their common enemy.

    Lots of moving pieces to this … and I wonder if we’ll be seeing a lot of similar developments in other categories.

    Published on: May 8, 2018

    Fox News reports that Walmart “will begin to restrict opioid prescriptions to help stem the deadly drug epidemic.” At pharmacies in both Walmart and Sam’s Club stores, the story says, they will “limit customers’ opioid prescriptions to a seven-day supply, with up to a 50 morphine milligram equivalent maximum per day.”

    According to the story, “The new rules align with the Centers for Disease Control and Prevention’s guidelines which suggest ‘three days or less will often be sufficient’ for those prescribed the painkillers, and ‘more than seven days will rarely be needed.’

    “Walmart will follow state laws for those which require opioid prescriptions to be filled for less than seven days.”
    KC's View:

    Published on: May 8, 2018

    • The Wall Street Journal reports that Amazon is engaged in an effort to learn more about its customers’ bodies, and is “inviting people to an office in New York to measure small changes in size and shape over the course of 20 weeks.”

    The participants are being rewarded with Amazon gift cards, but the company hopes to be rewarded with a better understanding of “how bodies change shape over time” that eventually can be converted into algorithms and, eventually, commercial applications.

    The story notes that “accurately predicting how a pair of jeans or a suit will fit is a Holy Grail for retail. Technology to model a human body and how clothing will look on it has a wide range of applications, from being able to prevent returns of ill-fitting garments to on-demand printing and production.

    “Startups and research teams have sprung up around the world to tackle the problem. Amazon acquired Body Labs last year, but it has been an important issue for company executives for years, according to people familiar with the matter.”
    KC's View:

    Published on: May 8, 2018

    • The USC Marshall School of Business Food Industry Management (FIM) Programs announced yesterday that it has received a million-dollar grant from Byron Allumbaugh, the former CEO/chairman of Ralphs Grocery Co. According to the announcement, “The Byron Allumbaugh Food Industry Leadership Scholarship has been established and is dedicated to educating and developing future leaders in the food industry. This full, graduate-level scholarship will be awarded each year to one outstanding FIM alumni accepted to the new online Master of Science in Food Industry Leadership.”

    • ReposiTrak, Inc., the compliance, food safety and risk management solution provider, said yesterday that all solutions previously offered under parent company Park City Group’s brand name now will be combined in a single unified platform under the ReposiTrak brand name, offering solutions that include Scan-based Trading, Automated Forecasting and Ordering, Vendor Managed Inventory, MarketPlace sourcing and B2B Commerce solutions.

    Full disclosure: ReposiTrak is a longtime and valued MNB sponsor.
    KC's View:

    Published on: May 8, 2018

    • Tanimura & Antle announced that the company’s president, Scott Grabau, has been promoted to the CEO job, following the recent passing of company co-founder and CEO Rick Antle.

    KC's View:

    Published on: May 8, 2018

    MNB took note yesterday of a Cooking Light piece that detailed what some major supermarket companies are doing to respond to the E. coli outbreak that has been traced to romaine lettuce grown in and around Yuma, Arizona.

    This prompted one MNB reader to write:

    The Cooking Light review of retail actions in response to the recent outbreak is really a testament to the great job retailers have done in this case.  When government said “Don’t eat Romaine from Yuma,” there’s little way a consumer was going to be able to make that call.  What we saw is that retailers (and restauranteurs) across the country did exactly what they should do – acting as buying agents for the consumer – and cleared shelves of product from that one region and replaced it with product from an area not in question.  Retailers protected their customers appropriately.
    Now, should every store have also posted signs saying “Our Romaine is not contaminated” or even “Our Romaine is not from Yuma?”  I submit there’s little to be gained by that – retailers acted responsibly by sourcing the correct product, without stoking greater fears about Romaine itself, or stoking fears of an entire growing region.  Americans consume millions of servings of healthy and safe Romaine a day.  And, Yuma is the nation’s salad bowl all winter, with tens of thousands of acres across a hundred mile region.  99.999% or more of lettuce grown in Yuma was not related to this outbreak.  But, unfortunately, that was the best FDA could do to identify a source.  Retailers acted responsibly in protecting public health, and in sourcing new Romaine for shoppers.

    MNB reader Gary Loehr had a thought:

    Can you imagine the farmers in the Yuma area whose crops had no e-coli issue?  They must have gotten crushed. Imagine that you work for months to get your product ready for market, then demand goes to zero in a few days time.  I would never want to be a farmer.

    Me neither, though I’d be more concerned about the long hours, manual labor, and the possibility that I might occasionally have to grab onto an udder.

    We referenced a Quartz piece yesterday about what the author saw as a fascinating trend - the propensity of powerful, wealthy white people to prefer bland food, while poorer, ethnic communities prefer food that is more heavily spiced. (In case you missed it, you can read it here.)

    MNB reader Randy Evins responded:

    I’ve sometimes wondered if I have a rogue Hispanic gene somewhere because I absolutely adore all things Mexican Food. Menudo is my favorite soup and I go to my local “mom and pop’ Mexican restaurant on Saturday’s just to get it fresh. It’s really kinda funny as the mostly Hispanic waiters give a look like “what’s this old white guy doing ordering Menudo?”…….Someday, maybe I am naive, we can quit the race analysis and just celebrate that different is cool and food choices aren’t genetic…

    But MNB reader Mary Schroeder thought something else could be at work:

    One other thing to consider, the ‘powerful’ people in the world are almost universally old.  They just can’t eat spicy foods any longer without living through an antacid commercial.

    To me, not being able to eat spicy food would be an unacceptable corollary to the aging process. Luckily, it hasn’t happened yet.

    For MNB reader Julia Ann Mataras, it isn’t about power or race:

    Simply: I like spicy food- but it doesn’t like me.  The heartburn that I get from it is just not worth eating it.

    We also posted yesterday a link to a Washington Post opinion piece by Michael Gerson in which he suggested that if you are anti-GMO, you are anti-science.

    MNB reader Jeff Weidauer responded:

    Interesting article, but he misses the point. Actually, three of them.

    While there are certainly an abundance of flat-earth type advising the world to avoid GMOs at all costs, there is another contingent (a larger one, I hope) that is more concerned about what the GMO is modified for. Insect resistant? Absolutely, bring it on. Pesticide resistant, so it can be doused in Round-Up to aid in the harvest? Pass.

    Two, a big part of the problem is the food industry itself. Instead of addressing these concerns up-front (as you’ve pointed out many times), they instead ignored it in hopes that the furor would go away. Now it’s taken on a life of its own, and the monster has broken out of its cell. If the GMA had spent as much money educating folks as they did lobbying, we might not be in this mess.

    Third, there is a general mistrust about the food industry – the folks who brought us Iron Fortified Froot Loops, part of a healthy breakfast. They have no credibility any longer to make any health claims.
    As for the CPGs he names, I can’t blame them for touting non-GMO – they are only marketing to their audience.

    Finally, I got some comments about the email we posted yesterday from the fellow who objected to my officiating as an “ordained minister” at a wedding ceremony, suggesting that it was part of the decline of the culture.

    One MNB reader wrote:

    This morning, I read your readers' views on your wedding "sermon", and I was particularly struck by the individual who lambasted you, citing a 50% divorce rate and "the religious component of marriage". While I respect everyone's beliefs and opinions, I just couldn't let this one lay...

    I got married in a small apartment outside of Phoenix. We had two witnesses and a friend of ours, recently ordained on the internet, perform the ceremony. Unconventional? Probably. Unqualified? ...define unqualified. Everyone in that apartment knew all they needed to know--that here were two people deeply in love with one another, who were willing to commit their lives to one another. There was no church or religion involved, and that was our choice. 

    Fast forward 13 1/2 years and my husband and I are stronger than ever. We have a home and a community of friends and family and have built a growing business together. We're talking about doing something "extra special" for our 15th anniversary in 2019. 

    So I can't help but feel that your reader may have been feeling quite jaded--dare I say bitter--when writing to you. I'd also go so far as to say they have no right to define anyone else's marriage--not the couple you recently wed, not mine, not the person down the street--based on lack or inclusion of religion, counseling, spiritual guidance, or who wed them. I would encourage them to do whatever they would like in their love life, and let others do the same. 

    My good wishes to your recently-wed friends and congratulations to you and Mrs. Content Guy on 35 years!

    One of the things I wrote yesterday was:

    I do not take marriage lightly. I’ve been married for 35 years, and so I have enough experience to know that a marriage taken lightly cannot possibly survive. And I have, from time to time, been accused of a certain uxoriousness.

    That said, I like to recall what the great Robert B. Parker once told the Wall Street Journal about marriage:

    “I've been married 52 years, and I like it a lot. I think it's the quintessential way to live, but not the only way. It's valuable to have a partner, regardless of gender or legal nature. It's good to have someone to love in addition to the dog.”

    MNB reader Deborah Faragher responded:

    Thanks for the vocabulary lesson today. Learned the meaning of “uxoriousness”! And I can see how that may have applied to you though I’m guessing it would be more excessive than submissive. On the subject, I’ve been married for 43 years with the ceremony having been performed by a friend of the family who happened to be a judge. The ceremony was personal, as was the one you performed, and we were surrounded by family and close friends. So chalk up one for the “non-traditional” start.
    KC's View: