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    Published on: May 29, 2018

    by Kevin Coupe

    A commonly used metaphor about Amazon is how it is playing chess while everybody else is playing checkers.

    It may also be true that Amazon is playing Galactic Civilizations, while everybody else is playing pong.

    Geekwire has an interview with Amazon founder/CEO Jeff Bezos, conducted at the International Space Development Conference, in which he says that “his Blue Origin space venture will work with NASA as well as the European Space Agency to create a settlement on the moon. And even if Blue Origin can’t strike public-private partnerships, Bezos will do what needs to be done to make it so.”

    In the long run, the story says, “Bezos’ vision is to smooth the way for millions of people working in space … The way Bezos sees it, moving heavy industry into solar-powered space outposts is the only way to ensure that our planet can cope with the rising demand for energy, and the stress that growing populations will put on Earth’s environment.”

    You can read all about it here.

    The thing is, if people live in outer space, they’re going to have to shop. I’m betting that Bezos has some ideas about what an Amazon warehouse on the moon might look like … which may be at least part of the reason he is willing to spend $1 billion a year - generated by the sale of Amazon stock - to make it so.

    But I don’t think this is all about extra terrestrial commerce. I also think it has to do with vision, and being willing to take on big challenges with audacity and commitment.

    And that’s the Eye-Opener.
    KC's View:

    Published on: May 29, 2018

    Fox News reports that Publix Super Markets has announced that it has “decided … to suspend corporate-funded political contributions as we reevaluate our giving processes,” a move that comes in the wake of “die-in” protests in two of its stores related to the company’s support of Florida gubernatorial candidate Adam Putnam.

    The reason: Putnam is a supporter of the National Rifle Association (NRA), and has described himself as a “proud NRA sellout.” Publix’ support for Putnam has been challenged by students from Marjory Stoneman Douglas High School in Parkland, Florida, where a shooting earlier this year claimed the lives of 14 students and three staff members; a shooting just last week at a high school in Santa Fe, Texas, resulting in 10 deaths, only exacerbated the situation.

    According to Fox News, “The supermarket chain has been criticized by the students for supporting Putnam, Florida’s Agriculture Commissioner. Records showed that Publix, its top executives and board members, and their family members have donated more than $750,000 altogether to Putnam or to his political committee. A former top Publix executive who is related to the chairman of Putnam's committee has donated an additional $65,000. The activists have called for a boycott of the supermarket.”

    Last Friday, “The students from Marjory Stoneman Douglas High School shouted ‘USA, not NRA!’ and caused brief delays at the checkout as customers navigated carts around them on the floor. Pro-NRA counter-protesters also showed up at one store, and two men almost came to blows before police intervened.”

    Much of the blowback against the students seems to focus on David Hogg, 18, a senior who has become the public face of many of the student survivors. Hogg helped organize the protests, though he did tell Fox News that “the media has falsely portrayed him as someone who wants to seize guns. He said he supports the Second Amendment but wants tighter regulations, universal background checks and training for people who own AR-15s and similar semi-automatic rifles.” The Orlando Sentinel reports that at one of the protests, “Hogg asked for a big round of applause for the supermarket chain for allowing the demonstrations.”

    The Publix statement about its change in policy said: “We would never knowingly disappoint our customers or the communities we serve. As a result, we decided earlier this week to suspend corporate-funded political contributions as we reevaluate our giving processes.’’
    KC's View:
    I sort of feel sorry for Publix, which isn’t really used to being at the center of cultural controversies. (It is interesting that this morning, when I went on its website to look for the press release about its change in policy when it comes to political gifts, it was nowhere to be found. Lots of good news press releases, but not this one.)

    I think the company did the right thing by allowing the protests, and by deciding to reconsider its political giving policy. The issue of gun violence is one that sharply divides society, and businesses have to be careful, I think, about casting their lots with candidates and policies that are seen by either side as being extreme. (They also have to understand that there are some issues that are seen as so important that they can become the core reason for a citizen to vote one way or another, and maybe even shop one place or another.) That’s not to say they can’t, or shouldn’t, take positions or make donations … but you have to know that there can be repercussions. Communities, more than ever, are not homogeneous, and should not be treated as such.

    I might especially steer clear of any candidate that pronounces himself or herself as being a “sellout” to any organization or cause - I don’t care if it is the NRA or the ACLU. I sort of prefer my elected officials not to take knee-jerk positions, to be willing to think about issues in a nuanced sort of way, and maybe even look for places of common ground where compromise can be forged. But maybe that’s just me.

    Published on: May 29, 2018

    Food & Wine reports that Amazon-owned Whole Foods “is delaying a policy that would have required its suppliers to label genetically modified organism (GMO)-containing products on its store shelves by September of this year,” a policy that was announced five years ago.

    According to the story, “Whole Foods cites upcoming U. S. Department of Agriculture standards as the reason behind the change and has not yet provided a new deadline.” The retailer told suppliers in a letter that it “wishes to avoid any undue additional costs or challenges to food manufacturers based on the USDA's guidelines.”

    In a statement, Whole Foods says that “as the USDA finalizes the Bioengineered Food Disclosure Standard and the food industry assesses the impact, we have decided to pause on our September 1, 2018 deadline for our GMO Labeling Policy. We remain committed to providing our customers with the level of transparency they want and expect from us and will continue to require suppliers to obtain third-party verification for non-GMO claims.”
    KC's View:
    Interesting. I wonder if there will be some who will argue that this represents less of a commitment to the GMO issue on Whole Foods’ part since it was acquired by Amazon. At first glance, it may be argued that Whole Foods is following rather than leading.

    I think it may actually be more interesting that Amazon/Whole Foods is casting this as a pro-vendor position, especially since there are considerable tensions between the retailer and many of its suppliers these days. This may be something of an olive branch.

    Published on: May 29, 2018

    Today is the day that Starbucks will close down 8,000 of its owned-and-operated US stores to engage in racial bias training for the majority pf its employees, a response to the incident in Philadelphia last month when a white store manager called the police on two black men waiting for a friend to arrive before ordering.

    The New Yorker has a terrific think-piece about the subject that you can read here. An excerpt:

    “Implicit bias disassociates racism from overt villainy and, as a consequence, engenders less defensiveness in the dialogue …The crucial aspect of the Starbucks story isn’t whether a company can, in a single training session, diminish bias among its employees. It’s the implied acknowledgment that such attitudes are so pervasive in America that a company has to shoulder the responsibility of mitigating them in its workforce.”

    At the same time, Business Insider has a story about how “a California coffee chain called Red Bay has curbed racial bias toward customers by hiring people of color in management positions and creating a culture of discussing racial issues, according to founder Keba Konte.” Red Bay Coffee, the story says, “has a staff composed entirely of women, people of color, and the formerly incarcerated.”

    Konte tells Business Insider, “The number-one question I get is, 'Specialty coffee is such a crowded field. What makes you different?' There's a competitive advantage to opening up opportunities for folks who have a higher barrier of entry to jobs, like the formerly incarcerated.”

    And, he adds: "Once you delve into this industry, you'll notice the coffee is only grown in countries, often near the Equator, by black and brown people that make the lowest pay. Once it's exported from the hard labor, in terms of the roasting, the branding, the technical education, the designing of the equipment — people of color are underrepresented.” Red Bay’s goal is to change that construct.

    Konte acknowledges that as his company grows, maintaining this commitment may get harder: “I think that is the bare minimum of what any company should do. Once you get larger, this is more difficult. But [American] companies should reflect the globe or at least the US. And when I say 'reflect,' I don't mean just on the front lines — like the entry-level baristas — but also the executive team and middle management. That's the part that has to be a better reflection of America.”
    KC's View:
    This is all a good start - nothing more, and nothing less. This has to be just the beginning of an ongoing effort by Starbucks that also will be modeled by other companies and organizations. I do think the Red Bay example is instructive, because it points to the importance of diversity at every level of an organization.

    Published on: May 29, 2018

    Last week, MNB reported on how a Portland, Oregon, couple had to unplug all their Amazon-branded, Alexa-powered devices after they learned that not only where their private conversations being recorded, but then were being emailed as audio files to someone on their contact list.

    Now, Amazon has provided an explanation of the incident to Digital Trends:

    “Echo woke up due to a word in the background conversation sounding like ‘Alexa.’ Then, the subsequent conversation was heard as a ‘send message’ request. At which point, Alexa said out loud, ‘To whom?’ At which point, the background conversation was interpreted as a name in the customer’s contact list. Alexa then asked out loud, ‘[contact name], right?’ Alexa then interpreted background conversation as ‘right.’ As unlikely as this string of events is, we are evaluating options to make this case even less likely.”
    KC's View:
    I haven’t turned off my Alexa-powered system yet, but I must admit to being not entirely satisfied by the Amazon explanation … perhaps because it seems more like an excuse than anything else.

    I think Amazon has to do better - perhaps with some sort of failsafe system that prevents these situations from occurring. But it has to start with better communications, and Amazon has a way to go in this area.

    Published on: May 29, 2018

    The New York Post has a story about how gourmet grocer Dean & DeLuca, which had announced expansion plans, instead is “drastically downsizing its chain nationwide, quietly closing stores, stiffing landlords and fending off lawsuits from angry suppliers who say they haven’t been paid for their pricey pastries.”

    Dean & DeLuca is owned these days by by Sorapoj Techakraisri, described as “a 40-year-old Thai property tycoon” who is “luxury-obsessed,” and who had announced plans to expand to 100 stores in the US and 100 more around the world; the hard times have meant that the chain has shrunk from 42 stores to 18, “including four in Manhattan and nine licensed stores overseas.”

    An excerpt from the Post story:

    “Costly distractions have included a six-year sponsorship deal with the PGA Tour’s Fort Worth, Texas, Invitational. Dean & DeLuca recently backed out of it, only two years into the contract. Last year, the grocer signed a six-year deal to be a sponsor at the US Open, including signage at Arthur Ashe Stadium. The company says it is ‘100 percent committed’ to that contract.

    “Nevertheless, Dean & DeLuca last fall hired restructuring firm Emerald Capital Advisors. In addition to pulling out of the PGA deal, the company has since closed four stores in Charlotte, North Caroline, and Wichita, Kansas, where the storied grocer is headquartered now.

    “Last fall, Dean & DeLuca also withdrew from three leases in Manhattan before the stores opened, The Post reported exclusively. Those included one near Grand Central Terminal where employees would be referred to as ‘cast members,’ delivering food with a theatrical flourish.
    Plans for a swanky store in London got canceled as Dean & DeLuca was forced into a settlement with a landlord, sources said. Last month, a landlord in Charlotte kicked Dean & DeLuca out for not paying three months worth of rent, which amounted to $96,000. Other store closures occurred under the radar.”

    Dean & DeLuca president Laura Lendrum tells the Post that the company is “renewing our focus on our New York City and Napa Valley flagship stores as well as our e-commerce business.”
    KC's View:
    I have to be honest here. I forgot Dean & DeLuca was even in business, that’s how irrelevant it seems to have become to the ongoing culinary/gastronomic conversation. I have to wonder if they focused so much on building the image that they forgot to build the business and focus on being relevant.

    Published on: May 29, 2018

    The Associated Press reports that the Batali & Bastianich Hospitality Group (B&B) is closing down three Mario Batali restaurants in Las Vegas, a move that comes in the wake of new sexual misconduct allegations against the celebrity chef/author/retailer.

    Carnevino Italian Steakhouse, B&B Ristorante and Otto Enoteca e Pizzeria at The Venetian and Palazzo resorts all are being shuttered because “Las Vegas Sands Corp., which owns both properties, was ending the business relationship.”
    KC's View:
    It was less than two years ago that Batali was on stage at the Food Marketing Institute (FMI) annual convention, participating in a conversation about food culture with FMI’s CEO, Leslie Sarasin. And now, he’s a pariah, his products being delisted by a number of retailers and his ownership of B&B being terminated. It remains to be seen whether he will end doing the kind of perp walk that Harvey Weinstein did last week - which I have to admit was enormously satisfying to watch, though only, I hope, a prelude to a conviction in a court of law that ends up with his sorry ass being sent to prison. (Apologies for the language here, but I find this guy to be disgusting.)

    I just hope that every executive in a leadership position is watching all this and taking action within his or her own organization to deal with sexual harassment and sexual predators.

    I’ve said it before and I’ll say it again: If you are any sort of leader in any sort of company, it is time for you to step up and say to everyone in your organization, there is no place here for this crap. If you are a victim, here’s my email address and phone number - please get in touch with me now and help me rid this organization of the creeps who are playing this game. I am on your side. And, if you are a predator, get ready to pack your bags ands clean out your office, because there is no room for you here … and I don’t care if you are the biggest superstar in the company. You’re going to be gone, and if we can do it, we’re going to make sure you are going to be prosecuted.

    Published on: May 29, 2018

    • Pret A Manger, the 530-unit UK-based sandwich-salad-coffee chain, is being sold to JAB Holdings, the German investment group that also owns Panera, Krispy Kreme and Keurig. Terms of the deal were not disclosed, though sources tell various news organizations that the price is in the $2 billion range.

    Pret A Manger, which had $1.2 billion in total sales last year, has been owned for the last decade by private equity firm Bridgepoint.

    Clive Schlee, Pret’s CEO, said that each of the company’s 12,000 employees will receive a check for more than $1300 when the deal is finalized.

    • The Associated Press reports that “the European Union has proposed banning plastic products like cotton buds, straws, stirs and balloon sticks when alternatives are easily available in an attempt to reduce litter spoiling beaches and ocean beds. The European Commission said its proposal would seek to cut marine litter in half for the ten most prominent items and avoid environmental damage estimated at over $250 billion over the next dozen years.”

    • The New York Times reports that PepsiCo is acquiring Bare Foods, which specializes in baked fruit and vegetable snacks. Terms of the deal were not disclosed.

    According to the Times, “the purchase of a company that makes products like salt-and-vinegar beet chips and Granny Smith apple chips is its latest effort to diversify its food and beverage portfolio and move toward the more natural, less-processed foods that are now in favor by an increasingly health-conscious public.”
    KC's View:

    Published on: May 29, 2018

    • Publix Super Markets announced the hiring of Dain Rusk, most recently Group Vice President of Pharmacy Operations at Albertsons, as its new Vice President of Pharmacy.
    KC's View:

    Published on: May 29, 2018

    We had a story the other day about the shortage of truck drivers, which prompted one MNB reader to write:

    From what I see in the retail end this is a real problem.  A new driver used to wait years to get a full time job at any of our regional supermarkets (New England).  The old time drivers have mostly retired; Since most of the driving is overnight, there are fewer applicants.
    Now they are being hired right out of driving school, plenty of overtime, six figure pay checks are not uncommon.

    Hence no money left for the front line, i.e. stores, especially check-out, and it's just getting worse.

    Regarding the hacking problem affecting Amazon’s Alexa-powered systems, MNB reader Ron Rash wrote:

    I utilize both Alexa and the Ring security systems.

    I turned Alexa off, and found I do not miss it at all.

    On my Ring settings I denied all access on my settings, but I still receive email messages telling me that my battery is low, etc. Not a biggie, but clearly one can not deny all access.

    I believe Amazon has very little knowledge of how much their systems are, or can be, hacked.

    On Friday, I posted a link to blog written my friend Karen Caplan, CEO of Frieda’s, the specialty produce company, in which she wrote about 9-year-old Madison Rude, who affected a change at her local bookstore:

    “Madison told the story of when she and her dad, Steven, were at Barnes & Noble bookstore a few months ago. Passing by the magazine rack, she noticed more than 20 magazines promoting guns, photos of guns, guns sales, etc. She asked her dad why Barnes & Noble was selling gun-oriented magazines and displaying them at eye level where young children could see and pick them up. He didn’t have an answer.

    “So they discussed it, and when they got home, Madison wrote a letter to the CEO of Barnes & Noble asking him to move the magazines. And then she waited. She never got a response. She actually called and emailed his office multiple times over the next few weeks, but never heard anything back.

    “But when they went back to that very same Barnes & Noble several weeks later, Madison noticed that almost all of the gun-oriented magazines had been moved to another display area out of the sight of young children.”

    Karen concluded: “These young people will speak up and fearlessly confront the most difficult issue with courage and conviction.

    “Watch out world. They’re coming to change everything.”

    One MNB reader responded:

    From your mouth to God’s ears, sir.

    Agreed. It won’t be painless, and they won’t always get things right. But it is going to happen, and you better start swimming or you’ll sink like a stone.
    KC's View: