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    Published on: October 24, 2019

    This week, something a little different … MNB Content Guy visits with Jimmy Sbarra, who with his wife Shannon has built a Bend, Oregon, business called Volcano Veggies - which uses aquaponics to create a uniquely sustainable business model. While developed on a small scale, Volcano Veggies offers a lesson in what's possible, and why it is critically important for retailers to embrace such opportunities.

    You can learn more about Volcano Veggies here.

    As always, this and past FaceTime commentaries can be found on the MNB Channel on YouTube.

    KC's View:

    Published on: October 24, 2019

    by Kevin Coupe

    Time has a piece about Google's new computer that has achieved what is called "quantum supremacy," which "really just an exceedingly fancy way of saying a super-duper kind of computer, one that not only operates on quantum principles, but masters them so deftly that it actually outperforms a traditional computer."

    "Outperforms," apparently, is the understatement of the year.

    "The Google computer, known as Sycamore, made the headlines," Time writes, "by doing nothing terribly important on its own: analyzing a random number generator and confirming that it was indeed working randomly."

    Which doesn't sound like such a big deal … except that Sycamore did it in just 200 seconds, and "even the most powerful traditional supercomputer would require a somewhat pokier 10,000 years - give or take a century - to achieve the same feat … Google does not pretend that Sycamore is remotely ready for prime time. There is far more refinement to come before it has truly practical applications - though even this first random-number result can have value in cryptography."

    I know this has very little to do with retail and business, at least as we now think of those things. But this stuff is so far beyond my understanding that I can hardly grasp any of it … and so, I figured it was the very definition of an Eye-Opener.
    KC's View:

    Published on: October 24, 2019

    The Wall Street Journal reports that Amazon apparently is continuing to do business with factories in Asian countries with which, for a variety of reasons, other retailers have decided they can no longer do business.

    While "Amazon has become a major player in apparel, a force with which other retailers must compete in a market where customers often seek the lowest price," the Journal writes, it may be paying less attention to some ethical issues that have been addressed by these competitors.

    For example, "After a 2013 factory collapse killed more than 1,100 people in Bangladesh, most of the biggest U.S. apparel retailers joined safety-monitoring groups that required them to stop selling clothing from factories that violated certain safety standards. Inc. didn’t join." And, "The Journal found other apparel on Amazon made in Bangladeshi factories whose owners have refused to fix safety problems identified by two safety-monitoring groups, such as crumbling buildings, broken alarms, and missing sprinklers and fire barriers. U.S. retailers such as Walmart Inc., Target Corp. , Costco Wholesale Corp. and Gap Inc. have agreed to honor bans imposed by those two groups, to have their supply chains inspected and to disclose to the groups the factories that supply them.

    "The Journal found clothing including pants, sweaters, clerical robes, fishnet body stockings and other items, that originate from blacklisted factories and end up on Amazon."

    The Journal asked Amazon about its practices, and the company responded by removing some of the identified items. The company said that none of its private label items are made in the offending factories, a conclusion with which the Journal seems to concur.

    The clothing from these factories seem to be largely being sold by third party vendors on Amazon's marketplace, and the "spokesman said Amazon doesn’t inspect factories making clothing that it buys from wholesalers or that comes from third-party sellers. Instead, it expects those wholesalers and sellers to adhere to the same safety standards.

    "Amazon’s agreement with third-party sellers doesn’t explicitly say they must meet those standards."
    KC's View:
    I'll say it again - Amazon doesn't really get to make these kinds of excuses. I firmly believe that it has the ultimate responsibility for not selling products that are made in places that have credibly been accused of these kinds of safety violations. Maybe it cannot enforce this kind of oversight overnight, but it has to be do a better of job of creating trackability, traceability and transparency throughout its systems.

    Published on: October 24, 2019

    REI Co-op has announced that once again this year it will observe Black Friday - the day after Thanksgiving, which traditionally has served as the start of the end-of-year holiday shopping season - in its own unique way. It will close its stores and "abstain from processing online orders," and encourage its employees to take a hike and/or "head out into their communities to pick up litter and plastic bottles."

    This is the fifth year that REI has taken this approach.

    The story points out that REI currently has 18 million members, and last year "rang up $2.78 billion in sales, up 6% from 2017" online and in its 160 stores.

    "Over the next five years," Fortune writes, "REI might add another 100 locations, Artz says, but they won't all be typical REI stores, measuring in at 20,000-square-feet per pop. For example, a smaller REI store open since September in North Conway, N.H. caters to people heading into the White Mountains. The store's biggest focus: ski equipment rentals." REI also "is tapping into customers' growing concerns about sustainability by beefing up two relatively new areas of its business: gear rental and the online resale of secondhand items between Co-op members."
    KC's View:
    REI's Black Friday tradition strikes me as a perfect example of shared values made tangible. Not only does it effectively reflect the company's culture, but it also reflects its customers' beliefs and positions. And the same thing goes for its product recycling programs. Perfect synergy.

    Published on: October 24, 2019

    Yahoo Finance reports that Walmart "will kick off its holiday shopping season before Halloween — its earliest ever — in order to make up for a condensed season.
    With Thanksgiving falling on Nov. 28 this year, retailers will have six fewer shopping days from the time families gather for turkey and stuffing — and when they open presents on Christmas Day … Walmart plans to launch its Early Deals Drop online at midnight Eastern on Friday, October 25, which includes discounts on items like a VIZIO 55-inch “smart” TV for $398, or a discount of $100 or $25 off the BouncePro 7-Foot My First Trampoline, for a new price of $99."

    The early holiday shopping season launch is largely an online phenomenon; Walmart says that stores will have Halloween decor until November 1, at which point everything will change.
    KC's View:
    Stories like these are one of the reasons that a lot of people like the REI approach, I think. It is a relief from the crushingly crass commercialism of the holidays.

    In "Silent Night," the Christmas-themed Spenser novel started by Robert B. Parker and finished after his death by Helen Brann - as noted here before, you can tell clearly where one ends and the other begins - expresses sentiment about the holidays that resonate for me: “I liked the myth elements of Christmas. The way in which its origins reach back far beyond Jesus, to the rituals of people unknown to us. The celebration of the winter solstice. The coming of light in the darkest time. And with it the promise of spring to come and beginning again. I liked it better than Rudolph the Red-Nosed Reindeer.”

    Or holiday sales that begin before Halloween.

    In the words of my ancestors: Oy.

    Published on: October 24, 2019

    In a piece published in the current edition of The New Yorker, Howard Fishman considers the critical moral choices one faces when shopping for a book:

    "While browsing a table of new books at the Strand and spotting one that I wanted to buy, I experienced a common, modern-day itch: Do I purchase the book there and then from the Strand without pause, thus supporting bookstores, publishers, authors, and everything that I believe in? Or do I drive myself crazy by pulling out my phone and checking how much money I would save were I to buy the book online? The Strand was selling the book at a modest discount off of its suggested retail price, but I suspected that it would be less expensive on a certain ubiquitous Web site. Sure enough, the same book was listed there, brand new, for ten dollars less than the Strand’s price. If I ordered it from this Web site, it would be delivered to my door, the next day, for free.

    "The moral high ground is to buy the book from the Strand. The store afforded me the pleasure of browsing the shelves on a weeknight in New York. The store’s owners permitted me to pick up the book and read a few pages, for as long as I wished. They should have my money. But, for the sake of argument, let’s just say that I chose three additional books and that each of those books was also ten dollars less online. I could save forty bucks, which isn’t chump change. So the question then becomes, where do we draw the line? Are we expected to underwrite David’s battle with Goliath, no matter what the cost?"

    The advantage of shopping in an actual bookstore is in part intangible, Fishman suggests … and then he advances an idea:

    "So why not monetize the intangibles? The Strand, and stores like it, could charge an admission fee. Something token, like a dollar. For a buck, you’re granted access to everything the store has to offer. You can browse to your heart’s delight. There’s no pressure to make a purchase. And, if you do buy something, perhaps the item costs close to what it would cost online, because all of those dollars would have allowed the store to lower its prices."

    Such an idea, as it happens, isn't entirely new … but it also suggests the ways in which retailers may have to change their thinking - and the traditional thinking of their customers - if they are to survive.

    You can read the entire, provocative piece here
    KC's View:

    Published on: October 24, 2019

    TechCrunch reports that Amazon has acquired Health Navigator, a medical technology startup, which now will "become part of Amazon Care, its pilot healthcare service program for employees … Health Navigator’s platform was created to be integrated into online health services, including telemedicine and medical call centers, to standardize the process of working with patients."

    Terms of the deal were not disclosed.

    TechCrunch notes that "this is the second health startup acquired by Amazon. The first was online pharmacy PillPack, purchased by the company in 2018 for slightly less than $1 billion. PillPack’s services have also been integrated into Amazon Care, which offers deliveries of prescriptions with remotely communicated treatment plans."
    KC's View:

    Published on: October 24, 2019

    …with brief, occasional, italicized and sometimes gratuitous commentary…

    Business Insider reports that Walmart is warning its customers "of a 'national supply shortage' of dish soap that could last until December 1."

    In one of its stores, Walmart reportedly has posted the following sign: "Dish soap is experiencing a national supply shortage, impacting product availability for our customers. These shortages will remain until Dec. 1. We apologize for any inconvenience this may cause you."

    One manufacturer, Procter & Gamble, confirmed the possible shortage: "We're aware that some P&G hand dish products may be harder to find at the moment. For a brief period, demand exceeded what we were able to supply, but this was temporary. We value the loyalty people have to our brands, and apologize for this short-term inconvenience. Our team is working around the clock to refill shelves and supply is catching up with demand, so all sizes should be available soon."

    Does this essentially mean that they're going to be all cleaned out?
    KC's View:

    Published on: October 24, 2019

    • E-commerce insights company Edge by Ascential is out with a study saying that "discount and convenience stores in the U.S. are projected to grow faster than all other offline retail channels over the next five years, reflecting consumers' increased focus on price and speed, even if it means more limited assortment."

    According to the study, "Non-food discount, food discount and convenience stores are all projected for annual growth rates above 5 percent, whereas all other offline retailers, aside from membership club stores, are projected at annual growth rates of 3 percent or below. Convenience stores are projected for the highest growth at 5.4 percent, with discount and non-food discount stores projected at 5.3 percent and 5 percent, respectively."

    It goes on: "The forecast seems to reflect broader economic trends. While paychecks remain relatively steady with unemployment continuing at historic lows, wages remain stagnant for many workers, placing increased sensitivity on overall value."
    KC's View:

    Published on: October 24, 2019

    • Kansas City-based Associated Wholesale Grocers, Inc. (AWG) announced that Dan Funk, the company's Chief Supply Chain and Merchandising Officer, has been promoted to the role of COO.

    In addition, AWG said that Jeff Pedersen, its EVP, Chief Sales & Support Officer, will "assume the functional oversight for the growing VMC subsidiary," which is in the business of "procurement and marketing of Health, Beauty & Wellness, General & Seasonal Merchandise, Natural, Organic and Specialty Food, and Pharmacy programs."

    And, Tye Anthony, the company's VP - AWG Brands and Merchandising, is being promoted to a new role as SVP, Merchandising.

    • Stater Bros. announced that Dennis McIntyre, the company's executive vice president-marketing, has been named its chief marketing officer.

    • Arts and crafts retailer Michaels announced that Mark Cosby, its interim CEO since last February, is having the "interim" removed from his title.

    Cosby's previous jobs included being president, North America at Office Depot Inc. and president of retail at CVS Caremark.
    KC's View:

    Published on: October 24, 2019

    …will return.
    KC's View:

    Published on: October 24, 2019

    • In the second game of the World Series, the Washington Nationals beat up on the Houston Astros 12-3 to take a 2-0 lead in the best of seven series. The series now moves to Washington, DC, for the weekend, which gives the Nationals an enormous advantage - only three teams, the New York Times notes, "have lost the first two games of the World Series at home and gone on to win the title — the 1985 Kansas City Royals, the 1986 Mets and the 1996 Yankees."
    KC's View:

    Published on: October 24, 2019

    There is a health, beauty and wellness revolution taking place, driven by enlightened consumer thinking about selfcare and startup companies that are innovating in the space. In this new Retail Tomorrow podcast, recorded in front of a live audience at the recent GMDC Selfcare Summit in Indianapolis, two such startup companies - in very different spaces - talk about how their strategies and tactics are helping retailers perform more effectively and efficiently.

    One important shift that has to take place: Retailers need to say "help me," rather than "show me." Which is more than a semantic difference.

    Our guests:

    • Monte Ahlemeyer, chief revenue officer at Accelerate, which is on the front lines of the CBD marketing revolution.

    • Dan Bourgault, VP, Sales & Business Development at Replenium, which provides consumer-level replenishment services to retailers.

    The host: Kevin Coupe, MorningNewsBeat’s “Content Guy.”

    You can listen to the podcast here, as well as on iTunes and GooglePlay.

    This edition of the Retail Tomorrow podcast is brought to you by GMDC, the Global Market Development Center.

    Pictured, below, from left: Kevin Coupe, Dan Bourgault, Monte Ahlemeyer

    KC's View: