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    Published on: June 16, 2020

    This weekly series of Retail Tomorrow podcasts features Sterling Hawkins, co-CEO and co-founder of CART-The Center for Advancing Retail & Technology, and MNB "Content Guy" Kevin Coupe teaming up to speculate, prognosticate, and formulate visions of what tomorrow's retail landscape will look like post-coronavirus.

    This week, Michael Sansolo, research director for two Coca-Cola Retailing Research Councils (and a weekly columnist on MorningNewsBeat.com), joins Sterling and Kevin for a deep-dive into the rationales behind a pre-pandemic planning guide into how to build stores for the future.  Using that guide as a starting point, they look at how current economic, cultural and medical realities are changing that future, making it more uncertain than ever, and yet replete with opportunities for retailers with the right mindset.

    You can listen to the podcast here, or on iTunes and Google Play.

    Note:  The Council research reports referred to in this podcast can be accessed here.

    Michael Sansolo

    Published on: June 16, 2020

    The US Supreme Court, in a 6-3 decision, ruled that the Civil Rights Act of 1964, which bans workplace discrimination on the basis of gender, also applies to sexual orientation.

    The Wall Street Journal notes that the ruling "extends a quarter-century of momentous advances for gay-rights advocates at the Supreme Court, " including the 2015 legalization of gay marriage, even as the court has become more conservative.

    The Journal writes that "conservative Justice Neil Gorsuch wrote the opinion, which was joined by Chief Justice John Roberts in addition to the four more liberal members of the court, Justices Ruth Bader Ginsburg, Stephen Breyer, Sonia Sotomayor and Elena Kagan. 'An employer who fires an individual merely for being gay or transgender defies the law,' the opinion said."

    Axios calculates the bottom line this way:  "Millions more Americans will go to bed tonight with legal protections that didn't exist when they woke up."

    “This is a huge victory for LGBTQ equality,” James Esseks of the American Civil Liberties Union (ACLU) tells the Washington Post, adding, “The Supreme Court’s clarification that it’s unlawful to fire people because they’re LGBTQ is the result of decades of advocates fighting for our rights. The court has caught up to the majority of our country, which already knows that discriminating against LGBTQ people is both unfair and against the law.”

    The Post writes that the three justices dissenting "said their colleagues were changing the law, not interpreting it."

    Associate Justice Brett M. Kavanaugh wrote, “Our role is not to make or amend the law. As written, Title VII does not prohibit employment discrimination because of sexual orientation.”

    KC's View:

    Not being a constitutional lawyer, I will take a pass on whether this decision interprets existing law or changes it.  Being a citizen, it seems to me that this is a good decision, and I'm a little distressed with the implication that employment discrimination ever is acceptable.

    Maybe we could all just get to the point that we treat people like people, do our best not to discriminate against anyone, and get on with doing business?  We'll probably all be better for it, even - or especially - if it takes us outside our comfort zones.

    There will be more cases, to be sure.  As I understand it, the Supreme Court made the point that this ruling does not cover the use of bathrooms or locker rooms, or whether insurance should cover gender reassignment surgery, or to what degree religious exemptions can be claimed.  Those all will play out in the future … both in the courts and on the political stage.

    But for the moment, businesses don't get to discriminate on the basis of gender orientation.  

    Published on: June 16, 2020

    Wegmans announced that it has "chosen to partner with UNFI Supervalu to add additional distribution capacity in Virginia for select grocery, dairy and frozen items. This partnership will help Wegmans reduce the travel time and shipping costs to our stores in Virginia and North Carolina.

    "Beginning June 2020, Wegmans will service a subset of our conventional Grocery, Dairy and Frozen products for select stores in Virginia and North Carolina through the Supervalu distribution center (now owned by UNFI) in Mechanicsville, VA."

    Wegmans disclosed the change in an email to suppliers in which it laid out how the transition will play out for vendors.

    KC's View:
     

    I have to be honest here - many  retailers with whom I have spoken about their relationships with UNFI since its acquisition of Supervalu have described themselves as dissatisfied with their service levels.  (I think I'm being generous here.)

    So I have to wonder if Wegmans' growth strategy has put it in a position where it has make deals with a company that has disappointed a number of its brethren.  So is this a good thing?  I don't know.

    And one other point, if I may …

    Wegmans makes the point that the products affected by this change are conventional - which may be a synonym for undifferentiated.  I find myself wondering about why a company likes Wegmans carries so many undifferentiated products in its increasingly large stores.  Should it be transitioning to s strategy in which the stores are smaller and more differentiated, with the products you can get anywhere available largely through a more proprietary e-commerce offering?

    Again, I don't know.  And I may be taking my credibility in my hands by suggesting that anything Wegmans does could actually be done better.  But iut is only because I have so much regard for the company and its stores that, when it does something conventional or traditional, I find myself wondering why.

    Published on: June 16, 2020

    Orlando Weekly reports that while Publix employees are required to wear a mask when working in its stores, they are not allowed to wear masks saying "Black Lives Matter."

    The story suggests that the company is getting some social media blowback because of it.

    On the one hand, the company has donated $1 million  to the Urban League as a symbol of its support of civil rights initiatives.  CEO Todd Jones said he was "saddened and unsettled by any racial injustice or events" and added, "at Publix, we reject racism and discrimination of any kind … We benefit from being an inclusive company made up of individuals who look and think differently."

    Critics suggest that these statements are inconsistent with the ban on masks saying "Black Lives Matter."

    To be fair, though, the Publix uniform policy "does not permit non-Publix messaging on any worn item."

    KC's View:
     

    One of the points that I've been making here for the past few weeks is that while companies were saying all the right things and writing checks to various civil rights-related causes and institutions, there will be greater tests of their commitment to the issue - like the diversity of management, and the degree to which tolerance is extended in the marketplace.

    I'm not questioning Publix's intentions in any way.  I think this scenario illustrates just how much of a tightrope this may be for some companies.  Unlike Starbucks, where the banning of masks seemed off-brand because of the company's progressive politics, I'm not sure anyone would make the same argument about Publix.

    I also think this illustrates the degree to which some people differentiate between civil rights and Black Lives Matter, which is seen as politically divisive by some and, therefore, controversial.  I don't share that opinion - I think that Black Lives Matter's point is that they matter as much as white lives, not more … and that it is demonstrable that systemic discrimination works against that premise.

    But I get the disconnect, and we certainly have to acknowledge it and then deal with it.

    Published on: June 16, 2020

    Reuters reports that Amazon said yesterday that its CEO-founder, Jeff Bezos, is willing to testify to the House of Representatives Judiciary Committee  regarding antitrust allegations against the company, specifically how it deals with third-party vendors.

    Details have to be worked out, such as timing, the production of documents (Amazon says it already has provided more than 225,000 pages of documents without getting a binding commitment of confidentiality from the committee), and whether other CEOs (from Google, Apple and Facebook) will appear at the same time.

    Still, the story says, this would be Bezos' first time testifying before Congress.

    KC's View:

    Cook up the popcorn.  Chill the beer.  I'm totally on board for that testimony …. it'll be fun.

    Published on: June 16, 2020

    Random and illustrative stories about the global pandemic and how businesses and various business sectors are trying to recover from it, with brief, occasional, italicized and sometimes gratuitous commentary…

    •  In the United States, there now have been 2,182,979 confirmed cases of the Covid-19 coronavirus, with 118,286 deaths and 890,015 reported recoveries.

    Globally, there have been 8,136,712 confirmed coronavirus cases, with 439,561 fatalities and 4,248,838 reported recoveries.


    •  From ABC News:

    "Miami, which is among Florida's most populous cities, will not move into the next phase of reopening because of concerns about rising COVID-19 cases, Mayor Francis Suarez announced during a Monday news conference.

    "Although the majority of Florida is in Phase 2 of reopening, rising new coronavirus cases in the state may put a damper on residents' new freedom."

    While the state maintains that increased testing is the reason for an increased number of confirmed cases, ABC News  reports that "a more worrisome sign is that Florida has seen a rise in new hospitalizations in recent weeks … that uptick cannot be attributed to more testing."

    Furthermore, the story says, "Data out of Florida has been mired in controversy. The state's coronavirus data scientist was fired over disagreement surrounding Florida's public-facing coronavirus database … That scientist has since launched her own competing Covid-19 database, which shows higher case counts and deaths than the state's database does."


    •  From National Public Radio:

    "The Environmental Protection Agency ordered Amazon and eBay to stop selling certain pesticide-containing products, many of which claimed to fight off and disinfect from the coronavirus.

    "The orders also bar the e-commerce giants from selling products that contain toxic chemicals like chlorine dioxide and methylene chloride, which is federally regulated as a toxic substance.

    "Exposure to methylene chloride can cause death, but in one instance, eBay marketed and sold 55-gallon drums of methylene chloride as a coronavirus disinfectant and paint stripper, according to the EPA press release.

    "Amazon was ordered by the EPA to stop selling over 30 products and eBay, more than 40, some of which falsely claimed to provide 'Epidemic Prevention,' '2020 Coronavirus Protection' and 'complete sterilization including the current pandemic virus,' according to an agency press release."


    •  The Wall Street Journal reports that "grocery stores are selling more milk for the first time in a decade as U.S. consumers use more of the staple during months at home because of the coronavirus pandemic."  However, it "isn’t enough to reverse the fortunes of many struggling dairy farmers."

    The problem is that while at-home demand for milk has gone up, demand at restaurants and hotels - representing about a third of milk sales - has dried up.

    One success story cited by the Journal:

    "Milk sales at Stew Leonard’s Inc., a Northeast grocery chain that began as a dairy goods store, have increased 46% by volume since March. After customers cleared beverage cases of milk that month, Chief Executive Stew Leonard Jr. said he made panicked phone calls to milk suppliers, inspiring one to drive through the night to restock shelves in time for the morning rush."


    •  From the Detroit Free Press:

    "An executive order by Gov. Gretchen Whitmer on March 23 suspended the redemption of 10-cent deposit beverage cans and bottles by retailers and others, part of orders intended to protect public health amid the coronavirus pandemic.  Of the 10 U.S. states with bottle and can deposits, Michigan was the only state to completely shut down returns, and residents accumulated more than $50 million in dimes-in-waiting during the shutdown.

    "As coronavirus-related restrictions are beginning to lessen, the state this month announced bottle and can deposit redemption could resume. All grocery stores, supermarkets and other retailers with bottle return facilities located at the front of the store, or housed in a separate area, and serviced exclusively by reverse vending machines, were required to begin re-accepting returns by Monday. The reverse vending machines, into which customers feed bottles and cans and receive a printed out receipt, minimize person-to-person contact during the transactions.

    "While some stores began taking returnables again last week, Meijer and Kroger waited until Monday — at least officially."

    Amazing what passes for "normal" these days, huh?


    •  CNN reports that "major US airlines in Airlines for America, the carriers' industry group, announced Monday that they intended to more strictly enforce mask wearing aboard their planes, including potentially banning passengers who refuse to wear a mask.

    "The announcement comes in lieu of a federal regulation requiring all passengers to wear masks -- the sort of enforceable measure that governs requirements to wear seatbelts and not smoke."

    In addition, the story says, "United Airlines came out Monday with its own separate announcement that has more teeth than what it's been doing so far. If you refuse to wear a face mask starting June 18, you could find yourself on a restricted travel list … United's policy does not include forcibly removing a passenger who still refuses to comply, but the attendants will file an incident report."

    CNN writes that "six other major US airlines -- including American Airlines, Delta Air Lines and Southwest Airlines -- pledged to roll out new policies requiring masks, also enforced with a penalty as severe as a ban on flying with that particular airline."

    The airlines are getting tougher, but the story points out that they all would've preferred that the government had given them cover with enforceable regulations.  I agree with them on this - for the time being, the FAA should be mandating the wearing of masks … and maybe even keeping empty middle seats so that physical distancing is more easily attained.


    •  In Oregon, Eater Portland reports that the Pok Pok restaurant group there, which over the past decade became a go-to brand for street food-style Thai cuisine, plans not to reopen every one of its Portland locations except for the original on SE Division Street.

    Owner Andy Ricker announced the decision on his Instagram account, saying that it was necessary "to focus on the potential reopening of the original Pok Pok down the road, though Ricker writes that 'It is not clear when that might happen.'  The post describes the financial and practical hurdles that face reopening multiple restaurants in accordance with the state’s phase one and phase two requirements."

    This is a shame.  I wasn't the biggest Pok Pok fan in the world, but recognized that it was a symbol of Portland's culinary diversity and innovation.  It is sad as the pandemic claims these kinds of victims … which isn't just a restaurant group, but also the livelihoods of all the people who worked there.


    •  The USA Tennis Association (USTA) is expected to announce this week that the 2020 US Open will be played as scheduled between August 31 and September 13 at the  Billie Jean King National Tennis Center in Queens, New York - assuming government approval is granted.

    The Open would be played without spectators.

    It is expected, the New York Times writes, that "players will be subject to frequent coronavirus testing. Many will be lodged together at a hotel outside Manhattan, and some restrictions are expected to be placed on their movement to protect their health."


    Variety reports that the pandemic, which has shut down the nation's movie theaters for months, as well as suspending production of countless movies and delaying the release of others, now has pushed The Academy of Motion Picture Arts and Sciences to delay its annual Academy Awards ceremony, moving it from February 29, 2021, to April 25, 2021.

    In addition, the Academy has extended its eligibility dates - instead of mandating that movies have to be released in the 2020 calendar year, it says that eligible movies have to have been released by February 28, 2021. 

    Published on: June 16, 2020

    •  CNBC reports that Walmart is spending about $200 million to acquire "technology and intellectual property from CareZone, a start-up that makes it easier for people to manage multiple medications."

    The story describes CareZone as developing "apps to help people manage their medicines," as well as building "technology for users to scan insurance cards and prescription drug labels, making it easier to figure out what’s covered by their health plan or to organize a home delivery."

    The CNBC analysis points out that this move allows Walmart to "stay abreast" of Amazon in the pharmacy business.  In other words, another battlefield on which we are seeing the clash of the titans.

    Published on: June 16, 2020

    •  From MarketWatch:

    "Walmart Inc. has surpassed eBay Inc. in share of U.S. e-commerce sales for the first time, according to May 2020 data provided by eMarketer, though Amazon.com Inc. remains number one by a large margin.

    "Amazon tops the list with 38.0% of all U.S. e-commerce sales share, followed by Walmart with 5.8% and eBay  with 4.5%.  Apple Inc.  (3.5%) and Home Depot Inc. (1.9%) round out the top five."


    •  Here's a number for you.

    CNBC reports that "Apple announced on Monday that its App Store facilitated an estimated $519 billion in billings and sales in 2019, according to a new study commissioned by the company."

    The number "includes sales from online retailer apps such as Target and Best Buy, travel booked through apps such as Expedia and United, and rides hailed through Lyft and Uber. The estimate doesn’t include revenue from Apple’s own app subscriptions, such as Apple Music."

    Here's how the money breaks out:  "$413 billion from physical goods and services, including $268 billion through retail apps, $57 billion through travel apps, $40 billion through ride-hailing apps, and $31 billion through food delivery apps" … "$61 billion from digital goods and services" … and "$41 billion from in-app advertising."

    Apple, the story says gets a cut of between 15 and 30 percent "from purchases of software or digital goods from apps distributed through the App Store," but does not get a cut of revenue from 84 percent of the apps on the App Store.

    Published on: June 16, 2020

    •  Glossy has a story about how Costco - looking to lower the age of its core customer from the current 65+ - is investing in beauty and cosmetics lines that it hopes will appeal to a younger demographic.

    As part of this shift, the story says, "In 2017, Costco incorporated premium and luxury brands like Japanese brands SK-II, and by Feb. 2018, it added Korean, natural and Ayurveda categories to its website, before officially creating a Japanese beauty section in 2019. In 2015, its only categories were fragrances, cosmetics, hair care and skin care …  In addition to adding new categories in the last two years, the wholesaler began adding buzzy brands like sun-care brand Coola, hair-care brand Briogeo, skin-care brand Perricone MD and, most recently, skin-care brand Boscia and sheet-mask brand All have core millennial customers."

    Glossy writes that "outside of beauty, Costco has endeavored to adapt to millennial shopping habits. In 2018, the wholesaler began offering high-value items such as jewelry and electronics via e-commerce … At the time, millennials represented 40% of new customer signups but spent only a fraction of what Boomers did. In 2019, Costco also added digital membership cards through its app, but it has been notably slow in making digital investments."


    •  USA Today reports that "plant-based breakfast sausages are coming to Burger King as the Restaurant Brands International chain said it would add the Impossible Croissan'wich to its menu nationwide. … It is the first chain to put the Impossible Foods sausage alternative on its menu," though "Dunkin' Brands already offers rival Beyond Meat's plant-based sausage."

    The story suggests that "the addition of the sausage offering represents an opportunity to expand beyond the confines of plant-based beef alternatives into pork and perhaps chicken."

    Published on: June 16, 2020

    …will be posted on Thursday this week.

    Published on: June 16, 2020

    Responding to yesterday's FaceTime piece about Tito's Tacos, MNB reader Wayne Redfearn wrote:

    Your reference to Tito’s Taco’s made me salivate. I discovered Tito’s as a late night snack during my college days at UCLA in the late 60’s. They are simply the In-n-Out version of tacos… deep fried (in lard for extra flavor), crisp corn tortilla, cold cheddar cheese, shredded lettuce topped with mild red salsa make for the world’s best tasting taco. I drive 49 miles (each way)  with my 2 sons to indulge in a culinary masterpiece. They taste exactly the same as I remember in my youth and always bring me back to time when life was not nearly so complicated…

    Regarding Starbucks' changing its mind about employees wearing Black Lives Matter t-shirts at work, one MNB reader wrote:

    You sure called it!!

    I personally do not associate BLM with an “equality” movement, rather an organization with a political agenda that goes far beyond equality. I can’t be the only one…I wish companies would support the message of racial justice/equality without the politically charged baggage.

    One can be environment and planet friendly without supporting Greenpeace for example.

    From another reader:

    Your initial stand is the right one – businesses should stay out of partisan politics. Can you picture to employees showing up for work, MAGA, BLM, Planned Parenthood and Pro-life hats/T-shirts?

    Not sure that was my initial stand … but I take your point.

    Finally….

    Yesterday we posted the following email:

    It sure was a lucky break for Black Lives Matter that the victim of this egregious filmed exhibit of police-brutality was Black when you realize that nearly twice as many Whites than Blacks are killed by cops.  They seized ownership of the entire issue and are running crazy with it, just like Jews have declared a monopoly on genocide.

    I responded:

    This email strikes me as the height of cynicism on so many levels.

    You really think that this was a "lucky break" for Black Lives Matter and the people it represents?

    You really think Jews have declared a monopoly on genocide, and that they are "running crazy" with it?

    I considered not running this email.  But then I decided, better not to pretend that these kinds of attitudes don't exist.  (That's a double-negative, but it somehow seems appropriate for such a cynical email.)

    The email also prompted the following note from MNB reader Jeff Gartner:

    Kevin, that “cynical” email you published today … it wasn’t cynical. No, it was racist and anti-Semitic. I don’t know if the author is, but their email sure was.

    It’s good to remind everyone how prevalent and pernicious this is, glad you published it.

    Published on: June 16, 2020

    The Wall Street Journal this morning reports that Major League Baseball Commissioner Rob Manfred said yesterday that it is possible that there will be no 2020 season - despite the fact that he said last week that he was 100 percent certain that there would be.

    The story points out that "baseball has gone from the possibility of returning ahead of all its main competitors on the Fourth of July, with about half a season, to a 50-game mini-season, to perhaps no season at all, in the span of two weeks."

    KC's View:

    If I understand the situation correctly, the new pessimism is driven by the fact that the players - while not happy with the fact that the owners want them to take a cut to their prorated salaries for a shortened season - are a) willing to play, and b) are unwilling to forfeit their right to file a grievance against the owners.

    The Journal writes that "a previous agreement from March gave Manfred the right to impose a schedule of a length of his choosing provided players received their full prorated salaries for the number of games. The owners had indicated that if it came to that, they would opt for about 50 games to minimize their outlay to players while still maintaining the lucrative postseason."

    I tend to be a players' guy on this stuff … they are the ones who will be on the field, risking their health … but I did see the owners' point because there will be such a big reduction of revenue since there will be no ticket and concession sales for the games.    That said, the owners did sign an agreement … and I'm pretty sure they wouldn't let the players off the hook if the shoe was on the other foot.

    Now, it is up to the owners.  Let the games begin, and if the players want to file a grievance, let them … the owners must have some confidence in their legal position, right?

    I still think that even a shortened season won't go very far, simply because there will be a coronavirus outbreak and they'll have to stop.  And all we'll be left with is a bad taste in our mouths, and the probability that this year's labor strife will lead to some sort of job action when the current contract runs out.