business news in context, analysis with attitude

Published on: July 15, 2020

Walmart announced this morning that it will mandate that customers in all of its some 5,000 Walmart and Sam's Club stores in the US must wear masks or some sort of face covering to prevent the spread of the Covid-19 coronavirus.

The new policy takes effect on  Monday, July 20.

The company emphasized that roughly 65 percent of its stores are in communities where mask-wearing already is mandated.

In a statement, the company said:

"While we’re certainly not the first business to require face coverings, we know this is a simple step everyone can take for their safety and the safety of others in our facilities. According to the CDC, face coverings help decrease the spread of COVID-19, and because the virus can be spread by people who don’t have symptoms and don’t know they are infected, it’s critically important for everyone to wear a face covering in public and social distance.

"In addition to posting clear signage at the front of our stores, Walmart has created the role of Health Ambassador and will station them near the entrance to remind those without a mask of our new requirements. Our ambassadors will receive special training to help make the process as smooth as possible for customers. The ambassadors, identifiable by their black polo shirts, will work with customers who show up at a store without a face covering to try and find a solution. We are currently considering different solutions for customers when this requirement takes effect on July 20."

Published on: July 15, 2020

As Walmart announced this morning that it would require all customers in its US stores to wear face masks, the National Retail Federation (NRF) released the following statement:

"The health and safety of associates and customers is retailers' number one priority and wearing a face covering or mask is scientifically proven to reduce the spread of COVID-19. NRF applauds the leadership of companies like Walmart, Starbucks, Best Buy, BJ’s Wholesale Club, Apple, Qurate Retail Group, Costco and others that have implemented nationwide mask mandates.

"We hope today’s announcement by Walmart – the world’s largest retailer – that it will be enforcing a policy requiring customers to wear a mask to shop in their stores is a tipping point in this public health debate. Workers serving customers should not have to make a critical decision as to whether they should risk exposure to infection or lose their jobs because a minority of people refuse to wear masks in order to help stop the spread of the deadly coronavirus."

Published on: July 15, 2020

by Michael Sansolo

It seems inarguable that retail workers have stepped up big time in often heroic ways to keep the normal flow of life going during the extraordinarily stressful circumstances created by the pandemic.  

In fact, a number of retailers have told me that the biggest positive surprise of the pandemic hasn’t been the gigantic jump in sales.  Rather, it has been the performance of those low-paid front line workers who are essential to any store’s operations and customer experience. One retailer said his company was bracing for a massive absentee rate that never materialized. People simply showed up and did their jobs just as it was hoped they would.

But that raises the question of how to show appreciation as both customers and business people. Once the pandemic fades into memory (and, for many, the stuff of nightmares)  the question will remain - how do we properly thank the people who kept the world running?  Or do we go back to treating farmers, truckers and supermarket employees with ignorance or casual disdain?

Essential to invisible simply should not happen.

Showing appreciation doesn’t have to be a gargantuan task either even though there are certain issues such as extending higher pay rates that will be challenging.  But let me offer an example of a simple idea.

My adult daughter edits documents for a federal government contractor; a job that, it might shock you to learn, hasn’t stopped at all during the pandemic. While she is able to work remotely, she and her colleagues have clocked in daily on topics that, frankly, she isn’t allowed to share with me.

But this I can share. A few weeks back she received a strange box from her employer. Inside were some simple, but suddenly very important items.

The box included five pairs of plastic gloves, five KN95 masks, 10 three—ply disposable masks, four single-ply and washable black mask covers, one homemade mask cover, two bottles of hand sanitizer, one face shield and one wood cutting board.

The box came with a card detailing all of that and reminding my daughter (and all her co-workers) that their employer cares.

The card also included fun tidbits such as how the homemade mask covers were made by the mother of the company’s CEO and that the cutting board was to help everyone prepare more homemade meals.

In all honesty, when my daughter received it she was in the middle of a back breaker of a project, so her reaction was muted. My wife and I were anything but blasé. 

My daughter has been with this company for a number of years and the CEO has always impressed me with surprising ways to salute her staffers and even entertain family members. Activities have ranged from tickets to baseball games and company picnics to heavily discounted Caribbean cruises.

But this box seemed just incredibly on point because it provided so many very important items at just the right moment and it was done at a time when company staffers were probably simply glad to have a job and didn’t need any extra attention. And that’s what makes it so great.  Appreciation can take so many forms and all are usually welcome.

A number of months ago Kevin suggested here on MNB that retailers could do something similar by giving staffers boxes of currently essential goods from toilet tissue to cleanser to baking flour.  That is simply a great idea.

Let's be clear.  The pandemic isn't over.  Far from it.  In some places - Florida, Texas, Arizona - it is as bad as it ever has been.  And so a focus on what is essential may, in fact, be as essential as ever.

I imagine there would be tremendous interest in “essential” gift boxes - perhaps sold to customers and gifted to employees - featuring products like basics needed in those now very busy home kitchens. Imagine it featuring a few cooking implements, a cutting board, some key spices and maybe a cookbook or some recipe cards.  All those are items a nation of home cooks would use and enjoy and it might remind shoppers of the incredible range of products they can get in their supermarket.  People might even give them as gifts to themselves.

After all, everyone appreciates some appreciation.

Michael Sansolo can be reached via email at msansolo@mnb.grocerywebsite.com.

His book, “THE BIG PICTURE:  Essential Business Lessons From The Movies,” co-authored with Kevin Coupe, is available here.

And, his book "Business Rules!" is available from Amazon here.

Published on: July 15, 2020

KC takes note of a Newsweek story about a new medical study concluding that plant-based proteins are better than animal-based proteins.  That's the clinical description.  KC has a much more practical interpretation ... for him, it is the ultimate good news story.

Published on: July 15, 2020

Amazon yesterday announced a new pilot program that will establish local, convenient health centers near Amazon fulfillment centers and operations facilities across the country.

The program, developed in conjunction with primary services provider Crossover Health, "will provide a range of quality primary care services exclusively for Amazon employees – further strengthening Amazon’s industry-leading benefits program, which provides comprehensive healthcare for employees starting on day one of employment," the company said in a prepared statement.  "Through this initial pilot program, Amazon expects to establish 20 health centers in five cities across the U.S., improving access and care for more than 115,000 associates and their families."

The first one will open in the Dallas-Fort Worth market, with additional facilities slated for Phoenix, Louisville, Detroit, and in the San Bernardino/Moreno Valley, California market. If successful, the company said it "will look to roll out similar facilities in other cities and states."

Published on: July 15, 2020

Axios has a story about a deep divide between big business and small business that has been created - or exacerbated - by the pandemic.

According to the story, "The coronavirus pandemic has changed the game for U.S. businesses, pushing forward years-long shifts in workplaces, technology and buying habits - and forcing small businesses to fight just to survive … These changes are providing an almost insurmountable advantage to big companies, which are positioned to come out of the recession stronger and with greater market share than ever."

The story goes on:  "Big companies, which have benefited far more from Congress and the Federal Reserve's coronavirus relief efforts, are expected to buy out or simply wait out smaller competitors … The Fed has provided nearly $3 trillion in liquidity since March to reopen credit and financial markets, and corporate titans like Apple, Exxon Mobil and United Airlines have taken advantage, borrowing a record amount of money at rock bottom rates.

"The lone lifeline for small businesses has been the Payroll Protection Program, which economists have found to be inefficient, ineffective and insufficient, largely excluding the businesses most in need of assistance."

Axios points out that "U.S. companies are making major investments in supply chain relocations out of Asia and closer to home, as well as artificial intelligence and robotics and re-skilling workforces to operate remotely and autonomously."  But for the most part, these are big US companies - small businesses simply do not have the capital or even the bandwidth to make those kinds of investments.

Published on: July 15, 2020

The New York Times this morning reports that "many retailers across the United States have quietly stopped providing their workers with the pay raises they had dispensed at the start of the pandemic, despite surging virus numbers in many states," arguing that "the panic-buying that flooded stores during the early weeks of the crisis has waned."

The Times goes on:

"Stop & Shop is the latest retailer to make such a move, ending a 10 percent pay raise it gave its 56,000 employees this spring to acknowledge that their work was essential and appreciated. Amazon, Kroger and Albertsons have also ended pandemic hourly pay raises, though some of them continue to give out bonuses. ShopRite said it planned to end its $2-an-hour raise early next month.

"But while hoarding may be over, infection remains a very real threat, especially in environments like retail stores, where even with masks and social-distancing measures workers say they still feel vulnerable.

"As dozens of states endure record levels of new cases, many employees say the job of the essential retail worker has actually become even more difficult than at the start of the health crisis."

Published on: July 15, 2020

Bloomberg reports there is a there is a massive nut glut that is causing a dramatic drop in prices.

Here's why, according to the story:  "You could blame the keto-crazed, paleo-passionate dieters that made almonds and walnuts their go-to snack. The past decade’s demand boom sparked farmers to bring on the supply. They planted loads of new trees in the past several years. Groves take time to mature enough to bear fruit. Now, all that crop expansion is finally coming to market, but it’s arriving just as Chinese tariffs and fallout from the pandemic are dragging down exports."

The story goes on:  "The U.S. is the world’s largest producer and shipper of tree nuts like almonds, walnuts and pecans. More than half of the crop is typically exported, so the $9.5 billion industry hinges on international trade. That’s being undercut even as global appetite grows for the healthy snacks. For almonds, America’s biggest nut crop, export prices are down about 25% from a year ago, according to estimates from Rabobank International. Other varieties have seen similar declines."

Published on: July 15, 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 3,546,278 confirmed cases of the Covid-19 coronavirus, with 139,162 deaths and 1,600,910 reported recoveries.

Globally, there have been 13,480,595 coronavirus cases, 581,732 fatalities, and 7,872,233 reported recoveries.

•  US News & World Report reports on new modeling from the University of Washington projecting that coronavirus fatalities in the US will grow by some 78,000 by November 1, bringing the total to more than 200,000 - but suggests that "new deaths would be reduced by nearly 60% and the overall death toll would be slashed to 163,000 if 95% of people wore masks while in public."

The model also projects a worse case scenario - that the total number of deaths in the US attributable to the coronavirus could be closer to 250,000 by November 1.

The model factors in the likelihood that there will not be a national mask mandate, that there will be economic shutdowns in states where pandemic-related deaths hit certain levels, and that schools largely will reopen in the fall.

•  From Axios:

"Florida is the new domestic epicenter of the coronavirus pandemic, and it's on track to keep getting worse … Of the 20 U.S. metro areas with the highest daily case growth, nine are in Florida, according to Nephron Research … Florida now has more confirmed cases, adjusted for population, than New York ever had — although New York's true caseload was almost certainly multiple times higher than its official one."

•  The New York Times reports that "North Carolina will allow schools to reopen in the fall, but at no more than half their usual capacity, the governor announced on Tuesday. He said districts could meet the capacity restriction by, for example, having students attend on alternate days. Everyone would have to wear masks. And districts could opt to continue with all-remote instruction, the governor said."

The Times also notes that "for the third time in its 120-year history, Philadelphia is canceling its Mummers Parade as the city is banning all public events involving more than 50 people for the next seven months."

Seven months?  Wow.  I guess that ends any speculation about spectators attending any Phillies or Eagles games.

•  New York State announced that it has added four more states - Minnesota, New Mexico, Ohio and Wisconsin - to the list of those from which people traveling to the state must self-quarantine for 14 days upon arrival.

The other states are Alabama, Arkansas, Arizona, California, Florida, Georgia, Iowa, Idaho, Kansas, Louisiana, Mississippi, North Carolina, Nevada, Oklahoma, South Carolina, Tennessee, Texas, and Utah.

Start spreading the news…because if you come from one of these places and break quarantine, you could be hit with a fine of up to $10,000 or put into forced quarantine on Rikers Island.

Just kidding.  About the Rikers Island part.  Everything else is accurate.

•  From the Puget Sound Business Journal:

In Washington State, "Gov. Jay Inslee extended his ban on further steps to reopen the state’s economy until 'at least' July 28 on Tuesday and warned that Washington could be poised to roll back the progress it’s made in opening bars, restaurants and businesses.

"'People should not be surprised if more gets rolled back depending on the course of this pandemic, and that’s going to be determined by how many people wear masks and socially distance,' Inslee said during an afternoon press conference.

"Earlier this month, Inslee paused for two weeks further steps to reopen the economy and placed new restrictions on bars and restaurants. His announcement Tuesday amounted to an extension of that order through late July.

"It’s possible, but not certain, that the state could close bars or once again ban indoor seating in restaurants, Inslee said, naming a few examples of the kinds of measures that may be on the horizon."

The story says that Washington State "has had 41,757 confirmed Covid-19 cases and confirmed cases have spiked into the 600 and 700 range per day in recent weeks.  Inslee noted that Covid-19 cases have now surpassed what was believed to be its peak in the spring and that the number of people infected for each new infection has risen to more than one.

"'That means it grows exponentially,' he said. 'This is a very dangerous position we are in…. We are heading to big trouble if we do not figure out a way to knock this pandemic down'."

•  The Wall Street Journal reports that Best Buy "will require customers to wear face coverings inside all U.S. stores to protect against the new coronavirus, including in places without mask mandates.

"Best Buy said its mask rule, which goes into effect on Wednesday, will 'help protect not only our shoppers and communities, but also the tens of thousands of Best Buy employees working to serve our customers each day'."

Damn right.

•  The United Food and Commercial Workers (UFCW) union is calling for national face mask mandate and, until that happens, for business leaders "who offer products and services to the public to require their employees and customers to wear masks whether or not it is required by local law. This vital step will help protect workers and customers.

"Such requirements will greatly increase the rate of mask wearing," the UFCW argues.  "This should be done in conjunction with, not as a replacement for, hand hygiene, physical distancing, testing, and contact tracing strategies."  But, it says, scientific evidence points to the degree that face masks can inhibit the spread of the coronavirus, and therefore must be taken seriously.

I agree … but the UFCW should've been calling for this months ago.

•  Axios reports that many US technology companies "are realizing that their reopening plans from as recently as a few weeks ago are now too optimistic."

The story says that "many tech companies had already announced plans to allow most workers to telecommute through the end of the year (and in some cases indefinitely). Quietly, though, companies had been drawing up playbooks for portions of their workforces to return to the office sooner.In many cases, though, those plans are now on hold."

The story goes on:

"Most companies didn't want to talk publicly about reopening plans, but private conversations with many of them revealed a consistent theme: The industry is expecting even more of its workforce to be out of the office longer than they'd anticipated before the latest U.S. resurgence of the pandemic.

"The key factors driving the shift are the increase in COVID-19 cases, a continued lack of widespread testing and the likelihood that many schools will remain closed this fall. That has left companies that had yet to communicate fall plans scrambling to do so … A clear sign of where things stand is companies are now spending more to help workers get set up in their home offices, paying for things like ergonomic furniture and other gear that's expensive upfront but can pay dividends over time."

However, Axios also notes that tech companies have "the luxury of taking care of its valuable workers. In many other industries, the practical and ethical equation is far more complex, because keeping the business going often requires some workers to be put at risk."

•  The New York Times reports that KFC has "closed dining rooms in all 40 of its corporate-owned restaurants in Florida … as coronavirus cases in the state continued to skyrocket."  It is urging franchisees in Florida - and other hot-spot states - to do the same.

•  From the Wall Street Journal:

"Tuna fish has surged in popularity thanks to pantry loading during the coronavirus pandemic, but producers of the canned fish are dealing with higher prices and other challenges that are making it difficult to keep up with the increased demand.

"Americans have been buying more canned tuna during the economic downturn, in part because it is one of the cheapest proteins on the market, costing as little as $1 for a 5-ounce can. Bumble Bee Foods said sales of canned and pouched tuna jumped as much as 100% from mid-March to early April, while Costco Wholesale Corp. put limits earlier this year on how many tuna containers a customer could purchase.

"Even after the initial feeding frenzy, canned tuna producers say sales for these products have remained significantly higher than a year earlier."

•  The Wall Street Journal reports that "Delta Air Lines Inc. trimmed plans for more summer flights amid rising Covid-19 cases nationwide after a $5.7 billion loss for the latest quarter underscored the depth of the crisis facing the aviation industry.

"Chief Executive Ed Bastian said that the recovery from April’s near-collapse in domestic flying had stalled. Delta will halve the number of extra flights it adds in August to 500, and capacity in the September quarter is expected to be at best 25% of the level a year ago."

•  Variety reports that "the 2020 edition of the Telluride Film Festival has been canceled."  The 47th annual festival was scheduled for Sept. 3-7.

“After months of intense due diligence around physically holding an event, we’ve come to the heartbreaking but unanimous conclusion to cancel this year’s Labor Day celebration of film in Telluride,” the festival said in a statement. “But with a seemingly unending number of new cases of Covid-19 and the national chaos around it, even the best strategy is threatened by this out of control environment.”

"National Chaos" will probably be the name of the one of the films entered in the 2021 festival.

Published on: July 15, 2020

Liquor manufacturer Diageo announced that it has "created the world's first ever 100% plastic free paper-based spirits bottle, made entirely from sustainably sourced wood."  It is expected that its Johnnie Walker scotch will be available in this paper bottle early next year.

According to the announcement, Diageo "has launched a new partnership with Pilot Lite, a venture management company, to launch Pulpex Limited, a new world-leading sustainable packaging technology company. To ensure that the technology can be used in every area of life, Pulpex Limited has established a partner consortium of world leading FMCG companies in non-competing categories including Unilever, and PepsiCo, with further partners expected to be announced later in the year. The consortium partners are each expecting to launch their own branded paper bottles, based on Pulpex Limited's design and technology, in 2021."

Published on: July 15, 2020

The Washington Post has a story about how "the new head of the U.S. Postal Service established major operational changes Monday that could slow down mail delivery, warning employees the agency would not survive unless it made 'difficult' changes to cut costs … Postmaster General Louis DeJoy told employees to leave mail behind at distribution centers if it delayed letter carriers from their routes."

Traditionally, the story says, "postal workers are trained not to leave letters behind and to make multiple delivery trips to ensure timely distribution of letters and parcels."

The Post notes that "critics say such a philosophical sea change would sacrifice operational efficiency and cede its competitive edge to UPS, FedEx and other private-sector rivals."  And the Post writes, "Analysts say the documents present a stark reimagining of the USPS that could chase away customers — especially if the White House gets the steep package rate increases it wants — and put the already beleaguered agency in deeper financial peril as private-sector competitors embark on hiring sprees to build out their own delivery networks."

Published on: July 15, 2020

The  Global Market Development Center (GMDC)|Retail Tomorrow trade association announced it will pivot this year’s General Merchandise Conference (GM20) and Selfcare Summit (SS20) to virtual events over a three-week period taking place October 5-23, 2020.

The organization says that "GMDC|Retail Tomorrow has reimagined this year’s event offerings in order to expand member opportunities and enable product discovery in a virtual format while protecting the health and safety of its members and employees during the global COVID-19 pandemic. The members-only virtual events are anticipated to bring together more than 80 retail/wholesale companies and 250 supplier companies from across North America to connect; to help retail industry stakeholders satisfy consumers’ health, beauty, wellness, selfcare and general merchandise needs; and to spark innovation for the marketplace."

The announcement goes on:

"The virtual events will be hosted on the GMDC*Connect video conferencing platform, bringing together the capabilities and member connections that GMDC|Retail Tomorrow has long spearheaded in a way that meets the industry’s needs in 2020, including: networking meetings; live and recorded learning track sessions focused on GM, selfcare and post-COVID consumer trends; and the Preview Box program that delivers participating suppliers’ products into the hands of retailers and wholesalers prior to the events.

"GMDC|Retail Tomorrow’s Strategic Executive Connection (SEC) meetings are scheduled for the week of October 5, 2020, for General Merchandise and Selfcare Summit participants, while Buyer’s Choice meetings will occur October 12-23, 2020. Retailers, wholesalers and suppliers will utilize a new self-scheduling tool to arrange meetings, allowing for a customized conference experience. The extended duration of the conference, combined with new virtual capabilities, will enable more meetings and enhance connectivity among retailers and suppliers."

For more information, click here.

Full disclosure:  MNB has an extended relationship with GMDC and its Retail Tomorrow initiative, providing content in a number of venues including the Retail Tomorrow podcast.

Published on: July 15, 2020

•  From USA Today:

"Target is bringing back its back-to-school discount for teachers this summer.

But instead of the savings for educators lasting one week like in past years, the Minneapolis-based retailer announced Tuesday that it will offer 15% off select classroom supplies and essentials for six weeks.

"Target said the discount will be available Sunday, July 19 through Aug. 29 for 'K-12 teachers, homeschoolers, daycare/early learning educators, university or college professors, and vocational/trade/technical school teachers.' It can only be redeemed once during Target’s Teacher Prep Event."

I hope that Target includes personal protective equipment (PPE) on the list of classroom essentials on sale … because I'm willing to bet that we will not be deep into the school year before we hear stories about how teachers back in the classroom are not being provided with sufficient safety equipment and are having to go out and buy it on their own.  This is a crock, but it is typical of even some of the most affluent districts, where teachers spend a lot of their own money just for basic classroom supplies in the best of years.  And in some of those districts, parents will resist the tax increases necessary to make sure that classrooms and teachers are adequately and safely equipped.

•  Ahold Delhaize-owned  Stop & Shop announced the launch of Nutrition Partners, described as "its new Dietitian Program. Available digitally at no cost to customers, the program connects Stop & Shop shoppers with licensed Registered Dietitians for nutrition consultations and help with making healthier food choices. Stop & Shop’s team of dietitians will also offer free online webinars and educational resources like newsletters, plus quick and easy recipes to make at home."

•  From USA Today, a story about fart-free cows:

"Burger King's new menu item aims to tackle the environmental impact of beef. 

The fast-food chain partnered with top scientists to develop and test a diet for cows to produce less methane, a greenhouse gas that traps the sun's heat and warms the planet.

"The new diet reduces up to 33% per day, on average, of cows' daily methane emissions during the last three to four months of their lives, according to initial study results.

"The Whopper sandwich with reduced methane emissions beef is available at select restaurants in Miami, New York, Austin, Texas, Los Angeles and Portland, Oregon, while supplies last."

I know I'm a child about this stuff, but I'm just happy for any excuse to use words like "fart" on MNB.  

Published on: July 15, 2020

One MNB reader responded to yesterday's story about Amazon new Dash Cart, a smart shopping cart it will begin testing.

I commented:

"This isn't one of those innovations that immediately strikes me as a quantum leap forward;  after all, there have been a lot of efforts to create smart and smarter shopping carts over the years.  But I'm looking forward to seeing what new factor Amazon brings to the table."

The MNB reader wrote:

You are of course 100% spot on with this comment - there have been many attempts at cart innovation over the years but as far as I can tell, other than a cup and phone holder, there hasn't been much mass cart innovation in years. The difference here is the "A" factor - Amazon has the bank and determination to look past short and medium term ROI to bring something like this to market where other retailers have balked at the economics. As we have seen with Go and countless other experiments, they will compromise margin if they believe it represents long term gains in share of wallet and improvement to the customer experience. 

You also comment on the friction in the concept. If we assume Go is unprofitable due to the technology cost, and Amazon does care about economics in the long term, they will eventually want to find a compromise of frictionless and economics, and hence Go isn't a viable point of comparison. The apt comparison may be self-checkout rather than the overall Go concept - does this improve on the self-checkout experience? I imagine that is an important benchmark for them in this test.

MNB reader Bill O'Neill had a comment about my persistent criticisms of retailers - in this case, Stop & Shop - making deals with Instacart:

You're looking at this from a business perspective only. We are in a pandemic, customers are scared, especially the elderly. So get off your soapbox and have some compassion.

Let me takes these one by one.

Yes, I am looking at this from a business perspective.  I think that's sort of my job.

Get off my soapbox?  I think the whole point of this thing is that I have a soapbox and get to use it.  Hopefully with some degree of responsibility and intelligence.  (Though, I grant you, not always.)

I don't think anything I have written can be construed as being not compassionate about the customers.

My argument is simple.  The Instacart model is great for Instacart, and great for customers.  It is, however, a potential nightmare for Instacart's retail clients, because they are in the position where they could be disintermediated out of their relationship with their shoppers if/when Instacart weaponizes their data against them.  I don't think these retailers should ignore or stop serving their online customers, including the elderly.  But I do think they need to own the relationship, not outsource it.

And now I'll get off my soapbox.  For the moment.