business news in context, analysis with attitude

Published on: September 29, 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.

It was a decade ago that Gary Hawkins, who with his son Sterling Hawkins founded and runs CART, released a paper about Retail 3.0, describing how the industry had evolved to the point where marketing personalization, contextual relevancy and customer data-fueled brand-retailer collaboration had become critical to survival.

Now, with a new paper, Retail 4.0, Hawkins argues that the digital transformation of retail will be breathtaking in its scale, scope, and speed. This digitalization of retail - the industry transmuting into a new, higher-order, ecosystem - will be accompanied by a radically different economic model, disrupting the entire industry.  

In this, the first of a two-part conversation, Gary, Sterling and Kevin Coupe talk about the cultural transformations that must take place within businesses if they are to have any chance of transforming their companies … setting the stage for the next step, which is implementation.  And Gary suggests that retailers no longer have the luxury of being followers; that in a world of exponential change, retailers have to find ways to change their games and be more effective before the competition.

You can listen to the podcast here…

Published on: September 29, 2020

Amazon this morning announced what it is calling Amazon One, described as "a fast, convenient, contactless way for people to use their palm to make everyday activities like paying at a store, presenting a loyalty card, entering a location like a stadium, or badging into work more effortless. The service is designed to be highly secure and uses custom-built algorithms and hardware to create a person’s unique palm signature."

The Amazon One technology will be available today at two Amazon Go stores in Seattle - the original at 7th & Blanchard and in South Lake Union at 300 Boren Ave. North.

In a blog posting this morning, Dilip Kumar is Vice President Physical Retail & Technology at Amazon, says that "beyond Amazon Go, we expect to add Amazon One as an option in additional Amazon stores in the coming months. And, we believe Amazon One has broad applicability beyond our retail stores, so we also plan to offer the service to third parties like retailers, stadiums, and office buildings so that more people can benefit from this ease and convenience in more places."

Sign-up is simple:  "The first step is to insert your credit card. Next, hover you palm over the device and follow the prompts to associate that card with the unique palm signature being built for you by our computer vision technology in real time. You’ll have the option to enroll with just one palm or both. And that’s it—you’re now signed up."

In his blog posting, Kumar also addresses the security issue:  "At Amazon, nothing is more important to us than earning and maintaining customer trust. We take data security and privacy seriously, and any sensitive data is treated in accordance with our long-standing policies. With this in mind, we designed Amazon One to be highly secure. For example, the Amazon One device is protected by multiple security controls and palm images are never stored on the Amazon One device. Rather, the images are encrypted and sent to a highly secure area we custom-built in the cloud where we create your palm signature."

Customers also can delete their biometric information at any time, Kumar says.

Published on: September 29, 2020

Target has scheduled its annual Deal Days promotion to run October 13-14 - precisely on the same dates on which Amazon will have its Prime Days promotion.

It will, the company says, kick off "a holiday season that will feature nearly 1 million more deals than last year, Black Friday pricing all November long and an extended Price Match Guarantee."

In its announcement, Target says, "Target Deal Days will feature digital deals on hundreds of thousands of items, more than double last year. Guests can sign up for the free, easy-to-use Target Circle loyalty program to access all the best deals, and for the first time, all deals will span the entire two-day event, giving guests more time to shop deep discounts across Electronics, Home, Essentials, Toys, Beauty and more.

"Nearly all deals are available via Target’s contactless Drive Up and Order Pickup, and more deals than ever can be received via same-day delivery with Shipt. This means guests can get their orders in as soon as one hour, with no membership fee required. Additionally, select deals will be made available early on Target.com starting Oct. 5."

The no-membership-fee-required part of the announcement is key, since it is a not-so-veiled shot at Amazon's requirement that one be a Prime member to take advantage of Prime Day deals (though one can get a free  short-term Prime membership that coincides with Prime Days).

Published on: September 29, 2020

Southeastern Grocers, parent company to Winn-Dixie and Bi-Lo, though it has been selling off stores carrying the latter banner, announced last night that it is beginning the process for an Initial Public Offering.

Here's the text of the announcement:

"Southeastern Grocers, Inc. (the 'Company') announced that it has confidentially submitted a draft registration statement on Form S-1 with the Securities and Exchange Commission relating to a potential initial public offering of its common stock. The shares in the proposed offering are expected to be offered by existing stockholders of the Company. This process will help enable the Company to make the decision to become publicly traded, subject to market and other conditions.

"This press release does not constitute an offer to sell or the solicitation of an offer to buy any securities. Any offers, solicitations of offers to buy, or any sales of securities will be made in accordance with the registration requirements of the Securities Act of 1933, as amended ('Securities Act'). This announcement is being issued in accordance with Rule 135 under the Securities Act."

Published on: September 29, 2020

More than 30 US corporations "have agreed to new disclosures of previously private race, gender and ethnicity workforce data," as they respond to "a push by the New York City comptroller and three city retirement funds," the Los Angeles Times reports.

Among those companies are Amazon, Starbucks, Target, Coca-Cola and PepsiCo.

According to the Times story, "The initiative is part of a broader push to compel workforce transparency at companies that have made explicit statements of support for equality after broad protest of the killing of George Floyd by Minneapolis police and disproportionate deaths of minorities from COVID-19. Two other groups were formed this month to ensure all public companies have at least one Black director.

"The New York initiative began in July and is being pressed by the city’s Employees’ Retirement System, Teachers Retirement System and Board of Education Retirement System. The comptroller and funds targeted 67 companies that made statements of support for reform after the unrest but weren’t disclosing the detailed reports they are required to make each year to the Equal Employment Opportunity Commission."

Published on: September 29, 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 US, we've now had 7,361,889 confirmed cases of the Covid-19 coronavirus, resulting in 209,815 deaths and 4,610,639 reported recoveries.

Globally, there have been 33,576,464 confirmed coronavirus cases, with 1,006,905 fatalities, and 24,895,466 reported recoveries.

•  The Washington Post reports that U.N. Secretary General António Guterres, responding to the passing of one million in the global death toll, called the milestone "agonizing" and said that leaders must learn from missteps earlier this year.

“Responsible leadership matters,” he said. “Science matters. Cooperation matters — and misinformation kills.”

•  The Washington Post reports on a new study from the  Korea Disease Control and Prevention Agency saying that "nine out of 10 patients who tested positive for the coronavirus reported at least one side effect of the disease following their recovery … Researchers say more than 90 percent of patients reported side effects frequently associated with the disease, including loss of taste and smell, fatigue and psychological issues.

"Fatigue was the most common reported side effect, with more than 26 percent of patients experiencing extreme tiredness, followed by difficulty in concentration, according to researchers behind the survey.

"In Britain, thousands of patients have reported long-term effects of the illness, often referred to as 'long covid,' which can affect people for weeks after they have had symptoms of the infection - even if they have not tested positive."

•  The Washington Post also reports on how "a party near Florida State University’s campus drew more than 1,000 people before it was broken up by police, authorities said Monday.

The party was one of more than a dozen large gatherings that prompted calls to the Tallahassee Police Department over the weekend, the department said in a statement. About 700 cars were reportedly surrounding the off-campus apartment complex around midnight, many of them blocking the road. Officers ultimately had to bring in a helicopter to get the crowds to clear out."

The Post writes that "since classes resumed in early August, at least 1,479 FSU students have tested positive for covid-19, and university officials have repeatedly begged undergraduates to stop throwing parties and start wearing masks. Meanwhile, Gov. Ron DeSantis (R) on Friday lifted all restrictions for bars and restaurants, clearing the way for them to reopen at full capacity.

"DeSantis also suggested last week that Florida should create a 'bill of rights' that would protect college students who attend large parties from being expelled."

I'm torn on this one, in the sense that I think it would be more appropriate to have the students sign a pledge of personal responsibility.  But at the same time, many of the actions of the authorities seem designed to assuage people's concerns, so I don't entirely blame them.  Maybe the governor should sign a pledge of personal responsibility?

•  Eater Chicago reports that Chicago "announced it will allow more people to dine indoors starting on Thursday, October 1. The city will raise indoor capacity from 25 percent to 40 percent, with a maximum of 50 people in a room. City officials say Chicago is trending in the right direction when it comes to key health metrics. That includes the number of COVID-19 cases, the burden on health care systems, and test positivity."

According to the story, "Starting on Thursday, bars will be able to close at 1:30 a.m., with last call coming at 1 am … The city will also ease restrictions for taverns that don’t serve food … starting Thursday, bars without food licenses can offer indoor service with the same 25 percent capacity, or a maximum of 50 people. Chicago Department of Public Health Commissioner Dr. Allison Arwady preached cautiousness, saying if metrics remain stable in 28 days, the city would be in a position to increase indoor capacity to 50 percent. That would be in line with what New York is doing on November 1."

•  From Reuters:

"U.S. businesses with COVID-19 outbreaks are facing an emerging legal threat from claims that workers brought coronavirus home and infected relatives, which one risk analysis firm said could cost employers billions of dollars … The cases borrow elements from 'take home' asbestos litigation and avoid caps on liability for workplace injuries, exposing business to costly pain and suffering damages, even though the plaintiff never set foot on their premises."

The story notes that "between 7% and 9% of the roughly 200,000 U.S. COVID-19 deaths so far are believed to stem from take-home infections and the lawsuits could cost businesses up to $21 billion if the number of Americans fatalities reaches 300,000, according to Praedicat, a firm that evaluates risks for insurers."

Published on: September 29, 2020

From the Puget Sound Business Journal:

"The U.S. Securities and Exchange Commission has charged a Amazon finance manager and two of her family members with insider trading, the agency said Monday.

"The SEC said in a statement that Laksha Bohra, a senior manager in Amazon’s tax department, and her family 'reaped illicit profits of approximately $1.4 million from their unlawful trading in Amazon securities'."

Amazon has not commented on the case, except to say that she is a "former" employee.

According to the Journal, "In her job, the SEC said, Laksha Bohra prepared and reviewed numbers included in Amazon’s quarterly and annual earnings statements that were filed with the SEC. The agency said she 'acquired, and tipped her husband Viky Bohra with, highly confidential information about Amazon’s financial performance.'

"Viky Bohra and his father, Gotham Bohra, traded Amazon stock using this confidential information in 11 separate accounts, which were maintained by various members of the Bohra family, according to the SEC.

"The alleged illicit activity took place between January 2016 and July 2018, the SEC said."

Published on: September 29, 2020

•  The BBC reports that it seems likely that Walmart is on the verge of selling its UK-based Asda business, which it has owned since 1999.

According to the story, "Asda could return to UK ownership for the first time in 20 years after a group comprising the billionaire Issa brothers and TDR Capital emerged as frontrunners to buy the supermarket.  It is understood the Blackburn-based brothers and the private equity firm have been named as preferred bidders.

A deal that would sell Asda to the consortium for more than $8 billion is said to be on the table but not yet finalized.

Published on: September 29, 2020

•  In Minnesota, the Star Tribune reports that Target-owned delivery service Shipt "has put in place new policies and strategies as it wages an uphill battle to gain more market share in an increasingly competitive industry against the likes of Instacart and DoorDash."

Among the policy changes made in the past few months:  "In August, the company rolled out a pay-per-order option, allowing a customer to buy a pass for one to five orders. Before that, customers had to pay either a $99 annual or $14 monthly membership … Also during the summer, Shipt began to implement a new pay model and rebrand a service it now calls Shipt Driven, where its drivers deliver products for retailers but don’t complete the actual shopping."

The story notes that "in addition to Target, Shipt shops and delivers orders for stores such as Costco, Hy-Vee, CVS and Kroger. In total, it has more than 120 retail partners, a 50% increase from last year."

•  Ahold Delhaize-owned Food Lion said that it is "adding additional 'Food Lion To-Go' grocery pick up services at 31 new stores in Georgia, Kentucky, North Carolina and South Carolina beginning September 28, 2020.

"Customers can use the Food Lion To-Go website or the Food Lion To-Go app to confirm availability and place orders."

•  Bloomberg reports that Amazon plans to triple its workforce in Vancouver, British Columbia, "where software engineers are cheap, smart and plentiful.

"The online retail giant plans to occupy a bunker-like former Canada Post mailing center that’s being redeveloped into a new 1.1 million square-foot office to house 8,000 jobs by 2023, Jesse Dougherty, a vice president and Vancouver site lead at Amazon, said by phone. Currently, the company has 2,700 full-time employees at its city hub. It also plans to add 500 jobs in Toronto, according to a statement released Monday.

"A weak loonie, lower wages and a steady flow of graduates make Canada an attractive place to expand for tech companies whose largest expense is labor."

Published on: September 29, 2020

•  The Detroit Free Press reports that Kroger has picked Romulus, Michigan - in the Detroit Metro area - as the site for a new $95 million Ocado-powered, robotics-enabled, 135,000 square-foot warehouse.

According to the story, "This facility will support the Michigan, northern Ohio and Indiana markets … Once ground breaks on the site, the facility is expected to be operational in 18 months."

•  Two weeks after Amazon opened its first Amazon Fresh supermarket in the Southern California community of Woodland Hills, the Long Beach Post News reports that Amazon has confirmed that it plans to open another one in the region - in a former Haggen/Albertsons location in Long Beach that has been shuttered for five years.

According to the story, "No opening date has been announced due to COVID-19 supply chain complications, an Amazon spokesperson said. The company is still working to finalize an open date but job postings will go live first thing Tuesday morning."

A quick check reveals that the new Amazon Fresh location is virtually next door to a Stater bros, across the street from a Grocery Outlet, and just a half-mile east of a Pavilions.  So while Amazon may not be spoiling for a fight, it is likely to get one.

Published on: September 29, 2020

•  The Minneapolis/St. Paul Business Journal reports that Steven Spinner, CEO of United Natural Foods Inc. (UNFI), has announced that he will retire when his contract runs out on July 31, 2021.

According to the story, "Spinner could leave the role sooner if the board appoints a new CEO before then.

"UNFI is working with an executive search firm. According to the company, the CEO search will include both internal and external candidates.  Spinner plans to remain a part of the UNFI board of directors, serving as executive chairman following his retirement."

•  Dollar General announced that Emily Taylor, the company's senior vice president of channel innovation, has been promoted into the role of executive vice president and chief merchandising officer.  She succeeds Jason Reiser, who left the company.

Published on: September 29, 2020

MNB reader Mike Bach had a reaction to a point I made yesterday:

To suggest that Amazon Prime Day will take sales from the holidays would be supported by Costco’s own merchandising calendar /approach.

Costco has its Christmas holiday selection on the floor now, including traditional Christmas trees, candles and bows along with some very cool gifts (Ms. Pac Man, basketball shoot hoops machine, etc.) that aren’t likely to be found elsewhere.

In talking about students behaving badly the other day, I noted that I always told my kids that "life isn't fair.  Get over it."

Prompting one MNB reader to write:

I couldn’t agree more with your assessment.  A fair is where you ride rides and buy popcorn.  People need to be held accountable for their actions and realize for every action, there is going to be a reaction whether positive or negative.  We all have to work together to get through this, if not, well I don’t think I need to say it.

And finally, MNB reader Gregory Gheen had a question prompted by the listing of all the movies not being released this year because of the pandemic:

If there are few to no movies released this year, will there be an Academy Awards?

I guess so … but I have no idea how it'll be done, or when.

But that's hardly the biggest problem the movie industry is facing in a world where theaters are becoming less relevant by the day.

Published on: September 29, 2020

In Monday Night Football, the Kansas City Chiefs defeated the Baltimore Ravens 34-20.

The Tampa Bay Lightning defeated the Dallas Stars 2-0 in last night's sixth game of the Stanley Cup finals, winning the championship four-games-to-two in the best-of-seven series.