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    Published on: May 11, 2021

    by Michael Sansolo

    Someday soon, there will be an edition of MNB that lacks any mention of Covid 19, but that day hasn’t come yet, for many good reasons. For months now and maybe longer, we’ve all been wondering if or how life will be changed by more than a year of Covid-related lockdowns. Maybe we shouldn’t have asked.

    The New York Times reported last week on one covid related change: people are showering less often, dropping from daily to, in some cases, weekly. Since I imagine we’ll start traveling again soon all I can say is I hope those shower-avoiding folks aren’t on my plane. But not everything has gone away. The Times also reported on how many women are starting to think - and not with complete happiness - about the return to shape wear (Spanx) and high heels.

    Pandemic related changes will hit in other areas as well. The Washington Post recently reported that New York City schools are weighing the possibility of eliminating “snow days,” those wonderful times when inclement weather caused schools to shut down. Thanks to a year of questionably successful remote schooling, the nation’s largest school district believes snow or weather postponements are no longer necessary. Rather, those days can simply switch to remote learning, something that at least some students and parents in New York think is the worst idea ever.

    The reality is that there will be some lingering changes due to Covid beyond the recognition that inclement weather is no longer an excuse to miss a day’s work or an algebra exam. The remote skills we acquired in covid are likely to remain.

    Again, the Post recently wrote about which ones might be lasting (such as wearing face masks when we’re feeling ill) and which might be fleeting (sweat pants 24/7). One area of uncertainty is what happens at mealtime.

    Certainly supermarkets are hoping that the forced return to home cooking for all meals will remain, at least to some extent. The Post agreed that to some extent, home cooking is back but with some twists. For example, thanks to product shortages and reluctance to make fill-in shopping trips many home cooks found creative ways to use whatever was on hand to get meals on the table.

    The challenge to the entire industry is to figure out the best ways to retain at least some of those stunning sales gains produced by the almost complete shutdown of the restaurant industry for at least part of the past 14 months.

    That would begin with recognizing (as we’ve written before here on MNB) that it’s likely you were not the main reason sales jumped so spectacularly. But just because fortune favored you for the past year is no reason to think you can’t hold onto some of the gains.

    Recognizing that many homemakers are counting the minutes until the family can eat out again, it’s also a great time to remind them of the benefits of eating at home - nutritionally economically and more. For years now, studies have shown the unexpected benefits of families eating at home together from improved scholastic performance among children to lower incidence of risky behaviors.

    So let’s redouble efforts to remind shoppers of all the labor saving steps offered by retailers and manufacturers to help them get meals on the table faster and easier than ever. And then double down on those benefits of home meals.

    But consider the argument of the food critic writing in the Post about how the lockdown turned many homemakers into more creative and better cooks as they simply looked for ways to use whatever was in the pantry or they just worked to up their game in the kitchen. Perhaps, it’s time for some in-store recipes competitions, challenging shoppers to share some of their covid-related creative solutions, which might help sustain the momentum to keep cooking at home.

    At the Washington Post writer put it wonderfully: “When every day looks exactly the same as the last, paying attention to simple things — making better coffee in the morning, planning a fancy homemade dinner for you and your partner, decorating a layer cake — helps relieve the cabin fever. I hope that sense of care and adventurousness lives on, even after people feel free to dine out.”

    Sounds like a winning recipe to me.

    Michael Sansolo can be reached via email at msansolo@morningnewsbeat.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: May 11, 2021

    The Financial Times has a piece about how Amazon's decision to open Amazon Fresh grocery stores around the country "is an acknowledgment by Amazon that it cannot take serious aim at America’s $1.3 trillion grocery market without the traditional physical retailing it has done so much to disrupt. Amazon’s grocery ambitions will help define the next stage of its more than two-decade battle with Walmart. It comes just as Walmart intensifies its efforts to break Amazon’s dominance of the broader ecommerce market."

    The story goes on:  "Sinking billions into ecommerce Amazon and Walmart’s sales have ballooned during the pandemic, making them the world’s two largest public companies in any sector by revenues. Walmart’s remain bigger by a comfortable margin, with net sales last year of $555 billion compared with Amazon’s $386 billion. The crisis has encouraged Walmart to more closely integrate its 5,300 US stores and Sam’s Club warehouse outlets with its web operations."  However, FT points out, "despite sinking billions of dollars into ecommerce — technology is among its biggest areas of capital expenditure, which totaled $10.2 billion in 2020 — Walmart remains a digital underdog. It has just 7 per cent of the US ecommerce market next to Amazon’s 40 per cent, according to eMarketer."

    Here's the bottom line:  "It’s competition for top of mind: what is the place you think of when you think, 'I want to buy a soccer ball, I want a dress, I want ground beef',” Janey Whiteside, Walmart’s chief customer officer, tells FT.

    You can read the FT piece here.

    KC's View:

    This is shaping up to be an epic battle, to be sure.  And there is so much that goes into it - the placement of distribution centers to put therm as close to consumers as possible … the embrace of technologies that can cut the time it takes to get orders to shoppers (drones, anyone) … and the strategic/cultural/tactical imperatives that define each company.

    In the end, I continue to believe that each company subscribes to a different internal mandate.  Walmart wants to sell more stuff to more people.  Amazon has a more grandiose goal:  to be inextricably intertwined with as many parts of our lives as possible.

    But even these mandates are subject to evolution.  Both companies are making health care bets, believing that investing in this sector will help them establish and sustain relationships with shoppers.  And the betting here is that we'll see the same sort of competition play out in the financial services business.

    Like I said.  Epic.

    Published on: May 11, 2021

    Recode writes that a recent internal Walmart company memo "highlights its struggles to overcome competitors like Amazon, Instacart, and Target. The document also hints at challenges the company’s new subscription service Walmart+ is facing in retaining new members."

    According to the story, "The 100-page document from February, which was viewed by Recode, was created for advertising agencies that Walmart invited to compete to handle the planning and buying of ad placements for the retail giant. The memo makes several blunt assessments about the uphill battle Walmart faces to hold onto its once-dominant retail market position, including in the US grocery industry, where the company has long been No. 1 in sales."

    Recode goes on:  "Even in the online grocery market, where Walmart has held the No. 1 position thanks in large part to its popular curbside pickup service at its supercenter stores, the memo reports that the company is barely holding on to the lead position. Delivery company Instacart gained popularity at Walmart’s expense early in the pandemic, when the retail chain could not keep up with the rush of customer demand, the memo states, and is seen on an enclosed chart as being nearly even with the retail giant for the top position in the US online grocery market."

    Regarding the company's Walmart+ offering, the memo reportedly "says the company is seeing improvements when it comes to the percentage of members who renew when their membership lapses. But Walmart says the service still needs to improve renewal rates, as well as the rate at which free-trial participants convert to paying members and the number of members who purchase general merchandise alongside low-profit groceries."

    You can read the Recode piece here.

    KC's View:

    I have one thought about this … which is that it strikes me as entirely possible that Walmart, in an effort to get concessions from ad agencies with which it is dealing, might actually benefit from playing up its challenges and casting its efforts in the harshest light.

    It usually is the barrister who describes himself as a "simple country lawyer" who you really have to watch out for.  

    Published on: May 11, 2021

    Kroger has announced the launch of its "Small Business Resource Guide – as part of its Framework for Action: Diversity, Equity & Inclusion plan, featuring steps developed in collaboration with associates and leaders to accelerate and promote greater change in the workplace and in the communities the organization serves.

    "In 2020, Kroger achieved $4.1 billion in diverse supplier spend, representing an increase of 21% versus a year ago and build on our commitment to reach $10 billion in diverse supplier spend by 2030. We remain committed to doing the work to advance our longstanding and nationally recognized supplier inclusion program, reflecting partnerships with entrepreneurs of color, women, and veterans as well as companies founded by the LGBTQ+ community and business operators with intellectual and physical disabilities," said Rodney McMullen, Kroger's chairman and CEO. "Greater racial, gender, health, and wealth equity will drive true and long-lasting change and better outcomes in our country. And as America's grocer, we're honored to play a role in driving this change as an employer, grocery provider, and community partner."

    The company says that last year it "introduced 107 new diverse suppliers, a 91% increase versus 2019. Of these suppliers, five played a leading role in supplying Kroger personal protective equipment during the peak of the COVID-19 public health crisis."

    Published on: May 11, 2021

    The New York Times reports that a business opportunity has been created by one of the byproducts of the pandemic - many people who stayed home gained weight, and now they want to lose it.

    The Times frames the story this way:

    "While some spent the year of the pandemic creating healthy meals or riding their Pelotons for hours, many others managed their anxiety and boredom through less healthy means. They spent the pandemic sitting on their couches, wearing baggy sweatsuits, drinking chardonnay and munching on Cheetos.

    "Now, as the weather warms up across the country and people venture out of their homes and back into public or return to offices, many are looking to lose their pandemic pounds.

    "The desire to lose that weight is the diet industry’s gain. In recent weeks and months, companies that sell plans to help lose weight have seen jumps in new business.

    "The privately held Noom, which offers customized health plans on its app starting at $59 a month, has seen that app downloaded nearly four million times in the United States in the past year, making it one of the most downloaded health and fitness apps, according to Apptopia. Similarly, with access to many of its studios all over the world restricted for much of the past year, WW International, formerly known as Weight Watchers, reported last week that it had 4.2 million digital subscribers, a 16 percent jump from a year earlier."

    KC's View:

    The story makes the point that one study suggested that it was entirely typical for people during the pandemic lockdowns to gain "more than a half a pound every 10 days. If they continued to live as if they were in lockdown conditions, they could have put on 20 pounds over the year."

    I totally get this.

    While the Times notes that there is a lot of skepticism out there about diet plans, I do think this is an opportunity for food retailers to get aggressive about promoting healthy food and focusing on helping customers deal with pandemic weight gains.  This is a great time to get creative and to be ambitious.

    Published on: May 11, 2021

    The New York Times this morning profiles H Mart, the Korean food-centric grocery store chain that has grown from a single store that opened in Woodside, Queens, in 1982, to a 102-store chain with units "across the land, with vast refrigerated cases devoted to kimchi and banchan, the side dishes essential to any Korean meal. In 2020, the company reported $1.5 billion in sales. Later this year, it’s set to open its largest outpost yet, in a space in Orlando, Fla., that is nearly the size of four football fields."

    The story makes the point that H Mart creates an environment that allows customers with a Korean heritage to embrace their culture:  "For an immigrant, cooking can be a way to anchor yourself in a world suddenly askew. There is no end to the lengths some might go to taste once more that birthday spoonful of Korean miyeok guk, a soup dense with seaweed, slippery on the tongue, or the faintly bitter undertow of beef bile in Laotian laap diip (raw beef salad)."

    At then same time, "For many non-Asian customers, H Mart is itself a sneak attack. On their first visit, they’re not actually looking for Asian ingredients; customer data shows that they’re drawn instead to the variety and freshness of more familiar produce, seafood and meat. Only later do they start examining bags of Jolly Pong, a sweet puffed-wheat snack, and red-foil-capped bottles of Yakult — a fermented milk drink that sold out after it appeared in Ms. Han’s best-selling novel-turned-movie 'To All The Boys I’ve Loved Before'."

    The Times points out that the family behind H Mart has believed that the stores, while embracing the culture, had to be "clean, modern and easy to navigate, to defy the stereotype of Asian groceries as grimy and run-down."  Signs are in both English and Korean.

    KC's View:

    At a time when there has been an alarming uptick in anti-Asian racism, it is worth pointing out that in 1982, when H Mart was founded, only about 1.5 percent of the US population as of Asian descent;  today, it is close to seven percent.

    While the idiots who commit atrocities against their fellow citizens because of imagined slights and conspiracies tend to get the headlines, it always is worth remembering that the family who founded and continue to grow H Mart are much more representative of the American dream.

    Published on: May 11, 2021

    From the Boston Globe this morning:

    "It can take a big push to make a drastic change. And when it comes to people’s work lives, there has been perhaps no greater disruptor than the COVID-19 pandemic. Many got laid off, or were suddenly allowed to do their jobs from anywhere. Some got sick, while countless others worried about their safety.

    "However they got there, the global health crisis has caused people to take stock of their careers - and then take a leap they might not have had the freedom, or courage, to make otherwise."

    According to the story, experts say that "the number of people considering a professional change appears to be at an all-time high … and more movement is expected as vaccinations increase and employers start calling people back to the office.

    "In this liminal moment before our post-pandemic lives begin, many people are reevaluating what they’re doing with their lives. Driving it all is a nightmarish pandemic that has made people realize life is short — so why not get a better job now?

    "Career experts say they are seeing stirrings from people of all ages, from twenty-somethings rethinking their career paths to baby boomers starting their own consulting firms."

    KC's View:

    It is a really interesting story, and it once again brings us back to a word that was used a lot during the early days of the pandemic - essential.

    People want to feel essential in what they do.  People want to know that their employers view them as essential.  And I think it is incumbent on retailers to consistently communicate this to their workers - they are not just stocking shelves or running checkouts, but are actively involved in the sacred mission of helping people feed themselves better and smarter.  You can't just tell them to feel that way;  you have to treat them differently and pay them differently and empower them differently.

    The stirrings described in the Globe piece can't just be happening among workers.  Some level of consciousness raising has to happen among employers, as well.

    Published on: May 11, 2021

    The BBC reports that sandwich chain Pet a Manger, which earlier this year announced it would start selling packaged versions of its popular fresh items in Tesco stores in the UK, now is going one step further, opening actual sandwich ships inside four Tesco stores.

    If the test works, expect more Pret shops to be opened inside other Tesco units.

    The story notes that Pret a Manger has had a tough pandemic, with the center city locations where it primarily operated having been largely shut down as a reaction to Covid.  "With more companies switching to hybrid working, chains such as Pret have been forced to respond," the BBC reports, with the chain saying, "We're transforming our business model to adjust to a new way of living and working."

    KC's View:

    I still think that a logical next step may be to make Pret locations in city centers collection points for Tesco orders placed online.  

    Published on: May 11, 2021

    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…

    •  The US Covid-19 coronavirus numbers:  33,515,308 total cases … 596,179 deaths … 26,507,427 reported recoveries.

    The global numbers:  159,665,632 total cases … 3,319,567 fatalities … 137,378,593 reported recoveries.  (Source.)


    •  The Centers for Disease Control and Prevention (CDC) is saying that 58.2 percent of US residents age 18 or older have received at least one dose of a vaccine, with 44.3 percent being fully vaccinated.


    •  The Washington Post reports that the US Food and Drug Administration (FDA) has  "cleared the first coronavirus vaccine for emergency use in children as young as 12 on Monday, expanding access to the Pfizer-BioNTech shot to adolescents ahead of the next school year and marking another milestone in the nation’s battle with the virus.

    The decision that the two-shot regimen is safe and effective for younger adolescents had been highly anticipated by many parents and pediatricians, particularly with the growing gap between what vaccinated and unvaccinated people may do safely.

    "Evidence suggests that schools can function at low risk with prevention measures, such as masks and social distancing. But vaccines are poised to increase confidence in resuming in-person activities and are regarded as pivotal to returning to normalcy."

    Published on: May 11, 2021

    The New Yorker has a terrific piece about Sweden's Disgusting Food Museum, which was created by psychologist Samuel West as a follow-up to his Museum of Failure, which was developed in the tradition of Croatia's Museum of Broken Relationships, New York's Museum of Sex, and San Francisco's Museum of Ice Cream.

    The story starts with a visit to the Disgusting Food Museum by Arthur De Meyer, described as a twenty-nine-year-old Belgian journalist:

    "There are eighty-five culinary horrors on display - ordinary fare and delicacies from thirty countries - and each tour concludes with a taste test of a dozen items. De Meyer, the son of a cookbook author and a food photographer, told me that he’d always been an adventurous eater. As a reporter, he also prided himself on his ability to maintain his composure. 'But the taste test was war,' he said. 'The kind where you’re defenseless, because the bombs are going off invisibly, inside of you.'

    "An Icelandic shark dish, called hákarl, was the first assault on his stomach. 'Eating it was like gnawing on three-week-old cheese from the garbage that had also been pissed on by every dog in the neighborhood,' he said. Next up was durian, a spiky, custard-like fruit from Southeast Asia that 'smelled like socks at the bottom of a gym locker, drizzled with paint thinner.'  But worst of all was surströmming, a fermented herring that is beloved in northern Sweden. De Meyer said that eating it was like taking a bite out of a corpse.

    "He vomited ten times, topping the museum’s previous record of six. Mercifully, admission tickets are printed on airplane-style barf bags."

    You can read the entire story here.

    Published on: May 11, 2021

    •  Reuters reports that Amazon has "issued its first sustainability bond on Monday, raising $1 billion to invest in renewable energy, clean transport, greener buildings and affordable housing.

    "The world’s biggest company joins a growing list of debt issuers tapping the market for green and sustainable bonds, which is swelling as asset managers come under pressure from their investors to advance environmental, social and governance (ESG) causes … The money raised through the sustainability bond is a fraction of the total debt Amazon issued on Monday - some $18.5 billion. The company said it forms part of a new Sustainable Bond Framework and will be spent on new and existing projects."


    •  AZ Big Media reports that HelloFresh announced "plans to open a new distribution center in Phoenix, Arizona. The nearly 440,000 square-foot facility located at 1850 South 71st Avenue will become the company’s largest shipping and fulfillment center globally, supporting growing demand for HelloFresh meal kits and enabling HelloFresh to better serve new and existing customers on the West Coast."


    •  TechCrunch reports that "Clubhouse finally has an Android app that you can download from the Play Store — provided you live in the U.S.

    "The voice-based social network launched its beta Android app on the Play Store for users in the U.S. on Sunday and said it will gradually make the new app available in other English-speaking countries and then the rest of the world.

    "The social network, valued at about $4 billion in its most recent fundraise, launched as an iPhone-only app last year. The app quickly gained popularity last year, attracting several high-profile celebrities, politicians, investors and entrepreneurs."

    Published on: May 11, 2021

    •  Ahold Delhaize-owned The GIANT Company yesterday announced plans for four new stores in Philadelphia, accelerating its omnichannel growth in the city. 

    The company said that, Building on the success of its GIANT Heirloom Market format," it plans "to open a new 32,000 square foot store in the Fashion District at 801 Market Street. In addition, the company will open three new GIANT stores in the city including a 46,000 square foot store on Columbus Boulevard at the corner of Reed Street, a 50,000 square foot store on North Broad Street at the corner of Spring Garden Street, and a 40,000 square foot store on South Broad Street at the corner of Washington Avenue. Store amenities, as well as opening dates for each new store, will be shared at a later date."


    •  Chipotle yesterday announced that it is increasing its wages to an average of $15/hour, saying that the move will mean that p[art-time employees now will be making between $11 and $18 per hour.

    The New York Times notes that Chipotle is going on a hiring spree - it plans to open more than 200 restaurants this year, and needs to hire some 20,000 people to staff them.

    Published on: May 11, 2021

    •  Charles Choi, managing director of Long Island, N.Y.-based Fruit Tree Farm, affiliated with the Associated Supermarket Group (ASG), has been selected to attend the first PepsiCo Diversity in Leadership Endowment scholarship from the National Grocers Association Foundation (NGAF).

    Choi is described as a second-generation Korean American "whose work is driving the growth of his family’s independent supermarket business."

    “Charles is a modern entrepreneur who understands the art and science behind merchandising as well as today’s consumer preferences,” said Michelle Mendoza, ASG VP of marketing and customer experience, who nominated Choi for the scholarship. “As the supermarket industry is transforming and the American consumer palate has an appreciation for diversity in food, Charles is at the forefront of this transformation.”

    Published on: May 11, 2021

    Longo's said last week that it was the first North American retailer to exclusively sell fair trade bananas, an assertion that MNB reader Cindee Lolik wanted to challenge:

    Food Cooperatives across the country, including our own here in Corvallis, OR, have been selling only fair trade bananas for year.  What this chain is doing is nothing new, their marketers are taking credit where no credit is due for being the first, but I applaud them for their belated efforts.


    Regarding consumer shopping trends, one MNB reader wrote:

    I guess my question on this is: Will this remote type of shopping continue at the level it has over the past year +?  It would seem to me that supermarkets are building a barn after the horse has already left.  Would it not be a more long-term direction to make the in-store shopping experience better, instead of the other way around?  That could create a greater point of difference.  Plus, to those retailers and manufacturers that rely on the “impulse buy” to drive sales; See Ya!  You cant tell the professional shopper “ hey, if you see something interesting grab it for me.” 

    True.

    BTW…we've been arguing here for making in-store experiences better for a long time.


    Regarding the current employment situation, one MNB reader wrote:

    One anecdote on Jobs.

    Met a fellow the other day.  He and his wife worked hospitality and were pulling down close to $15/hour each, prior to the pandemic.   Both lost their jobs.

    Both receive both regular unemployment and the supplemental unemployment, which totals out to $15/hour each, and that will continue through September, for NOT working.

    AND, he IS working on construction (booming here, and elsewhere) for cash WHILE learning a new skill (electrician).

    And his wife is watching over their kids and their schooling since they go to a school district which has a pretty  spotty record of providing a quality education during the pandemic.

    Making the same dough as before PLUS putting away some cash based money while watching over their kids education and learning a new trade that pays pretty well.  I kinda think that people are pretty smart and are doing their best at taking care of their families.


    Responding to the piece about the growth of dollar stores, one MNB reader wrote:

    In my area there have been 2 new ground up Dollar Generals open in the past 2 years.  They have a small footprint, provide same like or like variety on items, and have gone into areas with low population density.  So the only comp is a convenience store.  I have also seen them pop up in other areas right across the street from supermarkets.  Their low cost of entry and minimal cost of operation, make them a formidable competitor. I would be curious to see the basket size and the shopping frequency numbers for these guys.

    MNB reader Rich Heiland chimed in:

    We are road-trippers, off the interstates. In my opinion  Dollar-type stores go where others won’t. For many rural isolated areas, Dollar is all they have without a long drive. 

    I've seen the same thing while on my cross-country drives.


    Yesterday we had two stories - one about regulation of diesel trucks in California because of the pollution they create in poor communities where giant distribution centers often are built, and another about Marc Lore's new upscale food truck venture.

    Prompting one MNB reader to write:

    Wait, 2 stories up, trucks were “bad” – but you’re a big fan of the food truck model? Let me see if I have this straight – trucks are evil in e-commerce but good if they sell more food, serve more people, and bring their brands to areas they’re not currently serving. C’mon Kevin, this is a textbook example of “cognitive dissonance”.

    I'm not sure I agree, though I take your point.

    I think there is a difference between giant tractor trailers and small food trucks … and even the smaller, increasingly electrified vehicles that can serve smaller MFCs.

    I'm not saying we should get rid of trucks.  I am saying that we need to make a major investment in technologies that don't use fossil fuels.

    Another MNB reader responded to the diesel ruck piece:

    After his 20 year stint maintaining a squadron of fighter jets for the US Air Force, my son is now in charge of maintaining a fleet of tractor trailers for Wegmans. He’s been involved with some R&D on hybrid electric/natural gas powered vehicles with Volvo, Cummins, American Natural Gas, and Hyliion. Good stuff.

    We'll get there.  But the clock is ticking.