business news in context, analysis with attitude

Published on: September 14, 2021

by Michael Sansolo

I don’t know what it is about milestone anniversaries, but some how this 20th year since the September 11 attacks seems more prominent than the previous 19 years.  For me, it’s a reminder of why I love the people in the supermarket industry.

First, a confession:  Back in 1983 when I joined Progressive Grocer magazine, I never imagined that in 2021 and the twilight of my career I’d still be with this industry. But I am, and through my years at PG, the Food Marketing Institute (FMI) and now MNB, I’ve never regretted it.

What I found in these many decades is two-fold really. First, the people in this industry are remarkable in so many ways. And secondly, this industry is never dull. Whatever happens in society, whether demographic changes, eating fads or you name it, it happens in supermarkets quickly. The simple reality is that supermarkets and their products are found in every home, neighborhood, city and town and so in countless ways this industry is the essence of our society.

Especially when times are at their toughest.

The anniversary of September 11, 2001, always reminds me of the most heroic supermarket story I ever witnessed, albeit at a distance of time and space. A few months after the attacks, I was assembling an event for FMI and we decided we needed to say something different about what had just happened.

Working with our production partners at O’Keefe Communications, we hit on the idea to send a camera crew to New York to interview workers at two supermarkets that by chance were located in lower Manhattan, literally in what had been the shadow of the Twin Towers. Those interviews turned out to be powerful beyond belief.

The workers in the stores - what were then two powerful local companies, D’Agostino’s and Pathmark - recalled the horrible sounds, smells and feelings of the day.  But that was only the beginning.

Those same workers quickly realized the disaster that was unfolding as they watched dazed survivors walk down the street coated in the dust and hellish soot of the collapsed buildings. And the workers at both stores sprung into action.

They ran into the streets with bottles of water to wash the faces of the passersby. Some brought out various eyewash products to help those in desperate need. They gave food and when possible gave anything that could be used for clothing, shoes or bandages. No one had a policy about how to do this, they just did it.

The story that gripped many others and me was actually told by one stores’ manager who happened to be off duty on the 11th. When he went downtown on the 12th to check on his store he emerged from an underground subway stop to see a forever-changed skyline. His voice broke down in the interview and every audience that saw the video shed a few tears with him.

I pray we never know another day like 9-11, but sadly I know other horrible things will happen. And it will make me endlessly proud to hear stories of low-wage supermarket workers fighting through rain, snow, floods, fires and even terrorist attacks to get to work and provide an essential community service in good times and bad.

And every time that happens I’ll be endlessly proud yet again that I’ve gotten to spend so much time in the company of truly unsung first responders and heroes.

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: September 14, 2021

After doing his 9-11 FaceTime the other day, KC got a number of inquiries about the poster behind him.  It predates 9-11, he says, but it does have a story ... and even serves as a business metaphor.

Published on: September 14, 2021

Kroger announced this morning the launch of what it calling Kroger Delivery Now, a collaboration with delivery company Instacart that it says will allow it to deliver online orders in 30 minutes.

The retailers says that Kroger Delivery Now is "powered by a virtual convenience store that is fulfilled by the Kroger Family of Stores" with a "comprehensive offering of 25,000 items" that "combines customer favorites with quick and easy doorstep delivery – whether they're shopping for a meal, snack, last-minute ingredient, over-the-counter medication or diapers."

The solution will be available both through Kroger's e-commerce site and through Instacart's new 'Convenience Hub' on the Instacart Marketplace."

"Kroger Delivery Now is a differentiated solution in the e-commerce industry, not just the grocery sector," said Rodney McMullen, Kroger's chairman-CEO, in a prepared statement, noting that "this service reaches up to 50 million households and it's an expansion of our thriving e-commerce model that demonstrates strategic interplay among our assets, expansive store network, supply chain, and dedicated fulfillment centers and fleet, joined by Instacart's unrivaled fulfillment model and last-mile technology to provide our customers with anything, anytime, anywhere without compromise."

In its coverage, the Wall Street Journal reports that "Kroger tested 30-minute delivery about two years ago, but the grocer found it difficult to expand the service quickly with only its staffers, said Rodney McMullen, chief executive officer of Kroger. It will be easier to expand the service with Instacart, he said, because the grocery-delivery provider has the technology and shoppers in place to pick and deliver grocery staples, household products and prepared meals from Kroger’s more than 2,700 stores.

"Grocery delivery has become a competitive market as companies ranging from upstarts to giants like Amazon.com Inc. try to grab a bigger slice of consumer spending. It remains tough to reach consistent profitability in delivery because of high labor and transportation costs."

The announcement notes that "with the launch of Kroger Delivery Now, Instacart is also unveiling the Convenience Hub on the Instacart Marketplace, a new product experience that streamlines convenience shopping for customers. Through the new Convenience Hub, customers in nearly every major U.S. city can now shop for convenience essentials 24 hours a day, seven days a week with free Priority Delivery in as fast as 30 minutes for Instacart Express members on orders over $10."

Fidji Simo, Instacart's CEO, said that "Instacart has become a powerful retail enablement platform and today's expansion of our Kroger partnership is another example of our commitment to develop new solutions that help retailers grow and meet the evolving needs of their businesses and customers."

Published on: September 14, 2021

Bloomberg has a story about how, while service industries (restaurants, hotels) often are singled out as being hardest hit by the national labor shortage, the numbers suggest that the manufacturing industry has been hardest hit.

And it is getting worse - especially because of Walmart and Amazon, which "continue to raise their pay to be competitive in a tight labor market. We're used to America losing manufacturing jobs because companies can find cheaper workers abroad, but perversely, we might begin losing more of those jobs because factory owners can't offer what service employers can."

Bloomberg goes on:

"Manufacturing wages have gone up by 0.5% per month for four consecutive months — that hasn't happened since 1981.

"But as Walmart and other service sector employers have shown, they're not resting on their laurels, either, continuing to raise wages and benefits as needed in order to fill their positions.

"That’s putting manufacturers in an unexpected competition with service employers for workers. Amazon likes to quote its average starting wage of $17 an hour at fulfillment centers in Michigan that comes with a host of benefits, a package that's likely better than a lot of entry-level or lower-tier manufacturing jobs for similar work. Thursday, Amazon upped the ante again, announcing that it will pay for some U.S. employees to get four-year college degrees.

"A whole host of retailers pay $15 an hour or more — Walgreens announced it would do just that last month — and offer working conditions that are likely more comfortable and less hazardous than being on a factory floor. Would you rather make $15 an hour working at a sawmill or inside a Home Depot?

"This is one reason manufacturers will end up embracing automation: They just can’t find a way to make jobs good enough to attract the workers they need relative to their ever-escalating service economy competition."

Published on: September 14, 2021

Amazon this morning announced that its Amazon One technology, which the company describes as being a "fast, convenient, and contactless way for people to use their palm to enter, identify, and pay" in stores, has been expanded for the first time to a third party - the Red Rocks Amphitheatre in Denver Colorado.

According to the announcement, "AXS, a leading digital ticketing company, will deploy standalone ticketing pedestals including Amazon One. This means, upon enrolling their AXS Mobile ID with Amazon One, fans now have the option to simply scan their palm to enter concerts and events much faster and easier than before … When a ticketholder is ready to enter the amphitheatre using their palm, there is a designated entry line where Amazon One is enabled. When a fan hovers their palm over the Amazon One device, a unique palm signature is built by our computer vision technology.

"The service is designed to be highly secure and uses custom-built algorithms and hardware to create a person’s unique palm signature. Once enrolled, the service is contactless and ticketholders can use their palm to enter AXS ticketed venues in less than a second or two."

It is, the company said, "the first time the Amazon One service is available outside Amazon and Whole Foods Market stores and for entry into an entertainment venue, and we’re excited about the potential for expansion to other locations where entry lines can be long and time consuming."

To this point, Amazon One technology has been available at some 60 Amazon stores, including select Amazon Go, Whole Foods Market, Amazon Books, Amazon 4-star, Amazon Fresh, and Amazon Pop Up stores in markets that include Arizona, Colorado, Connecticut, Florida, Massachusetts, Michigan, Minnesota, Missouri, North Carolina, New Jersey, Oregon, Tennessee, Texas, Washington state, and Washington D.C.

Published on: September 14, 2021

Bloomberg reports that the Washington, DC, attorney general is expanding his antitrust lawsuit against Amazon, now including its scope to include the online retailer's own sales policies and relationships with wholesalers.  Previously, the suit focused on Amazon's relationship with third-party sellers on its site.

Originally, the antitrust suit accused Amazon of forcing its third-party sellers to guarantee that they would not sell their products for lower prices on other websites, which DC Attorney General Karl Racine said led to artificially high prices for consumers.

Bloomberg writes that "Amazon’s sales agreements with its wholesalers include a 'Minimum Margin Agreement,' in which wholesalers guarantee Amazon a certain minimum profit. If Amazon sells the product at a price that nets less than that agreed-upon profit, the wholesaler must compensate Amazon for the difference, a cost that can result in millions of dollars in payments to Amazon, the complaint says."

The Wall Street Journal writes this morning that "Amazon says its policies encourage lower prices for its shoppers, and are legal. It has filed a motion to dismiss the lawsuit."

“Amazon takes pride in the fact that we offer low prices to customers across the broadest selection,” a company spokesman said Monday. “The outcome the DC Attorney General seeks would result in higher prices to customers, whether offered directly by Amazon or by third parties in our store, oddly going against core objectives of antitrust law.”

Published on: September 14, 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…

•  In the United States, we've now had a total of 42,140,103 Covid-19 coronavirus, resulting in 680,274 deaths and 32,062,905 reported recoveries.

Globally, there have been 226,177,513 coronavirus cases, with 4,654,317 resultant fatalities and 202,835,279 reported recoveries. (Source.)

•  The Centers for Disease Control and Prevention (CDC) says that 73.9 percent of the US population age 12 and older has received at least one dose of vaccine, with 63.1 percent being fully vaccinated.

•  The New York Times reports that "hospitals in the southern United States are running dangerously low on space in intensive care units, as the Delta variant has led to spikes in coronavirus cases not seen since last year’s deadly winter wave.

"One in four hospitals now reports more than 95 percent of I.C.U. beds occupied — up from one in five last month. Experts say it can become difficult to maintain standards of care for the sickest patients in hospitals where all or nearly all I.C.U. beds are occupied.

"In June, when Covid-19 cases were at their lowest level, less than one in 10 hospitals had dangerously high occupancy rates."

Published on: September 14, 2021

•  United Parcel Service said that it "is getting into same-day delivery with a deal to buy Roadie Inc., a platform that uses gig workers to deliver items from retailers and other shippers quickly … Buying Roadie thrusts UPS directly into the space, while addressing some of the limitations of using its own network for certain packages. UPS said that Roadie drivers can deliver items that don’t fit because of their size or because they are perishable. They can also deliver items that are in shopping bags.

"Roadie’s network of crowdsourced drivers use their own vehicles to complete deliveries. The company says that it has 200,000 drivers that deliver items all across the country, including for retailers like Michael’s Stores Inc. and Home Depot Inc."

Terms of the deal were not disclosed.

Published on: September 14, 2021

•  From Bloomberg:

"Walmart Inc. made its green bond market debut with a $2 billion offering Wednesday, the largest ever from a U.S. corporation, according to data compiled by Bloomberg … Walmart’s $2 billion 10-year green issuance is part of a five-tranche, $7 billion sale to help fund a tender offer as well as a range of environmental efforts. They include solar and wind projects, energy efficient refrigeration, electric vehicles and waste reduction, according to its green financing framework. Walmart has a target of achieving zero emissions by 2040 and also aims for a 1 billion metric ton cut in emissions from its supply chain by 2030.

•  From the New York Times:

"The news release went out at 9:30 a.m. Monday, just as the U.S. stock market opened. It claimed to be from Walmart and had some big news for the cryptocurrency industry: The nation’s largest retailer would soon begin accepting payment in Litecoin, a digital currency.

"The announcement appeared real enough that several media outlets wrote it up. Even the Twitter account for the Litecoin Foundation, which promotes the use of the currency, touted the release in a post. The value of Litecoin jumped more than 30 percent before Walmart put out a statement saying the news was false.

"The newest thing in finance had apparently fallen prey to one of the oldest investor hoaxes around — a classic pump-and-dump scheme. Someone issued a false news release, likely taking advantage of the general hoopla around cryptocurrency to stoke enthusiasm for Litecoin, which is far less popular than Bitcoin and other digital currencies. Litecoin’s price jumped to about $230 from around $175 right after the news, then fell back and traded at around $180 after Walmart refuted the release. The perpetrators of the hoax most likely made money in that time.

"Securities lawyers said there was little doubt the phony release would lead to an investigation by the Securities and Exchange Commission and possible charges against the fraudsters, whose identity was unknown."

Published on: September 14, 2021

•  The Charlotte Observer reports that Kroger-owned Harris Teeter "will temporarily shorten all store operating hours from 6 a.m. to 9 p.m. starting Wednesday, according to the company website. The change is in place until further notice.

"The service counter, and meat and fish counters will close at 8 p.m., according to the company. Other amenities will close at 7 p.m."

According to the company, the problem is the "labor shortage affecting the country nationwide during the coronavirus pandemic."

•  The Rochester Democrat and Chronicle reports that "Wegmans Food Markets has announced it will open three more stores next year in the nation's Mid-Atlantic region: in Alexandria, Virginia; Washington, D.C.; and Delaware, just outside Wilmington.

"The Alexandria store — which will become Wegmans' second in that city of around 160,000 people — is set to open in the spring of 2022; Wegmans has not said when next year the Washington and Delaware stores will open."

Wegmans now operates more than 100 stores in seven states from New York to North Carolina.

Published on: September 14, 2021

•  United Natural Foods, Inc. (UNFI) announced that Steve Dietz, president of the company's Pacific Region, has been promoted to the role of Chief Customer Officer.

Published on: September 14, 2021

…will return.

Published on: September 14, 2021

In Monday Night Football, the Las Vegas Raiders defeated the Baltimore Ravens 33-27.