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    Published on: October 11, 2021

    Content Guy's Note:  A few weeks ago at the Organic Produce Summit, one of the two keynotes (Jim Donald and I did the other) was by Larissa Zimberoff, who has written a fascinating new book, "Technically Food: Inside Silicon Valley's Mission To Change What We Eat."

    In her book, Zimberoff takes the reader on a compelling journey, visiting with chefs and venture capitalists, looking at the difference (and tensions) between "Big Food" and "New Food," focusing on issues of transparency and consumer education, and prognosticating about how people will be eating and grocery stores will be marketing and merchandising product just a few years from now.

    I wanted to know more about this trend, and so I reached out via Zoom.  I hope you enjoy our extended conversation.



    If you want to listen to this conversation as an audio podcast, you can hear and download it here:



    You can buy "Technically Food: Inside Silicon Valley's Mission To Change What We Eat," at Amazon, Bookshop.org, at the iconic independent  bookseller Powell's, or wherever books are sold.

    Published on: October 11, 2021

    USA Today has a story saying that Walmart's announcement that it is "expanding its private-label apparel brand Free Assembly to include kids' clothes" reflects a broader strategic imperative - "Walmart is increasingly taking control of its own supply of inventory, up to and including making (well, procuring) its own goods and bypassing national brands as a result."

    The story notes that Walmart, as much or more than almost any other retailer, has the resources to create a national brand-style patina for its private label items, and yet still control the economics to a degree that increase its margins on these items.

    The USA Today story notes that Target has proven the potential of this strategy - "One-third of its revenue is driven by house brands."  Bed Bath & Beyond isn't there yet, but 10 percent of its volume is driven by private brands, and it has publicly committed to getting that number up to 30 percent.

    "Although Walmart isn't nearly as forthcoming with numbers about its private-label program, it's not exactly a stretch to suggest its house-brand revenue is nowhere near Target-like levels," the story says.  "It's also unlikely to keep pace with Bed Bath & Beyond's projected private-label sales growth. Walmart still has to carry a little of everything, and it needs national brands to make it happen.

    "Don't underestimate the potential of Walmart's private labels, though, as small as they may be right now."

    KC's View:

    Walmart has been making a number of moves to both improve margins and generate new revenue streams, because it knows that this is critical to funding core retail initiatives;  if it can make a little more money on private label items, that can be used to underwrite expensive e-commerce efforts, for example.

    Expect more of these kinds of moves, which will continue to make life challenging for independents, which have fewer resources with which to play.

    Published on: October 11, 2021

    The Wall Street Journal this morning reports that "global supply-chain delays are so severe that some of the biggest U.S. retailers have resorted to an extreme - and expensive - tactic to try to stock shelves this holiday season: They are chartering their own cargo ships to import goods … Walmart Inc., Home Depot Inc., Costco Wholesale Corp. and Target Corp. - some of the biggest U.S. retailers by revenue - are among the companies that are paying for their own chartered ships as part of wider plans to mitigate the disruptions, a costly and unattainable option for most companies. Some of the chains are passing along these added costs by raising prices for shoppers.

    "The chartered ships are smaller than those that companies like Maersk operate and move just a small slice of total imports, the executives said. Ships that can hold around 1,000 containers are on average nearly twice as expensive as the cost of moving cargo on a typical 20,000-container vessel, according to freight forwarders.

    "But the charters provide the big retailers with a way to work around bottlenecks at ports such as Los Angeles, by rerouting cargo to less congested docks such as Portland, Ore., Oakland, Calif., or the East Coast. It also could help retailers ensure that key products such as electronics and décor arrive for the holiday season."

    KC's View:

    One of the things that Amazon has invested in over recent years has been its own air force and navy, which enable it to exert greater control over its supply chain.  

    I have to wonder if the current moves being made by other big retailers will persuade them that this is an approach they should take long-term, not just as a response to supply chain snafus.  If so, it then will be interesting to see if there are ways in which they can collaborate, creating alliances that will reduce their individual exposure.

    Published on: October 11, 2021

    The Washington Post reports that "even with this summer’s surge in restaurant patronage, more than half of 4,000 restaurant operators surveyed in September by the National Restaurant Association say that business conditions are worse now than three months ago. They cite higher food and utility costs and supply-chain problems, but the biggest issue, restaurateurs say, is lack of staff … Nearly half of the restaurateurs in the NRA survey said they were not yet operating at full capacity, because they aren’t adequately staffed.

    "Owners have to abbreviate menus to accommodate fewer cooks, and they have to limit dining room capacity because of fewer servers, according to David Portalatin, food industry adviser at the NPD Group. Owners have to shuffle workers around like chess pieces between curbside service, outdoor dining, the bar and the dining room, sometimes going without hosts, bussers or bartenders."

    KC's View:

    The question of what is essential is one that restaurateurs have to consider along with everyone else in retailing, it seems to me.  To some extent, I think that this is a question that potential restaurant patrons may be asking themselves, as they think about the costs implicit in going out to dinner (and, in many cases, suffering sticker shock).

    Maybe it is better to have six great offerings on the menu that really differentiate a restaurant.  Maybe it is better to spread out one's best by having a more robust take-out offering, and maybe even a market that sells recipe ingredients.  

    Such alternatives won't work for every business in every place, but I certainly think that restaurant owners need to start thinking about these questions.

    Published on: October 11, 2021

    The Wall Street Journal reports that Netflix Inc. is teaming up with Walmart Inc. to create a digital storefront on the retailer’s website that will sell merchandise tied to hit shows such as 'Stranger Things' and 'Squid Game,' the companies said.

    "The partnership is part of Netflix’s broader strategy to develop new revenue streams beyond its core subscription business and market its content away from its own platform.

    "Netflix consumer products, from T-shirts to stickers to dolls, are already available online from several retailers. The deal with Walmart creates a dedicated area of Walmart.com for Netflix merchandise, the Netflix Hub—the first such online storefront that Netflix has created with a national retailer. Netflix also has its own online store, Netflix.shop."

    Published on: October 11, 2021

    The New York Times has a long interview with former PepsiCo CEO Indra Nooyi in which she talks about corporate responsibility, a conversation that is linked to her new memoir, "My Life in Full."

    An excerpt:

    "The PepsiCo that I inherited — it’s a great company that was purpose-built for one time. Society was different, tastes were different, lifestyles were different. Everything changed. We had to worry a lot more about plastic and water use and carbon footprint because of climate change. We had to worry about what kind of products to put in the marketplace. There are companies that ignore all that and say this is only about consumer choice. I’m also for consumer choice, but I wanted to make the better choice an easier choice. So rather than put regular Pepsi at eye level in the retail store, how about putting Diet Pepsi, Pepsi Max, Pepsi Zero Sugar at eye level? This is not about taking choice away. This is about nudging consumers to the healthier choice because societies are changing.

    "The biggest issue is when you use the words 'socially responsible.' It sounds like you’re giving away money that shareholders should be getting. It’s not about giving away money we’ve made. It’s about how we make money a different way."

    You can read the entire story here.

    Published on: October 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…

    •  Here are the updated US Covid-19 coronavirus numbers:  45,204,373 total cases … 733,575 deaths … and 34,664,963 reported recoveries.

    The global numbers:  238,724,799 total cases … 4,868,939 fatalities … and 215,893,129 reported recoveries.  (Source.)



    •  The Centers for Disease Control and Prevention (CDC) says that 76.4 percent of the US population age 12 and older has received at least one dose of vaccine, with 66 percent of that group being fully vaccinated.

    The CDC also says that 10.9 percent of the US population age 65 and older has received a vaccination booster shot.



    •  The New York Times reports that "Moderna, whose coronavirus vaccine appears to be the world’s best defense against Covid-19, has been supplying its shots almost exclusively to wealthy nations, keeping poorer countries waiting and earning billions in profit … About one million doses of Moderna’s vaccine have gone to countries that the World Bank classifies as low income. By contrast, 8.4 million Pfizer doses and about 25 million single-shot Johnson & Johnson doses have gone to those countries.

    "Of the handful of middle-income countries that have reached deals to buy Moderna’s shots, most have not yet received any doses, and at least three have had to pay more than the United States or European Union did, according to government officials in those countries."

    The Times goes on:  "Unlike Pfizer, Johnson & Johnson and AstraZeneca, which have diverse rosters of drugs and other products, Moderna sells only the Covid vaccine. The Massachusetts company’s future hinges on the commercial success of its vaccine … Moderna executives have said that they are doing all they can to make as many doses as possible as quickly as possible but that their production capacity remains limited. All of the doses they produce this year are filling existing orders from governments like the European Union."

    The Times quotes former CDC head Dr. Tom Frieden as saying, “They are behaving as if they have absolutely no responsibility beyond maximizing the return on investment."



    •  Bloomberg writes that "Walmart Inc. said 'the overwhelming majority' of employees required to get Covid-19 vaccines have received the shots.

    "A 'very small percentage' of the U.S. headquarters and regional staff covered by the company mandate are partially inoculated or haven’t gotten the shots, Walmart said in an email without providing specific numbers. Employees who aren’t fully vaccinated can complete the process this month 'while on a leave of absence,' the retail giant said."



    •  From the Wall Street Journal:

    "People who both had Covid-19 and are vaccinated don’t need to rush to get the boosters now rolling out across the U.S., health experts say.

    "Millions of Americans who have received Pfizer Inc. and partner BioNTech SE’s  Covid-19 vaccine now qualify for an additional dose, under the Centers for Disease Control and Prevention’s recommendation of shots for seniors and certain at-risk adults. Some of those who qualify are people who have been infected with the disease, either before they were vaccinated or after.

    "Several studies suggest that people who have had Covid-19 and were fully vaccinated have strong protection, including against variants, and probably don’t need the boost, though the research is preliminary and data is incomplete, according to scientists who specialize in vaccines and immunology."



    •  From the Wall Street Journal:

    Merck & Co. and partner Ridgeback Biotherapeutics LP said Monday they have filed an application asking U.S. health regulators to authorize their Covid-19 pill, the next step toward adding a long-sought drug for use at home.

    "The filing comes shortly after data from a late-stage study showed that the antiviral drug, molnupiravir, cut the risk of hospitalization or death by about 50% in high-risk people with mild to moderate Covid-19. 

    "The U.S. Food and Drug Administration could clear the antiviral in the coming weeks and possibly in time for what some public-health experts say could be another virulent winter, especially among people who aren’t vaccinated."



    •  The Boston Globe reports that "while an estimated 70 million Americans are eligible for COVID vaccines but remain unvaccinated to the dismay of public health officials, many fully vaccinated people, including some in Massachusetts, are flouting guidelines and getting extra shots.

    "Their reasons range from fears of getting a second debilitating case of COVID to uncertainty about when they will become eligible for an additional shot, to simply wanting the $100 Walmart gift card one state offered to entice reluctant people to get primary shots."

    I know of some folks who have gamed the system and gotten booster shots that either were not recommended or for which they were not eligible.  In some ways, I can't blame them - they are worried about getting sick, and getting their family members (especially elderly and vulnerable parents) sick.  Personally, I'm waiting until they recommend the Moderna booster for my age group, largely because I've said all along I'm going to trust the public health officials, and this seems like the wrong moment to veer away from that guiding principle.  Plus, I don't have any elderly relatives - my kids would say that I am the elderly relative!

    Published on: October 11, 2021

    •  From Forbes:

    "Marc Lore, former CEO of Walmart U.S. e-commerce and serial entrepreneur, is at it again, identifying tech start-ups that sound like the retail realm of tomorrow, but are here today. For example, conversational commerce. His latest find is Wizard, which is building one of the most powerful AI-driven conversational commerce platforms that Lore and other investors believe will revolutionize mobile shopping."

    “Having spent most of my career so far in e-commerce, it’s been clear that conversational commerce is the future of retail,” Lore said in a prepared statement. “With deep learning becoming more pervasive, the ability to create a hyper-personalized, conversational shopping experience is going to transform how people shop…"

    Published on: October 11, 2021

    With brief, occasional, italicized and sometimes gratuitous commentary…

    •  KSDK-TV News reports that a Schnucks' remodel of its Kirkwood, Missouri, store is complete, which means that a new food hall is open for business.  This food hall, the story says, "features several local restaurants including The Shaved Duck, Seoul Taco and The Greek Kitchen. They each have their own service counter and share a seating area."  The store also has a great emphasis on fresh, and an expanded grab 'n go meal section.

    The story notes that "there's also a spot to grab some St. Louis-inspired gear. Arch Apparel has its own section in the store offering customers several clothing choices."

    Alas, these clothing choices will not include St. Louis Cardinals 2021 World Championship jerseys…

    Published on: October 11, 2021

    •  Limited assortment banner Save-A-Lot last week said that it has named Craig Herkert, the former CEO of Supervalu, to be its interim CEO, succeeding Kenneth McGrath, who left the company to join Lidl as deputy chairman.



    •  In the UK, City AM reports that the British government has appointed Sir Dave Lewis, the former CEO of Tesco, "to help fix supply chain issues which are leaving UK supermarket shelves bare.  Lewis, who stepped down from the helm of the supermarket giant in September, will become the government’s supply chain adviser after it was revealed one in six adults have been unable to buy essential food items in the last fortnight."

    Published on: October 11, 2021

    It was an exciting weekend in Major League Baseball, as the Divisional Payoffs unfolded…

    Last night, the Boston Red Sox defeated the Tampa Bay Rays 6-4 to take a 2-1 lead in their best-of-five series.

    And, the Chicago White Sox defeated the Houston Astros 12-6, extending the best-of-five series in which the Astros hold a 2-1 advantage.

    Meanwhile, the Milwaukee Brewers and Atlanta Braves are tied at one game apiece in their best-of-five series.

    And, the Los Angeles Dodgers and San Francisco Giants also are tied at one game apiece in their best-of-five series.



    In Week Five of the National Football League…

    NY Jets 20, Atlanta Falcons 27

    Green Bay Packers 25, Cincinnati Bengals 22

    Detroit Lions 17, Minnesota Vikings 19

    Denver Broncos 19, Pittsburgh Steelers 27

    Miami Dolphins 17, Tampa Bay Buccaneers 45

    New Orleans Saints 33, Washington 22

    Philadelphia Eagles 21, Carolina Panthers 18

    Tennessee Titans 37, Jacksonville Jaguars 19

    New England Patriots 25, Houston Texans 22

    Chicago Bears 20, Las Vegas Raiders 9

    Cleveland Browns 42, Los Angeles Chargers 47

    NY Giants 20, Dallas Cowboys 44

    San Francisco 49ers 10, Arizona Cardinals 17

    Buffalo Bills 38, Kansas City Chiefs 20