business news in context, analysis with attitude

Published on: October 27, 2021

Supply chain issues have hit virtually every category, but that just means that in those segments where there is a virtual alternative - books, for example - this also is an opportunity to build a new market out of new users.  KC explains.

Published on: October 27, 2021

Business Insider reports that internal documents at Amazon suggest that the company has fallen behind its plans "to open hundreds of cashierless Fresh grocery stores by 2023."

According to the story:  "In a planning document from June 2020, Amazon projected these cashierless stores, internally codenamed 'Grace,' to go from zero to 33 in 2021, 280 in 2022, and 580 in 2023 in the US. That includes an adjustment made to reflect a more 'pessimistic scenario' because of a second wave of COVID-19 late last year, and retrofitting existing Fresh locations to add cashierless capabilities by the second quarter of 2022. A separate document from March 2021 mentions the same store projections for this year.

"So far, the internet giant has only opened one cashierless Fresh grocery store in the US. It's unclear whether the projections have been revised … The aggressive goal offers both a roadmap and a cautionary note for Amazon's lofty ambitions in the grocery retail space. Even if it gets close to the 580 Fresh store total, the company would still lag behind major grocery competitors. Walmart, for example, has over 10,500 stores. Target operates 1,915 stores in the US, and Albertsons runs over 2,200 supermarkets in the country. Amazon-owned Whole Foods has over 500 stores in North America and the UK."

The Business Insider story goes on:  "The vast expansion effort comes as Amazon anticipates huge cost reductions in the Just Walk Out technology powering the cashierless Fresh stores. Amazon projects the annual tech operating cost for each of those stores to drop by almost 75% between 2020 and 2023, making it easier and more affordable to scale, according to an internal document from August 2021.

"Amazon plans to put the Just Walk Out technology into every future Fresh grocery store going forward. All sites are expected to come equipped with the cashierless technology, while all existing non-cashierless Fresh stores will be retrofitted by the second quarter of 2022, according to one of the documents."

Published on: October 27, 2021

The Conference Board is out with its October report, saying that "U.S. consumer confidence increased in October following three months of declines, as the wave of Covid-19 cases due to the Delta variant started to ease," the Wall Street Journal reports.

"The consumer confidence index increased to 113.8 in October from a revised 109.8 in September, according to data from the Conference Board released Tuesday."

The story continues:  "The rise in confidence can be attributed to Americans’ easing concerns over Covid-19, said Lynn Franco, senior director of economic indicators at the Conference Board.  Short-term inflation concerns rose to a 13-year high, but consumers indicated they planned to spend on big-ticket items in the final quarter of this year, Ms. Franco added."

Published on: October 27, 2021

Newsweek is out with what it calls its "first" Most Loved Workplaces rankings, which is says measures "how employees feel about their organizations," which may be more important than ever because of the labor crunch facing many businesses during what is popularly described as "the great resignation."

There are several food businesses and other retailers on the list, with brief descriptions of what qualifies them to be on it:

•  Sweetgreen (#18) … "Virtual happy hours with the company founders, leaders and even outside guests, like academics, help develop collaboration and craft a solution-driven culture."

•  Home Depot (#44) … "Employees, thanks to former CEO Frank Blake, who revived the company, have bought into the vision of a retailer that has close ties to the community it serves. Workers 'bleed orange'."

•  Southeastern Grocers (#48) … "There’s a 'Shark Tank' space for associates to deliver business solutions and new product ideas. In addition, a My Culture email box in each store is a place for instant feedback to executives."

•  Chipotle (#52) … "Looking for upward mobility? This restaurant chain helps employees climb up the corporate ladder quickly by offering additional training to anyone who raises their hand."

•  Boxed (#56) … "All managers come up through the ranks—95 percent of leaders are promoted from within the organization. In other words: You can learn the ropes from the ground up."

•  Instacart (#88) … "Employees get bonuses for their insights and for coming up with beta tests for new customer features. If you are looking for hierarchies, this is not a place for you. No silos allowed."

You can read the entire story and rankings here.

Published on: October 27, 2021

CVS Health announced this week "the launch of a new enterprise-wide national advertising campaign, entitled Healthier Happens Together."

The announcement stresses the ways in which CVS seems to be expanding its definition of its role in the healthcare continuum:  "As the campaign builds through the rest of the year, new ads will showcase innovative work underway at CVS Health, including our efforts to transform kidney care, enhance telehealth services, lead in omnichannel pharmacy, and support communities through programs such as Return Ready and Project Health, the company's no-cost, community-based screening program."

Here's the first commercial:

Published on: October 27, 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, there now have been a total of 46,497,719 Covid-19 coronavirus cases, resulting in 759,932 deaths and 36,375,189 reported recoveries.

Globally, there have been 245,434,11 total cases, with 4,982,126 resultant fatalities and 222,486,001 reported recoveries.   (Source.)

•  The Centers for Disease Control and Prevention (CDC) says that 77.7 percent of the US population age 12 and older has received at least one dose of vaccine, with 67.2 percent being fully vaccinated.  Just 66.5 percent of the total US population has received at least one dose of vaccine, with 57.5 percent of the total population being fully vaccinated.

The CDC also says that 18.3 percent of the US population age 65 and older has received a booster dose of vaccine.

•  The New York Times this morning reports that "an expert committee advising the Food and Drug Administration on Tuesday recommended that regulators authorize Pfizer-BioNTech’s coronavirus vaccine for 5- to 11-year-olds, bringing about 28 million children a major step closer to becoming eligible for shots.

"If the F.D.A. follows the panel’s advice in the coming days, as is expected — and the Centers for Disease Control and Prevention agrees — the Biden administration will have expanded vaccine access to all but the youngest Americans, while providing booster shots for many as well."

•  Also from the New York Times:

"Merck has granted a royalty-free license for its promising Covid-19 pill to a United Nations-backed nonprofit in a deal that would allow the drug to be manufactured and sold cheaply in the poorest nations, where vaccines for the coronavirus are in devastatingly short supply.

"The agreement with the Medicines Patent Pool, an organization that works to make medical treatment and technologies globally accessible, will allow companies in 105 countries, mostly in Africa and Asia, to sublicense the formulation for the antiviral pill, called molnupiravir, and begin making it.

"Merck reported this month that the drug halved the rate of hospitalizations and deaths in high-risk Covid patients in a large clinical trial. Affluent nations, including the United States, have rushed to negotiate deals to buy the drug, tying up large portions of the supply even before it has been approved by regulators and raising concerns that poor countries would be shut out of access to the medicine, much as they have been for vaccines."

•  From the Boston Globe:

"A new strain of the COVID-19 virus, dubbed Delta-plus in the media, is increasingly infecting people in the United Kingdom, raising concerns among scientists that it could rekindle the pandemic here just as the virus seems to be receding.

"So far, only a handful of Delta-plus cases have been identified in Massachusetts and only about 130 in the whole United States, vanishingly small numbers that suggest it’s not a major threat. However, scientists say it’s crucial to remain vigilant, saying there’s evidence that the new strain, known officially as Delta AY.4.2, may be 15 percent more transmissible than its parent, the Delta variant."

•  And, another report from the Times:

"Nearly three months after Tyson Foods mandated coronavirus vaccines for all its 120,000 U.S. workers, more than 96 percent of them are vaccinated, the company’s chief executive, Donnie King, said in an employee memo on Tuesday.

"Less than half of Tyson’s work force was inoculated when it announced on Aug. 3 that it would require vaccines. Nearly 60,000 more Tyson employees got the shot following the announcement, Mr. King said. Tyson has said workers must be fully vaccinated by Nov. 1 as a condition of employment."

The Times notes that "Tyson was one of the first major companies to mandate vaccines after incentives like paid time off to be inoculated started to lose traction. Its stance was notable because it included frontline workers even as labor shortage concerns prevented many companies from expanding vaccine mandates beyond the office."

Published on: October 27, 2021

•  Engadget reports that Amazon is teaming up with Verizon to "to improve fixed wireless internet access in rural areas in the US. The alliance will initially concentrate on expanding Verizon’s LTE and 5G service using Amazon’s Project Kuiper for 'backhaul,' boosting coverage in areas with little or no high-speed data.

"Amazon and Verizon later hope to offer unified internet access for industries worldwide, including smart farms and transportation. For now, they’re establishing technical requirements for rural broadband using Project Kuiper antenna tech already in development."

No timetable has been established for the project, but Engadget notes that "Amazon recently lined up rocket launches for Project Kuiper, but it doesn’t expect to have half its satellites in low Earth orbit until 2026. The full constellation is expected no later than July 2029."

•  The Verge reports that "Amazon is next on the list of companies getting into the live audio game. The company is building a new app, codenamed 'Project Mic,' that gives anyone the ability to make and distribute a live radio show, complete with music, according to a presentation viewed by The Verge. This project’s big goal is to democratize and reinvent the radio. The app will be focused on the US initially.

"Listeners will be able to tune in through the app, as well as through Audible, Amazon Music, Twitch, and Alexa-equipped devices. With the Alexa devices, listeners will be able to interact with shows using just their voice. The app experience will also be optimized for the car, playing into Amazon’s idea of trying to reinvent radio."

Published on: October 27, 2021

•  The Detroit News reports that "after a nearly 20-year absence, Target will return to Detroit as an anchor tenant at City Club Apartments in Midtown, City Club and Detroit officials announced Monday.   The 32,000-square-foot store will be at the southeast corner of Mack and Woodward, officials said. The layout will follow the format of similar-sized stores around the country, with about a fourth of the space of Target's typical stores, which average 130,000 square feet, according to its website."

•  Reuters reports that Canadian food producer George Weston Ltd plans to sell its Weston Foods fresh and frozen bakery businesses to baking company FGF Brands for the equivalent of $970 million (US).  The story says that "the businesses comprised about 75% of Weston Foods’ net sales in 2020."

Published on: October 27, 2021

•  JCPenney announced yesterday that it has hired Marc Rosen - most recently Executive Vice President and President of Levi Strauss Americas and, before that, leader of the company's Digital Enterprise Office - to be its new CEO.  Rosen also spent 14 years at Walmart, ultimately serving as senior vice president of global e-commerce.

Published on: October 27, 2021

Content Guy’s Note: Stories in this section are, in my estimation, important and relevant to business. However, they are relegated to this slot because some MNB readers have made clear that they prefer a politics-free MNB; I can't do that because sometimes the news calls out for coverage and commentary, but at least I can make it easy for folks to skip it if they so desire.

•  Senators Cory Booker (D-New Jersey) and Mike Braun (R-Indiana) and Representatives Jim McGovern (D-Massachusetts) and Jackie Walorski (R-Indiana) announced yesterday that they have "introduced the White House Conference on Food, Nutrition, Hunger and Health Act to start the process of convening a second White House conference to address the nation’s nutrition crisis.

"The last – and only – White House conference convened more than 50 years ago and spurred the expansion of key programs that addressed severe hunger and malnutrition in the United States."

The initiative is supported by the United Fresh Produce Association.  Its CEO, Tom Stenzel, said yesterday that "while hunger still persists, in the decades since 1969, our nation’s hunger problem has become a dietary quality problem.  As we emerge from a pandemic that disproportionately impacted those with diet-related chronic disease – we simply cannot put off action any longer. We must be transformational in our approach to reverse our nutrition insecurity problem."

Published on: October 27, 2021

Mort Sahl, who in the late fifties and early sixties was the very model of standup comic and political satirist, has passed away.  He was 94.

Sahl, as the Washington Post writes, transformed political comedy:  "Before Mr. Sahl, wisecracks about government and Washington were little more than glib asides with no attempt at the jugular. For the most part, comedians avoided topics that might alienate escapist-minded radio, TV and nightclub audiences and stuck to safer material about mothers-in-law or nagging spouses.

"By contrast, Mr. Sahl dove headfirst into the divisive politics and tumult of his time — from the nuclear arms race to segregation — with erudite outrage, a finely tuned sense of the absurd and a high tolerance for risk … Behind Mr. Sahl’s humor lay a deep concern for American democracy, and his onstage probing was the antithesis of the cheap laugh. He sometimes warmed up crowds for his friend Dave Brubeck, but the jazz pianist complained that 'he demands so much of an audience that it hasn’t the strength for anyone else'."

His willingness to take on controversial topics meant that Sahl had long fallow periods in his career when he went out of style.  Like, the late sixties and the early-to-mid seventies.  But he made a comeback after Watergate and even had a one-man show on Broadway in 1987.

Sahl would take the stage often attired in v-neck sweater, carrying a newspaper, and, the Post writes, "having honed his style in seedy San Francisco bars and coffeehouses, he riffed in knowing argot about presidential politics, Cold War paranoia, institutionalized religion and neurotic relationships between the sexes … With more sophistication than a string of staccato one-liners, his jokes formed a free-flowing narrative punctuated by references to political and diplomatic leaders including Secretary of State Christian A. Herter, Cold War hot spots such as Malta and Pakistan, and legislation such as the Taft-Hartley Act."

Published on: October 27, 2021

Yesterday, we took note of a Wall Street Journal report that over the past year, Kellogg's has been ht with three different lawsuits claiming that its strawberry Pop-Tarts don't have enough strawberries in them to qualify for that name.

According to the story, "The latest suit, filed in the Southern District of New York last week and focused on Pop-Tart’s 'Whole Grain Frosted Strawberry' flavor, alleges that the products contain more pears and apples than strawberries. The case asks for $5 million in relief."

I commented:

With apologies to my friends at Kellogg's, I must admit that I am completely sympathetic to these suits.  There are so many cases of products that are labeled as one thing, and when you look at the labels, you see that they have none of the so-called featured ingredient, or so little as to be irrelevant.

I'm not sure I'd use the word fraud, but I certainly think it is misleading, and reflect policies and practices that ought to be changed.

One MNB reader responded:

I am somewhat shocked by your commentary of being sympathetic to this type of lawsuit!  The question I would ask is if any reasonable person thinks a Pop-Tart is filled with strawberries; fresh or otherwise.  And if they do, isn’t it reasonable to expect them to check the ingredient declaration?  That $5 million in relief is designed to line the law firm’s pockets while the consumer that can prove they bought the product during the aggrieved period and retained all receipts can receive a coupon.  These class action lawsuits are a real threat to the CPG industry and have little to do with misleading consumers.

And, from another MNB reader:

With regards to your story and comment on the Pop-Tart Ingredient issue...  I think that there is a very different issue between an item with a listed 'flavor' vs an item that is listed as an ingredient.

There are lots of foods we buy that have a 'flavor' that does not, and mostly likely not expected to, have that flavor as an ingredient.

We don't go after Grape or Orange Soda, we don't go after all the flavors in the Tootsie-Pop bag - they are flavors - not ingredients.

Very different from buying, say some type of Tuna, only to find out there is a completely different fish as the ingredient.

Pop-Tarts have an ingredient list on the side - that clearly calls out what is in it.

If the lawsuit is claiming this ingredient list is wrong, that is a different story.  But when I see Strawberry Pop-Tart - which I eat often - I think of the strawberry flavor I get from the Jam inside - which does taste like strawberries…

I don't think it is close to fraud and not even misleading... just my $0.02.

I take your point.  But I think that things ought to be what people say they are, not something else.

Go take a look at frozen blueberry waffles.  Often as not, there are no blueberries.

Unacceptable.

On another subject, MNB reader Frank White wrote:

I read with interest “Labor Pains: Jobs That May Never Be The Same Again”…

Supermarket/retail cashiers … "Stores are starting to put more emphasis on self-checkout and curbside pickup. They also are closing traditional checkout aisles during hours when staffing is short, resulting in longer waits that could drive more consumers to online shopping."

Walmart moved to almost total self-checkout and are now reversing to 40%+- clerk serve traditional due to customer push-back for larger buys. It makes sense.

Another MNB reader chimed in:

The jobs exampled are entry level jobs.  Cashiers, the more $$ /Hr production required for profit, the less cashiers you have.  The more you pay cashiers, the less you will have.  Not a good direction.  Restaurant workers.  This one is interesting, since it is also entry level and you can make pretty good jing, if you hustle.  This to me only points to lack of willingness to work.  Not a good direction.  Baristas?  I don’t like lattes so I can’t comment.  What people should realize, which they don’t, is that the more you push the system or fail to work within it, the more accelerated automation will become in the workforce. 

The interesting thing about your comment is that while you point out that that these generally are seen as entry-level jobs, they also happen to be jobs in which the person doing them has enormous impact on the business's relationship with the customer.  They're front-line workers who, depending on how they do their jobs, can determine whether a business is successful or not.

Also, who says they have to be entry level jobs?  I'd bet there are plenty of people who spend much of their work lives as checkout employees, waiters and baristas … not because they're just starting out, but because that;'s what they do.  I'd celebrate them, especially if they're really good at their jobs, not demean them.

Finally, if people don't want to do those jobs, you're right that employers may have to turn to automation.  But in doing so, those businesses have to reckon with the probability that they are losing an opportunity to connect with their customers in a way that machines simply cannot.  Which goes back to my original point - if businesses treat the people occupying those jobs as if they are assets not costs, and invest in those people so they feel invested in the business, then those front-line employees can make the difference between success and failure.

In my FaceTime commentary yesterday, I proposed that we retire the word "unprecedented," prompting an MNB reader to write:

A friend of mine who is a radio host is stuck on the word Iconic, every big event is Iconic to him.  Can we discontinue the word Iconic as well?

You can retire it from your repertoire, if you'd like.  I think I may use it … occasionally.  But I agree that overuse of a word like iconic makes it less impactful.

Published on: October 27, 2021

In Game One of the World Series, the Atlanta Braves defeated the Houston Astros 6-2.