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    Published on: March 17, 2022

    It is St. Patrick's Day, and so it seems like an appropriate time to remember Feargal Quinn, the legendary Irish retailer who created the iconic Superquinn chain … and who was the very definition of an independent, differentiated, essential food retailer.

    Published on: March 17, 2022

    The Los Angeles Daily News reports that Amazon-owned Whole Foods has opened a store in Sherman Oaks, California, that features the Just Walk Out, checkout-free technology pioneered in its Amazon Go stores.

    It is the second Whole Foods to be opened with the technology in a matter of weeks.  The first was in Washington, DC.

    The Sherman Oaks is said to be about 9,100 square feet in size.

    KC's View:

    In case you missed it, Michael Sansolo and I spent some time in the DC unit last week, and posted about it here.

    Published on: March 17, 2022

    The Cincinnati Business Courier reports that Kroger "is seeing customers react to soaring inflation, but those behavior changes haven’t hurt the supermarket giant’s results."

    CEO Rodney McMullen is quoted as saying, "We are starting to see customers engaging in coupons a little bit more aggressively than before and starting to move to Our Brands (Kroger’s store brands), where they don’t have to compromise on quality and they can save more.  So we are starting to see the beginning of some behavior changes, but (it’s) really early.”

    Own-label products bring Kroger higher margins, the story points out, which has allowed the retailer to hold the line on price increases even as costs go up.

    The Courier also notes that inflation could end up sustaining a trend toward eating at home - and away from eating at restaurants - that began during the pandemic.

    Shoppers "have found that eating at home is a lot more affordable than going out to restaurants, so they’re able to stretch their budget that way,” McMullen said.

    Published on: March 17, 2022

    USA Today reports that Walgreens "has recently rolled out digital screens replacing the traditional doors available in these sections, and some consumers are upset.

    "The high-tech doors were created in partnership with startup Cooler Screens, a company building technology where 'consumers experience in-store what they love about shopping on-line'."

    There are several YouTube videos showing the screens in action.  Here's one:

    According to the story, " the digital doors are capable of displaying full-screen ads, and will recognize when a shopper walks past. The screen then changes to show which items are available inside the cooler. Retailers could also promote sales digitally through the touchscreen instead of using additional physical signs.

    "A demo of the doors available on Cooler Screens' website shows how users can view nutrition information and reviews of products directly from the screen. The doors can also recommend other products for shoppers depending on what they pick from the cooler."

    Annoyance at the screens has been popping up on social media, the story points out.

    On his loyalty marketing blog, Howard Schneider synthesizes and expands on the complaints:

    "Two of the three rationales for this make sense, for marketers if not for consumers:

    "1.  Brands are desperate to get consumers to view their ads, in today’s self-directed, fragmented media environment, and capturing their attention in the act of shopping is a great opportunity.

    "2.  Retailers are desperate for ways to improve margins, and monetizing shoppers’ eyeballs is a great opportunity for them.

    "Here’s the rationale I take issue with: Walgreens said in an email that they’re installing the screens because they are 'committed to exploring digital innovation in [an] effort to deliver new and different experiences for our customers.'

    That sent my BS meter off the chart.

    "What consumers want is a quart of milk or a frozen pizza, without having to 'engage' with digital advertising messages. The very notion of a screen to show you what’s behind the screen is absurd … The best technology makes things simpler for users, disintermediates the media and technology walls that add friction to the customer experience."

    Schneider goes on:  "I find it especially annoying that Walgreens is pioneering this concept, since my local Walgreens has reduced pharmacy and operating hours, and the store is filled with empty shelves. I don’t blame Walgreens for the supply chain issues and the weird economic environment. But they should worry more about stocking their shelves and staffing their stores, and less about technologies that benefit brands and retailers at the customer’s expense."

    KC's View:

    I agree with Howard on this, and would take issue with the observation that screens allow consumers to "experience in-store what they love about shopping on-line."

    This misses an important point - that the online experience is and should be different from ther store experience.  I hate it when online shopping tries to replicate the store experience, which is why I've always been a little skeptical about virtual reality programs;  if I'm shopping online, it is at least in part because I don't want to be in the store.  Give me an alternative experience.  And the same goes for being in the store … I don't want it to try to replicate what I see on my computer or smartphone screen.

    The brand messaging should be consistent, of course, but not the experience.

    My feeling is that this stuff may exist mostly to give retailers another way of charging manufacturers and create a revenue stream for themselves … as opposed to actually serving consumers' needs.

    Published on: March 17, 2022

    The Wall Street Journal reports that the Amazon Air cargo airline is "growing at a breakneck pace," making "an average of 187 flights a day, compared with 85 in May 2020."  Amazon Air "now has more than 80 jets - less than DHL’s 202, UPS’ 289 and FedEx’s 474 but a lot more than the 50 it had at the start of 2020."

    Indeed, the story suggests that this could be an underestimate, since "Amazon doesn’t operate its flights, instead relying on partners such as Air Transport Services Group." The actual number actually could be more than 110 .

    "There is nothing like a pandemic and a European war to highlight the value of logistics," the Journal writes.  "Amazon.com’s growing fleet of planes shows that it is investing hard to deliver … Since the Covid-19 crisis started, e-commerce purchases have skyrocketed and a lot of belly-hold space in planes has been removed. Many airfreight companies have seized the opportunity to grow."

    The story goes on:  "Having previously leased its planes, Amazon started buying some last year as a flood of parked jets entered the secondhand market and freighter conversions surged. It has also taken equity stakes in ATSG and has warrants on the stock of Atlas Air. This strategy of building extra flexibility and control may herald more encroachment on the territory of FedEx and UPS. Amazon already provides some “third party” services to companies, and could soon start competing head-to-head in business-to-consumer deliveries."

    KC's View:

    This illustrates something that Scott Moses of Solomon Partners talks about all the time - the enormous financial example that Amazon has, with a higher market capitalization - and greater access to cheaper money - than most of its major competitors combined.

    Published on: March 17, 2022

    Variety reports that Netflix, concerned by password-sharing between households is eating into its revenue and profits - which can be a problem when you're planning to spend $19 billion on content acquisition during the current year - is going to launch a test "letting primary account holders pay an additional fee for users outside their households."

    "According to the Netflix terms of service," Variety writes, "a customer’s account 'may not be shared with individuals beyond your household.'  After years of turning a blind eye to password-sharing behavior that falls outside that requirement, the company last year ran a limited test prompting users to enter their account credentials as a way to nudge freeloaders into paying for their own accounts.

    "Now, in an upcoming test launching in three countries — Chile, Costa Rica and Peru — Netflix will let members who share their accounts with people outside their household do so 'easily and securely, while also paying a bit more,' according to Chengyi Long, director of product innovation at Netflix. The new options will roll out in the next few weeks in the three countries (and may or may not expand beyond those markets) … With the 'add an extra member' feature, members with Netflix’s Standard and Premium plans will be able to add subsidiary accounts for up to two people they don’t live with, each with their own profile, personalized recommendations, login and password — for less than the cost of a separate Netflix plan."

    KC's View:

    While this all sounds rather voluntary to me, and therefore hard to imagine gaining traction among users, if Netflix sees any kind of success it may prompt other streaming services to do the same thing.

    I have to wonder if Amazon would do the same thing, though, since streaming is just part of a broader suite of services that it offers.  People outside traditional households are still buying stuff from Amazon, so the number of individual accounts may matter less.

    Published on: March 17, 2022

    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 now has had a total of 81,289,602 Covid-19 coronavirus cases, resulting in 994,739 deaths and 56,631,117 reported recoveries.

    Globally there have been a total of 464,644,723 cases, with 6,082,766 resultant fatalities and 396,968,785 reported recoveries.  (Source.)



    •  The Centers for Disease Control and Prevention (CDC) says that 76.7 percent of the total US population has received at least one dose of vaccine … 65.3 percent is fully vaccinated … and 44.4 percent has received a vaccine booster dose.  The CDC also says that 49.9 percent of the total US population that is eligible to receive a vaccine booster dose has not gotten one.



    •  From the Washington Post:

    "A surge in coronavirus infections in Western Europe has experts and health authorities on alert for another wave of the pandemic in the United States even as most of the country has done away with restrictions after a sharp decline in cases.

    "Infectious-disease experts are closely watching the subvariant of omicron known as BA. 2, which appears to be more transmissible than the original strain, BA. 1, and is fueling the outbreak overseas … In the past two years, a widespread outbreak like the one in Europe has been followed by a similar surge in the United States some weeks later. Many, but not all, experts interviewed for this story predicted that is likely to happen."

    According to the story, "A number of variables — including relaxed precautions against viral transmission, vaccination rates, the availability of anti-viral medications and natural immunity acquired by previous infection — may affect the course of any surge in the United States, experts said.

    "Most important, it is unclear at this point how many people will become severely ill, stressing hospitals and the health care system as BA. 1 did.

    "Another surge also may test the public’s appetite for returning to widespread mask-wearing, mandates and other measures that many have eagerly abandoned as the latest surge fades and spring approaches, they said."

    Published on: March 17, 2022

    •  From Bloomberg, a story about how Walmart has chosen Atlanta and Toronto as the sites of two new global tech hubs "because of their growing tech sector presence and their broad and diverse local talent pools."

    According to the story, "The initial hiring phase in Toronto will include 45 full-time roles in software development, technical program management and product management. Initial hiring in Atlanta is expected to include 140 new full-time roles.

    "Walmart says deploying the latest technology is part of a $3.5 billion investment for Canada announced in 2020 to make the online and in-store experience simpler, faster and more convenient for its customers.

    "The company also says that the development of this technology hub will keep homegrown tech talent in Canada.

    "The expansion is part of Walmart Global Tech's plan to hire more than 5,000 employees globally this fiscal year."



    •  In a blog posting yesterday, Walmart's chief people officer, Donna Morris, wrote that the company plans "to hire more than 50,000 U.S. associates in our stores, clubs, campuses and supply chain facilities," in addition to the people being hired in its tech facilities.

    Morris went on:  "As we continued to expand our focus on the health and well-being of our customers and their families, we hired 5,500 pharmacists/pharmacy managers in 2021, the highest number in a one-year period, and more than 13,000 pharmacy technicians. Our private fleet is one of the largest in the U.S. and continues to grow, as we hired nearly 4,500 truck drivers last year, a company record."

    Published on: March 17, 2022

    •  From CNBC:

    "Food delivery company DoorDash is taking steps to try and help drivers offset rising gas prices, though unlike ride-share apps Uber and Lyft, it says the added costs won’t be passed on to consumers.

    "DoorDash said on Tuesday that all U.S. delivery drivers will be eligible for 10% cash back on gas through a prepaid business Visa debit card. They’ll earn cash back any time they use the card, even when they’re not working, the online delivery service said."

    The story goes on:  "DoorDash also announced a weekly gas bonus for those who drive more frequently in their job, saying, 'Dashers who accept and complete orders totaling 100 miles in a motor vehicle will earn an extra $5'."



    •  From the Wall Street Journal:

    "Salad chain Sweetgreen Inc. is reassembling a delivery program for office buildings as employees trickle back to workplaces and the competition for delivery customers reaches new heights.

    "The program, called Outpost and introduced in 2018, lets workers at participating employers pick up orders at locations in office buildings without paying a delivery fee. It had grown to more than 1,000 locations when the Covid-19 pandemic abruptly drove many workers to set up shop at home.

    "Most of Sweetgreen’s Outpost locations paused service or pivoted to providing meals to people in apartments, hospitals and other locations. Sweetgreen began gradually rebuilding its network with some new and existing partners in the summer of 2020, reaching 250 delivery stations at the end of the third quarter of 2021 and more than 500 today, according to the company.  Sweetgreen in the past two weeks restarted Outpost operations at 10 delivery stations and opened 18 new ones, it said."



    •  The Beet reports that Amazon Fresh's "Plant-Based selection offers 15 new-to-the-market products that will be distributed to retailers nationwide. Customers will also be able to order any of the plant-based foods directly from Amazon Marketplace. The Fresh Plant-Based line will include signature vegan Patties, Italian meatballs, Chick’nNuggets, and almond milk. The company intends to bring affordable plant-based options to people everywhere, guaranteeing that the new products do not sacrifice quality or taste at all … Amazon announced that the company intends to continue expanding the Fresh product selection throughout the year. The Fresh Plant-Based line aims to make plant-based food more affordable marketwide as more people take interest in healthier and more sustainable foods."

    The story points out that "people worldwide have started leaning into plant-based foods and major companies including Amazon have taken note. Last summer, Amazon recorded that shoppers searched for vegan meat 44,000 times during the month of June. The data signified an unprecedented demand for plant-based meats alternative."

    Published on: March 17, 2022

    •  From the New York Times:

    "Retail sales rose 0.3 percent in February from the prior month, the Commerce Department reported on Wednesday, a slowdown in spending that suggested inflation was taking its toll on American consumers.

    "The slower growth — January’s retail sales increased 4.9 percent, revised data showed — followed other indications that consumers were growing more pessimistic as they faced persistently rising prices with no end in sight. Last week, the government said the Consumer Price Index, a widely watched inflation gauge, rose 7.9 percent in the year through February, the fastest annual inflation in 40 years.

    "Wednesday’s report did not reflect the full effects of the Russian invasion of Ukraine, which began on Feb. 24 and triggered a surge in global energy costs. In the United States, gasoline prices have soared past highs last seen in 2008, an increase that will eat into consumers’ ability to spend on other goods."



    •  From the Washington Post:

    "The National Labor Relations Board has accused Starbucks of retaliating against two employees who sought to unionize their coffee shop in Phoenix, according to a complaint reviewed by the Washington Post.

    "Employees Laila Dalton and Alyssa Sanchez were contributing to a national campaign that has set up unions at a handful of Starbucks stores across the country. Starbucks Workers United, an affiliate of the Service Employees International Union, has brought at least a dozen charges on behalf of baristas across the country alleging similar retaliation, according to NLRB case dockets.

    If the NLRB prevails in its case, Starbucks could be required to read statements and post physical notices in its stores informing workers of their right to organize. That requirement is a common remedy in labor retaliations cases. The company also could be required to reimburse Sanchez for the hours of work that she lost because of Starbucks’s alleged retaliation. A hearing on the matter is scheduled for June 14.

    "In the complaint, the NLRB accused two Starbucks managers of suspending Dalton and giving her a written warning, as well as rejecting Sanchez’s scheduling preferences as a way of discouraging them from raising concerns with managers."



    •  Fox Business reports that "Starbucks' iconic white paper cups could soon be a thing of the past.

    "In an attempt to reduce landfill waste, the coffee chain will be phasing out its single-use cups in favor of reusable mugs.

    "The paper or plastic cups may not completely disappear, but they will be made less attractive.

    "'We set a bold aspiration to become a resource positive company – to store more carbon than we emit, to eliminate waste and to conserve and replenish more freshwater than we use,' Michael Kobori, Starbucks chief sustainability officer, said on the company's website. 'This aspiration included setting ambitious 2030 targets to cut our carbon, water, and waste footprints in half.'

    "By the end of 2023, customers will be able to use their own reusable cups in U.S. and Canada."

    Published on: March 17, 2022

    •  Weis Markets today announced Mike Gross, most recently the director of Center Store at Cub Foods, has joined the company as Vice President of Center Store Sales and Merchandising.  



    •  Krasdale Foods has announced that Chris Lavoy, most recently vice president of Southern Region Sales for United Natural Foods Inc, has been hired as the Vice President of the Bravo Florida brand for Beta II Marketing. Beta II Marketing is an affiliated company of Krasdale Foods.

    Published on: March 17, 2022

    Got a number of reactions to yesterday's report that Howard Schultz is returning to Starbucks as interim (?) CEO, making him retailing's version of Tom Brady.

    One MNB reader wrote:

    As soon as I read the headline that Schultz was coming back, I told my wife that you predicted it would happen. Love the analogy to Tom Brady!  Good for a morning chuckle!

    From another reader:

    I am a long time subscriber, but this is the first time I've ever gotten all the way through to hit send on a reply... have to admit, I actually looked over at my calendar to triple check that it wasn't April 1st when I saw the Howard Schultz headline. Seems like it should be April Fools Day fodder, not a real thing.

    From another:

    Maybe Howard and TB simply found playing pickleball wasn’t enough to occupy their time… LOL… Glad to have them both back doing what they do best… providing leadership!

    And still another:

    If I didn’t know better, I would say you were 15 days early for an April Fools Joke.

    Said in jest…yes, you called it. 

    Even a blind squirrel finds a nut everyone in a while.



    We reported yesterday that "high gas prices have led the  Arkansas Department of Agriculture Bureau of Standards to allow retailers in the state to price and sell fuel in half-gallon increments.  The change will be in effect until July 1, and experts speculate that the move could be adopted by other states."

    One MNB reader wrote:

    In regards to the State of Arkansas allowing the sale of half gallon units of gasoline, why don’t they just switch to metric?  Pricing by the liter will just blow their minds.

    Another MNB reader chimed in:

    So if I understand this correctly, this would mean that instead of filling up my tank with 15 gallons I can fill it up with 30 half gallons??? Am I missing something here?

    MNB reader Bob McGehee wrote:

    In the 70’s I worked for a convenience store chain that also sold gas.  When the oil embargo hit and gas went thru the roof the mechanical pumps weren’t able to go over $0.999 per gallon.  The only solution available was to change from gallons to liters.  It worked just fine but twice a day the stores had to go out and sweep up all the exploded heads from people trying to determine how much they were actually paying per gallon.  The people in Arkansas only have to multiple by 2 so they won’t suffer the same fate.

    You were all a lot faster on the uptake on this than I was.

    Arkansas may be allowing pricing by the half-gallon, but people always have been able to only put a half gallon of gas into their cars … or 1.5 gallons … or 2.5 gallons … and so on.

    I don't get it.



    Yesterday MNB took note of a Washington Post report that "the Securities and Exchange Commission plans to require all publicly traded companies to disclose their greenhouse gas emissions and the climate risks their businesses face … Under a groundbreaking new rule the SEC is expected to propose Monday, hundreds of businesses would be required to measure and disclose greenhouse gas emissions in a standardized way for the first time, according to two people briefed on the agency’s discussions who spoke on the condition of anonymity to describe internal deliberations.

    "The move could mark the most sweeping overhaul of corporate disclosure rules in more than a decade, and could put the United States on closer footing with other countries set to begin mandated emissions reporting over the next three years."

    I commented:

    I'm a big apples-to-apples guy, and I believe in transparency.  I think that public companies should be required to provide information like this so that potential investors can make informed decisions, and I think that it makes the most sense for there to be a consistent reporting structure.

    MNB reader Scott Nelson responded:

    I am generally opposed to more government regulations.  The CEI (Competitive Enterprise Institute) came out with a report in 2020 that shows Federal Regulations Cost $1.9 Trillion per year.   That is a cost that all of us pay as a pass through and more regulations are a barrier for competition.  I would like to see a movement to reduce many regulations keeping only critical ones.   I know difficult to say which ones are critical but there have to be many bad ones.  One of many examples I found is the city of Philadelphia requires all bloggers to purchase a $300 business privilege license and went after a “poor woman” who had earned $11 from her blog over two years.   

    From another MNB reader:

    Wouldn’t it be interesting if the same were required of government policy decisions?

    First of all, I'll agree with pretty much any rule that requires transparency of government officials, especially elected politicians.  Not nearly enough of that as far as I am concerned.  I think every donation over $10 ought to be instantly made available for online scrutiny - with no such thing as dark money.

    As for government regulations … I don't think that more regulation necessarily is better.  But I do think that regulation that protects the rights of consumers/investors, whop deserve to know everything possible about the companies with which they do business, is a good thing.  The Philly rule strikes me as absurd, but hardly a good enough reason to demonize all regulation.