business news in context, analysis with attitude

Published on: April 13, 2022

I had a chance to have lunch this week at a place called Lime Fresh Mexican Grill, which manages to combine modest prices, a cool vibe, and terrific food.  A great combo that reminded me of a Mexican Shake Shack, demonstrating that aspiration is mostly a matter of intention marinated in effective implementation.

Note:  The empanadas, especially the portobello mushroom variety, are killer, and the tacos are anything but lowest-common-denominator food.  I'd take this over a Chipotle any day of the week.

Published on: April 13, 2022

by Kevin Coupe

Author/entrepreneur Seth Godin's blog posting yesterday noted that generational labels tend to be "inexact," though an often-helpful "shortcut to remind us that not everyone sees the world the way we do."  And what should we call the next generation?

Godin argues that it should be called "Generation C" … "C is for Covid, C is for Carbon, C is for Climate."

Here's his rationale:

"The combination of years of school spent at home, in a mask, combined with the significant revolution (economic, political and social) that our industrialism has led us to means that this generation will be different than the ones before. Every decision and investment and interaction is going to be filtered through the lens of carbon and remediation and resilience.

"And yet, if we combine this with the c of connection, of a cohort of people who are finding solace and possibility in community, there’s a chance for all of us. Generation C didn’t ask for any of this, but I’m hopeful that they’re up for leading the change."

One can hope.  (I find myself of late feeling hopeful, while simultaneously wondering why.)  Generation C, with any luck, will be up to the challenges that face them, seeing them with Eyes Open, rather than being in denial with eyes closed.

Published on: April 13, 2022

The Information reports that "Amazon is launching a big recruiting push aimed at teens who are about to graduate high school, in the e-commerce giant’s latest effort to keep its sprawling network of warehouses staffed up in a tight labor market.

"In a hiring drive set to kick off next month, Amazon will attend events at schools across the U.S. and Canada, a person briefed on the matter said. The effort will involve recruiters going to hundreds of high school career days to talk up college tuition benefits and other perks of working at Amazon, the person said … Apart from benefits like healthcare, the stable pay and tertiary education perks are at the center of the pitch for high schoolers going on summer break, the person briefed on the initiative said. Those teens who may not be able to get into college can get employment at a local facility, work over summer at an Amazon facility, and then do a degree or technical training, paid for by Amazon. The person said the recruiting pitch can sometimes be couched as a 'second chance' for some teens who have struggled with high school. The only requirement is that potential new employees must be at least 18 years old."

The story notes that "not having enough workers has already eaten into the company’s bottom line. Amazon said operational disruptions from not being able to staff up its facilities during the 2021 holiday rush, along with inflationary pressures pushing up labor and transportation expenses, cost the company $4 billion in the fourth quarter.

"Ramping up high school recruiting is a natural next step for Amazon, which has hired like no other company during the Covid-19 pandemic as online shopping boomed. It added an astounding 750,000 workers over the last two years, 575,000 of them within the U.S."

The report is ironic, since CNBC also reported yesterday that "Amazon warehouse workers in the U.S. suffered serious injuries at twice the rate of rival companies in 2021, according to a new study.

"There were 6.8 serious injuries for every 100 Amazon warehouse workers. That’s more than twice the rate of all other employers in the warehouse industry, which had 3.3 serious injuries per 100 workers, the Strategic Organizing Center said in a report released Tuesday."

It needs to be pointed out that the Strategic Organizing Center (SOC) is, according to the story, "a coalition of labor unions including the International Brotherhood of Teamsters and the Service Employees International Union."

The study says that "Amazon reported approximately 38,300 total injuries at its U.S. facilities in 2021, up about 20% from 27,100 injuries in 2020. The vast majority of injuries in 2021 were categorized as serious, or injuries 'where workers were hurt so badly that they were either unable to perform their regular job functions (light duty) or forced to miss work entirely (lost time),' according to the report.

"Amazon was responsible for a 'staggering' amount of worker injuries in the U.S., the report found. In 2021, Amazon accounted for almost half of all injuries in the industry, while making up a third of all U.S. warehouse workers."

CNBC points out that Amazon does not try to deny the numbers:  "Amazon spokesperson Kelly Nantel pointed to the company’s pandemic-induced hiring spree as one catalyst behind the increase in recordable injuries between 2020 and 2021. Amazon’s recordable injury rate last year dropped roughly 13% compared to 2019, Nantel added.  'While we still have more work to do and won’t be satisfied until we are excellent when it comes to safety, we continue to make measurable improvements in reducing injuries and keeping employees safe, and appreciate the work from all of our employees and safety teams who are contributing to this effort,' Nantel said in a statement."

Published on: April 13, 2022

The New York Times reports that "inflation hit 8.5 percent in the United States last month, the fastest 12-month pace since 1981, as a surge in gasoline prices tied to Russia’s invasion of Ukraine added to sharp increases coming from the collision of strong demand and stubborn pandemic-related supply shortages."

According to the Bureau of Labor Statistics, the price of fruits and vegetables was up 8.5 percent in March compared to the same month a year ago … nonalcoholic beverage prices were up eight percent … food away from home was up 6.9 percent … cereals and baking products were up 9.4 percent … and meats, poultry, fish and eggs were up a whopping 13.7 percent.

"Fuel prices jumped to record levels across much of the nation and grocery costs soared, the Labor Department said Tuesday in its monthly report on the Consumer Price Index. The price pressures have been painful for American households, especially those that have lower incomes and devote a big share of their budgets to necessities.

"But the news was not uniformly bad: A measure that strips out volatile food and fuel prices decelerated slightly from February as used car prices swooned. Economists and policymakers took that as a sign that inflation in goods might be starting to cool off after climbing at a breakneck pace for much of the past year."

Published on: April 13, 2022

Albertsons yesterday released its Q4 and fiscal 2021 results, and here were the highlights:

In Q4, same-store sales were up 7.5 percent year over year;   the two-year stack was up 19.3 percent.  Digital sales were up  five percent, and 287 percent on a two-year stack.  Net sales for the quarter were $17.38 billion, up 10.2 percent from the fourth quarter a year ago.  Net income for the quarter was $455.1 million, compared to a net loss of $144.2 million in the year-ago period.

For the just-completed fiscal year, same-store sales were down 0.1 percent, though up 16.8 percent on a two-year stack.  Digital sales increased 5 percent; on a two-year stacked basis digital sales growth was 263 percent.  Fiscal 2021 net sales were up 3.2 percent to $71.89 billion.

In its analysis, ther Wall Street Journal wrote that "two months ago, Albertsons launched a strategic review, an odd move considering that it only made its debut in the public market less than two years ago. Tuesday’s share-price reaction to its quarterly earnings seems to justify the company’s decision.

"By most indications, the second-largest grocery-chain operator - behind Kroger - exceeded Wall Street expectations."  But, the story notes, "Despite impressive results and guidance that either matched or exceeded Wall Street expectations, Albertsons shares declined nearly 7% around midday Tuesday. Inflation could be weighing on investors’ minds."  The 8.5 percent inflation rate - higher for some food segments - was termed "uncomfortably high" by CEO Vivek Sankaran, "compared with the 3%-4% inflation rate, which Mr. Sankaran had previously said was the company’s sweet spot, where price hikes can easily be passed onto the consumer."

Published on: April 13, 2022

FMI—The Food Industry Association yesterday announced its 2022  Store Manager Awards finalists, chosen, FMI said, "for their spirited aptitude for team development and store leadership. Their high-level business acumen and passion for people management led to record financial growth, heightened customer satisfaction, energized, purpose-driven employees, innovative in-store programs, and impactful community investments."

The finalists are:

• Category A (1-49 Stores) 

- Jose Marroquin, Store Manager, Inserra Supermarkets ShopRite, New Milford, NJ 

- Scott Cristi, Store Manager, Roche Bros. Supermarkets, Co., West Roxbury, MA 

- Stephanie Wright, Store Manager, Monadnock Food Co-op, Keene, NH 

•  Category B (50 – 199 Stores) 

- Dionne Martin, Store Manager, Giant Food, Fort Washington, MD 

- Raymond Stockard, Store Manager, K-VA-T Food Stores, Inc. d/b/a Food City, Kingsport, TN 

- Rob Santoni, Store Manager, Weis Markets, Inc., Nottingham, MD 

•  Category C (200+ Stores) 

- Brandon Welch, Store Director, Brookshire Grocery Company, Monroe, LA 

- Rob Vassar, Store Director, Meijer, Inc., Stevensville, MI 

- Robin Olshenske, Store Manager, Food Lion, LLC, Myrtle Beach, SC 

•  Category D (International) 

- Dawn Haig, Store Manager, Save-On-Foods, Chilliwack, BC, Canada 

- William Colquhoun, Store Manager, SPAR Scotland/CJ Lang, Abronhill, Scotland 

Published on: April 13, 2022

Bloomberg has a story about an unexpected phenomenon - a resurgence by physical bookstores.

An excerpt:

"Barnes & Noble, which once said it would whittle itself down to 450 stores by 2022, started the year with 625 — and plans to add 20 to 25 more in 2022. James Daunt, who took over as chief executive officer in 2019 after hedge fund Elliott Management Corp. acquired the company, has been refurbishing existing stores and empowering store managers to use their local knowledge. Book sales have boomed during the pandemic, up 13% year over year, and at least 172 new independent bookstores opened in 2021. Some of those indies have even taken to the mall."

It ends up, Bloomberg suggests, that people may once again be embracing bookstores "because those bookstores were never just about books — they were about access, and freedom. The chains reached deeper into America, and brought books to a wider demographic, than today’s approximately 6,000 stores can. Yes, we have Amazon now. But it will never be the same as sitting on the carpet in some under-trafficked aisle and reading your first Sweet Valley High, your first Stephen King, or your first biography of The Great One."

You can read it here.

Published on: April 13, 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 United States now has had a total of 82,133,342 total cases of the Covid-19 coronavirus, resulting in 1,013,044 deaths and 80,015,081 reported recoveries.

Globally, there have been 501,215,485 total cases, with 6,210,094 resultant fatalities and 451,425,844 reported recoveries.   (Source.)

•  The Centers for Disease Control and Prevention (CDC) says that 77.2 percent of the total US population has received at least one dose of vaccine … 65.8 percent are fully vaccinated … and 45.3 percent of fully vaccinated people have received a vaccine booster dose.

•  Axios reports that "less than one in 10 Americans now describe COVID-19 as a crisis - with about three in four calling it a manageable problem and one in six saying it's no problem at all - according to the latest installment of the Axios/Ipsos Coronavirus Index.

"Why it matters: These sentiments — and the public's growing desire to be done with mask mandates and other restrictions — raise significant challenges for public health officials in managing new surges, and could create real political headwinds ahead of the midterms."

Axios goes on:  "The latest wave of our national survey actually found a slight uptick in people's perceptions of the risks of certain activities, including flying, attending sports events and returning to work. Yet it shows the highest share of Americans visiting friends and family members outside the home — and the lowest rate of social distancing — since the early part of last summer.

"Just half of respondents now support schools requiring students, teachers and administrators to wear masks, down from seven in 10 at the start of the school year.

The number of respondents who said their employers are requiring them to wear masks dropped by nearly half over the past month, from 39% to 22%.  37% of respondents said they've already returned to their normal, pre-COVID lives, a new survey high."

Published on: April 13, 2022

•  The Wall Street Journal reports that "Shopify is asking investors to approve changes to its complex share structure to protect the voting power of the Canadian technology company’s leader. The company also is proposing a 10-for-1 stock split … Under the proposal, co-founder and Chief Executive Officer Tobi Lütke will receive a new 'founder share' that, combined with his existing supervoting Class B shares, will increase his voting power to 40% from 34%. Mr. Lütke, who is 41 years old, will keep the founder share as long as he remains at Shopify as an executive, a board member or a consultant."

According to the Journal, "Shopify, which provides software and services to businesses that want to sell goods online, was one of the biggest winners during the pandemic. As people went into lockdown, e-commerce activity surged and Shopify’s stock increased more than 300% between the beginning of 2020 and its peak in late 2021. This year, as pandemic restrictions have eased, shoppers returned to physical stores and the company outlined plans to invest to build its own delivery network, the company’s share price has tumbled.

"Tesla Alphabet and Amazon.com have announced stock splits in recent weeks. Stock splits don’t change the value of a company or an investor’s stake, yet investors have rewarded the companies this year."

Published on: April 13, 2022

•  The Dallas Morning News reports that Albertsons is opening a store in South Irving, Texas, later this year, the first new store under its own banner that it has opened in the Dallas-Fort Worth market "in several years."

According to the story, "The grocery retailer is taking over space that was vacated by Fiesta Mart a couple of years ago at 2200 W. Shady Grove Road in Irving, the city of Irving said Monday.

"Albertsons hasn’t had a store in Irving since 2007, and the brand hasn’t opened a new store anywhere in the Dallas-Fort Worth market in several years. Boise-based Albertsons instead has focused on opening Tom Thumb stores. There’s one Tom Thumb store in Irving on Macarthur Boulevard.

"When Fiesta Mart closed its store, local neighborhood groups lobbied the city council to bring a supermarket back to the shopping center. Fiesta Mart, which operates 29 stores in D-FW, has two other Irving stores on West Airport Freeway and East Irving Boulevard … The Irving Economic Development Partnership worked with city officials to recruit a grocer and found “a respected brand,” said Beth Bowman, president and CEO of the partnership and the Greater Irving-Las Colinas Chamber of Commerce."

•  From the Wall Street Journal:

"The biggest U.S. retailers are rationing baby formula as a recall by the maker of Similac and other popular brands exacerbates already-spotty supply in much of the country.

As of Tuesday, Target Kroger CVS Health and Walgreens Boots Alliance have limited the quantities of many baby formulas that consumers are able to buy online or in some stores.

"A Target spokeswoman said stores in most states have a five-per-day limit on baby formula at the request of the Food and Drug Administration. CVS said it recently began limiting purchases in stores and online to three per consumer. Walgreens said it implemented limits in stores and online last month. Kroger didn’t respond to requests for comment."

Published on: April 13, 2022

•  Walmart announced that it has hired PayPal CFO John Rainey as its new chief financial officer. He succeeds longtime CFO Brett Biggs, who is retiring.

CNBC writes that "Rainey is joining Walmart as the big-box retailer chases new streams of revenue. Among them, the company wants to expand its third-party marketplace and ramp up its advertising business.

"Walmart also has invested in new areas. It created and backed a fintech startup that’s led by former Goldman Sachs bankers. Biggs, the retailer’s outgoing CFO, sits on the startup’s board."

Published on: April 13, 2022

…will return.