Published on: June 13, 2022
Apple just announced its own, self-funded buy-now-pay-later program. I'm a little skeptical; these schemes strike me as contributing to the problem of financial illiteracy in this country. But it did give me an idea for something retailers could do in their organizations that could help their labor relations.
Published on: June 13, 2022
Ahold Delhaize-owned Stop & Shop said Friday "a $140 million capital investment in its New York City stores to improve the shopping experience for local customers with a focus on adding thousands of new items from around the globe to ensure the assortment at each store reflects the diversity of the neighborhood it serves."
According to the announcement, "Store remodels will deliver a fresh new look and feel for customers and will also showcase value with deal bins and the addition of the Flashfood program which offers fresh foods at up to 50% off. Stop & Shop’s Bay Plaza store in the Bronx is the first to be remodeled and will celebrate its Grand Reopening with a ribbon cutting on June 10, with additional store upgrades across the boroughs taking place over the next two years. In addition to the investment in its stores, Stop & Shop has committed $1 million to fight food insecurity across NYC this year through several local initiatives and community partnerships."
The press release points out that "Stop & Shop began operating in New York City more than two decades ago and currently operates 25 stores in the Bronx, Brooklyn, Queens, and Staten Island – and home delivery in all five boroughs."
The first thing I wonder about is the impetus for this move. Is it just a sense that the stores are out of date and need refreshing? Or is there something else going on here?
Kroger has announced its plan to move into the northeast with a pure-play e-grocery model, but has not said where in the northeast. I wouldn't have bet on the New York City metropolitan area, but it is possible that Stop & Shop is worried about a bigger competitor coming and starting to steal market share. Better to play offense than defense.
I cannot recall the last time I was in any of these NYC Stop & Shop stores, so I have a limited frame of reference from which to work. But if those stores are anything like the Connecticut Stop & Shop stores with which I am familiar … well, they have some work to do. My experience is that those stores are just good enough, but never transformative, never exciting. There are a couple of them within miles of where a new Wegmans is scheduled to be built, and I suspect they'll be in a world of hurt when that store opens.
Good enough rarely is good enough these days. Depending on how things play out, Stop & Shop may find that out the hard way.
Published on: June 13, 2022
The New York Times this morning reports that "a range of companies, big and small and in a variety of categories, are utilizing 'the drop,' releasing limited-edition items in small numbers at a particular time. Some businesses that opened during the pandemic have only sold products this way. More established companies are turning from more traditional sales models, like releasing a collection every season or having a store that consistently has merchandise, and adopting this strategy."
Food retailers don't do this very much - their existence is pretty much predicated on the idea of being fully stocked at all locations all the time (though recent supply chain issues have made this goal elusive).
But the idea is that the combination of surprise and scarcity can be amazingly magnetic to shoppers, and also provide businesses with inherent drama … and I think it is the kind of thing that more retailers ought to embrace.
There's nothing wrong with saying we're going to have X amount of this item at Y store at this particular time, and when it's gone, it's gone. If the product or service has a c compelling story attached to it, and retailers do an effective job of telling that story, it creates a sense of fun, theater and demand … all of which add up to more effective retailing.
We may in a time when shopping will be constrained by inflation, and so if retailers also can use these moments to offer shoppers something that they perceive as a win, it can go a long way to creating sustained relationships with those shoppers.
Published on: June 13, 2022
The New York Times has snippets from an interview it conducted with Starbucks CEO Howard Schultz at its DealBook policy forum in Washington, DC.
Some excerpts…
• On unionization: "Starbucks unfortunately happens to be the proxy of what is happening. We’re right in the middle of it. If a company as progressive as Starbucks, that has done so much and is at the 100th percentile in our entire industry for benefits for our people, can be threatened by a third party that means that any company in America can.
"Now, I’ve said publicly I’m not anti-union, but the history of unions is based on the fact that companies in the ’40s, ’50s and ’60s abused their people. We’re not in a coal mining business; we’re not abusing our people.
"But the sweeping issue in the country is that businesses are not doing enough, and the business is the enemy.
"We don’t believe that a third party should lead our people. And so we are in a battle for the hearts and minds of our people."
• On getting workers back to the office: "I have been unsuccessful, despite everything I’ve tried to do, to get our people back to work. I’ve pleaded with them. I said I’ll get on my knees. I’ll do push-ups. Whatever you want. Come back. No, they are not coming back at the level I want them to. And, you know, we’re a very collaborative, creative group. I realize I’m an old-school person and this is a different generation. I’m in the office at 7 a.m. and I leave at 7 at night. I’m trying to make an example. I think people will come back two to three days a week and that’s the way — that’s the way it is. But the thing that I am evaluating is, what’s the level of productivity? And you know, it appears that people are working at home."
• On why he returned: "I came back to reinvent the role and responsibility of a public company at a time where there is a cultural and political change with regard to the crisis of capitalism — the needs, requirements of the employee in a company today.
"I don’t want to be critical but I have to be honest that the government in many ways have left people behind. If you call thousands of people who are working for a paycheck today and you asked them about economic mobility and specifically about the promise of country, for the most part they are going to say it’s not available to me. And if you ask people, unfortunately, who are Black or brown, they are going to say without question it’s not available to me for the most part.
"If we think about the past, Starbucks created comprehensive health insurance for our people 25 years before the Affordable Care Act. Equity in the form of stock options for everyone, including part-time workers. Free college tuition. We can go on and on, but the truth is those benefits, as good as they are and were, are not good enough for the employee of today, primarily because Gen Z has a different view of the world. And also because the government has not provided them with a pathway that they believe they deserve."
I've always been impressed by the fact that Schultz has not approached the Starbucks business in a transactional sense, but this interview - in which he talks in grandiose terms about the business and his own role - makes me wonder if this is the moment in which the company requires more granular thinking. I don't know. Maybe he can do both.
But is it possible that Starbucks stores - and that's where the magic is supposed to take place - have grown so numbingly similar and even stale that all the talk about hearts and minds misses the immediate point?
Published on: June 13, 2022
The New York Times over the weekend has a piece about how Stephanie Stuckey is endeavoring to revive the company that bears her family's name, in part through the power of storytelling.
An excerpt:
"She has posed for photos wearing a Stuckey’s 'Eat Here and Get Gas' T-shirt, and has posted recordings of herself belting out Andrew Gold’s 1977 hit, 'Lonely Boy,' in the car along with her best friend on Instagram. On her account, she has posted more than 1,600 neon signs, diners, tourist traps and quirky roadside attractions.
"Although the pandemic resulted in an increase in road trips and revenue for Stuckey stores, that may not last. Building the brand, however, doesn’t require people to actually take road trips; they just need to identify with the road-trip lifestyle, much the way not everyone who wears board shorts actually surfs. It’s aspirational.
"'Can I single-handedly revive the road trip? I can’t,' Ms. Stuckey said. 'But can I put out stories that resonate with people on a personal level, then encourage other people to share their road trips? I think we can build a bit of a movement'."
You can read the entire piece here.
I had the opportunity to do a Zoom conversation with Stephanie Stuckey earlier this year, and I found her to be utterly engaging … and you can see it here.
Published on: June 13, 2022
Fox Business reports that "the Food and Drug Administration (FDA) reportedly investigated seven more child deaths due to the consumption of contaminated baby formula from the Michigan Abbott Nutrition plant than was previously known … the agency investigated reports that as many as nine children had died since March 2021.
"Previously, the FDA said two children had died and two were sickened after consuming formula that contained the bacterium cronobacter sakazakii … the agency acknowledged Friday that it had received such additional reports, being unable to identify the source of the infection in all cases."
At the same time, the Associated Press reports that "US regulators have historically inspected baby formula plants at least once a year, but they did not inspect any of the three biggest manufacturers in 2020 … When they finally did get inside an Abbott Nutrition formula plant in Michigan after a two-year gap, they found standing water and lax sanitation procedures. But inspectors offered only voluntary suggestions for fixing the problems, and issued no formal warning.
"Inspectors would return five months later after four infants who consumed powdered formula from the plant suffered bacterial infections. They found bacterial contamination inside the factory, leading to a four-month shutdown and turning a festering supply shortage into a full-blown crisis that sent parents scrambling to find formula and forced the U.S. to airlift products from overseas.
"The gap in baby formula plant inspections, brought on by the COVID-19 pandemic, is getting new scrutiny from Congress and government watchdogs investigating the series of missteps that led to the crisis. A recent bill would require the Food and Drug Administration to inspect infant formula facilities every six months. And the government’s inspector general for health has launched an inquiry into the FDA’s handling of Abbott’s facility, the largest in the U.S."
There are going to be a lot of questions to be answered here, and I suspect that none of the answers will be very satisfying.
Published on: June 13, 2022
The St. Louis Business Journal reports that sandwich chain Panera Bread "has opened a 'Panera To Go' in Chicago, the first of three test stores it plans to open this year for the new pickup-or-delivery-only concept … The new 'digital-only' concept offers no seating and has a smaller so-called 'front of house' that will allow customers and delivery drivers to pick up orders from shelves reserved for Panera's Rapid Pick-Up and Delivery service. Ordering and payment for Panera To Go orders will be available only through Panera's website or app.
"Panera To Go is intended to serve all parts of the day, including breakfast, officials said.
Panera plans to open two more Panera To Go cafes, in California and Washington, D.C., this year, according to a Friday press release. Officials said the company will also evaluate adding kiosk and catering orders to the new Panera to Go format in the future."
The story notes that Panera is following the money - it says that "as of year-end 2021, 81% of Panera’s sales were through one of its off-premise channels including delivery, Rapid Pick-Up, drive-thru and catering."
Different places, different customers and different circumstances require different formats. Not a hard formula to figure out, though determining how to meet the challenges is something else again.
Published on: June 13, 2022
The New York Post reports that Juan Carlos Garcia, who was the CEO of Amazon Mexico from 2015, when the company opened its first office there, until 2017, currently is on the run while he is being tried in absentia in a Mexican court. The charge: hiring two hitmen for $9,000 to murder his estranged wife.
The Post writes that "one of the hired guns testified that Garcia offered an extra $2,500 if his wife was killed before the couple’s next court hearing in a lawsuit she had filed against him.
"Pérez had filed for divorce from her husband after she accused him of trying to kill her when he beat her with a baseball bat in January 2019. She was in Mexico City for a scheduled hearing when she was fatally shot by a motorcyclist, authorities said.
The trial for Pérez’s murder began on Monday while Garcia remains on the loose. Interpol has issued a warrant for his arrest in 190 countries … García allegedly fled Mexico days after the murder and entered the US on foot through a checkpoint near Tijuana, which borders San Diego."
I know that this isn't strictly a retail business story … but I'm also pretty sure that based on the headline alone, it will be the one story that everybody reads on MNB this morning.
While this took place in Mexico, it also is important to point out that this is part of a broader trend in which men commit acts of violence, and then the system treats them with benevolence that belies the threat they present to other people. The Post writes that "the mother of three had accused García of beating her with a bat while she was sleeping. He was taken into custody for the incident but released when the judge downgraded the charge to domestic violence."
Published on: June 13, 2022
• USA Today reports that starting in July, Costco will restrict gasoline sales at its 17 New Jersey locations only to people who are members, just at it does in the rest of the country.
The story says that "in 2004, Costco and other warehouse clubs were told restricting gasoline sales to members would violate state law after the retailer posted signs at pumps requiring drivers to present a membership card. The membership-card requirement was ultimately abandoned."
However, the current state tax authorities seem on board for the shift in policy. Costco locations have been crowded with cars in recent weeks as it sells gas - which has been driven to new price highs by inflation - for less than at many other local stations.
• WTOP-TV reports that Maryland-based Giant Food "has added two new electric delivery vehicles to its delivery fleet, and expects to add more.
"Giant received a grant from the Clean Fuels Incentive Program managed by the Maryland Energy Administration to acquire the step side delivery vans. The trucks can cover 105 miles on a single charge from Giant’s Hanover, Maryland, distribution warehouse."
According to the story, Ahold Delhaize-owned Giant "estimates over the lifetime of the two vehicles, they will eliminate the use of more than 210,000 gallons of gas. Giant Food said it plans to transition more of its delivery fleet to all-electric over the next several years."
Published on: June 13, 2022
…will return.
