Published on: July 27, 2022
I have some food news this morning. One story I find to be encouraging. One story, discouraging. And the third story, kind of distressing in terms of gastronomic priorities. (And I report these stories with full knowledge that I will be accused of being a food snob. Così è la vita!)
Published on: July 27, 2022
by Kevin Coupe
Local news reports in Connecticut, where I live, point out that Tuesday's Mega Millions drawing had a whopping $830 million jackpot … and that Stew Leonard's, which operates stores in Connecticut, New York and New Jersey, took advantage of the moment to give each one of its 2,500 employees a single lottery ticket.
It was, the company said, a way to say thank you to the staff.
I find myself wondering how many other companies did the same thing. It was an easy win, didn't cost all that much, but was the kind of Eye-Opening move that can make a difference.
Connecting with employees doesn't always have to be about grand gestures. Sometimes it is the little things … unexpected, but appreciated … that matter.
One quick note: No winning tickets were sold for Tuesday night's drawing, which means that the next drawing - on Friday - will be for $1.02 billion. This gives you a couple of days to buy every member of your team a lottery ticket.
(I don't play the lottery, but I may make an exception this week…)
Published on: July 27, 2022
Albertsons yesterday that its Q1 same-store sales were up 6.8 percent, while digital sales were up 28 percent.
The company said that Q1 net sales and revenue hit $23.3 billion in the quarter, up from $21.3 billion during the same period last year. Net income for the period was $484.2 million, up from $444.8 million a year ago.
Albertsons also said that it has "engaged a third party to review the value of its real estate portfolio. Based on the completed real estate appraisal, the total value of Company-owned and ground-leased properties has increased approximately $2.5 billion to $13.7 billion, up from $11.2 billion in 2019." Albertsons currently is engaged in a Strategic Alternatives Review, but has "not set a timetable" for its conclusion, "nor has it made any decisions related to any further actions or potential strategic alternatives at this time."
Published on: July 27, 2022
Eagle Hill Consulting is out with a new study saying that there is a "disconnect between employees’ need for performance feedback and how much feedback they receive. About half of workers (48 percent) report they only receive feedback on annual or semi-annual basis while eight percent say they never receive feedback on their work … 63 percent of workers want more immediate 'in the moment' feedback on their work performance. This sentiment is higher for younger workers (74% for those aged 18 to 34) as compared to mid-career and older workers (57 percent)."
The study goes on:
"82% of workers say they feel valued when someone takes time to provide feedback … 79% of workers say feedback is important to their professional development … 67% of workers say they receive the same level of feedback during the past two years despite proliferation of hybrid/remote work.
"Most workers (64%) agree their organization creates a supportive, comfortable environment for delivering, soliciting, and receiving feedback in the workplace.
"When asked what they need to succeed in their work environment, 31 percent of hybrid workers said it’s more forums to gather feedback from team leads. Twenty-two percent of fully remote workers held this sentiment, as did 16 percent of in-person employees
"During discussions with managers, employees say it is helpful to align on realistic goals/priorities (46 percent); review performance as it relates to promotion (21 percent); set goals (19 percent); and discuss career development (14 percent)."
The first thing I think that retailers should do is actually ask their employees, "Are you getting enough feedback from your managers? What kind of feedback would be helpful to you in terms of a) accomplishing your job and b) achieving your career goals?"
Now, this will create challenges for managers - once you get answers to these questions, you actually have to deliver.
At a time when there remains a shortage of employees - and maybe even a greater shortage of outstanding employees, part of your employee value proposition has to be helping employees in a way that resonates with them.
I hate to come back to this, because I've said it so often, but it remains a fact - these are the same people who, not so long ago, you defined as being essential. Just because the pandemic is receding doesn't mean you get to walk away from that designation. Not if you meant it.
Published on: July 27, 2022
The New York Times has a story this morning about how perception may be one of the biggest problem for government regulators trying to tame inflation and stave off recession. An excerpt:
"If consumers and companies expect fast inflation to be a permanent feature of the American economy, they might begin to shift their behavior in ways that cause prices to keep rising. Consumers might begin to accept prices increases without shopping around, workers might demand higher pay to cover climbing costs, and businesses might raise prices both to cover their higher labor bills and because they think customers will stomach the heftier price tags.
"Economists often blame that sort of spiraling inflationary mind-set for fueling rapid price gains in the 1970s and 1980s, a painful episode in which inflation proved difficult to tame. That is why the Fed, which is responsible for keeping inflation under control, has been focusing on a range of inflation expectation measures, hoping that a high-price psychology is not taking hold.
"Most signs suggest that people still believe that inflation will fade with time. But interpreting inflation expectations is more art than science: Economists disagree about which metrics matter, how to measure them and what could make them change. And after more than a year of rapid price increases, central bank officials are increasingly worried that it’s foolish to take the stability of price expectations for granted. Officials have been rapidly raising interest rates to try to cool the economy and send a signal to the public that they are serious about wrestling price increases lower."
The story notes that "people are coping with the climbing costs in a range of ways. Many said they were cutting consumption, which could help inflation to ease by lowering demand and giving supply a chance to catch up. A few were continuing to buy, hoping that costs would moderate with time. But others were asking for more pay or trying to find other ways to cover their climbing costs while resigning themselves to increasing prices."
The Conference Board says that its July consumer confidence index dropped to 95.7 from June’s revised reading of 98.4, which it said is the lowest number since February 2021 … which actually isn't all that long ago. (Though in some ways it seems like a lifetime ago.)
CNN points out that during the so-called Great Recession, the consumer confidence index got as low as 25.6. Which I suppose is both good news and bad news … the good news is that we have a long way to go before things get that bad, while the bad news is that things actually have gotten that bad.
The CNN story goes on: "It’s the third consecutive month that the index fell, a decline driven by consumers souring on the state of current business conditions. The index that tracks assessments of current business and labor conditions tumbled to 141.3 from 147.2, according to the report … It’s a sign that growth has slowed during the third quarter, Lynn Franco, The Conference Board’s senior director of economic indicators said in a statement.
"Consumers’ expectations for the next six months ahead held relatively steady, but remain at a level that suggests recession risks persist, she noted, adding that inflation continues to weigh heavily."
BTW … if you haven't seen it, John Oliver did a pretty good job of explaining the challenges of our current inflationary period in HBO's "Last Week Tonight" on Sunday. here it is … as always, the language makes it it not suitable for work, or or viewing around children, or anyone with delicate sensibilities.
Published on: July 27, 2022
The Wall Street Journal reports that Shopify is laying off about 1,000 employees, representing about a tenth of its global workforce.
According to the story, "Tobi Lütke, the company’s founder and chief executive, told staff in a memo sent Tuesday that the layoffs are necessary as consumers resume old shopping habits and pull back on the online orders that fueled the company’s recent growth. Shopify, which helps businesses set up e-commerce websites, has warned that it expects revenue growth to slow this year."
In his memo, Lütke took responsibility for making a bet - that e-commerce sales would continue to grow apace even as the pandemic receded - that didn't pay off. "Ultimately, placing this bet was my call to make and I got this wrong," he wrote.
The Journal reports that "the Ottawa-based company will cut jobs in all its divisions, though most of the layoffs will occur in recruiting, support and sales units, said Mr. Lütke. 'We’re also eliminating overspecialized and duplicate roles, as well as some groups that were convenient to have but too far removed from building products,' he wrote."
It is a dramatic move by Shopify, but to be clear, these are the first major layoffs at the company since it was founded in 2006 … considering how many swings we've been through since then, that's reasonably impressive. The Shopify bet during the pandemic also was reasonable, and I suspect that over the long run, a lot of those jobs will come back. Maybe more.
Published on: July 27, 2022
The Boston Globe has an interview with Chris Bischoff, who helps lead health care investing at Cambridge-based venture capital firm General Catalyst, in which he suggests that Amazon's planned acquisition of the One Medical health care system could prompt activity around other healthcare startups.
“We’ve clearly seen these big tech companies come in ... I’m overall optimistic that it will enable change to happen more quickly,” Bischoff said, adding that "health care needs a broad ecosystem of different companies with different specialties and strengths, so there should still be room for startups to flourish … I don’t think Amazon’s move will be unnoticed. Clearly there will be some further consolidation. There’s going to be some interesting [mergers and acquisitions] coming out of digital health as we go into 2023."
Bischoff points out that "the pandemic exposed deep vulnerabilities in the system … But on the other side, it also demonstrated the power of technology and innovation to transform. It proved that the health care sector can accept change — when faced with existential crisis."
The Globe writes that "Amazon’s purchase, and the down market, may encourage other tech companies to get involved in buying smaller players. Both Google and Apple have already targeted the health care market with their own apps and data services."
I'm no venture capitalist and, therefore, not nearly as smart … but this is sort of the point I was making here yesterday.
I think there's almost certainly going to be moves by the likes of Walmart, Kroger, Target, CVS, Walgreen and Apple to partnering with or even acquiring companies that will keep them in the healthcare game to a greater degree. I think that Mark Cuban is likely to be getting some phone calls from one or more of these companies that will be interested in teaming up with his CostPlus business. And I think that there are some smaller health-oriented technology companies that, even in this economy, may find themselves in a seller's market.
Published on: July 27, 2022
From Axios:
"Alternative meat startup MyForest Foods yesterday unveiled what it calls the world's largest aerial mycelium farm, a high-tech facility meant to crank up production of its mushroom-based imitation bacon, one of many products making it easier for meat lovers to give up the real thing … MyForest Foods' new facility, called the Swersey Silos, is located in Green Island, N.Y., a short drive up the Hudson River from Albany."
According to the story, "The Swersey Silos are expected to annually produce nearly three million pounds of mycelium - the root-like fungal structure from which mushrooms grow - for making the company's MyBacon pork alternative. A company rep said that would be enough for about one million pounds of MyBacon per year.
Company co-founder/CEO Eben Bayer explains the process to Axios: "We basically build these cyborg buildings that replicate the environment you find in a forest. And we sort of trick the mushroom to form these, basically, sheets of mushroom flesh. So rather than forming a mushroom, we get a 50-foot-long, four-foot-wide, two inches thick slab of mushroom meat.
"They've got this umami flavor, which sort of mimics flesh. And all we do is slice it off, slice it into bacon strips, salt it, smoke it, put a little coconut fat on it."
The story notes that "MyBacon, which was first available at an Albany grocery co-op, is now coming to two Massachusetts stores as the company scales up production and the broader alt-meat wars rage on."
Published on: July 27, 2022
Axios reports that "giant restaurant chains like KFC and Boston Market are making big-splash introductions of chicken nuggets on their menus this month … setting up a potential rematch of 2019's epic chicken sandwich wars."
The story notes that "with chicken consumption on the rise, fast food industry titans think they can boost profits by catering to the nugget-loving tastes of younger consumers. Driving the news: KFC began testing new chicken nuggets last week for a limited time in Charlotte, North Carolina, aiming to lure in Gen Z and millennial customers."
In addition, Axios writes, "Boston Market just rolled out its first nuggets, in "signature" and 'spicy.'
"McDonald's — which pioneered the McNugget in 1981 — has brought back its beloved Spicy Chicken McNuggets at some locations for a limited time.
"In January, McDs debuted the 'Crunchy Double' sandwich — two cheeseburgers on a bed of Chicken McNuggets — based on a popular menu hack. Not to be outdone, Burger King, which introduced spicy Ghost Pepper Chicken Nuggets in the U.S. last fall, just brought them to Canada."
I'll stick with my reaction to chicken nuggets as express in today's FaceTime. It's been my goal to avoid this particular food item until I have grandchildren, at which point I suspect they'll be unavoidable. But that'll be okay, because there will be grandchildren involved. (Though I'm hoping I can also encourage them to eat risotto…)
Published on: July 27, 2022
• Edge by Ascential is out with its annual 2022 Future of Marketplaces Report, projecting that "third-party online marketplaces will be the largest and fastest-growing retail channel globally. The report anticipates that third-party sales through online marketplaces will add $1.3 trillion in sales over the next five years and that by 2027 the four largest global online marketplaces - Amazon, Alibaba, Pinduoduo and JD.com - will be responsible for $4.3 trillion in global sales, up from $2.5 trillion today … Other major US retailers, such as Walmart, have been increasingly looking to court third-party sellers to their ecommerce platforms in order to diversify their product offerings and supply chains."
Some additional report highlights:
"Alibaba will continue to be the global leader in retail from 2022-2027, growing total net GMV sales (ecommerce and bricks and mortar) in 2027 to $1.5 trillion. Amazon will be the second-largest online retail marketplace with $1.2 trillion in total net GMV sales in 2027 … Third-party sales through marketplaces will be the largest and fastest-growing retail channel globally, adding $1.3 trillion in sales over the next five years …
forecasts show that third-party online sales will account for 38% of total global retail sales growth (2022-2027) … By 2027, the four largest global online marketplaces–Amazon, Alibaba, Pinduoduo and JD.com–will be responsible for 66.5% of global ecommerce sales by 2027 (taking into account first-party and third-party sales)."
• Reuters reports that United Parcel Service (UPS) will not increase the number of packages it delivers for Amazon, saying that it will focus on shipments with greater ROI.
Amazon is UPS's biggest customer.
UPS CEO Carol Tome' said the company would be enforcing its maximum package agreement with Amazon: "We've contractually agreed on what makes sense for us versus what makes sense for them. That means that the volume and revenue for Amazon is coming down."
Reuters writes that while Amazon's own delivery service "is growing fast and could eventually compete head-to-head with UPS, Amazon still depends on UPS to deliver millions of packages to homes.
"Meanwhile, UPS is racing to revive the business-to-business shipments that were its bread and butter before the pandemic. It has made slow progress on that front because corporations have reeled in spending and workers are reluctant to return en masse to office buildings."
• CNBC reports that "Amazon is raising prices for its Prime subscription service in the U.K. and across Europe as the e-commerce giant grapples with the effects of rising inflation … Amazon blamed the price rises on 'increased inflation and operating costs,' along with higher expenses tied to faster delivery and content production for its Prime Video streaming service."
According to the story, "In the U.K., Amazon is set to hike the annual price of a Prime membership to £95 ($114), up from £79, representing a 20% jump. The changes will take effect Sept. 15. The company is enforcing even steeper price increases in European markets.
"In France, the price of an annual Prime membership is going up to 69.90 euros ($70) from 49 euros, a 43% increase. German Prime members can expect a 30% hike in their annual Prime prices to 89.90 euros, up from 69 euros.
"The move follows similar price hikes Amazon announced in the U.S. In February, the company said it would raise the price of its annual Prime membership for Americans to $139 from $119, the first such increase to its discount loyalty program in the U.S. since 2018."
Published on: July 27, 2022
• Giant Eagle yesterday announced "the expansion of its partnership with Flashfood, a digital marketplace that provides customers access to heavily discounted food nearing its best-by date, to all of its 173 corporate Giant Eagle and Giant Eagle Market District stores. Starting in Cleveland, the 140-store expansion will steadily roll out throughout Ohio and Pennsylvania and will be completed by the end of October.
"Since Giant Eagle first introduced the Flashfood program at 34 store locations in 2021, more than 430,000 pounds of food waste has been diverted from reaching landfills. This equates to nearly 159,102 meals that fed families rather than being thrown away and about 834,335 pounds of CO2e- emissions saved from entering the atmosphere."
Giant Eagle says that "the Flashfood app enables customers to browse deals – directly from their phone or computer – on fresh items like meat, produce boxes, dairy, and bakery items, as well as center-store foods and snacks that are nearing their best-by dates. Purchases are made directly through the app and customers then pick up their order from the Flashfood zone located inside their participating Giant Eagle or Market District location. Regular Flashfood shoppers save an average of $96 per month on grocery bills."
Published on: July 27, 2022
…will return.
