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    Published on: September 26, 2022

    Mrs. Content Guy brought home a story the other day that illustrated the degree to which some retailers get caught in a flywheel of failure, which is literally the opposite of Amazon's famed flywheel of growth.  In this case, I think it is fair to say, it really does suck.

    Published on: September 26, 2022

    Bloomberg has a story about how Circle K owner Alimentation Couche-Tard is developing a series of tactics designed to serve a core strategy - growing its food sales to represent between 20 and 25 percent of sales.

    The impetus comes from a recognition that the company is too dependent on fuel sales and profits at a time when electric vehicles are becoming more available and prevalent on US roads.

    One possibility, Bloomberg writes, is an acquisition:  "it came close to buying a French grocery chain last year," but didn't, and hasn't made a major food-centric purchase in years.

    "So in the meantime, it’s expanding a marketing push in thousands of Circle K outlets, using food trucks and other forms of advertising to spur consumers to try a lineup of hot sandwiches, pizza, chicken and other meals," Bloomberg writes, quoting Brian Hannasch, the company's president-CEO, as saying that "as Covid has backed off in most of our geographies, you will see a lot more sampling and marketing around food … We have a lot more options than what Couche-Tard and Circle K of the past had for customers."

    Bloomberg continues:

    "Hannasch’s plan is to have universal production facilities in stores that allow for regional tastes. Food is brought to stores by suppliers and is then prepared and made ready-to-eat by employees, a model that’s more efficient that running full kitchens on-site … To free up in-store staff for food-related tasks, Alimentation Couche-Tard is rolling out 10,000 smart checkouts in 7,000 locations. 

    "Couche-Tard is making other investments in the food business. In July, it joined Kroger Co. and Burger King parent Restaurant Brands International Inc. in a US$100 million funding round for Kitchen United Inc. The US firm operates so-called 'ghost kitchens,' food production hubs that allow restaurants to streamline takeout orders. 

    "Hannasch said the company is “intrigued” by the business model and said it’s possible Circle K could eventually use Kitchen United as a distribution point for food and grocery items."

    KC's View:

    I've long believed that c-stores - especially a chain like Circle K, with its enormous geographic footprint - are ideally positioned to redefine convenience retailing and provide stronger competition up and down the supply chain.  By combining concepts like dark stores and ghost kitchens with new delivery technologies, and investing in more and better food to differentiate themselves, they can actually enlarge their relevance to a broader customer base, and do so without alienating their core.

    Published on: September 26, 2022

    Fox Business reports that Unilever CEO Alan Jope, in an appearance at the 2022 Clinton Global Initiative meeting in New York, "reaffirmed the consumer goods giant's sustainability agenda … saying it 'will not back down' despite 'ant-sustainability' and 'anti-woke' backlash."  Jope, the story says,, "called 'anti-sustainability' and 'anti-woke' backlash 'incredibly dangerous for the world.'  He also argued that saying 'we have a climate emergency' has started becoming unpopular."

    Some context from the Fox Business  story:

    "Unilever unveiled its Climate Transition Action Plan in March 2021, announcing a goal to reduce its greenhouse gas emissions within the company to zero by 2030 and across its 'value chain' to net-zero by 2039.

    "The consumer goods giant put its sustainability plan to a shareholder vote in which it 'squeaked through with 99.6% shareholder support,' Jope said. He credited BlackRock with leading the support and described the investment firm as 'one of the finest commentators on sustainability and what companies should be doing.'

    "BlackRock, headed by Larry Fink, has become a leader in environmental, social and governance (ESG) investing and pushing other companies to take up such agendas in a commitment to decarbonization, sustainability and social justice causes."

    KC's View:

    I've always thought that sustainability is not just a noble goal, but smart business - in the long run, taking care of your resources so they last longer and you do less harm to the planet is an intelligent fiscal and ethical approach.

    I've never really understood the whole anti-woke thing, to be honest.  I've always thought of being "woke" as trying to be sensitive to the concerns of others, to think beyond my own perceptions, to avoid epistemic closure.  When businesses and investment funds decide to focus on ESG, they're making a bet that this approach will pay off better in the long term.  It's their bet.  If other companies and funds don't want to make the same bet, that's okay … people can decided to do business or make investments with companies that best reflect their own priorities. If you don't approve of an ESG orientation, do business with someone else.  And yet, there often are stories about investors complaining about companies with a focus on ESG, trying to force them to take a different approach.

    Me, I'd rather be awake than asleep.  But that's me, and I may define the term less radically and less politically than others.

    Published on: September 26, 2022

    CNBC  has a piece about "omnichannel strategy, integration of offline or in-store sales with online orders and logistics. It’s a concept that originated in China in 2016 when founder Jack Ma of e-commerce giant Alibaba coined the term 'New Retail' and proceeded to open 300 high-tech Freshippo-branded supermarkets in 27 Chinese cities."

    This strategy, experts say, is one that has been adopted must aggressively in the US by Kroger, which has linked "together shopping, e-commerce and logistics: automated fulfillment centers bag groceries; vans make same-day deliveries to households; data analytics provide an early read on customer trends; mobile apps distribute customer promotions and coupons; on-premise 'ghost kitchens' prepare meals for in-store pickup or van delivery; QR codes handle payments online at self check-outs; and large online fulfillment centers and warehouses rely on robots for packing, sorting and loading orders.

    "New automated fulfillment centers are a critical part of the technology effort. These centers use AI and robotics to replace labor-intensive work of sorting and bagging groceries for delivery, while on-site employees handle such operations as engineering and inventory management."

    And it isn't just Kroger:  "Competitors Walmart and Target are spending heavily, even in a slowing economy, and with technology a focus among current capex investments."

    You can read the entire story here.

    KC's View:

    Yael Cosset, senior vice president and chief information officer at Kroger, is exactly right when he tells CNBC, “You just can’t be a 1990s grocer. You have to be courageous, break things, and quickly adapt."

    Breaking things.   I think that's a really good manta going forward.

    In fact, I'll make a prediction.  Five years from now, if you talk to people like Cosset who are in the innovation business, they'll say that it ends up that they didn't break enough things during this period of history.  That's not in any way a criticism - just an acknowledgment that in the end, progress always happens fast than we think and that, in fact, there is no such thing as "in the end."

    Published on: September 26, 2022

    The Wall Street Journal reports that Amazon is one of the companies, along with Berkshire Hathaway, most likely to be affected by the 15 percent corporate minimum tax that became law last month.  

    Here's how the Journal frames the story:

    "Researchers at the University of North Carolina Tax Center analyzed securities filings to determine what companies would have paid if the tax had been in place last year. They found fewer than 80 publicly traded U.S. companies would have paid any corporate minimum tax in 2021, and just six - including Amazon and Warren Buffett’s conglomerate - would have paid half of the estimated $32 billion in revenue the levy would have generated.

    "The tax, which takes effect in January, is the largest revenue-raising provision in Democrats’ climate, healthcare and tax law. The provision, projected to generate $222 billion over a decade, alters tax incentives and complicates corporate tax decisions. Democrats aimed the provision at large companies that report profits to shareholders but pay relatively little tax … Although this wasn’t the aim of the law, it could have an impact on some of the wealthiest Americans. Some Democrats proposed direct taxes on billionaires’ unrealized capital gains earlier in the legislative process. While that wasn’t adopted, the new corporate minimum tax would increase the tax burden on some wealthy shareholders, such as Warren Buffett at Berkshire and Jeff Bezos at Amazon.

    Mr. Buffett owned 16% of Berkshire Hathaway’s shares earlier this year, while Mr. Bezos owned nearly 13% of Amazon’s, securities filings show. Representatives for Messrs. Bezos and Buffett declined to comment."

    KC's View:

    It is a little hard for me to shed a tear for corporations and people who are enormously wealthy and pay little in taxes.  I feel like as someone who writes a business blog I'm supposed to, but I just can't summon up any outrage on this one.

    Published on: September 26, 2022

    With brief, occasional, italicized and sometimes gratuitous commentary…

    •  The Information reports that "Instacart has been letting go of staff, slowing hiring and curbing other expenses as it heads toward a public listing, when the grocery-delivery company will try to convince public investors that it can maintain its growth - and make a profit - as the economy slows.

    "The San Francisco startup over the last two months has fired some of its more than 3,000 workers after holding midyear performance reviews where managers were instructed to provide feedback on employees’ shortcomings, according to two people with direct knowledge of the situation.

    "Instacart joins other tech companies, including Meta Platforms, that are trimming staff by taking a harder look at employee performance or leaving open positions unfilled while avoiding highly publicized layoffs. The moves address high labor costs, which ballooned at tech companies during the boom of recent years and now look unsustainable as the economy decelerates."



    •  Good E Reader reports that "Amazon is dramatically changing their Kindle book return policy, due to increasing pressure from authors and the Authors Guild. Previously, customers could return a Kindle book for whatever reason and get a refund. Even if they have read the entire book … According to Amazon’s Kindle return policy, you can 'cancel an accidental book order within seven days.' While accidental purchases do occur - for example, if a child or a pet clicks on a book by accident or you purchase the wrong book with a very common title - several authors said that some people are reading the book in full before turning them to Amazon. Customers will get their money back, but authors will be charged a fee to have that book restocked."

    Good for Amazon.  The behavior being described here is outright theft, with insult being added to injury when authors get charged a fee for a reader's unethical conduct.  The story notes that there is a cadre of folks in social media who argue that "bookstores should be treated like libraries."  Which is, of course, a crock.

    Published on: September 26, 2022

    •  The National Grocers Association (NGA) has released a statement applauding "remarks made by Federal Trade Commissioner Alvaro Bedoya during a speech in Minneapolis today recommending that the agency resurrect the Robinson-Patman Act.

    "The Robinson-Patman Act was passed in 1936 to protect small businesses from price discrimination in the marketplace. Despite the law’s intention, the FTC has not brought a case under the Robinson-Patman Act in more than 20 years. Nor has the FTC brought an enforcement action against economic discrimination using the other antitrust laws."

    “Unfortunately, this is not a new reality faced by independent community grocers across the country, where the playing field on which they are operating is not level and dominant firms exercise their power to demand special treatment from suppliers without an economic justification. Independent grocers and the wholesalers that serve them provide critical competition on price, quality, service and convenience,” said NGA President and CEO Greg Ferrara. “A spotlight has been shone on these anticompetitive, harmful tactics and we look forward to working with the FTC and other policymakers to restore a competitive, robust marketplace that benefits local economies, independent grocers and their shoppers alike.”



    •  Bloomberg reports that while Costco decided not to raise its membership fees in its fourth quarter - it usually raises them every five to six years, and hasn't done so since June 2017 - CFO Richard Galanti said “it’s a question of when, not if.”

    Analysts expect it could happen in Q1 next year.   Bloomberg notes that Costco has been seeing "record renewal rates" during the fourth quarter.



    •  WinCo Foods announced that it has struck a deal with EVgo Inc., which describes itself as "the nation’s largest public fast charging network for electric vehicles (EVs)," to open public. charging stations in the parking lots of its stores.

    According to the announcement, the first at a WinCo stores has opened in Las Vegas, and "EVgo will add fast charging stalls to WinCo Foods locations in California, Texas, Arizona, Washington, Oregon and Utah. Since the Las Vegas station opening, EVgo has added fast charging stations to two additional WinCo Food locations in California. By adding EVgo fast chargers to its properties, WinCo Foods pairs its renowned shopper experience with EVgo’s first-class customer service to extend hospitality from inside the store to the parking lot. EVgo’s current footprint in the Las Vegas market spans 18 locations."



    •  Meal solutions provider Home Chef announced that both online and in stores (Home Chef is available at, and owned by, Kroger), it will be partnering with TV chef Rachael Ray, "rolling out exclusive … recipes on a weekly basis for six months … The collaboration makes it easier than ever to cook Rachael's recipes at home, combining her simple, delicious meals with Home Chef's convenient service that sets home cooks up for success from the prep to the plate."

    Published on: September 26, 2022

    On Friday, MNB took note of an Axios report on a new poll it conducted revealing that "eighty-two percent of Gen Zers say the idea of doing the minimum required to keep their jobs is pretty or extremely appealing — and 15% of that share are already doing so … 85% of young women find the idea of doing the minimum to get by appealing, and 79% of young men feel the same way.  82% of white respondents, 86% of Black respondents, and 79% of Asian respondents share this view of work, as do 84% of Democrats, 79% of Republicans, and 83% of independents."

    In other words, "the desire to work to live, instead of living to work," cuts across gender, racial and political lines.

    I commented, in part:

    if we accept the basic premise of these survey results, it makes it an even higher priority for business leaders to create organizational cultures that communicate the importance of doing more, not less, in one's work life.  That means creating a culture of caring and acknowledges and addresses this trend, not simply decries it.  That means helping everyone within an organization to understand why their contributions matter, and how their individual roles support the whole, and why what they do is meaningful.

    Maybe I'm old fashioned … and maybe I'm just old … but I'm a believer in aspiration, perspiration and inspiration.  But those things don't just happen.  They occur in companies when business leaders actually lead.

    MNB reader Phil Herr wrote:

    Two comments on this story:

    We really don’t have any benchmarks against which to measure these data. For all we know attitudes such as these have prevailed for decades — only no-one sought to do the research earlier.

    Within corporate environments many workers are distant from the fruit of their output. Being another “cog in the wheel” doesn’t engender inspiration to go above and beyond. It’s a long time since JFK inspired the apocryphal janitor at Cape Canaveral to claim his job was to “put men on the moon”. 

    I guess you have a different perspective, being solely responsible and benefitting from your business. 

    I didn't always have this kind of autonomy;  I worked for other organizations for some two decades before striking out on my own.  Now, Mrs. Content Guy will tell you that this move was inevitable because I "don't play well with others," and I can't really argue with that. But I also know that I never worked for great companies, rarely had bosses who had any interest in nurturing my talent and taking advantage of my strengths, and never had a mentor.  The good news is that I'm what a therapist might call "self actualized," and so I always felt invested in my work even if my employers weren't really invested in me (and thought that I generally was a pain in the ass).

    Here's the thing.  Even the smallest cog plays a role and has meaning.  When that cog is a human being, it is up to leadership to communicate that meaning to the employee and to help them understand their role.  It is about creating a culture of caring within an organization.

    To me, that's the very definition of great leadership.  It focuses on people, not just organizations and spread sheets.

    I loved this take on the issue from another MNB reader:

    What if Olympic athletes did “the minimum?” What about Ukrainian military doing the minimum? What if ….. I’m 76 years old and I’m most proud of the times I gave “just a bit more.” No pride in doing the minimum. And, yes, family is important. It’s not a balancing act; it’s an act of integration.

    I think this is absolutely true.  The things I am proudest of in both my personal and professional lives are the times when I did more, not the times I did less.



    We had a story the other day about rethinking "gas stations" as "mobility destinations," in line with changing technologies, needs and expectations.  This prompted MNB reader Rich Heiland to write:

    The crotchety old editor in me shakes his head and sheds a tear at the headlione that no doubt is coming…

    "Police nab shoplifter at local mobility destination."



    We linked to a story the other day in the Wall Street Journal about how "trucking contractors that worked frequently for Amazon were more than twice as likely as all other similar companies to receive bad unsafe driving scores … About 39% of the frequent Amazon contractors in the Journal’s analysis received scores at that level."

    One MNB reader responded:

    This article is eye opening.  All of us in this industry that put on more car miles for our job than the average citizen knows how more dangerous the trucks have become.  I personally have seen drivers on their phone, swerving on the road, tailgating, just pulling into other lanes, speeding.  Just this week while driving a 4hr trip to part of my market, just about every truck was traveling at 75 or more on the highway.  I was cut off, and as previously mentioned, saw one driver holding his phone.  This is just one trip.  Imagine what goes on every day.  (These were not Amazon haulers either)

    Something must be done.  I believe that in this environment, we have people starting up trucking companies to make a quick buck, hire immigrants or younger drivers that have totally different or no driving skills and “supposedly” train them, put them on the road, and turn them loose.   Trucking firms need to be held accountable for their lack of action and this article points to that they are not.  One other point, the company owner that put his 21 year old daughter as the owner of Blue Feather Trucking and says he is not involved.  Should be locked up.



    On the subject of Walmart+ now offering to pick up returns at its members homes or offices, one MNB reader wrote:

    Walmart customers have a great advantage.  In Panama three days ago I purchased a Dolce Gusto Genio Plus coffee machine at a retailer for $160.  Got home and it was, as we say in the appliance industry, “dead on arrival”.   I called Nescafe customer service and they said that the problem was that the product was on the retailer shelf too long.  They instructed me to lift the water tank and put it back and repeat that twenty times.  I did and it still did not work and they told me to do it again.  I balked and said it would be easier for me to just return it to the retailer for another unit.  They said I could not do that and had to bring it to one of their service centers.

    The next day I went to the center (25 minutes) and had to wait 5 minutes outside the building for someone to come and get the unit.  I mentioned that the unit probably was in a container for 30 days and in their warehouse for who knows how long and why are they blaming the retailer when it is obviously a design problem.  I had read the Axios article about Walmart+ and showed it to them and said that is how a multinational should act.  They called me later and said they would deliver the fixed unit to my house.  I checked the retailer website and they had a notice saying that they could not accept returns of that product.  I also found out that the problem is happening around the world.  And slow movement by retailers is probably being blamed.



    I did a FaceTime video on Friday in which I discussed and found business lessons in three major changes planned by Major League Baseball for the 2023 season - larger bases (to prevent injuries), a pitch clock (to speed up the game), and a ban of the shift.  My argument against a ban of the shift quite simply, is that teams could get rid of it themselves, just by hitting the ball away from the shift.  Hit the ball where the defense isn't, and you get a hit;  in retailing, you have to do things that your competition doesn't if you want a hit.

    Got a number of emails on this subject.

    One MNB reader wrote:

    Wee Willie Keeler said, “Keep your eye on the ball and hit ‘em where they ain’t.”

    Keeler had 13 straight seasons in which he batted over .300 and he reached the mark in 16 of the 19 years he played. He had a lifetime average of .345 and for seven straight seasons he also had an on-base percentage that was above .400.

    MNB reader Chris Zook wrote:

    On the subject of pitch clock I think they should put back into play that the batter has a clock on them to get back into the batter’s box which they tried to do many years ago but it went away after a season.

    Regarding the shift, when it first started it was only used on your top power hitters then it started being used on guys in the bottom of the order or just up from the minors. The art of bunting isn’t a thing anymore , how often do you see someone bunt and have it be a good bunt? Nowadays everyone is into launch angles and home runs.

    There are Triple A teams out in the Pacific league using the “Robo-Ump” so it will be coming soon. I want to say I remember seeing a story about a batter getting thrown out of the game for arguing the strike zone that the “robo-ump” was using.  I’ve tried to keep an open mind with the new rules of baseball but the one that needs to go and I think it won’t be around next year is the man on 2nd in extra innings.  Steve Stone who’s a broadcaster for the White Sox says if you’re going to use a runner in extra inning then they should start at 1st instead. 

    Good Luck to your Mets.

    Thanks…and I agree with you about the 10 inning starting with a man on second.  Stupid rule, and I hope they go back to the way it used to be.

    MNB reader Glenn A. Cantor wrote:

    If pitchers know that hitters will try to beat the shift by hitting the other way, the pitchers will them jam them inside to force them to pull.

    Exactly.  I think that's the very definition of baseball.



    And finally, last week we had a story on a cultural/societal shift  -  a new Pew Research indicates that "Christians could fall below 50% of the U.S. population by 2070 if recent trends continue."

    Which prompted one MNB reader to write:

    Very interesting article on Christians and religion.  As I move through life and the aging process, I see more and more of a lack of morals and ethics in the younger generations.  Hmmm…could that be because of the decline of Christianity?  

    And I replied:

    Your question assumes that people who define themselves as Christian are inherently more moral and ethical than people who define themselves as being part of non-Christian religions, or not part of any organized religion at all.  I would argue that this isn't even close to being true.

    I'd also challenge the notion that younger generations are less moral and ethical.  I think there is plenty of evidence to the contrary, not to mention plenty of evidence that their elders are perfectly capable of acting in immoral, unethical ways.

    MNB reader Suzanne M. Shriner chimed in:

    Full stop.  I may have to frame this answer.  This made my day.

    And, from another reader:

    And the congregation said AMEN!

    Thanks.

    Case in point…

    I am a 1972 graduate of Iona Preparatory School in New Rochelle, a Catholic institution.  A couple of years ago, the Prep sent out a fundraising letter to alumni for what it called the Brother Harold H. M. Delaney Hardship Relief Fund, which it said was designed to "address the myriad negative repercussions" on the Iona family that are a result of the coronavirus pandemic.  The fund was named after a former principal at the school.

    I had a problem with this.  This was the same Harold Delaney who was implicated in lawsuits as having been in charge of Iona Prep at a time when young men were being molested by faculty members.  When he was moved into a leadership role with the Christian Brothers, he was implicated in the moving from school to school of brothers who were engaged in this despicable misconduct.  In other words, he was in positions of responsibility during a time when members of the Christian Brothers were committing acts that were nothing less than a terrible breach of trust - not to mention crimes for which they all should have gone to jail.

    And yet, Iona decided that this the person after whom they should name a hardship fund.  I was, and remain, appalled.

    And one other thing.  When I was at Iona Prep, between 1968 and 1972, Delaney was principal.  I knew him.  (Though, to be clear, I personally was never molested by him or any other member of the clergy.)

    I wrote to the president of the Prep to explain my disgust.

    I never got a response.

    Two things did happen, though.  One was that they changed the name of the Hardship Fund.  (I guess we can count that as a win). The other was that they (apparently) took my name off the fundraising and alumni rolls, because I've never again received any communications from the school.

    You want an example of a "lack of morals and ethics?"  There it is, and it has nothing to do with a decline in the number of Christians in the country.  In fact, I think we'd be better off with a lot fewer of these "Christians."  

    Published on: September 26, 2022

    •  In one of the best sports stories of not just the week, but the year, 42-year-old Albert Pujols hit his 700th career home run on Friday night, becoming just the fourth major league player to reach that number.  The others:  Barry Bonds, Henry Aaron and Babe Ruth.  And most remarkably, his achievement comes as Pujols enjoyed a hitting surge in the final months before his retirement after a 22-year career.

    The Dodger Beat online newsletter captures the moment:

    Everything about Albert Pujols hitting his 700th career home run on Friday night felt perfect. 

    It was fitting that Pujols was wearing a Cardinals jersey at the time of the historic accomplishment. At the end of his career, Pujols’ No. 5 will undoubtedly be retired in St. Louis, and it would be shocking if they didn’t ultimately build him a statue. 

    Pujols hitting his 700th home run at Busch Stadium might’ve made the moment better. It would’ve been a great moment for the home fans to embrace Pujols, one of the best players in franchise history. 

    But it was destined to happen at Dodger Stadium, a place that holds a special place to Pujols, and against a Dodgers organization that helped the future Hall of Famer fall in love with baseball once again. It’s not outrageous to think that Pujols wouldn’t have played this season if the Dodgers didn’t give him a second chance last season after the Angels designated him for assignment in May. 



    •  Also in Major League Baseball, the Cleveland Guardians clinched the American league Central Division title with a 10-4 win over the Texas Rangers.

    In the AL, the Guardians join the Houston Astros, who have clinched the AL West division title, and the New York Yankees, who have clinched a playoff spot but not yet the AL East title.

    In the National League, the New York Mets and Atlanta Braves have both clinched playoff spots, but continue to fight it out for the NL East title, while the Dodgers have clinched the NL West title.  The Cardinals are the probably winner of the NL Central title, but have not clinched it, nor a playoff spot, yet.



    •  In Week Three of National Football League play…

    Buffalo Bills 19, Miami Dolphins 21

    Cincinnati Bengals 27, New York Jets 12

    Las Vegas Raiders 22, Tennessee Titans 24

    New Orleans Saints 14, Carolina Panthers 22

    Baltimore Ravens 37, New England Patriots 26

    Detroit Lions 24, Minnesota Vikings 28

    Philadelphia Eagles 24, Washington Commanders 8

    Kansas City Chiefs 17, Indianapolis Colts 20

    Houston Texans 20, Chicago Bears 23

    Jacksonville Jaguars 38, Los Angeles Chargers 10

    Los Angeles Rams 20, Arizona Cardinals 12

    Green Bay Packers 14, Tampa Bay Buccaneers 12

    Atlanta Falcons 27, Seattle Seahawks 23

    San Francisco 49ers 10, Denver Broncos 11