business news in context, analysis with attitude

Published on: March 8, 2023

Today I'm pleased to share with you my conversation with Dr. Mindy Weinstein, author of a fascinating book entitled "The Power of Scarcity:  Leveraging Urgency and Demand To Influence Customer Decisions."  I've always thought that scarcity is too little employed as a marketing tool by most food retailers, and Weinstein offers a unique perspective on the tools that retailers can use to create customer loyalty and sales.  Sometimes, less is more.

"The Power of Scarcity" is available on Amazon, the iconic Portland independent bookstore Powell's, on Bookshop.org, and wherever books are sold.

Published on: March 8, 2023

Green Zebra, the Portland, Oregon, "healthy convenience store" that began operations a decade ago, announced this morning that it will wind down operations and close all three of its units at the end of the month.

“We have been holding on by a thread since the pandemic started and have been in austerity mode since then,” said Lisa Sedlar, Green Zebra's Founder and CEO. “We experienced 9 straight quarters of increases to our cost of goods, packaging, fuel, insurance, taxes, freight charges and well, pretty much everything. Combine that with supply chain and staffing shortages and razor thin grocery margins, we just couldn’t overcome all the obstacles. We definitely gave it our all and fought the good fight. We are thankful for the opportunity to have been in service to our community.”

Green Zebra's mission from day one has been to "redefine what it means to be a convenience store in America. Instead of selling cigarettes, lottery tickets and jumbo-sized sugary drinks like most convenience stores, Green Zebra offered customers made-from-scratch grab-and-go meals, a full service coffee bar, kombucha Zlurpees, locally sourced meat, produce and groceries along with the best local beer selection in Oregon. In addition Green Zebra supported its staff with fair wage jobs, increasing their internal minimum wage seven times in their 10 year history and offering affordable health insurance for all staff and their dependents."

Sedlar said that as she winds down the business, "We will pay all of our team members in full, including their accrued vacation hours."  She said that she is "personally reaching out to other local grocery leaders and encouraging them to hire our team members," who she described as "knowledgeable grocery professionals who provide the highest level of service."

Published on: March 8, 2023

Starbucks CEO Howard Schultz has agreed to testify before a US Senate committee about the company's approach to labor relations and unionization.

The move came just a day before the Health, Education, Labor and Pensions Committee, chaired by Sen. Bernie Sanders (I-Vermont), was scheduled to vote on issuing a subpoena to Schultz.  

An invitation to Schultz to appear before the committee previously had been declined, with the company saying that because Schultz scheduled to step down from the CEO job in just a few weeks, it made more sense for someone else to testify.  But Sanders observed that because Schultz has taken the lead in framing the company's response to unionization efforts, he was best positioned to answer the committee's questions.

The Seattle Times writes that "Starbucks, long considered a model employer, has been facing a growing union campaign movement since November 2021. Schultz has described unions as a third party that will divide the company and its workers. At least 285 stores have successfully unionized.  There are 509 unfair labor practice charges against Starbucks and 102 against the union, Starbucks Workers United."

Schultz's appearance is scheduled for Wednesday, March 29.

Published on: March 8, 2023

KPMG yesterday released a new study saying that "37% of consumers consider environmental sustainability and 33% consider social responsibility in buying decisions."

Other conclusions in the study:

•  "Over 75 percent of consumers are at least somewhat familiar social responsibility.
--over 50 percent of them associate social responsibility with diversity, equity, and inclusion (DEI); employee human rights; health and safety; and fair wages."

•  "Over 75 percent of these consumers are looking for environmentally friendly products and/or packaging.  Approximately 50 percent of these consumers determine a product’s environmental sustainability based on product labels, descriptions, images, or marketing."

•  "50% of underage (age 13-17) Gen Z consumers are most likely to say that environmental sustainability is important to purchase decisions."

•  "Consumers are most likely to choose a product/service based on environmental sustainability features in the personal care products (48 percent), groceries (44 percent), restaurants (42 percent), and apparel (42 percent) categories."

•  "Of consumers who say a company’s social responsibility is important to their purchase decisions, over half (51 percent) determine a product’s social responsibility based on product labels."

•  "Underage (age 13-17) Gen Z consumers are more likely to say that social responsibility is important to their purchase decisions (41 percent versus 33 percent for overall consumers)."

•  "The categories for which consumers are most likely to choose a product or service based on social responsibility features are restaurants, apparel, and personal care products."

The conclusions are included in the 2023 KPMG Winter Consumer Pulse Survey.

Published on: March 8, 2023

From the Washington Post:

"Toblerone, the chocolate bar known for its distinctive triangular peaks, is losing the Matterhorn mountain from its logo after falling afoul of strict marketing rules on 'Swissness.'

"Future Toblerone wrappers will feature a generic mountain design instead, after the chocolate bar’s American owner, Mondelez, decided to shift some production to the Slovakian capital of Bratislava this year.

"The packaging redesign 'introduces a modernized and streamlined mountain logo that aligns with the geometric and triangular aesthetic,' a Mondelez spokesperson said in a statement. Toblerone’s distinctively shaped boxes will also be changed to read: 'Established in Switzerland,' rather than 'of Switzerland.'

"Under the 'Swissness' legislation, which came into force in Switzerland in 2017, businesses have to show their products are sufficiently 'Swiss' to claim that label and to use national symbols of Switzerland. Swissness has long been associated with prestige products such as Swiss watches."

The Post also writes that "Switzerland is not the only country concerned about safeguarding the authenticity of its products. French producers fought for years to protect the name Champagne from being used by foreign producers — a spat that reared up again in 2021 in Russia."

However, there are holes in the trend:  "A U.S. appeals court last week ruled that the name 'Gruyere' is a common term for cheese made in America and can be used for producers outside of the Gruyère region of Switzerland and France."

Published on: March 8, 2023

The New Yorker has a piece entitled "A Community of Desires: The Seduction of the Big-Box Superstore," in which writer Annie Ernaux assesses the unique role of the superstore in French culture.

An excerpt:

"We choose our objects and our places of memory, or, rather, the spirit of the times decides what is worth remembering. Writers, artists, filmmakers play a role in the elaboration of this memory. Superstores, which the majority of people in France have visited roughly fifty times a year in the past forty years, are just beginning to be considered places worthy of representation. Yet I realize, looking back in time, that from every period of my life I have retained images of big-box superstores, with scenes, meetings, and people.

"The superstore and the supercenter cannot be reduced to their function in terms of home economics, to the 'chore' of grocery shopping. They provoke thought, anchor sensation and emotion in memory. We could definitely write life narratives from the perspective of superstores that are visited on a regular basis. They are part of the landscape of childhood for everyone under fifty. For all but a limited segment of the French population—those who live in the center of Paris and other old historical cities—the superstore is a familiar space, whose regular use is part of daily life but whose impact on our communities and our way of 'building society' with our contemporaries in the twenty-first century we do not fully grasp. When you think of it, there is no other space, public or private, where so many individuals so different in age, income, education, geographic and ethnic background, and personal style circulate and rub shoulders with one another. No enclosed space where people are brought into greater contact with their fellow-humans, dozens of times a year, and where each has a chance to catch a glimpse of others’ ways of living and being. Politicians, journalists, 'experts,' those who have never set foot in a superstore, do not know the social reality of France today."

Really interesting piece that, in the style of The New Yorker, is given room to breathe and ruminate.  And you can read it here.

Published on: March 8, 2023

With brief, occasional, italicized and sometimes gratuitous commentary…

•  Business Insider reports that Ian Wilson, a human resources vice president at Amazon Web Services (AWS), told an internal town hall meeting that the company is looking for ways to rehire people who have been laid off in recent months.

Here's the exact quote:

"I do believe that one of the best things developmentally for any of us, including the individuals of our team that were impacted by the role reductions, is the experience and the time they've had at Amazon. So one thing we've been really clear about, so many of those folks are eligible to rehire."

"How do we really proactively extend an invitation to any of those Amazonians that are ready to return and resume their career with us? How do we make those opportunities available?" he added.

Business Insider writes that "Wilson said re-staffing laid off employees has been 'top of mind' for him, but it's been difficult because of Amazon's recent hiring freeze. Still, he said there are 'different conversations' happening to support them, and 'as things turn' at Amazon, he wants to 'leverage' the former employees for future opportunities."

Published on: March 8, 2023

•  In Maine, the Ellsworth American reports that Ahold Delhaize-owned Hannaford Supermarkets is acquiring Tradewinds Marketplace in Blue Hill.

Terms of the deal were not disclosed.  The banner is expected to be changed over to Hannaford in May.

Tradewinds originally opened in Blue Hill in 1999.

•  IRI and NPD, which merged in August 2022, yesterday announced a new combined company name and brand identity - Circana, saying that the name conveys the notion of providing "clients a first-of-its-kind, full-circle perspective on the market and consumer."

Published on: March 8, 2023

…will return in two weeks.

Published on: March 8, 2023

Yesterday we reported that Kroger announced "a more than $770 million incremental investment in its associates during 2023. The company will use this investment to raise average hourly rates, improve healthcare options, build new training and development opportunities, and more."

One MNB reader - obviously someone better at math than I am -  wrote:

$770 million sounds like a big number but if you spread that across about 420,000 employees that is $1,833/yr at 2,000 hours worked in a year that is 91 cents/hour.

Yesterday we took note of a Bloomberg report that California Governor Gavin Newsom has "directed the California Department of Health and Human Services to review all relationships Walgreens has with the state," a reaction to Walgreens' decision not to sell mifepristone, an abortion pill, in 20 states, including some where abortion remains legal.  Walgreens made that decision under legal threat from a number of state attorneys general.

I commented, in part:

In my opinion, Newsom isn't helping the situation.  He's posturing every bit as much as the GOP attorneys general.

One MNB reader replied:

I couldn't agree with you more. I'm a liberal, and a Californian, but I'm sick and tired of politicians on both sides courting outrage instead of solving problems. In this case, punishing Walgreens (or more likely, talking about punishing Walgreens and then not actually doing anything meaningful) accomplishes nothing. 

Newsom is setting himself up to run for President someday, and that's clearly become more important to him than governing. I'd say the same thing about Desantis and others.

If Newsom really believes that women ought to have access to abortion-related healthcare, then he ought not be cutting off California's relationship with a retailer that can help provide it.  This is like cutting off your nose to spite your face.

In writing about my disappointment that Fat Tire amber ale is being reformulated, I mentioned that I am open to suggestions about red or amber ales that I should try.

One MNB reader wrote:

Being an East Coaster, wondering if you are familiar with Blue Point Toasted Lager.  It’s a easy drinking Amber but not sure if it has changed since AB bought them.

I don't know - it's been years since I've had one.  But I'm happy to try one in the interest of research.

Finally … yesterday the New York Times wrote that "the Biden administration, keeping a watchful eye on an outbreak of avian influenza that has led to the deaths of tens of millions of chickens and is driving up the cost of eggs — not to mention raising the frightening specter of a human pandemic — is contemplating a mass vaccination campaign for poultry, according to White House officials."

I commented:

The problem is that there is a cadre of birds out there lobbying against any sort of national vaccination program, saying that it is just an excuse to inject them with microchips that will allow the government or global elites like Bill Gates to track them.

One MNB reader wrote:

That's funny, I don't care who you are.

Thanks.

MNB reader Kevin Duffy responded:

Are the chickens going to be required to wear a mask?

Good point.  I hope so.

And then, this absolutely terrific response from an MNB reader:

If a mass vaccination program for poultry is in place and we subscribe to the notion that it is actually a way to track the movements of chickens, will we finally be able to answer the question of "Why did the chicken cross the road?"

Boom!  Mic drop!  Wish I'd come up with that line.