business news in context, analysis with attitude

Published on: May 10, 2023

Today, Part Two of my extended conversation with ReposiTrak CEO Randy Fields, who has been sounding the alarm for years about demands created by the Food Safety Modernization Act (FSMA).  Now, these regulations are in place and regulators are poised to enforce them - and food businesses have to meet the moment.  They have no choice.  And so, we return to Randy Fields for an update.

If you'd like to listen to this Conversation as an audio podcast, click and download below.

For more information about what you need to do in order to conform to FSMA requirements, click here.

Published on: May 10, 2023

by Kevin Coupe

The Hollywood Reporter writes that after 36 years, MTV News - which "was created to expand the stable of programming that defined the cable channel MTV," and "became a bona fide news outlet for Gen X and older millennials who found that traditional TV programming on the broadcast networks and CNN wasn’t cutting it," is itself being shut down.

In other words, it didn't make it to the big 4-0.

The story notes that MTV News "covered music, pop culture, politics and other topics with an eye toward the younger generation that was tuned to MTV, rather than the network evening newscasts.  Along the way, MTV News created some pop culture moments itself, perhaps none bigger than in 1994, when President Clinton appeared on MTV’s Enough Is Enough, a town hall addressing violence in America … MTV News subsequently held town halls with Barack Obama, John McCain, Bill Gates and others … Coverage of topics like sexual health, the Iraq War and devastating natural disasters earned the news division and its correspondents Emmys and Peabody Awards, while it continued to deliver news and criticism of music and pop culture."

But now, in part because parent company Paramount Global was looking to cut costs, but also because the format simply was irrelevant to young people who are absorbing content in other ways, MTV News became expendable.

It is a good and Eye-Opening lesson in the life cycle of a business, and how leaders have to continually reinvent their enterprises if they want to remain viable and credible.

Sure, MTV News may have been an institution.  But that is a description of dubious benefit these days - after all, as the old joke goes, who wants to live in an institution?

Published on: May 10, 2023

There continues to be speculation that if federal regulators allow the $24.6 billion acquisition of Albertsons by Kroger, the stores that will have to be divested by the two companies could be acquired by Amazon.

Whether the number of divested stores is 300, 500, 600 or even more, the belief is that this could be a vehicle for Amazon to finally get the kind of footprint it has long desired for a grocery offering.  And the belief is that such an investment by Amazon would help to save the jobs that some worry could be lost as the result of such a deal.

In the latest bit of speculation and analysis, Salon writes:

"To be clear: Is it confirmed that Amazon will acquire the divested Kroger/Albertsons locations? No. But is it possible? Yes. And would that be a good thing? Well, this is where things get a little hazier.

"It's easy to look at the prospect of Amazon taking on these locations with a lot of cynicism. 'Oh, great. Another monopoly benefiting from the monopolization of the American supermarket industry.' But for many folks who live in food insecure communities, where supermarket options are already limited, an Amazon-owned grocery store is better than no grocery store.

"What this prospect ultimately highlights is the extent to which the American grocery landscape is broken. Here's the thing: As Purdue University Northwest professor Anthony Sidone recently said, the merger between Kroger and Albertsons won't even make it the largest supermarket chain in the country.

It will just bring it up to the current scale of Walmart.

"'It looks like their strategy will be to serve the grocery market segment that stands between the Whole Foods and Dollar General segments,' (Purdue University Northwest professor Anthony) Sidone told the Northwest Indiana Times. 'The grocery market is extremely competitive and both Kroger and Albertsons might have sensed a squeeze between the opposite ends of the grocery market segments.'

"Perhaps — as the cost of a typical grocery visit has shot up by 10% over the last year — the idea of these mega-corporations feeling the squeeze feels like poetic justice. Or perhaps it's just another reminder that we — and especially our most vulnerable citizens — ultimately have to pay the price with fewer choices when they do."

Published on: May 10, 2023

CBS News reports that Starbucks has announced that it is now going to charge patrons a buck for one special request that used to be free.

According to the story, "The coffee chain will charge customers a dollar extra to get their Refresher beverages made without water, angering some brand loyalists. Starbucks said the charge is necessary because the juice drinks are more expensive to make when they're not diluted … Refreshers are cold beverages consisting of flavored juices, freeze-dried fruit chunks, water, various milk choices and lemonade, according to the chain's website. Fans of the drinks took to social media to express their disappointment."

"There will be an additional cost of $1 for Starbucks Refreshers Beverages customized with no water, as this customization requires extra ingredients," the company said in a statement. 

However, CBS News notes that at some stores, customers also are being charged an extra dollar if they order refreshers "with light ice," which is not mentioned in the new corporate policy.

Published on: May 10, 2023

From Axios:

"Amazon's plan to enter the Twin Cities grocery store market with its Fresh brand appears dead … The company has put six properties where it had been planning to open stores up for sublease."

According to the story, "A couple years ago, it looked like Amazon was ready to make a splash in the competitive Twin Cities grocery market. But it has re-thought its retail strategy nationwide and won't make a go of it in Minnesota … All six of the stores are now being marketed for sublease by Mid-America Real Estate's Twin Cities office."

Published on: May 10, 2023

From the Wall Street Journal this morning:

"Inflation eased to 4.9% in April as the economy showed signs of cooling.

"Inflation has cooled from its recent peak, but remains stubbornly elevated. The Federal Reserve aggressively raised rates for more than a year to try to tame inflation by slowing economic activity, and indicated last week it might be done lifting them for now.

"The Fed is looking to see signs of inflation declining toward its 2% target. April’s rise comes after prices rose 5% in March from a year earlier.

"Consumer prices rose a seasonally adjusted 0.4% in April from the prior month, versus a 0.1% gain in March, the Labor Department said Wednesday in its consumer-price index report. April’s increase was driven by housing costs and an uptick in gasoline prices."

Published on: May 10, 2023

•  From the Associated Press, a story about how Amazon has "launched a new service, called 'Amazon Anywhere,' that will allow customers to purchase physical products from its online store while playing video games or interacting in virtual reality.  With the new service, customers can purchase items from Amazon without having to leave the game, or whatever mobile app they might be using, the company said."

According to the story, "Amazon said its new service will be launched within Peridot, an augmented reality game from Pokémon Go developer Niantic. The retailer said gamers can link their Amazon account to the game, and purchase T-Shirts, hoodies, phone accessories and throw pillows featuring characters from the game.  The company said on its website that its looking to partner with more developers for the service, which is currently only offered by invitation."

Published on: May 10, 2023

•  The Commercial Observer reports that Lidl plans to open a second store in the New York borough of Manhattan, with plans for a 23,000 square foot store in the Chelsea neighborhood at Eighth Avenue and West 26th Street.  It already has a store operating in Harlem.

This is, the story says, in addition to stores that it operates in Queens and on Staten Island, and expectations for additional units to be opened, including in Brooklyn - reflecting a significant commitment to bringing its low-cost, limited assortment model to New York City.

•  Kroger announced that "it is seeking to hire associates for salaried and hourly roles, across all geographies, searching for talent in retail, e-commerce, manufacturing, supply chain, merchandising, logistics, corporate, pharmacy, healthcare and more."

"Across our Family of Companies, we respect and value all of our associates and have opportunities for everyone to feed their future and discover a career. We are driven to be a leading employer in America, offering tools and pathways to grow as individuals and with our organization, no matter your skill set, role or ambitions," said Tim Massa, Senior Vice President and Chief People Officer.

•  From the BBC:

"Tesco's chairman has strongly denied claims that he touched women's bottoms on two separate occasions.

"A report in the Guardian newspaper alleges that John Allan touched a Tesco employee at the supermarket giant's shareholder meeting last year.

"It also claims Mr Allan, who is the former president of the CBI, 'grabbed' a woman at one of its events in 2019.

"Mr Allan said that the claims are 'simply untrue' and Tesco said it has not received any complaints.

"The supermarket giant - which Mr Allan has chaired for eight years - told the BBC that in relation to his conduct at Tesco annual general meeting last year 'it has received no complaints or concerns formally or informally, including through our confidential Protector Line service.'

"It said it noted that Mr Allan strongly denies the allegation and his conduct has 'never been the subject of a complaint during his tenure as chair of Tesco'."

Published on: May 10, 2023

The other day we reported that Kroger plans to eliminate its weekly print ad, prompting one MNB reader to write:

Kevin, I went back to the archives to pull this story after perusing my local Schnucks’ ad to make my weekly shopping list yesterday.

There, on the first page, above the fold, was the notice that after 6/12, Schnucks will no longer deliver a print ad with the Monday grocery inserts in our St. Louis Post Dispatch.

I recognize the way of the digital world, but now I can’t even enjoy my morning coffee reading the grocery ads and planning my meals.  I might as well go back to work.. . .

P.S.  This may be the hammer that puts the nail in my printed newspaper subscription, too, since I justified the cost of the print copy because of the Monday ads.

Responding to our story about Albertsons' most recent financial numbers, MNB reader Lisa Malmarowski - who, for purposes of this email, needs to be identified as the director of Brand & Store Development for the Outpost Natural Foods Cooperative - wrote:

I’ve been living under a rock - I didn’t realize that Albertson’s made BILLIONS of dollars in profit. But in my defense I’ve been pretty busy these past few year - you know, keeping our doors open and our employees and shoppers safe. 

There is something wrong with our capitalistic system when food retailers can make this much, and yet people go hungry in our country every single day. People struggle to make ends meet every single day. 

Honestly, it’s disgusting. 

But it makes me proud to work for a small, community owned and operated grocery. And yep, we are sure feeling the pinch that rising costs and inflation are making. 

I know this wasn’t the point of your posting, but I think that people need to wake up and really think about what it would mean for our food supply to have a merger like this happen. It is definitely anti-competitive and will be terrible for consumers and our country. 

And yet, I firmly believe that institutions such as the Outpost Natural Foods Cooperative, and many of its brethren cooperatives around the country who deliver something truly different in the marketplace, will survive.  And even thrive.

Monday's Eye-Opener was about the mass shooting at an outlet mall in Allen, Texas, which some described as being "unspeakable," and yet we speak of such things all the time.  (According to the Gun Violence Archive, there have been more than 200 mass shootings in the US already this year - there have been 10 just since the Allen shooting.). 

I commented, in part:

Shootings happen at churches and concerts and schools and malls and supermarkets.

I find myself wondering what would happen, in response to this particular case, if the CEOs of major food retailers doing business in Texas - the names include H-E-B, Walmart, Kroger, Albertsons, Whole Foods, and Costco - went to the governor's office and made a simple statement:  "Whatever we are doing to keep people safe from gun violence isn't working.  Our customers are at risk.  Our employees are at risk.  We have to do more, and just adding more armed guards to our store staffs isn't the answer.  And if you want us to continue investing in Texas, you have to do more than just pray, have to do more than offering 'healing'."

Now, that would be an Eye-Opener.

To be clear, I don't know what the answer is.  I do understand that the culture of guns in Texas is different from how it exists in Connecticut, where I live.

But people are dying.  They'r being shot to death.  And I think maybe it is time for retailers - whose stores and people increasingly seem to be in the cross-hairs - to do something more.

One MNB reader wrote:

In response to the Texas mall shooting, I understand the need to address these shooting incidents that appear epidemic today in our country. There needs to be a willingness on both sides to have a meaningful discussion on access to guns. However,I can't help but feel that it is in part inflamed by the unwillingness of parties, particularly our governing bodies, to seek compromise and actually sit down and listen to what they each have to say and drop the party line. What we see in the streets is a reflection of what we see in our governmental leaders, most particularly congress. Given what I see on a daily basis coming out of Washington I don't see much hope in the near term.

From another reader:

I do like your idea as politicians generally respond to large employers in their states. It does not take a visionary to see that current gun policy endangers our citizens, it does not protect any of us from mass shootings. Removing military weapons from society does not endanger a citizen’s right to keep and bear arms. We have restricted machine guns and other personal military weapons such as BARs from public ownership. Assault weapons are meant to kill other humans with efficiency. They have no other use. They need to be removed from society, and removed now. An Albert Einstein quote seems appropriate here, “The definition of insanity is doing the same thing over and over and expecting different results”. Hopes, prayers, and willful evading the issue will not fix a thing. Leadership and action is desperately needed. I question if Governor Abbott is up to it.

And from yet another reader:

The gun industry lobby is eager to make it seem impossible and hopeless to create safer US communities, even though this is the only country with this brutal level of gun-related deaths. Gun violence is now the leading cause of death for children and teens in the US (https://www.cnn.com/2023/03/29/health/us-children-gun-deaths-dg/index.html). The only thing we hear from the gun lobby and their paid-for politicians is that we need even more guns to make us safer.

Here's what we can actually do: 

Elect politicians who prioritize safer communities over NRA money.

“The [AP-NORC] poll shows bipartisan majorities of Americans support a nationwide background check policy for all gun sales, a law preventing mentally ill people from purchasing guns, allowing courts to temporarily prevent people who are considered a danger to themselves or others from purchasing a gun, making 21 the minimum age to buy a gun nationwide and banning those who have been convicted of domestic violence from purchasing a gun.”

Source: https://apnews.com/article/gun-violence-covid-health-chicago-c912ecc5619e925c5ea7447d36808715

Create Better laws:

“Texas mass shootings up 62.5% since 

 Carry Bill signed by Governor Abbott”

Source: https://www.reformaustin.org/public-safety/texas-mass-shootings-up-62-5-percent-since-permitless-carry-bill/

Take action.

“I used to pray that God would feed the hungry, or do this or that, but now I pray that he will guide me to do whatever I'm supposed to do, what I can do. I used to pray for answers, but now I'm praying for strength. I used to believe that prayer changes things, but now I know that prayer changes us, and we change things.”

Source: Mother Teresa

Reject propaganda:

“Myth: The only way to stop a bad guy with a gun is a good guy with a gun.

Fact: If more guns everywhere made us safer, America would be the safest country on earth. Instead, we have a gun homicide rate 26x that of other high-income countries.”

Source: Everytown for Gun Safety

Another MNB reader wrote:

How do you feel about the existence of hate groups such as RWDS?

Before I answer, some context from the Texas Tribune:

The man who killed eight people at a Dallas-area mall wore extremist insignia, posted racist and misogynistic screeds and praised Nazis online. Here’s what you need to know about the shooter and his ties to ongoing right-wing mass violence.

On Tuesday, the Texas Department of Public Safety confirmed that Mauricio Garcia, who was killed by police during Saturday’s attack at Allen Premium Outlets, had neo-Nazi tattoos and beliefs. Garcia also wore a patch during the killing spree that said "RWDS" — an acronym for "right wing death squad" — and while police have yet to announce a motive for the attack, journalists have uncovered a trove of social media posts in which the gunman fantasized about violence and glorified the Third Reich.

I must admit I don't really understand why the perpetrators of mass violence are not classified as domestic terrorists, and treated accordingly.  Can you imagine how people would feel if the people committing these atrocities were identified as Islamic terrorists?

I think that there always are going to be hate groups.  RWDS is just one more in a list that, unfortunately, gets longer every day.  And the idea that the opinions and beliefs of the people who populate them are somehow "American" is truly frightening.

Responding to another story, one MNB reader wrote:

I loved your segment on Mental Health Awareness and wanted to share how Harris Teeter and P&G are partnering throughout the month of May as part of our year-round “Aisles for All” platform:

Together P&G and Harris Teeter are donating $25,000 to Mental Health America.  We are distributing 120,000 informational cards via Harris Teeter’s click/collect on-line shopping service. These cards will also be distributed throughout HT’s corporate office.

We designed shelf tags w/QR code which are placed throughout the store on core, everyday use items.

Later in May, the “Self-Care” information & QR code will also be distributed via e-mail blasts to VIC loyalty members, banner ads on harristeer.com and via several social media posts on Instagram & Pinterest.

As you mentioned in your video, we wanted to provide access to resources whenever/wherever/however people are receptive to receiving the information. Every little bit helps.

Thanks for sharing the story!!!

Yesterday we posted a story about how late last month, Calli Schmid, vice president of grocery at Meijer, sent the following email to "all Meijer grocery suppliers," essentially saying that the cost of doing business with the company would include the supply of free product to the half-dozen new stores being opened by the company this year.

I commented:

There is a strong-arm nature to these emails that is disquieting - I assume that this free product is in addition to all the fees, allowances and promotional money that is being sent from the manufacturer to the retailer.  But that's not enough - the supplier is being told that if you want to continue being a supplier in good standing to Meijer, you have to supply this much free product, at a cost determined by Meijer, and that the deal will continue for the foreseeable future.

And it is all bathed in the aura of "this is a partnership," while the reality is that Meijer is making suppliers an offer they can't refuse.

The retailers' perspective is that this is a way to mitigate the massive investment that it takes to build a new store, and while that has some validity, don't they realize that somebody, someplace has to pay for this product?  It is going to come out in the cost of goods - and, in the end, it will be the consumer who will pay.

If I were a retailer - and it probably is a good thing that I am not - I would make these deals being made by my competition a centerpiece of my advertising and marketing.  I would explain how all these promotional deals work, and why, in the end, all they do is obscure what things really cost.  And I'd promise not to dip my beak in the same way other retailers do, with the goal of actually being a partner with suppliers to deliver the best possible value to my shoppers.

And, by the way - the very fact that this email was forwarded toi me suggests that there is a degree of antipathy, if not outright resentment, in the supplier community about demands like these. Don't you think that suppliers are going to try to stick it to retailers when they get the opportunity?

One MNB reader wrote:

These practices… free store fills, free warehouses fills, etc. have happened many times over the years. These are done under the guise of “shared growth. Clearly national brand manufacturers are inflating their prices to have trade funds to finance these practices. Private label suppliers typically don’t get hit with these “partnership” opportunities. Make no mistake, the consumer ultimately pays for these “partnerships” in the form of higher retail prices.

And from another reader:

This (unfortunately) reinforces my point – Meijer has become a grocer blatantly interested in only their bottom line.  Back in my sales days, I found that if I looked out for the customer (grocery retailers), my success and my employers' success were assured.  I believe it would behoove Meijer to take a similar approach by treating suppliers and customers fairly and respectfully.  Requesting free goods as part of doing business fails that litmus test.

But another MNB reader disagreed:

Tempest in a teapot KC.  When I was at Meijer from 2010-2016 it had been standard practice for years, and there are many good reasons for it. No one is going to get rich, nor go broke. It’s also standard practice in much of the business.

I think you just illustrated the problem.

Responding to yesterday's piece in The Information about why Amazon Go hasn't gone as planned, with even outside retailers reluctant to license the checkout-free technology, one MNB reader wrote:

Many retailers have restrictions or outright bans on third party partners using AWS to host their products or data.  The idea being this is essentially providing revenue and more importantly profit to one of their largest competitors.  Not to mention the inherent distrust that exists between competitors and having so much data visible to Amazon.   Taken a step further to Just Walk Out, why would a retailer want to fund Amazon's development and potential profitability of this tech, especially when the value is questionable to start with?  

IF a retailer were to sign up for this, they would want and NEED it to be effective, thereby making them cooperative (complicit?) in helping Amazon become more profitable by helping them develop and fine tune the tool for a larger retail environment.   I doubt any major retailer wants to do that. 

We had a story the other day about Michelle Obama serving as a co-founder and strategic partner for a new company, PLEZi Nutrition, which has as its stated goal "to create higher standards for how the U.S. makes and markets food and beverages for kids, leading with nutrition, taste, and truth" … PLEZi Nutrition's first product - a kids' drink called PLEZi—has 75% less sugar than average leading 100% fruit juices, no added sugar, plus fiber and nutrients, like potassium, magnesium, and zinc."

I commented:

I'm not sure that, if the goal is to get kids to drink more water, the first product introduced should be a kids' drink, even one with less sugar than most fruit juices.  That said, Michelle Obama has a lot of street cred around this issue, and it will be interesting to see how she parlays that into a functional and effective business model operating in a "responsible and sustainable manner."

One MNB reader responded:

I was the broker of record when Coca Cola Foods launched a line of “better for you“  kids juices licensed with Disney.  And it failed miserably.  Less sugar means less taste . Mothers thought it was a good ideal but the kids did not, and that is what matters.

Fair point.

I got several other emails about this story that, to be honest, I'd rather not post - they took aim at Michelle Obama in a personal way that I found unnecessary.  A common point was that PLEZi Nutrition is a for-profit company, and therefore it - and the former First Lady - have no credibility.

It is true that it is a for-profit company, describing itself as "a public benefit corporation, meaning that the for-profit company was created specifically for the public's benefit and will balance its profit needs with its mission to help improve child nutrition."

You can believe that or not.  You can be a fan of Michelle Obama or not.  You can trust her motives, or impugn them.  Up to you.

But, let's be fair.  Are you equally harsh about other former White House residents and employees who have left government and then moved into for-profit enterprises?  Or is this a purely partisan enterprise?

Just asking.