business news in context, analysis with attitude

We got a number of emails in response to yesterday’s story about how the Shell Oil Co. stopped shipping Pennzoil and Quaker State products to Kmart because the retailer was promoting them at prices Shell considered to be way below what it felt the products should be sold for; our question was whether Shell would have made a similar move on Wal-Mart if the Bentonville Behemoth decided to price those products similarly.

One MNB user wrote:

“I agree with your view completely. K-Mart is being dictated to about what price they can sell a product. Wal-Mart would never be positioned that way!!!

And MNB user Patrick Dunne wrote:

“I always thought that manufacturers could cap retail prices, but not set minimum prices unless co-op advertising money was involved.

“Makes one wonder who the complaining retailer(s) was (were).”

It does, doesn’t it?

Of course, another MNB user made a different observation:

“On the other hand, Wal-Mart's paying their bills on time.......”

Good point.

More on the Safeway-Dominick’s situation…

MNB user Gary Demond wrote:

“In 1979 Kroger tried to get a new union contract and threatened to close all stores in southwestern Michigan. The union and its members did not believe it and they closed. What it gave was a tremendous opportunity for retailers like myself to buy a good store and operate non-union. This may be an opportunity for some independents…”

We wrote yesterday about “Magellan,” a new shopping cart being tested by Safeway in California that includes a book-sized computer on the handle through which shoppers can swipe their Safeway club cards. The computer then can use the shopper’s buying history to display four SKUs that are available at cheaper prices than would be available to anyone else. We suggested that privacy advocates might be concerned, but one MNB user made an excellent point in response:

“Hey, Privacy Prima Donnas...You're not affected, you don't have a Loyalty Card, Remember??? So you'll never see those "special deals"...”

And on that note….

We’ll see you tomorrow.
KC's View: