business news in context, analysis with attitude

One of our MNB user sent us the following email:

Had reason to make a number of trips to Phoenix recently and found some interesting things going on. AJ's owned by Basha's is doing an outstanding job in creating differentiation. They are People Focused in their own associates and again with the shoppers. Wow, do they stimulate people to buy in their service departments. All the perishables are in one word outstanding and again the AJ's folks are ready and ABLE to assist. Different, exciting and well merchandised.

Then to the Basha's stores: again very competitive in the market, clean as a whistle and each associate is knowledgeable to assist in any department of the store. Perishables as you might guess are outstanding.

Then I visited the competition. Just hard for me to understand Safeway. They started to remodel the stores...not just one as I was in 4 of their stores. Perishables looked much better. However not much business compared to Basha. Asked a checker how they are doing on their remodeling and her comment, "they tell us they will finish soon."

But went on to say, "don't know for sure whose definition SOON really is." Sad but true, as the grocery was looking more like a warehouse market with all the back stock on the top of already too high shelves.

Just yesterday, and yes its' a Tuesday, their competition including Fry's was ready for business, but Safeway wasn't ...... NO -- absolutely NO fresh baked in the wall cases....donuts, bars, bagels, muffins....all missing....Guess the baker (only one in the shop) couldn't keep up with the business. WOW, what an opportunity to make a statement.

We would make one observation about this email, and about the business in general.

Can we get rid of the word “perishables,” please?

They’re fresh foods.

Perishables rot.

Fresh foods appeal.

We had a report yesterday that in a move that conceivably could set a precedent for the collection of sales taxes for goods purchased over the Internet, a California appellate court has ruled that the state of California can collect such taxes from Borders for products sold online to the state’s residents.

The US Supreme Court ruled in 1992 that sales taxes cannot be collected if the online retailer does not have a brick-and-mortar presence in the state. Borders has more than a hundred stores in California, and the state’s Attorney General – seeing the opportunity to generate revenue for the state’s troubled coffers – went after the company.

Borders argued that its online division had no physical California presence and therefore was not liable for sales taxes. Since then the company has outsourced its online business to, but the courts have ruled that the physical and online stores are co-marketed and therefore liable.

One MNB user responded:

E-commerce is no longer in its infancy. Retail sales taxes are critical (unfortunately) to most local municipalities. Is it time to level the playing field?

We don’t think so. We believe that the ban on sales taxes for e-commerce companies ought to be maintained for a while so as not to risk any damage to this still nascent industry.

Responding to yesterday’s piece about Wal-Mart and Target deciding to pretty much discontinue the sale of VHS tapes in favor of digital formats like DVDs, MNB user Bill Drew wrote:

I am not expressing "consumer outrage" that most retailers are in the process of making the decision the stop carrying VHS. I am just disappointed for my three year old, my ten year old who has Down syndrome, and my wallet. VHS tapes are much more durable than DVDs and are also easier to pop into a player. We purchased "Finding Nemo" in DVD format for our sons to watch, and within two weeks, the disc was so scratched that it wouldn't play. I ended up buying a VHS copy as a replacement and am pleased to report that it still works! Taking this a bit further, perhaps the most irritating thing about DVDs and the other "disk" formats for games such as PlayStation and Game Cube is their size and thus their uncanny ability to become lost in the wastelands of family rooms, bedrooms, or vehicles. We, and I suspect thousands of others, have shelled out late fees to Hollywood or Block Buster because of this.

Yeah, yeah, I know. Teach your kids some responsibility. Believe me, I'm trying.

We would never lecture you about teaching your kids responsibility. And we do believe you.

You make an excellent point that many of us would have not considered – in many cases and for specific reasons, VHS is a preferred format.

The good news, we suppose, is that companies like Amazon. Probably will continue carrying VHS tapes because they don’t have the same space issues.

We joked yesterday that while Wal-Mart and Target were getting rid of VHS tapes, it still remained for Ksears to close down its eight-track tape department. Which prompted one MNB user to write:

That was a low blow 8 track tapes!!!, I have notice a slight ongoing improvement at K-marts this past year and I think the Sears Essentials might be a good concept to get people back into the stores. The plus side is less clutter store than most Wal-Marts with broader product mix than most Targets ( hardware etc ). The group running Sears Holdings is not the group that destroy SS Kresge or Sears lets see what happens for the next year and maybe give some support to the underdog.

Sorry. We try to never miss an opportunity to make a joke.


MNB user David J. Livingston had some thoughts about Wal-Mart being accused of doing illegal price checks of a competitor:

If Wal-Mart is going to check your prices there is nothing really anyone can do about it. I often do price checks as part of a market study. Keeping it to about 35 key items per store I usually fall under anyone's radar. When you start doing 300 to 850 (Wal-Mart has an 850 "will not be beat" list) items, you are going to be noticed, especially using a bar code scanner.

Stores like Albertsons, Safeway, Ahold, and A&P are easy because they have very little labor in their stores to notice what is going on. No company should ever send in one person to do 850 items. Its better to send in 17 people to do 50 items and do it by hand or tape recorder. Or simply buy the products and then donate them to a food pantry and take the price data off the receipt. Of course always dress like a customer and never wear something idiotic like a Wal-Mart blue vest.

If one person gets caught its no big deal. While the manager is throwing someone out, the other 16 are finishing up quickly and it won't take much effort to go back for any incomplete data. Wal-Mart used to be picky about people checking prices in their stores. However, for the past several years Wal-Mart has backed off. I suppose they have nothing to fear.

MNB user Amy Haefele had the following g observation about people buying and eating smaller portions:

Hurrah for smaller portion sizes!! While trying "a greater variety" would defeat the purpose of smaller portions, one of the first steps toward fighting obesity in the U.S. is to get people not to eat so darn much.

And MNB user David Staverman wrote:

In a decade of SUPER SIZE, I think it is great that someone is attempting to Right Size. You always preach moderation so why not package in reasonable portions. The average American has not idea what moderation is when it comes to daily food intake.

Responding to our piece about new competition in the Grand Rapids market, one MNB user wrote:

I found the Grand Rapids Press article interesting because the Wal-Mart supercenter is opening in the community of Ionia, which is 25+ miles from the most eastern border of Grand Rapids. I know there will be some effect in Grand Rapids but we have had a Super Wal-Mart in Holland, which is 30 miles to the west of Grand Rapids for some time now and that has not necessary caused a retail warfare in Grand Rapids.

What this will effect are the small one store independent grocery stores in the small communities that are in the Ionia area. These independents, if they can weather the storm for a year or so will be fine, because I have noticed that at about that time Wal-Mart stops dangling the carrot on grocery items and starts doing gradual price increases, which if you are a savvy shopper, will realize that the 1-2 cents savings on a can of corn is not that big of a savings when driving 30-40 miles one way, especially when gas costs 2.25 a gallon.

The savings might come in place on large non-grocery items, but a lot of that stuff is junk anyway, and I feel you get what you pay for. But there must be a lot of unsavvy shoppers because Wal-Mart always seems so busy!

MNB wrote yesterday about a Florida woman who has filed a lawsuit against the company, hoping that the legal action will get her an apology and compensation for the two years she has been out of work.

The lawsuit has been filed citing provisions of the Americans with Disabilities Act. The woman, you see, has a face that is partially paralyzed because of surgery related to her being an achondroplastic dwarf. And she says that she lived for her job handing out samples and collecting shopping carts, and had worked there long enough that she had full benefits and made $10 an hour.

One MNB user questioned our choice of stories:

OK, now you’re starting to look like the NY Post! The Candy Show is on in Chicago, is this piece really the best use of your space?

We can’t please all the people all the time.

We have a simple policy about such things. If we find a story that has the words “Wal-Mart,” “lawsuit” and “dwarf” in the same paragraph, we report it.

Journalistic standards have to be set somewhere.
KC's View: