business news in context, analysis with attitude

MNB reported last week that Wegmans would respond to two current trends – the economic strife hitting so many families, and anticipated lower costs for raw materials – by imposing price cuts on hundreds of items in its 72 stores in advance of actual cost reductions on the supplier side. Danny and Colleen Wegman released the following statement: “During difficult times like these, it’s okay with us if we make a little less money. And, as always, we are committed to offering the lowest price in the market on the items most important to families.”

I commented: This is a perfect example of what I’ve been talking about a lot here on MorningNewsBeat in recent weeks – the importance of both value and values, and of communicating both to customers with clarity and consistency. It also correctly anticipates the likelihood that a lot of shoppers are going to wonder why, if costs are going down for raw materials, prices are not coming down for a lot of products. Like it does so often, Wegmans is getting ahead of the curve.

But one MNB user wasn't buying:

Am I mistaken, or are you flipping on your opinion regarding lowering prices? In a number of past instances, I seem to recall you expressing doubts about an across-the-board price reduction as a sound tactical maneuver. If memory serves, you've had the opinion that it's a poor move for food retailers because it's too easy for competition to simply follow, creating a price war. It's clear that you have a love affair with Wegmans,

it seems your opinion is that they can do no wrong, but are you being
inconsistent here?

Actually, what I think I’ve said is that while retailers need to pay attention to value in the current economy, they should not lose touch with the core values that define their companies…and that they probably shouldn’t try to be Aldi or Walmart if that isn’t consistent with their culture. And I think that is what Wegmans has done.

As for having a love affair with Wegmans….well, I’m not sure I would have put it quite that way. Smitten, perhaps, and appreciative of a superlative retailing operation, certainly. And I’m not going to apologize for it.

MNB user Ted File chimed in:

Over the many years I have known the company and its leaders, they never fail (at least in my estimation) to lead out as leaders usually do. Now this pricing change has got to wake up the industry. Why haven't the majors stepped on the bandwagon? At this point they sure haven't announced their intentions. Again, a missed opportunity?

As is my custom, I was fairly critical of the US Food and Drug Administration (FDA) last week, which prompted one MNB user to write:

Quit blaming the FDA. They do what they are told by whoever is currently in power. All department heads are political appointments. Perhaps you do not want to bash Bush since he has been bashed enough but…Justice Department, SEC, regulation of Wall Street – these are all government bureaucracies that follow the dictates of their leader, in this case Karl Rove, retired, and Dick Cheney, still active, as well as second in command, George W. Bush. Things will change and department heads will change and consumers will have some protections until the Supreme Court gets involved.

Gosh, that’s cynical.

Regarding my ongoing criticism of the Federal Trade Commission (FTC) for trying to undo the Whole Foods-Wild Oats deal that was finalized more than a year ago – something I’ve characterized as being like a dog chasing a car without any real plan for what to do if it actually catches up with the vehicle – one MNB user wrote:

I can’t agree with you more. In this economy, the combined company could not get away with raising prices anyway. I don’t think the consumers would stand for it!

Couldn’t the FTC be spending their time doing something to help the economy instead of wasting money on a merger that already made it through all (well, most of) the red tape??

MNB reported last week that People For The Ethical Treatment of Animals (PETA) is calling on Publix Super Markets “to report any progress it has made toward adopting animal welfare policies that pertain to the purchase of eggs and pig, chicken, and turkey meat.” PETA maintains that at the present time, “the limbs of chickens and turkeys purchased by Publix are often broken, and the birds are conscious when their throats are cut during slaughter. The company buys most of its eggs from suppliers that cram hens into cages so tightly that the birds can't even stretch a wing, and it buys pig meat from companies that immobilize pregnant sows in tiny ‘gestation crates’ for months at a time.

I commented: The problem with statements like these is that it is hard to know the objective truth, especially when one has the sense that the people putting out the statement have their own agenda. Not sure if it can fairly be called a radical agenda, but it certainly is out there on the fringes and some of PETA’s membership pretty much defines the phrase “lunatic fringe.”

On the other hand, it is hard to read that description of animal treatment and not feel something like revulsion for the situation as it is described…if indeed it is the objective truth. Seems to me that it is up to Publix to come up with a crackerjack defense, or start figuring out how to satisfy PETA’s demands at some level.

MNB user Amelia Kirchoff replied:

I feel that you almost always provide an unbiased viewpoint. Not so, in the case of PETA. Perhaps they seem to you to be a radical organization but when there is so much cruelty to animals and so many people that seem not to notice, PETA has to bring attention to these incidents so that we start to pay attention. I am sure that at one time Civil Rights Organizations and Women’s Lib were also considered radicals. But change came, injustices were corrected and we no longer consider them radicals …If PETA says that Publix is buying meat and eggs from such operators I believe them. Their only agenda is the prevention of cruelty for animals.

Another MNB user wrote:

On an organizational level I have to admire how PETA can mobilize its members so quickly.

On a values and beliefs level I have no respect for PETA. Taking any belief to the extreme, as PETA does, is always inevitably negative. They now place animal rights over human rights. Publix owes PETA no explanations or direct response whatsoever. Publix, like any responsible grocer, is answerable primarily to its customers. If the PETA member confronting Publix is a stockholder, he or she has a conflict of interest and should ethically give up one position or the other. There are plenty of animal protection laws in force and the large majority of food producers and purveyors adhere to them. To give livestock human qualities or to glamourize them as cuddly house pets is infantile and irresponsible. I challenge any PETA member to become a large-scale, commercial livestock farmer, saddle themselves with every belief they so vocally espouse, and successfully make a living.

It's too bad that such a strong organization manifests itself in such a negative way. Consumers and retailers alike resent when they feel that PETA looks down its nose at them. Until PETA loses its holier-than-thou attitude and belief, they will deserve to be perceived as lunatics.

On the subject of new plastic bag regulations being considered by the Tucson city council, one MNB user wrote:

Tucson needs to be applauded. This is the proper and the right way to attack this issue. Big cities like New York, Austin, and others are doing it right by understanding that bans and taxes do not work. They only make us consumers use other plastic bags that are not on the ban list or the tax list, that usually do not get recycled at all. And god forbid we move to paper, which by now, everyone understands the bigger issues involved with that move….more energy used, more emission, more water used, harder to recycle, not to mention you still have to cut down trees, even if you use recycled paper…..hello… Walmart and many other large chains have known this all along and are walking the talk every day and it is working…..reduce, reuse, recycle….

Responding to last week’s MNB Radio piece about my new Kindle, MNB user Mark Thorngren wrote:

I've had a Kindle for about 4 months and found it was great. Did have a recent "brain freeze" and left it on the seat of a plane I was getting off. When I came back 10 minutes later the Kindle was gone. They are popular.

Finally, responding to my note last week about the election of Barack Obama, and my comment that no matter how you feel about his politics, one has to concede that his win signifies that we have come a long was as a people, one MNB user wrote:

I am sorry, but how in the world does the fact that we've elected Barack Obama to President say that we've made 'progress as a people'? Just because he is an African-American? I would think that even he is offended by this! (And believe me, I've heard the same thing in the media all day today!) Wouldn't it be progress if we focused on his morality, his skills, his leadership, his plan, his love and respect of his Country. No, it’s just about the color of his skin.

I hope and pray that he leads this country in a positive direction. Economically as well as morally. Whether or not he is successful, though, is not contingent upon the color of his skin! One last thought – maybe others around the world approve of this change not because of the possibilities of making our Country stronger, but because of what those
countries might gain as a result?

With all due respect, I disagree. I was not suggesting that anyone should vote for him because of the color of his skin. But to ignore the fact that our country has a history of racial tensions, and that it just elected a black man president for the first time, seems a little myopic to me.

Then again, I’m a member of the media. So you can paint me with whatever broad brush you would like to use.

BTW, this comment was similar to another email that I got from an MNB user who wanted to respond to my comment that while in Argentina last week, it was extraordinary how much enthusiasm there was for Obama.

This MNB user suggested that this only added to suspicions that Obama is a socialist, since Argentina’s government is socialist.

My response to this is simple: most of the people I met in Argentina don't seem to like or respect their government…and their reaction to Obama seemed to be that they saw in his election the kind of democratic freedoms that they do not enjoy. It had nothing to do with being Democratic or Republican.

But when it comes to what really makes Obama special, my favorite email came from this MNB user:

History in the making. I believe he is the first White Sox fan in the White House! Our time has come!

Change you can believe in, huh?

KC's View: