business news in context, analysis with attitude

Yesterday I offered what I referred to as “gentle heresy” with some criticisms of some of the things I recently saw at Wegmans Massachusetts store, which led one longtime MNB reader - and Wegmans executive - to respond:

Ouch, Kevin, I’m sorry your visit to our Northborough store didn’t measure up to your expectations. You are correct though, that while we love the accolades from our industry, our customers, and our people, we know we can’t rest on our laurels. As you’ve said, our current legacy is based on what we’ve done, our future legacy will be based on we do today and tomorrow, so our focus is to improve how we do that work and to create a great working environment for our people so you can have a great shopping experience as our customer. Thanks for the feedback, and really, thank you for shopping at Wegmans!

I expected nothing else from the folks at Wegmans.

MNB user Jim DeLuca wrote:

It is tough to read how great Wegmans is, so I appreciate your more grounded analysis.   I compete in Wegmans home town and 80% of my customers spend the majority of their food dollars at Wegmans.  My last visit was on a Saturday.  I visited the store they are soon closing because it no longer fits there footprint style.  The East Avenue store has about 44,000 retail sq. ft and their new building will have about 85,000.   That East Av store has the highest sales per sq foot of all their stores, I've been told; and it is easy to believe.  On my visit, I was chagrined/jealous to note that they had at least a dozen sampling stations gathering crowds. The feel of this store reminds me of small shops in NYC, crowded but full of energy.  I am hoping that when they close the cozy store and open the big box, my store will benefit from the people who prefer to skip the BIG.

My personal experience opinion based upon my shopping at a variety of Wegmans since 2004 is this:  not once until this last visit has anyone other than a cashier ever spoken to me. On this visit, when I noticed that all the prepacked bulk peanuts were expired or expiring on that day, I pointed it out to a stocker who did apologize (sort of; she blamed the product company for sending short dated product which made me  strangely happy that 1, they messed up; and 2, they thought blaming the distributor as opposed to the stocking team would pass as an excuse.  I guess a regular customer and not a grocer may not have noticed) and go thru all of the bags to find one at the back of the shelf with a reasonable use by date. Previously the only help I have received in the aisles has been from a product jobber.

I try to avoid the sour grapes, but sometimes I just can't...

From another reader:

Everything is relative. I never really thought Wegman's in-store cafes were anything special. They were always good "for a supermarket."

I also wish that people would refrain from using the term "fresh seafood" in supermarkets. As we all know, almost all fish sold by grocers are previously frozen - which is the best thing attainable in most places. Even outdoor seaside markets that give the impression of "fresh" are really selling commercial product now.

Another MNB user joked (I think):

OMG... you did not bow down to the all mighty W.

Watch your back... someone may be coming after you!

Not even a little bit worried. I think the response I got above will be typical of that most Wegmans folks will have.

Of course, the email about Supervalu continues to come in...

One MNB user wrote:

I very much enjoy reading your content. Concerning “hard decisions” at Supervalu ... We are in the midst of our third (3RD) massive lay-off. This does not include lay-offs at store level (or labor issues due to strikes). We have had 17 (soon to be 18) consecutive quarters of negative “like store” sales. The most recent lay-offs eliminated our Structural Engineering staff, as we are building no new stores. East Coast banners (Shaw’s/Acme/Shoppers} are running 15-18% behind sales averages from the past two/three years. Jewel has lost 6% market share in Chicago in the past two years. Cub in MSP/STP is losing market share to alternative formats such as Trader Joe’s etc. Supply Chain business is down drastically in the past three years due to lost Target transfers (our alternative competitors), lost retailers (Nash/Finch etc.) and a genuine lack of interest on the part of Albertsons management to grow and nurture that business.

There are no profits, and soon cash flow will lessen as management has sold off many well performing assets such as Risk Planners to pay down debt. Employee moral has reached an all time low, until next week. And the stock price is in the toilet.

Hard decisions, and positioning itself properly for the future?  A cruise that could not be cancelled?  I managed stores for years and did not need an I-Pad to get out and meet/greet my customers.  After 17 quarters of like store sales should a cruise even be scheduled?  How about an Executive trip to tour stores in Great Britain?  My VP said the job eliminations were being done to "flatten expenses".  Should I believe that?

Albertsons perished, A & P became a mere shell of its formal self, Winn/Dixie has been absorbed. Companies with poor management always have excuses, but the end result is you cannot “control” yourself to profitability. You have to define what you are and then compete well in that arena, You need to meet your customers needs and continue to “have what it takes” to keep your competitors chasing after you.

What did Wegman's and Publix eliminate from their employee benefits packages this week?  How about Kroger, Safeway?

Supervalu has no relevance in the grocery community any more. What is sad is that a Board of Directors which has a deep responsibility to both Share Holders and Employees sits back and allows this mess to happen.

As the saying goes, “when the war ends, the dead do not get to go back home.”

And another MNB user wrote:

As a current Supervalu employee, I feel compelled to respond to the recent writer who asks if there is no loyalty any more. When companies show no loyalty to their employees, employees don’t show any loyalty back. That’s how it works – from the top down. We have seen huge layoffs throughout Supervalu but I have never once heard about anyone at the top taking a pay cut. We do not feel like we’re in this together. We barely get by, but those at the top are paid excessively. When will they take pay cuts and pay freezes so the rest of their workforce can actually afford to go to our own grocery stores? That’s when I’ll feel some loyalty to this company – when we’re in it together!

Regarding the Pink Slime controversy, one MNB user wrote:

You mention transparency. How was the labeling of the textured beef not transparent? It is in fact beef. It is treated with ammonia. Ammonia isn’t an ingredient. So how was it not transparent?

Name a raw food that mentions on the label what it was treated with? Carrots? Apples? Chicken? Cheese?

Treated with something the USDA and FDA has deemed safe and part of the “contains less than 2%” of the total make up.

So it posses another question: do we not trust the USDA or FDA?

Have those agencies become such big government that we have conspiracy theories about them as well as Congress?

And if you do believe that yes, every single item we consume should have a “treated with” statement with the ingredient statement, then do not attack ONE item. Attack ALL food items and do it properly through the law. Not with a celebrity on a soap box.

From another MNB user:

The Beef industry & big super market chains do not want the public to really be informed about what they are buying.

Case in point.

Years ago it used to be the law that ads had to contain the grade of beef being sold  USDA Choice, USDA Select  etc.

Today in our area the only store that labels their beef USDA Choice is Costco. They also have some USDA Prime.

All the others have Angus Supreme, Ranchers Best, Ranchers Reserve or some other name and they are selling both

USDA Choice & Select at the same price.  Some use select only , some use choice and the upper end of the select grade.

The point is if they want the public to really respect them why not be honest ???

And, from another reader:

Any in depth, factual, and graphic representation of the Beef, Pork, or Chicken Industry would and should give pause to those who consume these products. Every animal component that can be is rendered. Detailed analyses of the process is a good thing for the consumer.

These industries have funded their version of education and marketing to lead the public  to think that what they see shrink wrapped, in nuggets, on the grill, or between two buns as necessary, wholesome, and healthy. "Pink Slime" has gotten traction but these industries depend on many  processes that, under modest public scrutiny, would likely reduce consumption.

Some seemed to think that the closing of three plants by BPI, which is mired in the controversy, is the fault of people like me. One MNB user wrote:

Talk about shooting the messenger!  No disagreement that a big part of the problem is that many people do not trust government (FDA, USDA etc.) to adequately police the safety of foods. Also, many people have illogical fears unfounded in science about numerous food safety issues.  The use of the rBST "hormone" to boost milk production in cows is the extreme example.  When the public hears hormone, they think of steroids like DES (diethylstilbesterol).  Many hormones are steroids, but rBST is not a steroid.  rBST is identical to the BST naturally produced by the cow for the biological purpose of stimulating milk production.  Both BST and rBST are rapidly destroyed in the stomach when ingested.  Unfortunately some in industry saw a marketing advantage in the anti rBST activist publicity and added claims such as "rBST Free" to their labels.  FDA quite correctly thought that was misleading because it implied a difference in the milk that could not be substantiated.  Irradiation of certain foods would be a safe way to virtually eliminate the e-coli in salads etc. but a large number of consumers would instinctively avoid anything that was labeled "irradiated."

It is a wonder that consumers still buy microwave ovens.  In the end, perception becomes reality, and consumers have the right to be irrational and have their prejudices no matter how unfounded. For business to ignore that would be swimming against the tide.  But it is a shame to waste that safe and nutritious "pink slime" when people in this world are starving though it would probably be politically incorrect to offer it to them.

KC's View: