business news in context, analysis with attitude

First of all, thanks to all of you who wrote in about yesterday's lead stories, which took advantage of the fact that it was April 1 to stretch credibility and accuracy a little bit. It remains amazing to me how many people remember "Mr. Ed." I see a movie revival one of these days...

Had a piece the other day in which I raved about Bell's Oberon, one of the m,any craft beers that seem to be driving growth in the beer business these days. Which led one MNB user to write:

Oberon is in my top ten favorite beers of all time!  Good to know we have similar tastes!  While you’re in Kalamazoo, you should try Bell’s “Two-Hearted Ale”.  Another one of my all-time favorites.

It shouldn’t be much of a surprise that the craft beer market is blowing up like it is.  The sheer quality, craftsmanship, ingredients, and attention-to-detail is unparalleled versus the BMC (Bud Miller Coors) brewers of the world.  Plus, customer tastes are evolving for craft beers and this has resulted in double-digit growth in the industry for the past few years, while domestic and imported beers are seeing declining sales year after year.  Why do you think In Bev AB bought Goose Island?!  Craft beer sales have doubled from 2007-2012 from $5.7 billion to $12 billion despite a down economy, PLUS analysts predict that the industry will be $18 billion in 2017!!!!  Time to turn my homebrewing hobby into a full-scale operation!

So this begs the question, why would you shell out $5 for a six-pack of “watered-down” Budweiser when you could pay $7 or $8 a six-pack for an IPA with 7-10% (sometimes more) ABV and a lot more flavor?!  It’s not a difficult question to ponder….well, not for me at least!

Got a number of emails about our story last week about Celiac Supplies, a specialty food store in Brisbane, Australia, that decided to start charging shoppers a $5 fee for looking without buying - a solution, it hopes, to the showrooming problem. The store has a sign on the front door that says:

As of the first of February, this store will be charging people a $5 fee per person for "just looking." The $5 fee will be deducted when goods are purchased. Why has this come about? There has been high volume of people who use this store as a reference and then purchase goods elsewhere. These people are unaware our prices are almost the same as the other stores plus we have products simply not available anywhere else. This policy is line with many other clothing, shoe and electronic stores who are also facing the same issue.

My comment:

I think the folks at Celiac Supplies need to get a little more fiber in their diets. Because this is the dumbest idea I've ever heard. The sign may say one thing, but it actually means something else. It means three simple words: "We cannot compete."

MNB user Steven Barry wrote:

Think of it this way.  If they actually pull this off and convince their buying customers that they are not paying this $5.00 Charge (which really, they’re not),  many lessons will be learned and US retailers will take notice.  Think of all of the new, hip stores like Whole Foods, Wegmans, Dorothy Lane,  who spend much effort, time and money to develop unique products, product Categories and Merchandizing strategies only to watch an endless flow of Manufacturers, Suppliers, Brokers, competitors on so on, come in and  “borrow” these great ideas to either share with their competition or just plain steel the idea’s all together….all for the very low price of $0.00.   Retailers are always looking for ways to somehow get more money out of the supplier community so  I can see this being another way to create an income source from not only your current suppliers but also the vendors who do not business with you not to mention your competitors.  It’s not like they’re not going to pay in order to do their recon work..  sure they will.    And customers can be trained.  If they’re trained to believe there is something in it for them to slide their cards before entering the store, then they will not have a problem with it.  I hear they get that $5 back when they make a purchase anyway.   It could happen…..

From another reader:

Seems to me that “Celiac Supplies” just needed a little more time in thinking through how to combat showrooming.

Instead of an every visit fee, they could call themselves Celiac Supplies “CLUB”, offer great value and charge an ANNUAL fee...

Another MNB user wrote:

Celiac Supplies is a complete embarrassment to retailing. I wouldn’t pay them 5 cents to look around in their store. Down under, someone has a hole in their head!

MNB user David L. White wrote:

Celiac Supplies posts a sign indicating a $5.00 surcharge for “just looking” in their store.  I suspect the next sign on the door will say “Going Out Of Business.”

I loved this email, which happened to come from my younger brother, Tim:

Forget the three word sign saying "We can't compete." It really is a two word sign: "Go Away!"

That's the difference between my brother and me. I would've chosen two different words....
KC's View: