business news in context, analysis with attitude

We had a story the other day noting that Whole Foods has been putting in self-checkout systems in some stores, which I suggested works against its traditional value proposition.

One MNB reader responded:

Don't remember how often you go to Whole Foods ....They have self-checkout!!!! At least here in Massachusetts.

Now, Market Basket seems to be the only hold-out. 🙁

I actually go to my local Whole Foods, which is a less-than half mile walk from my house, about 4-5 times a week.  This store, at least, still does not have self-checkout.

On Friday we reported that Instacart announced yesterday what it called the "first phase of the company’s next-generation fulfillment initiative designed to bring automated technology solutions to retailers across the U.S. and Canada," saying that it will work with automation partner Fabric to build warehouses for its retail partners, using them to make the fulfillment process more efficient and effective.

I commented:

Instacart is like heroin - and I say that with grudging admiration - in that it is building a system that will relieve retailers of many of the responsibilities of fulfilling e-commerce demands, while simultaneously creating a mechanism that won't need retailers.  It has the customers, delivery systems, and now it is going to have warehouses - which, by the way, will be able to operate as dark stores, selling directly to those shoppers, should relationships go asunder.

Instacart doesn't need to pick its retail clients' pockets - those clients are simply emptying their pockets and handing everything over to it.

One MNB reader wrote:

There is one differential advantage that can’t be taken from retailers and that is their own brands.  If retailers do business with Instacart but elevate their own brand offering through the ecommerce shopping experience, the transition of Instacart to a direct to consumer model may be a bit more challenging.

Last week we took note of a Wall Street Journal report saying that,  "faced with rising costs for materials, transportation and workers, companies are charging more for products from metal fasteners to Oreo cookies, helping fuel inflation like the U.S. hasn’t seen in more than a decade.

"As customers accept the price hikes, some big companies said they expect to raise prices even more. Others are more cautious, unsure if U.S. consumers have the appetite to absorb additional increases."

I commented:

My sense from talking to a number of retailers is that there is some level of skepticism about some of these price increases.  There's no doubt that the cost of some raw materials is going up, but there's also a suspicion that in many cases, companies are taking advantage of the moment.

One MNB reader responded:

The first problem is you spoke with numerous retailers.  Retailers historically feel the manufacturer has hidden pots of money, or that they are in this case gouging the consumer by using covid as an excuse in increase prices.  That feeling, idea, premise, whatever you want to call it is absolute HS.  Every,  bar none, manufacturer that I have ever worked for looks internally to cut costs before they go the final step and increase prices.  Herein lies one of the fundamental issues between retailers, distributors and manufacturers, retailers con’t understand or don’t want to accept the fact that manufacturers just want to sell their products not sell programs, food shows, shelf space, ad fees, preferential contracts and the list goes on and on and on.  We as manufacturers have one objective, sell our product.   What is so difficult to understand???

I take your point.

I was just relaying retailer skepticism, not attesting to its accuracy.

But I also have a problem with the implication that manufacturers are pure of heart and intent, and that retailers are crafty, duplicitous and manipulative creatures.

Some of the things that you suggest that retailers are focused on exist in part because manufacturers at least helped to create mechanisms that were less dedicated to selling products than perhaps one would like.

And finally, this email from an MNB reader and fellow wine lover:

Thanks for the recommendation of the Occhipinti SP68 wine from Sicily. My wife and I were quite struck with Arianna Occhipinti as well, and plan to visit her the next time we are in Sicily.

Me, too.  Next time I'm in Sicily.