business news in context, analysis with attitude

With brief, occasional, italicized and sometimes gratuitous commentary…

•  Fox Business reports that Costco CFO Richard Galanti last week told analysts likely will raise its membership fees.

""What we’ve said again, and I’ll say again, is that our view is all the parameters, as it relates to member loyalty and value proposition that we’ve improved to our member, we have no problem thinking about doing it and doing it ultimately," he said during an earnings call. "So it’s a question of when, not if … But we feel that we’re in a very strong competitive position right now … And if we have to wait a few months or several months, that’s fine. And I’ll be purposely coy on when that might be."

"If we wanted to do it yesterday, we could, and if we want to do it six months from now, we can," Galanti told analysts. "We’ll wait and see."

The comments came as the Wall Street Journal reports that "Costco Wholesale Corp. sales growth slowed slightly in the most recent quarter compared with recent years as some shoppers bought fewer big-ticket discretionary items.

"Comparable sales, those from stores of digital channels operating for at least 12 months, rose 7.1% in the quarter ended Nov. 20. That quarterly figure, which excludes currency fluctuations and gasoline sales, hasn’t fallen below 9% over the past two years. Online sales fell 3.7% from the prior year, Costco said. 

"The slower growth is both due to the quarterly comparison with massive growth last year and some pullback on spending…"

•  From the Wall Street Journal:

"Juul Labs Inc. has agreed to pay $1.7 billion in a broad legal settlement covering more than 5,000 lawsuits, according to people familiar with the matter.

"Many of the lawsuits accused the e-cigarette maker of marketing its addictive products to children and teens. Juul has said it never targeted young people and that it has been working to regain the public’s trust.

"The settlement deal, signed earlier this week, resolves much of the legal liability that had pushed the embattled e-cigarette maker to the brink of bankruptcy. The company is now working to settle cases brought by several attorneys general. Once it has resolved most of its legal liabilities, Juul could seek a sale or strategic investment, people familiar with the matter said.

"The Food and Drug Administration in June ordered Juul to halt its U.S. sales, saying the company hadn’t submitted sufficient evidence that its e-cigarettes were safe. The agency then put the ban on hold while Juul appealed the decision."

I have a bias, one that I've made clear here on MNB many, many times over the years.  There is very little that anyone from any of these companies could say that I would believe or trust.  And as far as I am concerned, "to the brink of bankruptcy" isn't far enough.  The goal is addiction, and lifelong customers, and I suspect the "long" part of that may be less important to them than to others.

•  Yellow Banana, owner-operator of more than 30 Save A Lot locations in the US, announced a partnership with Flashfood, a digital marketplace that provides customers with access to heavily discounted food nearing its best-by date. The food waste reduction app is now available at all of Yellow Banana’s Save A Lot locations, expanding Flashfood’s presence to Dallas, TX and Jacksonville, FL for the first time. 

The announcement notes that "Flashfood aims to eliminate food waste at the retail level by connecting shoppers with savings of up to 50% on food nearing its best-by date that would otherwise be thrown away. The partnership will enable customers at Yellow Banana’s Save A Lot locations to save big on everyday grocery items like meat, produce boxes, dairy and bakery items, as well as center-store foods and snacks. Shoppers make a purchase directly through the Flashfood mobile app and simply pick their order up from a team member at the checkout area of their participating location."