business news in context, analysis with attitude

PORTLAND, Ore. -- Here at the 10th annual Portland State University’s Food Industry Leadership Center Executive Forum, the message to students in attendance was that the world is changing in fundamental and consequential ways, offering both challenges and opportunities to business. Some examples…

  • Tom Rubel, president and CEO of Retail Forward, for example, told the audience that “there is a palpable fear in the marketplace” as consumers face an “age of uncertainty” in which they are concerned about their security, have lost faith in institutions, and even wonder about the US role in the global continuum. At the same time, enormous opportunities are to be found in places like China, India, and the “new Europe.”

    India, he said, offers the potential for major growth. “More people are born in India in a week than are born in the EU in a year,” he said. And China – “the single most important business phenomenon in your lifetime” - is undergoing such profound changes that Wal-Mart sees it as the only nation where it can replicate the kind of store density it has achieved in the US.

    And here in the US, Rubel noted, by 2050 half of all consumers will be non-white…which creates its own level of opportunity.

    Making things even more complicated, Rubel said, is the fact that the same consumer can have many “head sets.” “The same consumer can go to Sam’s Club in the morning, then to Nordstrom, and then to a convenience store – three stores that were built for different populations,” he said.

    Finally, Rubel also suggested the solutions-oriented retailers will be well positioned for the future. That’s the great discovery by Home Depot, he said. “People don’t want lumber, they want a deck. In fact, they actually don’t want a deck…they want the pleasure that comes from having a party on their deck.”

  • Separate presentations by Doug McMillon, executive vice president of merchandising for Sam’s Club, and John McKay, senior vice president and northwest region general manager for Costco, highlighted the differences between the two club store. Increasingly, Sam’s Club is focusing on small business customers and doing its best to push more and more sales into that column; Costco is focused on the consumer market, with a regular cycle of hot products that heighten the treasure hunt aspect of the shopping experience.

    In a separate presentation, Phil Bonanno, vice president of training and content for Market Ventures Inc., suggested that BJ’s, the other major club chain, is moving toward becoming a “grocery membership club,’ giving it a distinct identity as compared to the other two club chains.

  • In a presentation on diversity, Pam Powell, senior VP for customer service at Albertsons, threw down the gauntlet. “Our goal is to become the number one food and drug retailer in the world,” she said. “So I guess I should say, ‘Watch out Wal-Mart.’”

More to come…
KC's View: