business news in context, analysis with attitude

We got a number of emails responding to yesterday’s story about Minyard’s being sold to a Texas investment group.

MNB user Thomas D. Murphy wrote:

Minyard's was able to compete successfully for years with the traditional grocers, but when Wal-Mart entered and changed the rules, they could not adapt quickly enough. They struggled with poor investments and strategies in the technology arena, which minimized their adaptability...they just had nothing to leverage.

This is a lesson for all of us...flexibility and adaptability of the infrastructure and business mindset are key to survival in the grocery industry! The days of "stack it high, price it low, watch it go" are ending!

MNB user Marty Gillen wrote:

You can kiss this chain good bye. Ron Johnson has had notable success in running Jitney Jungle and Del Champs into the ground and almost did the same to Farm Fresh in Norfolk.

What a shame.

Another member of the MNB community wrote:

I agree - it is a shame to see a family leave the industry. I would imagine you'll begin to see an exodus of employees in the near future as Mr. Johnson and crew begin to "slice & dice" the business. Just hope he doesn't bring the same great ideas to Minyard's that he did to Jitney Jungle.

And MNB user David J. Livingston wrote:

A lot of people are going to miss Minyard's. They were a good company to work for, was very involved in the community, and was a good corporate citizen. However in both Dallas and Ft. Worth they had fallen to a distant 5th in market share behind Wal-Mart, Albertsons, Tom Thumb (Safeway), and Kroger. Chains right behind Minyard's like HEB, Fiesta, Super Target, and Save-a-Lot have been adding stores and gaining in market share. While Albertsons, Super Target and Tom Thumb are pretty much ineffectual competition, they don't make it any easier when trying to compete with heavy hitters such as Wal-Mart, Kroger, HEB, and Fiesta. Albertsons’ eventual exit from Texas will help a little, but they will most likely sell their best locations to the stronger operators. Given the short-term strategy history of the new owner's past supermarket experiences, I have to wonder what their real motive is in buying this chain?

A question a lot of people are asking…

Interesting response to our piece yesterday about how Wal-Mart, just a week after it decided not to sell Jon Stewart’s “America: The Book,” it sent back 3,500 copies of George Carlin’s “When Will Jesus Bring The Pork Chops?”, saying it had never order the best-selling satire to begin with. We commented that we can't help but feel that these sorts of moves represent a sanitized cultural mindset that does not encourage diversity of thought and debate.

One MNB user responded:

As you know I'm no fan of Wal-Mart, however, how can one say that a retailer’s choice not to sell a book is a bad thing? We are not talking about the publishing industry or the government banning a book but a retailer’s choice as to their product line. Within legal guidelines every retailer should have the ability to sell the products that best represent their business beliefs, values and those products which they believe their customer base will support.

An idle observation worth more research on my part…

Religious connotations are always tricky and could contribute to a retailer’s choice for or against the book. As a Christian I understand many differences in the Law (of Moses) and the teachings of the New Testament in regards to edible foods. To me the title suggest a general lack of respect for religion but would others feel that way? The food reference is not necessarily insulting but it seems many will be offended in that Jesus was a Jew and the title may alienate shoppers. (Whether one believes in Jesus as the Messiah it would be unlikely that Jesus would have found pork as anything other than unclean.) Perhaps the anti Semitic and anti-Christian views that are growing in Western Europe are making headway in the USA with small steps. I always thought that George Carlin was of Jewish decent so perhaps this is a very funny title and I need to lighten up? Just some observations to be curious about. Thanks for the continued great reporting and commentary.

Two responses. One, we have said, and we believe, that Wal-Mart…and every other retailer…has every right to decide what to sell and what not to sell. That said, we think you can use such decisions to look into the heart and soul of a retailer and understand where it is coming from. Some will see such decisions as positive, and others will see them as negative. (And Wal-Mart, we’re sure, would say that the message it is sending is precisely the message it wants to send.)

Second, while we haven’t read the book we have heard Carlin interviewed about it, and his point simply seemed to be that the words created a juxtaposition that he found funny. It’s irreverent, to be sure…but we think he delights in that.

And, we continue to be criticized for some of our commentaries about Wal-Mart.

One MNB user wrote:

Until you can verify that Wal-Mart drags people in off the street - kicking and screaming - and forces them to work for or shop at their stores, your diatribes will continue to seem specious.

Sometimes there aren’t a lot of choices for people. And are you suggesting that because Wal-Mart (or any other retailer, for that matter) doesn’t force people to work in its stores, a discussion of what its policies are is inappropriate?

MNB user Bob Vereen wrote:

I don't know if you regularly visit any Wal-Mart stores or not. I do get into them periodically, sometimes as an observer, sometimes as a customer.

What has always intrigued me, when I read the negative Wal-Mart articles in the consumer press (and sometimes in MNB), is the contrast between what I read and the generally cheery attitude of Wal-Mart employees.

It seems to me that, on average, the helpfulness and cheerfulness of
Wal-Mart employees is far greater than that to be found among employees of their big-box competitors, Target and Kmart. If what management does is so bad, how come the employees seem so happy?

Not to be argumentative, but we also get into a local Wal-Mart a couple of times a month, and we wouldn’t say that there is a surplus of good cheer among employees there. They aren’t any happier or more helpful than the folks who used to work at Caldor in the same location.

Maybe it’s the building…

Another MNB user had an interesting take on the company’s claim that it cannot verify some of the charges made against it in terms of health insurance issues:

It seems hard to believe that a company that reportedly stores more terabytes of data than the Department of Defense would have a hard time figuring out a way to validate some of the numbers being reported on the health coverage issue. Maybe they should survey their current associates and ask: Do you use Medicaid, or Do you have insurance coverage? If they really cared about the associates, don't you think they would want to know?

When writing about Wal-Mart’s efforts in China, we wrote (somewhat tongue in cheek): “When you think of the famous photograph of Tiananmen Square, do you picture Wal-Mart as being the tank, or the single individual holding up his hand in protest?” One MNB user responded:

Oh, come on Kevin. You've made some low-end digs about Wal-Mart since I started reading your column but I believe this takes the prize.

More than likely, for every small store owner with their hands up, there's thousands going past the people-greeter at their nearby Wal-Mart. The only non-business person with their hands up, more than likely, is carrying a union sign out front of a new nearby SC.

You, of all the ones here, should demonstrate a little more of an open mind when it comes to writing about happenings in the retail side of the business.

For every snide comment you make about the "Bentonville Monster" I could possibly recount a story I heard direct from shoppers apparently very happy that they could shop at Wal-Mart.

I think you need to tone down these types of remarks about Wal-Mart, stick to reporting the news, before you find yourself writing only to and for "fellow travelers" who hate their guts.

For the record, we’ve never called Wal-Mart the “Bentonville Monster.” Only the “Bentonville Behemoth”…and we can’t imagine who would argue with that.

And we don’t hate Wal-Mart. We think that, as the world’s biggest companies, Wal-Mart can be legitimately questioned – about its size, its policies, its attitudes, its culture and its responsibilities. Wal-Mart is neither a perfect company, nor worthy of being demonized. And we would hope that MNB is just posing fair questions and creating an environment for legitimate discussion.

We got several letters about last week’s story regarding Caribou Coffee having to close several stores because of an Internet “rumor” that it was funding terrorism – which could be traced back to a former partner at one of its owning companies who apparently was fired for having made pro-terrorist comments.

MNB user Darren Moss wrote:

I have seen this Caribou rumor in the past and tried in vain to research Caribou's ownership. I was curiously surprised that no information is listed about Caribou ownership on their website. By not denying it, the company's statement seems to confirm that 88% of its stock is controlled by a group of Arab investors. So the question really is how reputable are the activities of this Arab bank? We know they have had at least one previous associate that advocated terrorism, so one has to wonder about the general climate of such an organization… Who knows whether the ownership is reputable in this case, we certainly aren't seeing much proof from the company that they aren't funding terrorism.

Two responses. One, how do you prove a negative – that the company isn’t funding terrorism? Second, does it mean nothing at all within the context of this discussion that the head of the company is Jewish?

Another MNB user wrote:

What happened to innocent until proven guilty? A group of individuals perpetuate a rumor, rile up consumers and hurt a business. The group of individuals that circulated the rumor should be prosecuted by Caribou. Finding them guilty would be Caribou's best defense.

Forget finding them guilty. Just finding them would be as trick…

We wrote yesterday about how the Chipotle restaurant chain is trying to train its people in the art of customer interaction, in the belief that a more engaged labor force will create a better dining experience.

One MNB use responded:

Chipotle has bigger problems than customer service. Mediocre food, not worthy of my peso! Better burrito options from chains such as Moe's/Baja Fresh or any of the local "Mexican" restaurants.

Hmmm… We’ve never had a bad meal at Chipotle, but then again, we live in Connecticut, and good Mexican food is hard to find there.

MNB user Kerri Holtzman had a different take:

The folks at my local Chipotle seem to have picked up on this already. Noticing that my burrito preferences created a much smaller burrito than most people’s, they offered to charge me less for mine. How many other places would do that? I also appreciate how I always see them making sure people know that guacamole is extra, rather than surprising them with the $1.50 guacamole surcharge at the cash register. This customer service and willingness to customize is what keeps me coming back to Chipotle.

Got the following email from an MNB user:

Having spent almost 30 years in the industrial relations field I have to agree with your analysis that contracts negotiated between management and labor often appear to be stop gap measures. I think recent experiences tends to make it appear that this happens more than it really does.

It is my experience that when the problem being faced by both parties is, in the final analysis, one which neither side has the power to solve, they start to look for short term solutions hoping that those who can solve the problem do so before the contract expires.

In recent cases it has been the ever-escalating cost of health care insurance. It is a huge national problem that cannot be solved in southern California, Denver, San Francisco, or any other region. It is a national problem that needs a national solution.

The way it sits now there is a battlefield littered with carnage from both management and labor from a fight neither can win. Sitting on the sidelines, and doing nothing, is the health care insurance industry that, no matter who wins the battle, always wins the war!

Sooner or later both labor and management are going to stop the battle long enough to take a look around and both are going to see the health care insurance industry sitting smugly on the sidelines. When that happens both sides will come to the realization that they must join together on a national basis and demand a change from those who have the power to make change happen.
KC's View: