business news in context, analysis with attitude

Regarding the planned expansion of Walmart's Neighborhood Market format, one MNB user wrote:

I remember walking out of a WM Neighborhood Market down near Bentonville about 10 years ago thinking Food Lion and Winn Dixie were history. I remember the store manager telling mr the store sold more rotisserie chicken than any Walmart. Hard to believe but I was impressed with the store. They obviously did not grow like I thought.

The model they now appear to be embracing is very vanilla. I suspect that they have decided that good is good enough to take on the weak players. They are probably correct.

The question for me is the effect on the big dogs like Kroger and Publix. Also, it will be interesting to see if they make inroads in the Northeast. I'd say that's years away.

Anyway, it's not a great store. I expected more.


I'm not sure that good enough is ever good enough these days.




I did a piece the other day ranting about Time offering me a more than $200 discount on a subscription because of my age.

One MNB user responded:

I think the more eye-opening question is, “How does Time know how old you are?

From another:

Since you weren't born yesterday I hope you understood that the $240 was the price of buying weekly issues at a news stand for 1 year, not the "regular" subscription price that is (a) far less, and (b) even farther less than the price the majority of subscribers pay.

Of course. My big point was that it is a lot more likely that older people would want a paper magazine subscription ... so maybe they were offering a discount to the wrong demographic.

And another:

The $20 subscription rate for TIME is actually available to just about anyone, regardless of age.  They send this offer to many of their target groups, and have been doings so for several years (I get it from several different sources).  They still compare the discounted rate to the newsstand rate to make it look like a ridiculously good deal.  Almost all of the print magazine publishers use this gimmick.

And still another:

Maybe this will make you feel better... Time made the same $20.00 subscription offer to our 24 y/o daughter.

Okay, so let me ask another question.

Time is essentially saying that the magazine is worth $240 a year, but they're willing to offer a $220 discount. So what are they saying about the magazine's real value? Is it $240? Or $20? I'm not suggesting that discounts are not a good idea. But when you make cuts this deep, it seems to me that you are saying something profound about real value.




Regarding a new discount program being instituted by Giant Eagle, one MNB user wrote:

Top 10% of earners took home 50% of wages…do the math for the next 55% of Americans (the middle class) and you will understand Giant Eagle’s concerns. Not many of the top 10% are shopping Giant Eagle.




On the subject of the ongoing health care debate, one MNB user wrote:

I find it interesting how many business stories highlighted on MNB serve as a microcosm of the politics of the day…perhaps even more so, how societal views of the day are reflected in the business world especially with regard to discussing how folks should be treated and what they are, or are not entitled to; whether it be a so called living wage or healthcare coverage.

Many articles regarding businesses reviewed on MNB revolve around customer service or the lack thereof, or how businesses succeed or fail based on their ability to connect with their customer base. In the broader sense why does any retailer even think twice about who their customer is or how to cater to them? Why does Walmart care about what Dollar General is up to, or why would Kroger be concerned with what Publix is doing in Atlanta? My personal answer to that question is because if they don’t, they stand to lose. Everyone, regardless of their political leaning seems to hate poor customer service. I mean, I’ve never read one word in your comments or those from your readers even remotely suggesting that poor customer service is okay, regardless of how poor customer service is defined, everyone knows it when they see it and no one likes it.
 
As consumers, we are fortunate that we have choices, if we don’t like our experience at a particular restaurant or retailer, we simply don’t have to go there again, we can switch to a new venue that trips our trigger. What makes such choices available to us? Competition for our dollars makes all such options possible. It’s that freedom of choice that makes our free enterprise system work. It’s who we are at our core, I believe that anyway, with the key words being freedom and choice.
 
What does any of this have to do with Obama Care? Well, one of the main goals of Obama Care according to Harry Reid is to move to a single payer system where all insurance is purchased through/provided by the federal government. Think about that for a minute. What if there were only one supermarket chain in the U.S.? What do you think customer service would be like with such retailer if they did not have to worry about a competitor taking sales dollars from them? What would the in-stock position be? What about sanitation, selection, new items, front end service, or pricing? What would the impact on suppliers be?
 
Does standing in line at the local DMV or Post Office strike a chord? Does anyone think that procuring health care from the federal government will be any different? Especially when consumers have no other choice? Hell, the post office actually has lots of competition, but does that make your experience there any better or their organization profitable?
 
The two most cherished rights supposedly guaranteed to “we the people” by our Constitution are freedoms and choices; personal liberty. Personally, regardless of political leanings, I believe that most people would like to see everyone be able to support their families. But do we really have to get there by being forced into a program that provides us no other choice? To be told that if we choose not to participate, not to purchase insurance that the government will tax/penalize us for making such a choice? Look what competition does for our shopping and eating out experiences…that can’t work for our insurance needs?


I don't want to be in a position of defending Obamacare because I, like most people, don't completely understand it and certainly don't know for sure what the long term implications will be. One thing I do know - mandating the kids be covered under their parents' policies until age 26 and making sure that pre-existing conditions are covered by insurance companies are both good ideas that have made a difference.

And again, without defending Obamacare ... a free market is what existed before ACA was passed by both house of Congress and signed by the president. And it seems to me that health care costs did nothing but go up to unaffordable levels. I have no idea if Obamacare will fix this ... but there seemed to be a least some shortcomings in the free market approach.

As for the living wage debate ... I'm not sure I understand the connections you are making.
 



But let's get more into the living wage debate...

MNB user Jeff Gartner wrote:

Kevin, I am saddened by the cynicism and lack of compassion voiced by some of your letter writers about the minimum wage. Most people trying to support their families while earning the minimum wage (or even just a little more) are trying to scrape by, living paycheck to paycheck.

Their take-home pay after SS, Medicare and even the lowest federal and state income taxes often barely covers their monthly rent, utilities, food and transportation costs. They don't have health insurance unless their employer is paying for it. They're not buying the latest cell phone and don't qualify for extended data plans, but rather cheap pay-as-you-go phones and plans. They're not buying cars for their teenage kids, because they can't afford a car for even themselves. They're not buying the latest clothes and shoes, but they have to buy new ones every year because their kids, just like these letter writers' kids, are outgrowing last year's. Or they're flocking to shoe give-aways as they have during the late summer here in Grand Rapids at In the Image, a fabulous community nonprofit. They don't have money to buy pens or notebooks and other items they need for school.

Some nonprofit organizations have poverty simulation exercises to help their community members understand what it's like to be poor. I suggest those letter writers spend time at one, as it may lead them to become more empathetic of those less fortunate.


Another MNB user wrote:

While I agree in principle with you position on a living wage I was somewhat surprised with  your comment on “settling for state schools”.  This seems to reveal an elitist point of view.  I have two daughters who “Settled for state schools”.    They are both well employed right of college and are doing better than many of our friend’s children who went to “non-state schools.   Comments like that while I believe were inadvertent  serve to perpetuate unnecessary stereo types.

Fair point. I only meant that state schools tend to be less expensive than private schools.

MNB user Philip Bradley wrote:

It's not only "an appalling lack of compassion," as you put it in your take on the low minimum wage, but there's even a good self-interest reason on the part of the business community to be concerned about the low minimum wage as well as the excessive income inequality now present in our society.  Henry Ford got it right away when he paid his workers the unheard-of amount of $5/day because he wanted them to be able to buy a Ford car.  If the forces that promote income inequality continue (and a low minimum wage is one of these), American workers are not going to be able to buy all the goods and services produced by the American economy.  The result is obvious--lack of growth and/or stagnation in the economy.

MNB user Mark Raddant wrote:

I have a suggestion for the reader who thinks Fast food workers and other lower end employees should focus on expenses: Try to live for a month on what they make.  Allowing for your housing, just factor in whatever the average rent for a two bedroom apartment is within 10 miles of the restaurant.  Go visit that place to make sure it’s where you would be willing to live, though.  I’m not saying it can’t be done, it can.  But it is an eye-opener to try it yourself.  And as you pointed out, not all those people have the benefits of understanding budgets.  

And from another:

Kevin, once again thank you for expressing your views, re: living wages and the basic decency of most citizens. It needs to be said more.




Regarding the GMO labeling debate, I wrote the other day:

Labeling isn't condemnation.. It is just information.

Which prompted one MNB user to write:

Until some crazies with an agenda distort and demonize that information.

Sure. Happens all the time. Ever watch cable news?

But that does not mean that you don't provide, in a transparent and comprehensive way, all the information that a consumer could possibly want and need.

Worrying about distortions is just an excuse. And not a good one.

From MNB reader David Burgess:

It's not so simple.  Transparency is good, but let's be clear here.  The fear-mongering is largely on the side of those who would demonize GMO without any scientific basis.  Fear works, and "frankenfood" is a tough label to overcome.  Some of the starches that are in many of our foods simply can't be had in non-GMO versions in sufficient quantities or at reasonable prices.  Stores like Whole Foods are in a tough spot.  They are supporting the initiative here because they really have no choice.  Their customers would have their heads if they didn't.  But are they and their customers willing to pay the higher prices that non-GMO products will cost?  And will it not hurt the sales of those items that cost substantially more?  All this without any evidence that GMO has any negative consequences.

Real businesses and real people are going to be hurt by this.  Will firms need to have two sets of packaging, double the number of products, and half the efficiency to sell into states with a GMO labeling law?  Or will they have to move everything to non-GMO products and raise prices to everyone?  There is a lot to address here that goes beyond transparency.  Why not also stand up and say that the hysteria over GMO is unfounded and unsubstantiated fear-mongering?


For the record, I am pro-labeling and I have said little to demonize GMOs.

Labeling actually strikes me as the compromise solution. Say that a product contains GMOs, and then explain why. Educate. Enlighten.

I cannot for the life of me understand why so many companies are afraid of labeling. They say that labeling will create fear, but I think much of the fear-mongering is taking place within the pro-GMO community.

I wrote the other day about anonymous companies fighting a GMO labeling initiative in Washington State:

I think that any organization that contributes $2.2 million to any campaign - for a person or position - ought to be required to disclose precisely where that money is coming from. This would help voters decide how to vote.

One MNB reader responded:

The only problem is that allows opponents to demonize the contributors, counting on voters to focus on defeating the "demons" while ignoring the merits of the issue in question.

With all due respect, that's such a crock.

There will always be forces - on either side of the aisle, and on any side of any debate - that will look to demonize either an argument or an advocate. And sure, demonization often cheapens the debate without illuminating the issues.

But especially when massive amounts of money are being thrown at elections and debates, voters and consumers have a right to know who is behind those contributions. Sometimes this results in demonization, but sometimes we can draw legitimate conclusions about issues from the identities of the people and organizations that take one side or another.

Remember the line from U.S. Supreme Court Justice Louis Brandeis: "Sunlight is the best disinfectant."

To those who oppose such transparency, there is a simple question:

What are you afraid of?
KC's View: