Friday, October 31, 2014

Why Shopping at Costco (Too Much) Makes Me Feel So Good

Oct 27 2014

You don’t have to be a heartless entity to win big. Nice folks canfinish first

"I'm tired of hearing about the minimum wage, I really am."--New Jersey Governor Chris Christie.
To me honest, I’m a big fan of wealth. I love to see individuals succeed wildly. I love to see companies succeed. I hate companies that do so as a result of virtual slave labor, which Walmart does right here in America. Hate is perhaps too strong a word; I’m not a hater. Despise.
Walmart makes hundreds of billions of dollars on the backs of its employees. The pay is actually fine, unless employees want to eat, sleep with a roof over their heads and maybe see a doctor once on the while. The latter has just been made more difficult as Walmart cut employee health benefits while hypocritically getting into thehealthcare business.
Walmart has increased stores and profit while they’ve actually cut their workforce. The result was predictable: longer checkout lines, less customer service throughout the store, and overall disarray. Walmart consistently places last among department and discount stores in the American Customer Satisfaction Index and has either tied for or been in last place for the 6 years running. But hey: low, low prices.
Walmart workers labor under the threat of intimidation and retaliation for complaining about working conditions or wages. They work on holidays—they must. Walmart has ingeniously figured out a way to not pay their employees holiday overtime. Employees must wear “uniforms” which, naturally, they can buy at Walmart. How convenient!
Walmart pays their workers such a low-wage that U.S. taxpayers pay an estimated$6.2 billion in public assistance, which includes food stamps, Medicaid and subsidized housing. A single Walmart “cost taxpayers between $904,542 and $1.75 million per year.” According to the Americansfortaxfairness.org, “The company, which is number one on the Fortune 500 in 2013 and number two on the Global 500, had $16 billion in profits last year on revenues of $473 billion. The Walton family, which owns more than 50 percent of Walmart shares, reaps billions in annual dividends from the company. The six Walton heirs are the wealthiest family in America, with a net worth of $148.8 billion. Collectively, these six Waltons have more wealth than 49 million American families combined.
Costco—winning customers over by putting people before profits

Costco, the second largest retailer behind Walmart, is at the other end of the spectrum. Costco is closed on Thanksgiving. And Easter, Memorial Day, Labor Day, Independence Day, and of course, Christmas Day (but not Hanukkah—that’s eight days!) Would they make more money if they were open those days? Of course, but they care more about their employees than their profit. What are they thinking?
Voted the #1 company to work for, Costco has a full spate of employee benefits.Eighty-eight percent of Costco employees have company sponsored health care, for which the company covers 90% of the cost. I can feel the commitment and workplace satisfaction when I need help from their staff. In that way Costco reminds me of Home Depot. Perhaps that’s why their employee turnover rate stands at a paltry 12 percent—unheard of in retailing. Recession in 2009? Costco handed out raises.
Costco doesn’t see its employees as an expense as much as an investment. It’s known for treating employees well. Some say great. The CEO, W. Craig Jelinek, doesn’t create an atmosphere of intimidation, just the opposite. In fact all of the doors at Costco headquarters in Issaquah, Washington, remain open. Colleagues can literally walk up to him and have a conversation.
Costco went public in 1985, and over the years, Wall Street repeatedly asked it to reduce wages and health benefits. They instead boosted them every three years. How has this fairness to its employees affected the bottom line? The stock price hasdoubled since 2009.
Will this kind of success send a message to businesses in this country that treating your employees with kindness, fairness and dignity and allowing them to make a living for their families makes good business sense?
It will if you shop at Costco instead of Walmart.
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Canada's #1 food brand, President's Choice®, removes all artificial flavours and artificial colours

BRAMPTON, ON, Oct. 29, 2014 /CNW/ - (TSX:L) – Loblaw Companies Limited has successfully achieved its pledge to remove all artificial flavours and artificial colours from the full range of more than 4,000 President's Choice® brand products. In recent years, these additives have been associated with consumer concerns around hyperactivity, allergies, and various other serious conditions and diseases*.
In 2012, the company began its journey to strike from its ingredient lists all flavours and colours created by chemical synthesis. Due to the brand's long-standing high standards for ingredients, most President's Choice® products were already free of these additives. Others have since been reformulated. Many products presented significant challenges – particularly in categories like candies, desserts, ice creams, and entrees where bright colours and unique flavours are the norm. Today, all President's Choice® production is free of artificial flavours and artificial colours.
"For thirty years, President's Choice has been at the forefront of Canadian tastes and food interests," said Galen G. Weston, Executive Chairman and President, Loblaw Companies Limited. "By removing all artificial flavours and artificial colours we are proudly carrying on that leadership role."
More than 4,000 products sell in Loblaw's various retail banners under the President's Choice® brand – the number-one consumer packaged goods brand in Canada. Loblaw has consistently used the President's Choice® brand to leadCanada's food and grocery industry, driving new tastes and flavours as well as a range of commitments around sustainable seafood, animal welfare, sodium reduction and the now the elimination of artificial colours and flavours.
This latest President's Choice® innovation is celebrated in a television ad, currently airing, which features colourful food images, and concludes with Galen G. Weston in the President's Choice® test kitchen, proclaiming: "Food is colourful enough. That's why, as of now, no President's Choice products will be produced with any artificial flavour or artificial colour. Not one."
The ad is part of a new era of President's Choice® defined by a new rallying cry – CRAVE MORE – which encourages Canadians to expect more of their food.
* Centre for Science in the Public Interest, 2014
About Loblaw Companies Limited
Loblaw Companies Limited is Canada's food and pharmacy leader, the nation's largest retailer, and the majority unitholder of Choice Properties Real Estate Investment Trust. Loblaw provides Canadians with grocery, pharmacy, health and beauty, apparel, general merchandise, banking, and wireless mobile products and services. With more than 2,300 corporate, franchised and associate-owned locations, Loblaw, its franchisees, and associate-owners employ approximately 192,000 full- and part-time employees, making it one of Canada's largest private sector employers.
Loblaw's purpose - Live Life Well - puts first the needs and well-being of Canadians who make one billion transactions annually in the Company's stores.  Loblaw is positioned to meet and exceed those needs in many ways: convenient locations; more than 1,050 grocery stores that span the value spectrum from discount to specialty; full-service pharmacies at more than 1,250 Shoppers Drug Mart and Pharmaprix locations and more than 500 Loblaw locations; no-fee banking with PC Financial; affordable Joe Fresh fashion and family apparel; and three of Canada's top consumer brands in Life Brand®, no name® and President's Choice®. Through the PC Plus™ and Shoppers Optimum® loyalty programs, more than one in every three Canadians are rewarded for shopping with the companies.  For more information, visit Loblaw's website at www.loblaw.ca and Loblaw's issuer profile at www.sedar.com.
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Denny's Is Suddenly Cool Again

  • OCT. 28, 2014, 3:19 PM
Denny's just reported its highest quarterly same-store sales growth in more than two years.
The diner chain is now on track to achieve its best annual same-store sales increase in eight years. 
Denny's turnaround is a bright spot in the fast food industry, which has been plagued by declining traffic over the last several years. 
Here's what Denny's has been doing to win back customers.
1. The company has been remodeling restaurants to support a rebranding campaign. In the first three quarters of the year, Denny's had completed 129 remodels, Denny's President and CEO John Miller said in a call with analysts Monday. Within the next four years, 70% of the Denny's 1,289 restaurants will be updated.
"The remodels have boosted same-store sales and traffic, resulting in mid-single-digit gains, despite the challenging economic environment," Miller said in a third-quarter earnings call with analysts.
2. Denny's has simplified its menu and added healthier options. 
"We rolled out a new core menu which included two premium sandwich entrees with new high quality 7-grain bread in addition to over 20 other menu changes for simplification and for margin improvement," Miller said.
3. The company is rolling out a millennial-focused fast casual concept on college campuses called The Den.
The Den's menu, which is smaller than Denny's traditional menu, offers breakfast all day, gourmet burgers, burritos, sandwiches and salads.
The company now has seven Den locations and four set to open soon.
Denny'sEugene Gologursky/Getty Images for Denny’sDenny's in New York City.
4. McDonald's prices have been increasing, which may be benefiting Denny's, IHOP and other rivals that have historically been more expensive than McDonald's. 
McDonald's said its prices increased 3% through the end of June compared with the previous year, Bloomberg's Leslie Patton reports. 
A Double Quarter Pounder with cheese, fries, and a drink now totals about $7.50 at some Chicago locations, Patton writes.
That's too costly for customers like 58-year-old Mark Hiner, who told Patton he no longer takes his grandsons to McDonald's, instead visiting rivals like IHOP, Denny's, and Chili's.
"Those meals are the same price," Hiner told Patton. "And they’re better."
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Cash-Strapped Americans Are An Ominous Threat To Retailers

  • OCT. 30, 2014, 2:05 PM
Wal-Mart shopperReuters

Americans aren't shopping like they used to. 
Low-income and middle class retailers including Wal-Mart, JCPenney, Target, Macy's, and Family Dollar have reported disappointing earnings this year. 
Executives at these retailers say that Americans are increasingly unwilling to spend money on discretionary items, despite modest gains in the job market. 
"Low-end and middle-income retailers are still suffering because people are buying so close to need," Brian Yarbrough, consumer analyst at Edward Jones, told Business Insider. "In the past, retailers could depend on people spending a little more." 
The Federal Reserve Board reports that all groups of consumers had a lower mean income in 2013 than they did in 2007. Mean wealth also declined for all the groups. 
Yarbrough said that even fluctuations in the weather can make a big difference for retailers, like JCPenney, which recently said that unseasonably warm weather was hurting sales of its fall fashion assortments. 
"Today's consumer is waking up when its 35 degrees and realizing it's time to buy long sleeves or a winter coat," Yarbrough said. "They're not going to spend the money before they absolutely have to."
Macy's CEO Terry Lundgren has said that customer malaise is hurting his business. 
"The consumer has not bounced back with the confidence that we were all looking for," Lundgren said at the Goldman Sachs Annual Retail Conference, weeks after the company reported sluggish second-quarter sales. 
Lundgren also said he doesn't expect things to get better in time for the holiday season. 
"The performance I think we had in the second quarter, and we expect to have in the second half, is going to be a continuation of what we’ve been able to do over the last several years — and that is to capture market share and get the most out of the consumers that are in our stores," he said. 
macy's black fridayKim Bhasin / Business InsiderMacy's CEO Terry Lundgren has said that consumers aren't recovering.

Earlier this year, Family Dollar CEO Howard Levine said that economic conditions were worsening for his shoppers. 
"The low-end consumer has not benefited in this recovery at all; in fact I think (they) have slipped further back," Levine said. 
Even Wal-Mart is acknowledging that its customers are becoming choosier about how they spend.  
Wal-Mart CEO Doug McMillon recently told investors that the brand has a renewed focus on offering the cheapest products. 
"Price matters to our customers and it always will," McMillon said. "As a company, being a low cost operator is in our DNA. This will never change and we will be the price leader, across a broad assortment, everywhere we operate."
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We Tried The Meatless Burgers And Nuggets Coming To Restaurants Near You

  • OCT. 30, 2014, 2:13 PM
The meatless movement is on the rise.
Sales of meat alternatives in the US rose to $553 million in 2012, up from $513 million two years earlier, according to market-research firm Mintel.
Meanwhile, Americans' per capita consumption of meat and poultry has declined more than 9%, from 221.6 pounds in 2007 to an estimated 200.8 pounds this year, according to the USDA.
Dozens of well-financed startups are battling each other to capture America's growing population of plant protein-seekers, including Beyond Meat, Impossible Foods and Hampton Creek, the Wall Street Journal reported earlier this month. 
One of the brands at the head of the pack is five-year-old Gardein, which is based out of Canada.   
Gardein expects to generate retail sales of $100 million this year, the company's founder and president, Yves Potvin, told Business Insider. That makes it one of the top five meatless brands in the country, according to sales estimates by Mintel. 
The company's meatless meatballs, beefless tips, chick'n tenders and two dozen other products are sold at roughly 22,000 grocery stores and restaurants across the country. Gardein's products are also served in the cafeterias of more than 70 college campuses and at the corporate headquarters of Yahoo!, Google, Microsoft and AOL.
GardeinBusiness Insider/Hayley Peterson
"Restaurants is one of the fastest growing segments for us," Potvin said, noting that Gardein expects to double foodservice sales next year. 
More than a dozen Gardein products are offered at Yard House, a chain of 60 restaurants owned by Olive Garden parent company Darden Restaurants, and Lyfe Kitchen, a fast-growing chain launched by two former McDonald's executives. 
The diner chain Johnny Rockets, which has 300 locations around the world, just launched a test menu with Gardein products and the company is also in talks with Chili's, which has more than 1,500 restaurants, Potvin said.
Surprisingly, vegetarians and vegans don't make up a majority of Gardein's consumers. Most of the company's consumers describe themselves as flexitarians, which means they eat a primarily plant-based diet supplemented by occasional meat consumption. 
"Many people are just incorporating Gardein into their diets to diversify their protein," Potvin said. 
For the purposes of this story, I tried some of Gardein's newest offerings from the frozen aisle. I'm a meat eater and I don't typically eat frozen foods so I didn't have very high expectations.
I ate the Beefless Sliders, the 7-Grain Crispy Chick'n Tenders, and the Golden Fishless Filets. 
Here's a look at the chick'n tenders (left) and the fishless filets (right).
GardeinBusiness Insider/Hayley Peterson
After more than 20 minutes in the oven, the tenders and filets were hot and crispy. I took a bite of each and was shocked at how closely they mimicked the taste and texture of chicken and fish.
Here's a close-up of the fishless filets.
GardeinBusiness Insider/Hayley Peterson
After a couple more bites, the filets and tenders started to taste pretty similar to one another, however, and the chicken tenders started to dry out too much. They were much better with some ketchup. 
In the future, I would add the filets and tenders to a salad instead of eating them alone.
I was more impressed by the beefless sliders. 
Here's a look at the sliders after they have been warmed in a microwave.
GardeinBusiness Insider/Hayley Peterson
They don't look particularly appetizing, but they tasted great.
GardeinBusiness Insider/Hayley Peterson
I could taste onions and seasoning and again, the texture was surprisingly close to meat.
I also liked that I could pronounce all the ingredients listed on the back of every package.
GardeinBusiness Insider/Hayley Peterson
The calorie counts and sodium levels are pretty reasonable, as well. 
Every two tenders, for example, is 100 calories and contains 240 milligrams of sodium and 8 grams of protein.
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Digital disruption, emerging technologies to drive retail revenue in 2015

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Oct. 30, 2014
Innovating the customer experience to adapt to shifting consumer preferences and emerging technology capabilities will be top of mind for leading retail brands in 2015, according to predictions by real-time omnichannel personalization firm Certona.
"The retail industry is at a tipping point, as customer experience claims a greater influence over retail conversion than any other business process or output," Certona CEO Meyar Sheik said in a statement. "However, improving and personalizing the customer experience requires the right mix of new technologies, processes and strategies designed to address the changing marketplace of consumer demands and needs."
According to Gartner research, "In many industries, hyper-competition has eroded traditional product and service advantages, making customer experience the new competitive battlefield. Competitors and alternatives abound and product innovation is subject to accelerating commoditization. Customer experience innovation remains the secret to lasting brand loyalty."
With the increasing power of the consumer and resulting disruption of traditional business operations, Certona predicts the following changes across the retail industry in 2015:
  • E-commerce, m-commerce and in-store commerce will evolve closer into simply commerce. The battles between brick-and-mortar stores and digital channels such as Web and mobile will abate, and instead, each channel will be designed to direct the customer down the most likely path to conversion.
  • Access to APIs will pave the way to more personalized consumer experiences: Merchants will actively pursue open APIs to develop more predictive apps that allow sharing of information and leveraging new functionality in real time to better personalize the user experience.
  • Discounts will be in high demand by customers, threatening retail margins. Retailers will be forced to offer discounts and free shipping to meet consumers' demands during the peak shopping season. However, retailers will also have the opportunity to make up the gap in revenue with personalized offers and recommendations. Ultimately, this will allow brands to deliver in-demand discounts, while recovering margins through recommended add-ons.
  • Customer data will claim its position as a company's DNA. Businesses with datacentric cultures will thrive, while companies that ignore the discipline of data science will lose to competition.
  • Mobile device makers revamp hardware and software strategies to specifically cater to mobile commerce. In response to consumer demand for streamlined commerce, device makers will make strategic decisions based on improving geotargeting, integrating payment technology, user authentication, messaging and inter-app communication.


Certona is a provider of real-time omnichannel personalization for brands including Charlotte Russe, GameStop and Steve Madden.
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