Not too long ago, the sales of private label products stood as a useful barometer for food retailing and the economy in general. When the economy was in decline, which caused a drop in food sales, private label sales increased and the sales of branded goods dropped. When the economy improved and food sales picked up, spending shifted from private label goods to branded product. Seems logical, right? The reason for that phenomenon is obvious at face value: Private label product is seen by consumers as an economical and satisfactory substitute …
Big Three Set the Table for the Future of Food
As food retailing's big three go, so goes all of food retailing. That's not as extravagant a claim as it might seem. Walmart, Kroger and Albertsons together sell the vast majority of all food and related consumables in the nation. And all three are all on the move in response to competitive pressures, and are leading their competitors in many ways. The smaller brands will play catch-up if they can, or risk withering away. Forces driving these three operators are well known: Amazon, discounters and the worry that direct-to-consumer food …
Meal Kits Move to Blended Retail
A strange thing happened to Blue Apron on its way to an IPO, and then in its aftermath. The whole experience for Blue Apron was an economic misadventure, which tells us a lot about the future of the entire meal-kit business, plus retailing in general. It was more than a year ago that Blue Apron - once the favored practitioner of the meal-kit business - launched an IPO at $10 per share. Regrettably, the timing of the offer was far from propitious. There were already indications that Blue Apron was in for a rough ride. Chief among them was the …
What Will Happen When 3000 Amazon Go Stores Open?
The Amazon Go concept is innovative enough that it may prove to be a highly disruptive force. Yet, it might be a little too soon for anyone in established food retailing to despair. Nonetheless, let's take a closer look the Amazon Go stores and whether there's much chance that thousands of them might really spring up. As is well known, the Amazon Go stores are brick-and-mortar units, embed with high tech. Their main claim to fame is that they're cashier-less. Video and AI detect the products shoppers pull from the shelves; costs are …
Kroger’s Little Car Experiment
Every now and then news crosses my desk that seems so unlikely that I suspect it might be a hoax. Of course, that happens with alarming frequency when it comes to political news, but in this instance, I’m referencing business news. Specifically, I was startled by the news that supermarket operator Kroger and Nuro have formed an alliance aimed at using driverless cars to deliver groceries. Maybe that’s possible, but there are many challenges standing between such an idea and its realization. Conversely, I recall many aspects of technology …
The Amazon Effect on Whole Foods
It has been almost exactly one year since Amazon made its stunning buyout of specialty grocery retailer Whole Foods Market for $13.7 billion. So, what better time than now to take a look at how the whole thing is proceeding. It’s difficult to assess with great precision whether sales and profits at Whole Foods have risen or declined under Amazon’s ownership. As a publicly held company, Amazon doesn’t break out results for its subsidiaries, so we’re left to surmise a lot. Thus, I would surmise that Whole Foods is probably performing a little …
Why Walmart Sold Asda
In an unfortunate lapse of judgement, Mike Coupe was caught on a hot mic crooning the ditty made famous by the musical 42nd Street,” We’re in the money, the sky is sunny, let’s lend it, spend it, send it rolling along,” as he prepared for an interview by the UK’s ITV television network. Coupe is the CEO of the British supermarket chain Sainsbury’s that had just acquired a controlling interest in Asda from competitor Walmart. He was in the television studio to discuss the deal. And Coupe was in the money too. The value of the Sainsbury’s …
Success Eludes Lidl
What happens when an abundance of ambition meets empty execution? The result might be called “Lidl.” The truth is that Lidl, the discount grocer from Germany, has been opening stores in the U.S. for nearly a year now, but has failed to demonstrate anything close to what it set out to accomplish. The lack of clear success certainly isn’t for want of deep pockets. Lidl is a unit of Schwarz Gruppe, a huge company that operates some 10,000 stores in 26 countries other than the U.S. It’s well established as one of the largest food retailers in …