Promoters of a vegan lifestyle, such as The Vegan Society and others, not only point to the health benefits of eating vegan but also to its Green benefits. Among the Green benefits of a vegan lifestyle, they point to the fact that it takes much less land to produce vegetables than it does to produce animals for meat.
Wednesday, October 31, 2007
Promoters of a vegan lifestyle, such as The Vegan Society and others, not only point to the health benefits of eating vegan but also to its Green benefits. Among the Green benefits of a vegan lifestyle, they point to the fact that it takes much less land to produce vegetables than it does to produce animals for meat.
Tuesday, October 30, 2007
The Hemet, California Fresh & Easy Neighborhood market is located at 1709 West Florida Avenue. If you are nearby, check it out and let us know if the store is open.
British retailer Tesco is building one of its Fresh & Easy Neighborhood Markets on Hollywood Boulevard, right along the iconic Hollywood Walk of Fame. (You can see the "stars" on the sidewalk in front of the "coming soon" sign in the photograph above.)
The sidewalk stars, depicting famous Hollywood movie, television, radio and other show business personalities, stretch along the sidewalk on Hollywood Boulevard from Gower Street to La Brea Avenue, and along nearby Vine Street, from Yucca Street to another famous street-- Sunset Boulevard. Millions of tourists visit the neighborhood each year.
Locating one of the upscale, Fresh & Easy Neighborhood Markets on The Hollywood Walk of Fame is a brilliant move by Tesco. First, it's a very busy location. During the day the area is filled with workers, tourists and others, and at night the neighborhood is packed with people having dinner, going to a club or other venue, and generally congregating. There's lots of street life and activity in the area day and night.
Building the store in the neighborhood also is a smart move from a marketing and publicity standpoint. The neighborhood is home to the Kodak Theatre, where both the Academy Awards and Emmy Awards are held annually. The theatre also hosts entertainment performances and events nearly every night.
Next to the theatre is the upscale Hollywood & Highland Center, a mixed-used shopping, dining, residential and entertainment lifestyle center. It draws ten of thousands of people day and night to the neighborhood.
World famous Grauman's Chinese Theatre is located on Hollywood Boulevard. Millions of tourists visit the famous movie palace each year. Additionally, the Hollywood Chamber of Commerce hosts two or three celebrations each month on The Walk of Fame, in which they award and unveil a new sidewalk star for a showbiz celebrity. These events are attended by thousands and covered by the international print and broadcast media.
Having a Fresh & Easy store at this high profile location will reap huge media attention for the brand and for Tesco, in addition to providing what we believe will be excellent sales opportunities for the retailer. The fresh, prepared foods and natural and specialty foods focus of the Fresh & Easy format will be hugely popular in this location. The neighborhood demographics couldn't be better overall.
There's no word when the Hollywood Walk of Fame Fresh & Easy Neighborhood Market will open. The store still has considerable construction to be completed so we doubt if it will open until sometime near the end of the year at the earliest.
Note: Photograph curtesy of our friends at the Curbed LA blog
Monday, October 29, 2007
The group says "Wal-Mart and it's addiction to cheap, unsafe Chinese goods has been all over the news recently. This month, at least 40 people were sickened with the kind of tainted beef sold at Wal-Mart stores, prompting the second largest beef recall in history. Toxic chemicals like melamine have been found in Wal-Mart's pet food, and its shelves are stocked with lead-laced children's toys," the group says.
"It sounds like a cheap horror novel but, unfortunately, its all true," the group says on their website in introducing the Tales From the Big Box Boneyard feature. Further, they say "The situation is critical, and now is the perfect time of the year to spread the word. So, in keeping with the spirit of Halloween, and Wal-Mart's terrifying product safety record, we've decided to host a feature called Tales From the Big Box Boneyard.
Wakeup Walmart.com is encouraging consumers to write them at the website with their most disturbing Wal-Mart horror stories. After Halloween the group will feature what they deem to be five of the most "ghastly tales" (and their authors) on their website. Wal-Mart shoppers can post their comments/stories at a link on the website here.
The group says they aren't looking for anything specific in terms of the stories but "the more shocking, terrifying and stomach turning the better," they add. "It is Halloween after all, and we know there is no shortage of horror stories from the aisles of Wal-Mart," Wake up Walmart.com says. Ouch.
As an example of their assertion, the group has a dozen articles culled from recent newspapers posted on their website, which they say more than proves the point that there's no shortage of Wal-Mart product and other horror stories out there. Not all of the 12 stories the group has posted are about dangerous product purchases at Wal-Mart stores. Some involve political or other social issues as well.
We will share the group's first example with you. It's a product safety issue example, to say the least. Then you can go here if you want to read the other examples the group has posted on its website.
Below is one example from the group's website, taken from an article in the Salt Lake Tribune newspaper (10-02-07). We've fact-checked the quotes we used below from the Wakeup Walmart.com website against the original Tribune article. We have corrected anything from the group's website that isn't properly attributed from the Tribune article. (See our note after the article quote below.)
From: Salt Lake Tribune, 10-02-07, "That's Not Ratatouille: Utah woman finds rodent head in her can of green beans." Story summary below:
"Earlier this month, a Utah woman was preparing lunch for her children when she noticed something peculiar floating in the green beans she had bought from Wal-Mart. It was the severed head of a mouse.
No, it's not Stephen King's remake of the Pixar classic. It actually happened to Marianne Watson. 'I'm quesy just talking about it,' she said in an interview with the Salt Lake Tribune. 'Thank goodness it ended up on the top and not the bottom, so I didn't serve it [to my family].'
Now, her refrigerator is a makeshift morgue where she keeps the frozen head of the offending mouse, as the matter could take up to two years to be fully resolved.
Fair and Balanced notes:
>Wal-Mart spokeswoman Diesha Galbeth told the Tribune, "food safety is a top priority, and we are investigating this situation thoroughly. Our store has inspected similar product on our shelves and feel confident that this complaint is an isolated incident."
>The green beans, packed and marketed by Allen Canning, were in a can. As such Wal-Mart couldn't know there was a rodent head inside. Allen Canning is an American company and says the canned green beans in question were grown and canned in the U.S. and not in China or any other foreign country.
>Wal-Mart representatives have talked with Ms. Watson about the situation.
>Ms Watson says in the Tribune story she would consider shopping at Wal-Mart again, but doubts she would buy the Allen brand. "Until I'm reassured that it's just an isolated incident, I won't," (buy the Allen brand) she says. On their website, Wakeup Wal-Mart.com has changed this quote (either by omission or intentionally) from the Tribune story.
On their website they print: "When asked if she would consider returning to Wal-Mart, Watson said, 'Until I'm reassured that it's just an isolated incident, I won't.' " That's not what Ms. Watson said to the Tribune, as our quote taken directly out of the Tribune story shows. In fact, the way Wakeup Walmart.com has changed it (either by omission or on purpose, we'll let you be the judge) changes the meaning of Watson's words. She said she would consider shopping at Wal-Mart again. Not that she won't, as the omission or changes on the WakeupWalmart.com website say.
Because of this omission or intentional quote change on the group's website, we checked all of the quotes we used above against the actual story in the Tribune. We've used only those quotes that we verified from the original Tribune article.
We suspect Wal-Mart would prefer something other than this feature from the group as a Halloween surprise. And, as our readers know, and what a quick "Wal-Mart" search in our blog "search box will show, is that we write positively about Wal-Mart often as well as being critical when we feel it's warranted.
We generally give the retailer high marks for its environmental initiatives, overall retail pricing structure, new focus on natural and organic foods and some other issues. However, we also aren't here to shill for anybody, and we don't. In the case(s) of it's Chinese imported products policy, its employee wages and benefits policy, and a number of other issues, we give Wal-Mart low grades. There's much room for improvement, and we take every opportunity to encourage the mega-retailer to do so.
In the case of the abundance of imported Chinese goods with lead content, we simply say to the retailer: "For heaven's sake use your huge buying power and position as the world's number one retailer to get the lead out." There's no excuse for so many lead-based products in Wal-Mart stores. If Chinese products have lead, just don't buy them and offer them for sale. Imagine if a U.S-based manufacturer tried to sell a Wal-Mart buyer a product, such as a child's toy, that contained lead? We think Wal-mart would likely ban that vendor from its Arkansas buying offices once the lead content in the product was discovered.
We aren't a member of nor do we support or not support Wakeup Walmart.com. We're neutral on the group. We're merely writing about their side of the issue and balancing it with Wal-Mart's side as we did in the case of the rodent head in the canned greens beans story above.
In our view zealots on either the left or the right are very seldom right. We prefer reasoned discussion and thought. (We aren't saying anyone here is a zealot by the way.) As such we like to bring both sides of an issue to the table when possible. Wakeup Walmart.com has some very valid points (but also tends to criticize Wal-Mart using a very broad brush overall), and sometimes it takes a feature like the group's Tales From the Big Box Boneyard to stimulate action and get a response from a huge corporation. As such, we hope the group is willing to enter into a reasonable dialogue with Wal-Mart rather than merely bash the retailer if that opportunity arises. Also, we think Wal-Mart should be open to talking with the group if that conversation can be open, civil and reasonable.
Meanwhile, we expect there will be some interesting stories posted on Wakeup Walmart.com's website after Halloween. In closing, I hope we don't seem too trite after writing this piece to, in the spirit of Halloween, say: "Trick or Treat."
Last week the U.S. Federal Trade Commission (FTC) filed an appeal with the U.S. Federal Court for the District of Columbia seeking to block the acquisition of Wild Oats Markets, Inc. by Whole Foods Market, Inc. even though Whole Foods is well on its way to merging the former supernatural retailing rival it acquired into its corporate culture and retail operations.
At the end of August, 2007, the U.S. Federal Court in Washington D.C. approved the merger despite an original objection filed by the FTC (which was dismissed by a federal judge) and an appeal after that, which the same judge also dismissed, ruling in Whole Foods' favor at the time, and paving the way for the acquisition/merger to go through.In their August appeal, asking for a temporary injunction against the merger, the FTC sighted anti-competitive arguments for not allowing Whole Foods to acquire Wild Oats. Essentially the FTC argued the merger/acquisition would result in a serious lack of competition in the supernatural grocery retailing sector by giving Whole Foods a monopoly over the selling of natural and organic grocery products in the category.
In its ruling, the United States District Court for the District of Columbia rejected this argument by the FTC. The court said that "premium natural and organic supermarkets (how the FTC refers to Whole Foods and Wild Oats) was not a relevant product market. A relevant market is one in which a hypothetical, multi-store monopolist , owning all stores in the category (and eliminating competition among them), would raise prices," the court stated in its ruling. Based on a number of economic studies it reviewed the court said a Whole Foods/Wild Oats' merged company would not meet its test of a monopolist, and as such it ruled against the FTC's August, 2007 pre-merger appeal and for Whole Foods. ( you can read the D.C. federal court's ruling here as well as testimony from FTC experts and Whole Foods and court experts here.)
However, almost two months after the federal court ruling in favor of Whole Foods, and over a month after the supernatural grocer first began integrating Wild Oats' operations and stores into the Whole Foods retailing system, the FTC is back with an unusual new appeal. The appeal is unusual in that the federal regulator very seldom, if ever, has filed a new appeal once the federal court has made a final ruling on an acquisition or merger, and once the acquiring company is well on its way to integrating the purchased company into its operations.
This time around the FTC is still arguing against the merger based on anti-trust grounds, saying the deal will stifle competition and raise prices. The FTC is sighting what it says its research demonstrates is a high estimated "diversion ratio" between Whole Foods banner stores and Wild Oats stores. In other words, when Wild Oats goes out of business, 50% of its customers automatically go to Whole Foods stores, the FTC says. This means a "diversion ratio" of half, which economists say is very high, if true. The FTC sights this argument as evidence of anti-competition, saying the 50% "diversion ratio" figure amounts to a monopoly in the supernatural retail grocery category. The commission also argues this "monopoly" will then result in Whole Foods eventually raising prices.
This argument was used by the FTC however (along with expert testimony) in its original appeal, so we're hard pressed to see why the commission thinks it will work with the court this time around, by merely giving it more weight and emphasis. Most anti-trust legal experts agree with us, saying it's highly unlikely the FTC will be successful with their new appeal.
Last Monday, when the FTC filed its latest case, it said a new appeal also is warranted in part because Whole Foods continues to operate many of the Wild Oats stores separately. We really aren't sure what significance the FTC puts in this fact.
First off, Whole Foods has only been integrating the Wild Oats stores into its retailing system for about a month. Some Wild Oats stores are being rebranded as Whole Foods stores, others are being closed, a number still have the Wild Oats banner, and some are even getting new names, like a former Wild Oats store in Boulder, Colorado (Wild Oats' former corporate headquarters), which Whole Foods has rebranded as Alfalfa's Market, a name the grocer obtained the rights to in the acquisition. (Alfalfa's was a popular Boulder-based chain of natural foods stores that Wild Oats acquired in the 1990's.)
Second, Whole Foods has told its stockholders it plans on changing most if not all of the Wild Oats banner stores remaining to the Whole Foods banner--and a few more to banners like Alfalfa's when it makes marketing sense. Public corporations aren't likely to tell their shareholders facts like this unless they mean it. There's no upside to doing so for Whole Foods. Lastly, even if Whole Foods keeps a number of stores under the Wild Oats banner, so what. Food retailers create and eliminate store banners/brands all the time. The Wild Oats brand is intellectual property Whole Foods acquired in the merger and we see nothing wrong with them using the name in any manner the grocer sees fit to do.
We don't understand how still having stores operating under the Wild Oats banner is evidence of anti-competitive behavior or "price raising," which are the FTC's chief arguments from an anti-trust perspective against the merger. Is the FTC saying Whole Foods' continuing to operate stores under the Wild Oats banner is part of a master plan by the grocer to acquire its rival but keep stores under its name because they believe they can control the category by having both? Doesn't make since. Wouldn't work if the grocer wanted it to.
Let's examine the logic (or lack thereof) of the FTC's argument. First, the FTC is saying Whole Foods already is a monopolist because of the merger. As such store names should hardly matter. Second, Most companies pay a premium in an acquisition because of the brand equity a company offers. In fact, seldom does an acquiring company eliminate the brands it obtains in a acquisition at all. Therefore, the FTC argument just doesn't make much sense. And it surely isn't the basis for an new appeal in our view. We asked for some elaboration from the FTC but they aren't commenting on the appeal; not even to the New York Times and Wall Street Journal, according to editors at both papers.
Whole Foods Market, Inc. has filed a motion, asking the D.C. appellate court to dismiss the FTC case as moot because the two companies (Whole Foods and Wild Oats) completed the merger transaction on August 28, 2007 after being given the green light from the federal court. The FTC is asking the appellate court for an expedited review. Most anti-trust lawyers are saying the appeal is considered a long shot. We agree.
We also think this dog is long dead and that the FTC should spend its time on more productive and important endeavors. The natural, organic and premium food and grocery industries are moving so fast, and are far too dynamic, for Whole Foods to gain a monopoly. There are far too many retail formats--with more coming online seemingly every month--to allow Whole Foods to stifle competition and raise retail prices on category products in any significant way.
Additionally, Whole Foods has an organized consumer opposition movement that refers to the grocer as "Whole Paycheck," among other negative epitaphs. Should the grocer raise its retail prices more than a couple percentage points at any one time, based on the natural increases in cost of goods, inflation and the like, it will find itself with an "anti Wal-Mart type" opposition movement, which is the last thing Whole Foods wants, especially post the Wild Oats acquisition. In other words we think the market as it is at present will be an strong enough check on Whole Foods' retail pricing behavior.
Does Whole Foods benefit having acquired Wild Oats? Yes. Does the grocer benefit to the extent it will allow it to be a monopolist? No. Whole Foods now owns the supernatural retailing category. We have no doubt of that. However, the point is that there are plenty of other retail formats--upscale national, regional and independent supermarket chains, mass merchandisers like Wal-Mart and Target, Trader Joe's and the many similar specialty grocers in the U.S., and more--where natural, organic and premium foods and grocery products can be purchased by consumers. Whole Foods may own the supernatural retailing category, but it doesn't own anywhere near the exclusivity in retail sales of products in these categories.
In fact, the supernatural retailing category is slowely blurring and going away. Why? Two reasons. First, the channel-blurring between natural foods supernatural stores, supermarkets, mass merchandisers, specialty grocers and others who sell natural and organic foods is making the supernatural category less relevant. In the past, when the only places a shopper could find natural and organic foods was at Whole Foods, Wild Oats or other natural foods stores, the category had meaning. Since that's no longer the case today--you can even buy a limited assortment of natural and organic foods at drug stores and traditional convenience stores--the entire concept of the supernatural category is being turned on its head and being rendered less meaningless and significant.
Second, the retail food industry is constantly evolving. New formats like Tesco's Fresh & Easy Neighborhood Markets (upscale, convenience-oriented grocery markets featuring fresh, prepared foods and natural, organic, basic and specialty groceries), Trader Joe's new larger stores with more fresh natural and organic foods, H.E.B's huge new 112,000 square-foot Cypress Market banner (which carries as many natural and organic groceries as a Whole Foods store), Safeway Stores Lifestyle format (which is evolving into a Whole Foods-like store but with basic groceries as well), and many others, are constantly redefining food retailing.
In an industry as fast moving as natural, organic and premium food marketing and retailing, there really isn't much time for a retailer like a Whole Foods to become a monopoly. The fact is, only a month or so after the merger, Whole Foods is already looking over its shoulder at the food retailers mentioned above, and many others. It's a dynamic industry. And the next hot format (or more likely format combinations) could change the retail landscape considerably.
Whole Foods also is considerably smaller than most supermarket and mass merchandising chains that sell natural, organic and premium foods. Safeway, Kroger and Supervalue, for example, are five to six times the size of Whole Foods in terms of gross sales and store count. H.E.B., Publix, Wegmans (and a number of others), all upscale grocery chains and major players in the natural and organic grocery retail space, are two to three times bigger than Whole Foods in terms of annual sales. And Wal-Mart, the world's largest retailer and a major player in natural and organic grocery sales, does over $300 billion in annual sales with stores located globally, compared to Whole Foods annual sales of about $6.5 billion.
As these huge, major food retailers (and numerous others) move more and more into natural and organic grocery retailing, as they're doing, it would be a big mistake to discount the notion that Whole Foods itself might become a takeover target. We don't think an acquisition offer or hostile attempt is on the radar screens of these mega-food retailers now or in the near future for a number of reasons. However, it's potential isn't lost on them (or not discussed behin closed doors). Nor is the potential of either a friendly or not so friendly acquisition lost on Whole Foods' management.
Saturday, October 27, 2007
On Friday, October 19 we reported here that Tesco had secured its first store location in Northern California in the Bay Area city of San Jose. That store will be located in a former Albertsons supermarket building in San Jose's Willow Glen district.
According to commercial real estate and municipal official sources we talked to, Tesco will completely renovate the building to decrease it's square-footage and make it suitable for its 10,000 to 13,000 square-foot Fresh & Easy Neighborhood Market format. These sources also told us plans call for the store to open in the summer of 2008.
Talking with the same and additional sources in the San Francisco Bay Area yesterday (10-26), we learned Tesco is aggressively looking for Fresh & Easy store sights throughout the nine-county Bay Area (including in San Francisco), as well as in other Northern California regions and in the Central Valley, which is located mid-way between Southern California and Northern California.
In addition to the San Jose location, which is a done deal according to our sources, Tesco has inquired with the East Bay Area city of Danville's Economic Development Department about possibly locating a Fresh & Easy store in that city's Green Valley Shopping Center. The shopping center in the upscale, high-income community, is currently without an anchor retail food store since an Albertsons supermarket closed there in 2006.
Jill Bergman, Danville's economic development director, recently said Tesco has talked to her about tenant improvements to the center's vacant Albertsons store but hasn't filed any applications regarding the store as of yet. Commercial real estate sources also told us Tesco has been talking with the building's owner and shopping center representatives about locating a Fresh & Easy store there.
Our commercial real estate sources also told us Tesco is busy looking in other cities in the East Bay Area, including Pleasanton, Livermore, Walnut Creek, Concord and others. They also told us Tesco is interested in a number of other empty Albertsons store buildings in that region as well as in the South Bay Area, where San Jose is, and the San Francisco Peninsula county of San Mateo.
A commercial real estate agent in San Francisco told us he recently talked to a business associate who said Tesco representatives told him they plan on opening more than one Fresh & Easy store in the city of San Francisco if they can find suitable locations in the dense, urban city.
The Bay Area and other Northern California regions aren't the only areas north of Southern California where Tesco is aggressively looking to locate store locations for its Fresh & Easy convenience-oriented grocery markets.
Last week, the Bakersfield Californian newspaper reported that Tesco is in serious negotiations with a property management firm to locate a Fresh & Easy Neighborhood Market in Southwest Bakersfield, at a shopping center at White Lane and Buena Vista Road, south of the city's Stockdale High School.
Bakersfield is located in the center of California in Kern County, about a 100 miles from Los Angeles to the south, and about 250 miles from Sacramento to the north. Tesco wants to locate the store at that particular location and has a zoning change application before the Bakersfield City Council. The change of zoning would allow retail food stores to locate in the shopping center (which currently isn't the case for some reason) and pave the way for the Fresh & Easy store there, according to the newspaper report.
Natural~Specialty Foods Memo's Analysis:
If Tesco moves aggressively into Northern California--which we believe it will based on our information and analysis--it will add an interesting competitive twist to food retailing in the region, especially in the Bay Area, which currently is home to about seven million residents.
Safeway Stores, Inc. has its U.S. corporate headquarters in the Easy Bay Area city of Pleasanton and is the food retailing market share leader in the nine-county Bay Area. Recently, Safeway has been opening up very upscale versions of its "Lifestyle" format Safeway banner stores in the Bay Area. These new stores average about 45,000 to 65,000 square-feet in size and feature numerous prepared foods offerings, including in-store restaurants, cafes with fresh baked goods and gourmet coffee, wine departments with tasting bars, gourmet olive bars, and other upscale features. Huge selections of specialty and natural groceries and expansive fresh produce departments also are part of the mix in these stores.
Whole Foods Market, Inc. also is a major upscale player in the Bay Area with about 21 stores at present. The retailer has opened three new, large natural foods lifestyle-oriented supermarkets in just the last two months, with more new stores on the way. The supernatural grocer plans to built at least 21 new stores in the next 3-5 years in the Bay Area. Upscale quality, prepared foods are a major feature in Whole Foods' Bay Area stores, like they are in Tesco's Fresh & Easy format stores.
The Bay Area also is home to numerous upscale multi-store and single store independent retailers. Many of these grocers have been national pioneers in upscale, natural and specialty foods retailing. Among these independents are Mollie Stones Markets, Andronico's, Lunardi's, Draeger's, Cosentino's, Zanotto's, Berkeley Bowl, and a number of others. All offer high quality prepared foods in their stores, which are collectively located all over the nine-county Bay Area.
Tesco's Fresh & Easy format has some major differences from these upscale supermarket and supernatural foods retailers however, despite the fact that prepared foods play a major positioning point in what all of them do. First, the Fresh & Easy format is smaller--about 10,000 square-feet--and designed to bridge the gap between huge superstores and traditional convenience stores.
Second, It's upscale, but also offers basic groceries and non-foods offerings. Fresh & Easy stores also will have fresh produce and meats, perishables of all kinds and other offerings one would expect in a neighborhood grocery store. This helps them in that they can supply basic needs to shoppers (like all the supermarkets mentioned above do) and not become just a tertiary retailer in the region.
Lastly, Fresh & Easy is non-union. All of the major supermarket chains and independents in the Bay Area (except Whole Foods and Wal-Mart) are union shops. The average retail clerk, with one year's full time experience (journey level), makes about $20.00 per hour in wages and has a full health benefits package which adds another $10-$12.00 an hour to their compensation in terms of the high-quality value of their benefits package.
However, like Whole Foods and Wal-Mart (which has only a handful of Supercenters in the region), Tesco's Fresh & Easy will be a non-union shop. With the exception of management staff, all of the retail associates in the Fresh & Easy Neighborhood Market stores set to open in Southern California, Nevada and Arizona, will be part-time. They will work at least 20 hours a week and no more than about 35 hours a week. Their average salary will be $10.00 hour, according to Tesco. Fresh & Easy store's part-time associates will have a health care policy but it will be nowhere near as good as what the unionized supermarket retail clerks have. In fact, the union retail clerks health policy is one of the best in the U.S.
We suspect Tesco to basically try to maintain their current employment policy and wage structure for Northern California, although the retailer likely will have to increase the hourly wage by at least two or three dollars an hour in order to attract employees in the Bay Area, which has a very low unemployment rate, and was recently ranked number one as the region with the highest salaries in the U.S. The Bay Area is a much more competitive labor market than Southern California, Nevada and Arizona are.
Even if Tesco has to pay two, three or four dollars an hour more, it's still at an advantage from a labor standpoint compared to the unionized retailers. Of course, the Bay Area is a heavy union region, and shoppers support union supermarkets like Safeway, Lucky Stores, the independents mentioned above, and others who pay their employees well. In fact, it's likely Tesco will be welcomed to the Bay Area with an organized campaign against their lower wages. There is such a campaign currently going on in Southern California against Tesco but its fairly small. Expect a larger, better organized campaign in the Bay Area, which is the most liberal region in the U.S.
Either way, established Bay Area retailers like Safeway and Whole Foods won't sit back and let Tesco take significant market share with its Fresh & Easy stores in the region. In fact, Safeway CEO Steve Burd has already said the chain is studying Tesco's format and is prepared to open its own Safeway convenience-type stores if the retailer believes Tesco is becoming a threat with its Fresh & Easy format in the Western U.S.
Whole Foods also is in the process of converting a former Wild Oats store in Boulder, Colorado into a new retail concept for the grocer called "Whole Foods Express." We think this development is in part a reaction to Fresh & Easy. We also believe Whole Foods won't hesitate to roll its "Express" stores out in places like the Bay Area and Southern California if they determine Tesco is taking market share from them with its upscale, convenience-type stores.
Tesco's Fresh & Easy Neighborhood Market format could do very well throughout the Bay Area and elsewhere in Northern California however. In the Bay Area's suburbs there's a huge base of time-pressed dual income families who like the concept of being able to get fresh, prepared foods, fresh produce and meats, basic, specialty and natural groceries in a fast and convenient way, without having to shop a large store.
In both the suburbs and cities like San Francisco, Oakland and San Jose, there also is a large, single professional population who doesn't cook often or at all and spends a sizable amount of their disposable incomes at restaurants and for prepared foods to go.
Trader Joe's has markets throughout the Bay Area and Northern California and is adding more stores at a rapid clip. Their smaller store, upscale format is very successful in the region. The Bay Area also is a "foodie" region. Its consumers have an appreciation and like for quality foods, and if Tesco is able to offer the same quality upscale fresh, prepared foods at its Fresh & Easy markets as it does at its stores in the UK, the offerings should go over well with the region's quality food loving population, helping to make Fresh & Easy stores a success.
Fresh & Easy Store Opening Update
Coming Up: The first six Fresh & Easy Neighborhood Markets will open at 10:AM on November 8 in Southern California cities of Los Angeles, Anaheim, West Covina, Upland, Arcadia and Hemet. Five Fresh & Easy markets will opn in the Las Vegas metropolitan area on November 14. On November 28 another store will open in the Orange County (Southern California) of Laguna. Stores will open in Arizona before the year is over, as well as additional Fresh & Easy markets in Southern California (including San Diego) and Nevada.
A Little Background Reading: This article from today's (10-27-2007) London Daily Telegraph newspaper talks about the numerous British retailers of all types who have ventured to the U.S., only to fail. As the article says, "The U.S. has long been a graveyard for UK retailers." However, in the piece Tesco says it will be different than all of the others who've ventured into the U.S. retail market, only to fail and close shop. The story provides some good background to our piece.
Friday, October 26, 2007
Since the inception of its Inland Empire name in the 1950's, the region has grown significantly commercially and in population. Beginning in the 1980's the Inland Empire started shifting from a primarily agricultural-oriented economy and region to an urban one. People flocked to the area because of its relatively affordable housing compared to communities in the Los Angeles metropolitan region and coastal Southern California.
Wednesday, October 24, 2007
The "Push-Button House" is an innovation designed by Kalkin to be used in areas where there has been a natural disaster, such a Huricane Katrina, or the current wildfires in Southern California. It's also designed for lower-income people (or anyone who wants to live in one frankly) who can't afford a traditional house but wants to own rather than rent. It's essentially a "house in a box." It comes prefabricated in a container. And with the push of a button it transforms into a living space in about 90 seconds. It has a kitchen, small dining room, bedroom, bathroom, living room and even a small library. You can read more about the "Push-Button House" and view pictures of it here.
As you can see in the pictures above and below, the "Push-Button Illycaffe" has pretty much everything a "brick and mortar" cafe would have. It's also rather attractive. We find this concept not only innovative but effective as well. Food retailers can use it to extend their brands to places they currently aren't: fairs, sporting events and a myriad of other venues. Manufacturers could use it to sell their products direct to the public, as could small start-up and artisanal food and beverage companies on limited budgets.
Whole Foods' New Market Hall Store: In mid September we wrote about the new Whole Foods Market "Market Hall" style store which was set to open in Oakland, California on September 26. The store, a first-of-its-kind design for Whole Foods, opened on the 26th to much acclaim from shoppers, suppliers and Oakland city officials. We recently read an excellent profile and review of the Oakland "Market Hall" store, which we have visited, written by Julie, a blogger for the sfist, a San Francisco Bay Area-based blog. You can read her piece on the new Oakland Whole foods Market Hall here. She has great pictures of the European-style food hall format store as well.
Columnist Dissed For Liking Whole Foods: Liberal San Francisco Chronicle columnist Mark Morford likes the new Whole Foods Market Hall store in Oakland. In fact, he likes Whole Foods in general and recently said so in his Chronicale column. (You can read the column, "Is it OK to love Whole Foods?" here.) In response to his positive column on the supernatural grocer Morford receives an email box full of angry and nasty responses from readers who have a distain for Whole Foods. These anti-Whole foods folks essentially acused Morford of "selling out" his "Liberal" credentials by giving the grocer an overall favorable nod despite having some intellegent critiques of how they do business.
Morford didn't take the nasty detractors sitting down though. He does what a writer should do. He took fingers to keyboard and wrote another column (10-12-2007) about those who dissed him for liking Whole Foods. In that column (read it here) Morford said most of the letters he recieved were in agreement with his point of view on Whole Foods or were a i reasonable and polite disagreement with his opinion. There was a segment of letters however which Morford takes off on.
These letter writers he says are absolutist, extreme and voracias Liberals. Morford asks: "Does the Extremism of some progressives spell danger to delicious evolution?" His answer: "Well, yes." But read his 10-12 column for yourself as it's witty, satirical and biting. He makes a number of larger political and social points using his writing about Whole Foods--and the "Whole-Paycheck-label-crowd's" letter-writing responses to his column--as not only the chief topic at hand but as a metaphor for the larger issues of public discourse and debate. The column is pretty humorous as well.
Now the FTC is back again, this time appealing the ruling with a new court motion designed to overturn the merger on anti-trust grounds despite the fact that Whole Foods is well on its way to integrating Wild Oats into its operations. In fact, it's this integration the FTC aims to stop with its appeal. This is an unusual move by the FTC, attempting to stop a merger not only after it has gone through, but at a point where the acquiring company is well on its way to integrating the company it has purchased into its culture and operations. You can read more details about the FTC's appeal here and here. For a satirical take on the FTC's new court filing to stop the Whole Foods' acquisition of Wild Oats take a look at this dialogue from the Wonkette Blog. The topic: "The FTC hates Hippies."
H.E.B's New Natural-Specialty Cypress Market: H.E.B's newest retail format, its 112,000 square-foot upscale Cypress Market, made its debut yesterday when the first store opened in the Cypress neighborhood in Houston, Texas. The huge store features the largest meat market (full-service and self service) in the area. It features aged prime, all-natural and organic meats. The store also has a giant fresh fish and seafood department. The department will get fresh fish deliveries seven days per week in order to ensure optimum freshness, according to H.E.B. A large selection of both wild, farmed and locally-fished seafood and fresh fish are offered in the upscale department.
The store's produce department is expansive and upscale. It features over 900 varieties of fresh fruits and vegetables, including more than 100 varieties of certified organic produce. Cypress Market also features a huge wine department which includes a temperature controlled wine cellar and tasting room. The wine department features at least 2,000 different varieties of wines from throughout the world, according to an H.E.B. executive. The store's bakery is equally as expansive and upscale. It features a wood-burning hearth oven. Artisan, craft and organic breads are baked in the bakery multiple times daily. The store also has an international cheese shop that includes a cheese aging cave. The cheese shop offerers over 400 varieties of cheeses from throughout the world.
The store also features a Central Market "Cafe on the Run," which has numerous upscale meals for takeout or catering. There also is a full-service eat-in restaurant nearby in-store. Other ser vice highlights include a tortilleria where homeade tortillas are made, an eat-in sushi bar which also offers sushi to go, a cafe/coffee bar with an in-store coffee bean roaster.
The store also has the "Cooking Connection," an in-store department staffed full time by a professional chef and assistants. The department oeprates numerous "H.E.B. Showtime Cooking Stations" located throughout the store. Store culinary professionals will interact with shoppers every day of the week, consucting over 30 in-store demos or tastings each week, according to an H.E.B spokesperson.
Specialty, gourmet, ethnic, natural and organic grocery products and non-foods play a major role in the store. The shelves are full of premium specialty, international, natural and organic groceries. There also is a large store-within-a-store natural and organic health & beauty care and nonfoods area. A "Healthy Living Department" features row upon row of natural and organic bulk foods.
H.E.B. is one of the pioneer retailers of natural and specialty foods with its Central Market format. This format inspires the specialty and natural product offerings in the Cypress Market, which takes the Central Market concept to its next level in terms of upscale, premium, natural and organic retailing. The store also offers a huge selection of basic groceries and an expanded basic non-foods offering in its 112,000 square-feet. Everything from small appliances and kitchenware (basic and upscale) to various types of furniture and other offerings. H.E.B says on of the goals is for the Cypress Market to not be just an upscale specialty market but also a complete destination retail shopping center for consumers. It is.
Mid-Week Roundup Ender
However, we aren't sure if the cuisine being offered by Britian's Famous Wild Boar Hotel restaurant might not just be taking the concepts of natural, fresh and locally procured just a little to far. The restaurant, located in Crook, near Windermere, in Cumbria UK, is preparing and serving up pancakes made from grey squirrels to diners, according to a story in the London Daily Mail (10-16-2007). And the price is right--as an introduction to the squirrel pancakes, which head chef Marc Sanders describes as "Peking duck-style squirrels wraps, the restaurant is currently offering them to diners for free as an introduction to the new dish on its menu.Head Chef Marc Sanders diplays his creation: Grey Squirrel Peking Duck-style wraps or panckaes.
The grey squirrels also are locally procured. They're caught on the hotel's 72 acre wooded grounds. Hotel general manager Andy Lemm says the grey squirrels are everywhere on the grounds. "Our diners seemed to enjoy the squirrel pancakes," Lemm told the Daily Mail, "and I thought they tasted rather nice, a bit like rabbit," he added.
Grey squirrels are killing off red squirrels in the UK. As such the reds have become an endangered species while the government has encouraged hunters and others to eliminate the greys. Britian's Lord Inglewood, a conservationist, warned Brits that the red squirrel would soon become extinct if grey squirrels are allowed to go on increasing. Red squirrels are native and the greys aren't.
Lord Inglewood also suggested one way to deal with the problem would be to foster a market for grey squirrel meat. He told Brits that Americans eat grey squirrel and even have a number of recipes for the meat, including what he discribed as the most popular dish in the U.S., Brunswick Stew, which the Lord says "is casseroled squirrel."
He wants famous British chefs like Jamie Oliver to promote grey squirrel-based dishes for school dinners. (Really, the Lord told the Daily Mail that, we couldn't make it up.)
Meanwhile, chef Marc Sanders decided to take the Lord up on his suggestions by creating the squirrel pancakes and putting them on the hotel's menu. The hotel's general manager also had a hand in the dish since he was looking for a way to help rid the grounds of the grey squirrel infestation.
Fresh, all natural, locally procured--the grey squirrels do hit all the hot buttons with today's foodies. And we must say the squirrel Peking-style pancakes do look attractive in the picture. Perhaps what was once unmentionable cuisine will become tomorrow's new trendy food dish. We're not sure though, those grey squirrels are rather cute. And a wise man once told us never to eat meat from an animal that's much cuter than you are.
We would give the squirrel pancakes a go as the Brits say. Would you? Let us know if you would in the comments link below.