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Retailers, consumers and prices

September 10th, 2009

Check Out Line: Thinking about Black Friday deals

Posted by: Aarthi Sivaraman

USA/
Check Out this prediction about Black Friday deals.

Black Friday, the day after the U.S. Thanksgiving holiday that typically kicks off the holiday shopping season, is known for some of the best discounts of the year, both in stores and on the Web.

And its never too early to think about deals, as illustrated by dealsnews.com, which has compiled a list of what it predicts will be the best holiday deals to emerge between mid-November and “Cyber Monday” — the Monday after Thanksgiving when office workers go online en masse to shop for specials.

This year’s list kicks of with expected deals on netbooks, which are inexpensive and compact laptops suited for basic computing and surfing the Internet.

Dealsnews predicted that a Linux-based netbook with 9-inch screen will be as cheap as $129, while pricier models would be ”well-equipped” $399 netbooks with 15.4-inch screens.

If you are in the market for a flat-screen TV, the Web site predicted that you are likely to find an abundance of deals. TVs traditionally are one of the top-selling items around the holidays since retailers offer deep discounts on them. This year, a 40-inch or 42-inch LCD high-definition TV could be as cheap as $449 while the bigger brand-name one with 52-inch screen could be on the market for $1,049, the Web site showed.

The site also said shoppers should be able to snag good deals on Blu-ray players, and items like digital photo frames.

Also in the basket:

Target moves to declassify board

P&G sees sales rising in second quarter

Dollar General profit more than triples

(Photo/Reuters)

September 3rd, 2009

Shift FROM thrift? Are diners trading up?

Posted by: Lisa Baertlein

olivegardenAfter a much heralded “shift to thrift” during what has become the longest and deepest recession since the Great Depression, diners are now saying they plan to spend less money at cheap fast-food chains and more at some pricier eateries like Darden’s Red Lobster and Olive Garden chains, Chipotle and Maggiano’s Little Italy from Brinker

“Trading up is supported by fewer customers saying they’re ordering less expensive items, skipping beverages and choosing less expensive restaurants,” RBC Capital Markets analyst Larry Miller wrote in a client note. Miller regularly polls diners about their spending plans. 

“Confidence in the economy is improving and those planning to spend more at restaurants cited better job security and less need to save money,” said Miller, who added that consumer spending plans at Starbucks were also ”less bad.”

Are you trading up on food — or anything else — after trading down?

September 2nd, 2009

Attack of the snack tax

Posted by: Lisa Baertlein

obesityA worsening obesity epidemic and lingering recession have state and local governments scrambling for new streams of revenue — including taxes on soda and other sugary beverages.

That’s potentially bad news for the nation’s food and beverage industries, which are on the defensive as the battle rages behind the scenes.

If you watch TV, you’ve probably seen this ad from American Against Food Taxes, which is backed by the likes of McDonald’s and PepsiCo.

Nearly three dozen states already charge tax on sugary beverages. But, in most cases the tax is not high enough to curb consumption, said Kelly Brownell, director of the Rudd Center For Food Policy and Obesity at Yale University and author of “Food Fight.”

The Rudd Center’s Web site offers a calculator that shows the revenue a city or state could potentially generate with snack taxes — which are being eyed as funding for everything from public works projects to U.S. healthcare reform.

(Reuters photo)

August 31st, 2009

The flu frenzy has begun

Posted by: Jessica Wohl

flu-shotPeople have been worried about the H1N1 flu, aka swine flu, for months but the vaccine for that flu is not expected until at least mid-October.

So, for the time being, we’re taking a look at how the three major U.S. drugstore chains are preparing for the seasonal flu, which is responsible for about 36,000 deaths in the United States each year.

A survey conducted by Walgreen in mid-August found that 50 percent of consumers plan to get a seasonal flu shot this year, up from 43 percent who say they got one last season.  Twenty-seven percent of respondents to the online poll said they were more concerned about getting the flu than they were a year ago. 

Another poll found more than 60 percent of Americans plan to get the H1N1 flu vaccine.

CVS is putting the biggest dollar figure behind its push, unveiled on Monday, offering $3 million worth of seasonal flu shots to the unemployed this season.  That’s 100,000 shots.

Walgreen has another lofty number in mind — 5 million.  That is the number of vaccinations the largest drugstore chain by revenue wants to administer this season.  Last flu season, it handled 1.2 million shots and nasal spray flu vaccinations.

Walgreen said it would give vouchers for $1 million worth of flu shots, or 40,000 of them, to uninsured consumers.  Walgreen is also asserting itself as having the largest U.S. retail network of immunizers, with 16,000 able to administer the shots. Last year, only 7,500 of the company’s pharmacists could do so, a spokeswoman said.

Rite Aid, the smallest of the three chains, said it has more than 2,000 certified immunizing pharmacists on hand at more than 1,500 of its 4,800-plus stores.

Pricing for shots will vary.  Walgreen is promoting its flu shots at $24.99, while CVS and Rite Aid each priced their shots at $30.

(Reuters photo)

August 20th, 2009

Whole Foods CEO healthcare Op-Ed spurs boycott

Posted by: Lisa Baertlein

wholefoodsMaybe Whole Foods Chief Executive John Mackey should stay away from the keyboard and stick to selling gourmet groceries.

The CEO’s recent opinion piece in the Wall Street Journal suggested alternatives to healthcare proposals being batted around in the nation’s capital.

Among other things, he asserted that healthcare is not a right and called for ”less government control and more individual empowerment.”

His view got some of the chain’s historically liberal customers so hot under the collar that they have threatened to go elsewhere for their organic apples.

The company’s own healthcare reform forum has more than 14,000 posts. Twitter users are opining on the subject.

And the Boycott Whole Foods group on Facebook, which has attracted more than 20,000 members, is planning to picket stores in Washington, D.C. and the company’s hometown of Austin, Texas, on Friday.

According to the Facebook group, which also dings the company for not having unions, Mackey is ”suggesting that healthcare is a commodity that only the rich, like him, deserve.”

In his own blog, published shortly after the editorial ran, Mackey pinned some of the blame on changes made by those darn headline editors.

“I wrote this Op/Ed piece called simply ‘Health Care Reform.’ An editor at the Journal rewrote the headline to call it ‘Whole Foods Alternative to Obamacare,’ which led to antagonistic feelings by many.”

He continued: “While I am in favor of health care reform, Whole Foods Market as a company has no official position on the issue.”

This isn’t the first time Mackey, the scribe, has caused a flap.

For several years ending in 2006, Mackey used the pseudonym “rahobed” on Yahoo Finance stock forums to talk up Whole Foods shares and his performance as CEO. He also trash talked competitors like Wild Oats. The U.S. Securities and Exchange Commission investigated for nearly a year but eventually ruled out any action.

Whole Foods acquired Wild Oats in 2007 and just recently settled an antitrust case with the same federal government that Mackey says should keep its hands off healthcare.

(Photo/Reuters)

August 18th, 2009

Molson Coors-sponsored survey finds water pollution key concern

Posted by: Martinne Geller

molsoncoorsWhat is the latest and most important environmental concern these days? Global warming? Disappearing ice caps and rain forests? Reliance on non-renewable energy?

Wrong. According to a new survey sponsored by Molson Coors Brewing Co, water pollution ranked No. 1, followed by fresh water shortages, depletion of natural resources, air pollution and loss of animal and plant species.

The survey was commissioned by Circle of Blue, a nonprofit affiliate of the Pacific Institute, a water and climate think tank. It polled people in 15 countries, including the United States, Mexico, China and India, about their views on water issues including sustainability, management and conservation.

Molson Coors, maker of Coors Light and Molson Canadian beers, sponsored the survey as a first step in trying to understand how people in international markets — where it hopes to expand its business — view water. 

Molson Chief Executive Peter Swinburn said that as the company expands internationally, it must understand what a local community’s issues are and try to address them before spending money and building a factory.

“We’re a branded organinzation. We live by research and consumer opinion,” Swinburn said in an interview. ”To try and address a problem without going to consumers and understanding their perceptions is difficult to do.”

Of the seven ”focus” countries, consumers in Mexico seemed to take the problem of water pollution the most seriously, with 90 percent of respondents calling it a “very serious problem.” The rest of the countries ranged from 58 percent in Britain to 71 percent in Canada.

The survey included a “water concern index” which measured people’s concern about water issues by aggregating their concerns about water pollution, lack of safe drinking water, lack of water for agriculture and the high cost of water.

According to that index, Mexico and India were much more concerned than average. China and Canada were right above average. Britain, the United States and Russia showed below-average concern.

Swinburn said conserving water can improve its profit margins by reducing costs, while helping people get access to clean water increases the health and economic vibrancy of a community, making it a stronger potential marketplace. 

“From the microcosmic level of our margin through to the broader social impacts, it affects our bottom line,” Swinburn said, proving that risks related to the world’s fresh water supply ripple through the beverage industry.  

Another interesting point concerned responsibilty for ensuring clean water. Respondents in Russia, the United Kingdom and the United States said they believed that water companies were the most responsible, followed by the government, large companies, citizens, farmers and non-governmental organizations.

In Canada, China, India and Mexico, respondents thought the government should be most responsible.

Following the discussion on water, Swinburn took a few moments to answer Reuters’ questions about its business outlook for the rest of the year.

July 29th, 2009

On the front lines of the coffee war

Posted by: Lisa Baertlein

mcdonaldsstarbucks2By Laura Isensee

On her way to work in downtown Los Angeles, banker Teresa Roman recently picked up a large iced vanilla coffee. Her cup had no green mermaid, the iconic Starbucks symbol. Instead, it displayed McDonald’s famed golden arches.

Roman switched from Starbucks iced coffee to McDonald’s when the fast-food giant started selling lattes, mochas and cappuccinos as part of its McCafe beverage expansion that launched officially earlier this year.

One would think the move from McDonald’s would be disasterious for Starbucks, which already had been slashing costs and closing stores after overbuilding during the real estate boom. But for all the angst over McDonald’s noisy entry into Starbucks territory, it doesn’t seem like Roman’s behavior is the norm.

Information from coffee drinkers, analysts and data suggest that McDonald’s and Starbucks are appealing to very different customers.

As part of our reporting, we talked with caffeine-starved workers in downtown Los Angeles. They said they chose their joe based on a variety of factors ranging from convenience and price to taste. 

“It’s not about saving money. It’s about an alternative taste,” said Stova Wong, who picked up a medium regular coffee - three creams, one sugar - at McDonald’s before heading to work in the IT department at a law firm. He now splits his coffee habit evenly between Starbucks, McDonald’s and mom and pop shops.

“McDonald’s coffee is not as dark, but it still provides a good level of coffee taste,” Wong said.

Lawyer Mindy Kay has noticed McDonald’s big advertsing blitz. “It hasn’t made me drink more or less. I did try some of their drinks but I mostly stick to regular coffee … I see McDonald’s first and foremost as a fast food restaurant where I can get good coffee.”

Eric Stevens, a 24-year-old summer associate at a law firm, has been drinking Starbucks coffee nearly every weekday this summer.

“I drink Starbucks mostly out of convenience if the location is close,” Stevens said. The cafe is located in the basement of the building where he works. 

Starbucks is his drink of choice for now. He’s never tried brews from McDonald’s, which is only two doors down, but his favorite coffee is from Peet’s Coffee & Tea. Catch what he has to say in this video:

July 28th, 2009

New doc checks into MinuteClinic

Posted by: Jessica Wohl

minuteclinic_0031The doctor is in.

Dr. Andrew Sussman was named president and chief operating officer of CVS Caremark’s MinuteClinic unit on Tuesday.

Sussman, who was most recently COO at UMass Memorial Medical Center and an associate professor at UMass’s medical school, also became CVS Caremark’s associate chief medical officer.

The company named Troyen Brennnan, Aetna’s former top doc, to the new role of chief medical officer back in November.

The latest appointment comes as CVS tries to expand the reach of MinuteClinic in-store clinics, which can already be found in about 500 locations across 25 U.S. states.  Rival Walgreen has about 345 Take Care clinics in 19 states.

Chip Phillips, who had been MinuteClinic president for just over a year, became president of TheraCom.  That CVS business helps biotech and pharmaceutical manufacturers find commercial success for their specialty products.

Clinics, which have popped up in some Walmart stores and other  retail outlets, have gained some popularity as consumers look for quick, inexpensive advice rather than waiting in emergency rooms or doctor’s offices.

(Photo\CVS Caremark)

July 27th, 2009

Starbucks workers will pay more for health insurance

Posted by: Lisa Baertlein

schultzinsuranceStarbucks Chief Executive Howard Schultz says the coffee chain now pays almost as much for employee health care as it does for coffee beans, so the company long-known for its generous health benefits will begin passing more of those costs to employees.

The news from Starbucks comes amid skyrocketing U.S. health-care costs that are forcing American companies large and small to hike employee health-care contributions,  cut back on coverage, or eliminate it altogether.

U.S. health care spending consumes 16 percent of GDP, about $2.2 trillion a year,  and is projected to rise to 25 percent of GDP by 2025. But while the U.S. spends more than any other country on health care, its residents aren’t among the world’s healthiest. Some 46 million Americans are uninsured.

President Barack Obama says a broad health care overhaul is critical to a U.S. economic recovery. Congress is not expected to pass any reforms until after Labor Day. 

Remember all this next time you consider putting coin in the tip jar at Starbucks.

June 24th, 2009

Disappearing restaurant deals?

Posted by: Lisa Baertlein

olivegardenWhether it is “value menus,”  Applebee’s two dinners for $20 deal or Ruth’s Chris Steak House’s “Summer Classic” three-course meal for $39.95, restaurant operators long have been depending on specials to woo customers during a long recession that has driven unemployment to a 26-year high.

Now, one high-profile restaurant executive says he has seen some rivals’ deep discounts disappear over the last few weeks.

“We see a little bit of pull back from some of the more significant offers,” said Clarence Otis, chief executive of Olive Garden and Red Lobster parent Darden International Inc.

Darden has specials of its own. For example, the company’s Red Lobster chain plans to repeat its “Lobsterfest” promotion during the the pre-Easter season of Lent,  when many Catholics eat fish on Fridays. Still, Otis said his company is careful to make sure its discounts reap financial rewards.

“We don’t know that a lot of folks who did discounting got much for it,” in terms of driving diners into restaurants, he said.

Have you seen your favorite discount disappear?

(Photo\Reuters)