Painful Pistachio Recall

First it was peanuts. And I could deal with the Food and Drug Administration's orders to avoid them at all costs, once I clearly understood that my pantry must -- jarred peanut butter -- was safe from any salmonella contamination. (Peanut butter in my house is like mayonnaise or butter in other households -- a essential condiment that cannot be lived without, even if that means late night rides to the supermarket or c-store, whichever happens to be open.)

I would miss peanuts, sure: the sweet and salty honey-roasted perfect for a late-night snack, the salted and roasted ones you find at certain burger joints, and everything else that contained them, even the health bars I buy as a to-go breakfast. And knowing the products identified as suspect from Peanut Corp. of America were in the hundreds, it wasn't worth my time to investigate and make sure any peanut product was safe. Better to avoid all of them, and save time and effort scouring the FDA's Web site.

I could live with these new rules, knowing my sacrifice of peanuts and their products would probably be better for my health, anyway.

But now I'm being told to avoid my second favorite nut -- pistachios -- and its resulting products, for a potential salmonella contamination. A voluntary recall involving approximately 1 million pounds of products from California-based Terra Bella Inc. is a lot of product, and the FDA says there's more to come on its Web site: "Because the pistachios were used as ingredients in a variety of foods, it is likely this recall will impact many products."

Why do they fail to keep my favorite foods safe? According to published reports, there's 15 U.S. agencies with the task of food safety. Why isn't there a better system for identifying possible contamination and stopping it before it enters the consumer food market? There are theories circling that the policies and procedures regarding food safety are outdated and more focused on reacting to an issue, instead of preventing one.

And rumors are going around that there are not enough resources to thoroughly inspect the food coming into this country, nevertheless the food that is made in it.

I shouldn't have to worry that my food is safe, no matter where it came from. But it's not only me that is angry. It’s the hundreds of millions of consumers who are losing trust in the government and its ability to protect them.

-- Mehgan Belanger

Retailing After the Recession

As the effects of the country's recession lingers and consumers' buying habits change for the long-term, the country's retailers will find themselves learning many lessons that c-store operators learned long ago,
including bigger isn't better, and the battle for the consumer is being waged at the point of purchase.

Evolving retail trends will gain momentum, as retail sales remain flat through the rest of the year and short-term shopping behaviors become long-term mindsets, according to "Retailing 2015: New Frontiers," by PriceWaterhouseCoopers and Retail Forward, an analysis of the current economic crisis and its impact on retailing trends for the next five years or more.

As consumers shift from conspicuous consumption to "conscious consumerism," every as aspect of retailing -- from packaging, to store footprint, to growth expectations -- will be downsized, the report predicted. Future growth is likely to come from tailoring existing stores to specific customer
segments and local markets, rather than adding stores. Even the old 80/20 rule is likely to be broken, as retailers turn to limited editions to build excitement and generate more full-price sales.

Retail consolidation and store closings will likely mean suppliers become even more aggressive in protecting their turf, the report predicted. Expect more innovative distribution strategies.

In one way or another, as operators of small-format stores selling impulse purchases in diverse neighborhoods, many c-store operators have already addressed these now global developments. That experience should put them in a great position to react quickly to ground-shifting consumer habits.

 -- Barb Grondin Francella

A Bailout we can Sink our Teeth Into

Two foodservice chains -- Costa Mesa, Calif.-based El Pollo Loco and Ann Arbor, Mich.-based Domino’s -- are using the current economic headlines to help sell more chicken and pizza.

This week, the chicken chain -- with tongue planted firmly in cheek -- announced the formation of a new political party, the Dinner Party, to offer families “real savings on real food.” The chain is offering deals in all 400-plus locations. The “Family Stimulus Plan” includes the following discounts:

•  6-piece Legs & Thighs for $4.99
• 1/2 pound Classic Chicken Burrito for $1.99
• Taco al Carbon for 69 cents

Speaking like a true politician, El Pollo Loco CEO Steve Carley said:  “As the Dinner Party's first initiative, you can be certain that our Family Stimulus Deal does not include any pork and is designed to keep change you can count in Americans' pockets. Our healthful, juicy, citrus-marinated and flame-grilled chicken is all substance and no show and, best of all, will help get America moving in a delicious, flame-grilled direction."

Carley stars in the new Dinner Party ad campaign, as he announces the party's intention to put a drumstick on dinner plates across the country. Additional details about the Dinner Party's limited time offer is available on El Pollo Loco's Web site, and YouTube.

Also starring in commercials for his pizza delivery chain’s new promotion -- “Domino’s Big Taste Bailout” -- is CEO Dave Brandon.

Filmed on location in Washington, D.C., New York and New Jersey, the TV and on-line spots feature Brandon traveling from Capitol Hill via Wall Street to Main Street, with an offer to deliver three or more medium, one topping pizzas or oven baked sandwiches for just $5 each to American consumers.

"We know times are hard, it's a reality we are all facing," says Brandon in the spot. "But I didn't go to Washington to ask for a bailout. Instead, we are giving one. I'm proud to be able to offer our consumers a promotion with such a great deal on pizza. By adding our oven baked sandwiches to the mix we are further increasing the number of taste varieties to the offering."

In one spot, Brandon actually rips a pizza box out of the hands of a suited man who he calls "Mr. Hedge Fund" and hands it to an average American.

Both campaigns speak to the current unrest and worries of the American public over the state of the current economy. Some convenience stores are getting into the act as well. Convenience Store News covered the grand opening of Cumberland Farms’ newest prototype store, which opened earlier this month in Farmington, Conn., and saw a sign that highlighted a similar theme: “You’re on a budget; not a hunger strike,” printed above a photo of Cumberland’s new flatbread sandwiches, starting at $2.99.

If you’ve created a marketing campaign around the theme of today’s economic adversities -- whether it’s about the stimulus plans, government bailouts or just general governmental stupidity -- send your examples to us. We’ll publish the best ones.

-- Don Longo

To Comply or Not to Comply with PCI

Sheetz Inc., based in Altoona, Pa., just announced a rollout of upgrades to 2,000 pumps, and many other c-store retailers are choosing vendors to take on the project and upgrade their equipment.

In fact, it is estimated to cost as much as $1 billion for the convenience store and petroleum industry to meet the July 2010 compliance deadline and many are spending their entire technology budgets on various aspects of PCI, according to Convenience Store News' 2009 Technology Study, which will be
published in May 2009.

However, some retailers are choosing another route. We have heard a few say instead of spending the money to upgrade the PIN Pads at the pump so they can take debit cards for payment, they are simply shutting off debit at the pump, and only taking credit -- and without any effect on sales.

What approach are you taking at your stores? Is is worth the investment to allow debit transactions -- especially since the fees are less than credit?

---Tammy Mastroberte

Is Quiznos Painting Itself Into a Corner?

Subway and Quiznos’ battle over the $5 footlongs is over. This week, Quiznos threw a new punch with the launch of $4 Toasty Torpedoes, a new line of sandwiches prepared on extra-long and extra-slim ciabatta bread that come in a sleeve to make it easy to eat.

The new sandwiches aim to set the standard for value, convenience and taste, Quiznos stated. "We realize almost everyone is feeling the pinch in today's economy. An important way Quiznos can help ease that stress is by offering people terrific value without sacrificing quality and taste -- a gesture that started in January with our ongoing New Lower Prices campaign," said Rebecca Steinfort, Quiznos’ chief marketing officer.

There’s no doubt that offering value items is a must to sustain and even grow during these tough economic times, but I believe Quiznos’ approach of putting a constant low price on its sandwiches -- $5 footlongs and now $4 Torpedoes -- will ultimately end in the chain painting itself into a budget corner when the economy improves. In my opinion, a better tactic would be to do more intermittent pricing promotions. This way, consumers don’t come to expect the lower price or become desensitized to the promotion.  

What do you think -- do you agree or disagree?

-- Linda Lisanti

Archaic Laws Weigh on Convenience Stores

There are two laws I can think of off the top of my head that have made news headlines recently for their effects on convenience store retailing, despite the fact that subject of those news stories -- the laws themselves -- are decades old.

Earlier this week, Maryland counties were encouraged by state Comptroller Peter Franchot's team to enforce a law some have called "archaic" that enforces a soda fountain license fee. The fee is anywhere from $25 to $60, but has not been used in years, and will allow fees to be collected from all restaurants, convenience stores and other places where soft drink dispensers are found.

And earlier this year, a federal judge declared unconstitutional Wisconsin's 70-year old law minimum markup on gas. With the ruling, gas retailing experts predicted lower prices on fuel would follow, along with increased competition.

Why has taken so long for these laws to come into the public's eye? In Maryland's case, it is the increasingly frequent instance of a budget shortfall, which is causing lawmakers to look to new places to find funds. At least the lawmakers haven't proposed a hike in the state's excise tax on tobacco products -- knock on wood -- like the slew of other U.S. states doing just that.

Is there an antique law in your state that has crimped your convenience retailing business? Let us know about it!

-- Mehgan Belanger

Tale of Two Convenient Formats

Over the last day or two, news from two retailers investing in similar concepts emerged. Tesco PLC  delayed its planned opening of 20 Fresh & Easy stores in the Sacramento market. At the same time, Giant Eagle unveiled plans to build three to five more of its Giant Eagle Express stores in the Pittsburgh area in the next year or two.

Both concepts opened within months of each other -- Fresh & Easy in November 2007, Giant Eagle Express in May 2007 -- but from there, their development couldn't be more different. British-owned Tesco quickly opened 110 units in southern California, Nevada and Arizona. The 10,000-square-foot concept, selling a limited selection of groceries and a wide range of prepared foods, is now being tweaked to better satisfy American shopping habits, and the aggressive rollout strategy was slowed by consumer disinterest and a weak economy.

Meanwhile, Giant Eagle's Express, a roughly 14,000 square-foot prototype of groceries, gas and prepared foods, is still considered in the test phase. The offer has been modified prior to any more stores opening.

The c-store industry -- with many players opening larger-format stores selling more fresh and foodservice items -- often has relied on its ability to react quickly to changes in consumer trends and has remained competitive by being nimble and speedy while embracing change. The willingness to try new programs and fail at them is a hallmark of the industry's most successful retailer. Still, many c-store operators probably could take a lesson from this tortoise-and-hare story.

Valero CEO has Heart

The executives at AIG could learn a thing or two about leadership from William R. Klesse, the chairman, president and CEO of Valero Energy Corp.

When presented with a bonus of more than $700,000, he asked that it to be distributed in $50 bonus checks to hourly employees – talk about boosting company morale.

In today’s economy, every penny counts, and I’m sure the employees of Valero who will receive this bonus will not forget the gesture.

In fact, when the economy picks up and more jobs become available, I don’t think Valero will have to worry about losing employees to the competition. Who would want to leave a company run by someone who cares enough about his employees that he gives up his own income?

--Tammy Mastroberte

Prom Queens and Pizza -- a Powerful Promotion

You get the best of both worlds when an internal contest designed to motivate employees to sell more also captivates customers and attracts loads of unexpected -- and free -- publicity.

Such was the case earlier this month when Kwik Trip’s store manager in Rochester, Minn., Ed Houser, made a bet with employees that he would dress up as a prom queen if his 20 store employees sold 300 slices of pizza (which was being promoted for $1 a slice) in one day.

The best thing that could have happened was losing the bet. The employees exceeded their sales goal and got a chance to see their manager dolled-up for the day in drag. While Houser took quite a ribbing all day long, the sight of the man in the blonde wig and pastel-colored ball gown attracted lots of customer buzz and was even covered on local television news outlets (must have been a slow news day).

What kinds of fun -- and profitable -- events or motivational activities have you conducted in your stores? Please let us know. Picture welcome -- just no more men in drag.

Moms' Buying Power

When my 15-year-old was a preschooler, I tried to give her healthy food choices, but was just as likely to give in to her requests for trips to McDonalds because the Happy Meal promotion was a Teeny Beanie Baby. I'd justify the choice by making sure she drank her milk. Goldfish was the most common snack food. I'd pack a Go-Gurt for the road, or, on longer trips, we'd stop at a new ice cream or doughnut shop for the fun of it. Somehow, she grew up healthy and has great eating habits today.

But 10 years later, I'm much more concerned about her four-year-old sister's eating habits and establishing a healthy lifestyle. Trips to fast feeders aren't as frequent, and fruit or cheese is the most common afterschool snack. While on road trips, I pack bananas, dry cereal and raisins, trail mix – only counting on Wawa and a few c-stores to stock something semi-nutritious when we stop for gasoline.  

According to a recent survey, I'm not alone in my new attitude. Moms surveyed by Just Kid Inc. said the kid-fun factor, packaging, promotions and convenience, while still considerations, are less important criteria than nutritional ones when buying food for their kids – a change in thinking from a decade ago.

Still, a whopping 96 percent of the moms say their kids influence what they buy. Plus, as the survey noted, there is often a gap between moms' "ideal" purchases and what they typically end up purchasing or preparing when rushed, left with few choices or confronted by other real-world considerations (What will my kid eat?) C-store operators and fast-food purveyors, then, have a huge opportunity -- sell products to go that kids will be attracted to -- taste and presentation still count -- but that moms can feel good about buying, even if they aren't ideal choices.