Grocery Share Tampa

From Aldi to Publix to Whole Foods, here’s how Tampa Bay’s grocery market share breaks down (Interactive)

Jun 22, 2017, 7:18am EDT
The new Publix location in downtown St. Petersburg

With Amazon.com’s purchase of Whole Foods Market Inc., the online giant will control 1.2 percent of the grocery market in the Tampa Bay region.

That was Whole Foods’ market share in Hillsborough, Pinellas, Hernando and Pasco counties in 2016, according to Chain Store Guide. Whole Foods has three stores here, with two in Tampa and one in Clearwater.

Amazon is planning to buy the specialty grocer for $13.7 billion, but the implications of the deal go far beyond the more than 400 Whole Foods stores it will own. It will mean a new level of competition for Publix Super Markets Inc., which is based in Lakeland. Publix employs more than 36,000 people in the Bay area, including corporate workers at the Lakeland headquarters.

Publix, the hometown grocer, controls 39.3 percent of the grocery market with 117 stores here, according to Chain Store Guide. Use the interactive graphic below to see grocers’ market share versus number of stores.

Winn-Dixie and Winn-Dixie Marketplace, which are owned by Jacksonville-based Southeastern Grocers, has nearly as many stores in that same area — 100, according to Chain Store Guide. But it controls only 16.1 percent of the market. Wal-Mart Stores Inc. controls 16.4 percent of the market with just 32 stores. (That figure doesn’t include Walmart Neighborhood Markets, which account for 3.2 percent of the market with 17 stores.)

The market share numbers will likely look different in the coming years. Amazon’s digital savvy has the potential to increase Whole Foods’ market share, and there are new competitors to consider. Sprouts Farmers Market Inc. is just entering the Florida market, with three stores open so far this year (in Carrollwood, South Tampa and Sarasota).

German discount grocer Aldi, which controls 1 percent of the market with 15 stores, recently announced it will ramp up its U.S. expansion plans. Lidl, another German discount grocer, appears to be laying the groundwork to enter Florida in the coming years.

 

Logistics Education

Online Education: Become a Supply Chain Leader…in Your Pajamas

Tags: Education & Careers, Logistics, Education, Supply Chain

A wide range of quality online education options lets you build your skill set and advance your career without leaving home – or thinking about the dress code.

When Christine Reinelt left the workforce temporarily to stay home with her two young children, she decided to use her break from paid employment to further her supply chain education. Her home in western New York isn’t near an academic institution offering the instruction she wanted, so Reinelt searched for online education options. She was particularly interested in enrolling in a program that was well known among employers for providing solid supply chain education.

She found it at Pennsylvania State University, where she could ease back into the academic world by starting with the online graduate certificate in supply chain management program, a 12-credit hour program that feeds into the school’s master in professional studies in supply chain management degree program.

After excelling in the program, Reinelt applied her certificate course credits to the master’s program and continued on for a second year to earn a graduate degree. Now a business analyst at GE Transportation in Erie, Pennsylvania, through a contract with Paradigm Infotech Inc., Reinelt says the two-year certificate and masters program gave her the confidence she needed when she re-entered the job market after her children started school.

“I wasn’t exposed to global markets in my previous position, but I am now at GE,” Reinelt says. “The Penn State program prepared me for that.”

Just as important are the unanticipated benefits she reaped through learning online.

“I didn’t expect much teamwork and communication in an online learning environment, but I was wrong,” Reinelt says. “All of it helped me become a more effective team member and collaborator. It also helped me develop analytical skills and become a more strategic thinker.”

DEGREE OPTIONS

Online supply chain education is flourishing, with options ranging from one-off courses to certification programs to master’s degrees. The best option for any individual depends on career goals.

Looking for a deep dive into a specific topic—for example, performance measures for supply chain management? Take one or two courses, and maybe earn a certificate—which isn’t the same as obtaining certification. Want to boost your resume and make yourself more attractive to the job market? Enroll in a reputable certification program. Interested in moving into management? Invest in a master’s degree where you will learn more about the role of multiple disciplines, from finance to marketing, in supply chain management. Each education type serves a different purpose.

Organizations including the Institute for Supply Management (ISM), the Council of Supply Chain Management Professionals (CSCMP), and APICS, say their certification through online education options demonstrate subject knowledge and career commitment. The ISM website, for example, notes that its certification tells hiring companies that employees or job candidates have “mastered critical skills and can apply them to real-world situations to achieve superior outcomes.”

“Certification says something about the people who earn it,” says Nichole Mumford, director of education programs and marketing communication for CSCMP, a global association for supply chain management professionals. “Employers look for these kinds of credentials.”

Pat Woods, founder of SupplyChainEducation.com, which offers online training for APICS and ISM certification exams, agrees. He compares certification to a master’s degree: “With certification, students learn technology and gain knowledge that’s directly applicable to their jobs. Sometimes a master’s program can be higher level.”

In some cases, he adds, employers place more value on certification than they do on a graduate degree.

Then there’s the additional money that comes with certification: Average salaries for certified supply chain professionals were 10.3 percent higher than for those without certification, according to ISM’s 2017 Salary Survey.

Employers funding higher education also appreciate that online certification training is less expensive than a graduate degree, Woods adds.

Still, when combined, all three of CSCMP’s SCPro certifications demonstrate a mastery of knowledge and skills similar to a master’s level program. “We compare it to preparing for a bar exam or CPA testing,” Mumford says.

The certificate-followed-by-master’s-degree hybrid program that Reinelt enrolled in serves both needs.

“We were surprised by the interest in the certificate program,” says David Huff, director of online graduate programs in supply chain management and a professor at Penn State. “It lets those with some experience move forward without getting a master’s degree.

“It’s the foundation, so it’s more accessible,” he adds. “The last 18 credits are more rigorous.”

More than half of certificate program students apply to the master’s program.

MASTER’S PROGRAMS DEVELOP LEADERS

One difference between online education for certifications and a master’s degree is the leadership skills master’s degree students develop.

“Any good supply chain master’s program offers the teamwork that helps students develop leadership skills,” says Huff. “For instance, our students learn how to work long distance and coordinate with teammates around the globe, all while working around their existing job commitments.”

Penn State students, who also meet in person for four days during the summer after the first year, typically take one to two courses per semester and participate in three to five team projects—usually a case study—per course.

“They learn how to apply all this knowledge to their companies, and it gives them the skills to recognize opportunities and act on them,” says Huff.

Tony Saracino, market development manager for the building solutions team at chemicals company BASF in northern California, is working toward an online MBA with a concentration in global supply chain management through the University of North Carolina (UNC). His coursework helps him understand other corporate functions and how they relate to his position and responsibilities.

“It’s extremely important to understand other functions and speak their language, otherwise you risk making decisions in a vacuum and getting frustrated,” he says.

He particularly enjoys UNC’s live— “synchronous”—instruction because of the interaction with students and instructors and the opportunity to ask questions. “You can learn from someone who works at Boeing, 3M, or Procter & Gamble, who brings their own stories and experiences into the learning process,” he says.

This interaction brings with it an unexpected skill: learning how to use online technology.

“When students enroll in a program like this, they’re thinking more about content than technology, but from a process perspective, that’s a big takeaway,” says Wendell Gilland, associate professor of operations at UNC Kenan-Flagler Business School.

The program also requires a great deal of document sharing, video conferencing, and accessing material in a technology-focused learning management system. “Students also get comfortable being on camera,” adds Saracino.

WORKING THROUGH PROBLEMS

It’s a similar experience at Indiana University (IU), which offers an online MBA in Supply Chain and Operations and a Master of Science in Global Supply Chain Management. The same faculty teaches both online and classroom courses, but online students have the benefit of learning how to work through problems that come naturally when collaborating with teammates in different time zones and in varying environments.

“Nobody is the boss in that situation—it’s the optimal example of a matrix organization,” says Carl Briggs, clinical professor, operations and decision technologies. “It’s a group of people pushed close to the edge of what they can deliver and it’s all virtual—you can’t just walk across the hall and talk to your teammate. This gives these students a huge advantage in today’s virtual global workplace.”

Students are exposed to even more when they decide for themselves which technology tools to use, according to IU Senior Lecturer Scott Dobos, who went through the online Master of Science program while employed at Pratt & Whitney before joining the faculty.

“The students don’t want our structure,” he says. “They figure out what works best for them. That offers another benefit—team members introduce each other to new tools they’re using in their workplaces.”

THE PERSONAL TOUCH

While Dobos appreciated the flexibility of online education when he was an IU graduate degree student, he particularly enjoyed the one-week in-person immersion program that starts the masters programs. “Meeting the instructors and my peers in person was valuable,” he notes.

As an instructor today, he has seen how improved technology, including video conferencing, helps provide a more personalized online experience for students than he had. “When I can see their video feed and the expressions on their faces, I’m better at figuring out what’s going on and the experience they are having,” he says.

While faculty and students alike stress the value and flexibility of online degree programs taught by renowned faculty members, some naysayers continue to question the quality.

When someone tells Saracino that an online degree can’t be as good as an in-person MBA, he has a response ready: “At my job, I work with people all over the world. We meet on the phone and via videoconferences rather than flying to meet in person every time we need to connect—just like we do in my course work.

“My education is providing the skills I need to function in a global economy,” he says. “I wouldn’t have the same experience sitting in a classroom for two years.”

And you can do it in your pajamas.

Lidl Store Impression

The wait is over. Lidl is finally open for business on U.S. soil, with 10 stores opening yesterday in Virginia, North Carolina, and South Carolina. I had the opportunity to visit two of those stores (Greenville, S.C., and Spartanburg, S.C.), navigate the crowds, and get a first-person view of the much-hyped retailer. My head is still spinning with all I saw, but here are some quick first impressions:

1.  “Surprise” is a huge part of the offer. Roughly 20% of the center store is devoted to “Lidl Surprises,” an array of unexpected nonfood items, such as diaper bags and dress shoes (Figure 1). These items are available in limited quantities and rotated weekly with the aim of driving a treasure hunt mentality. Once they’re gone, they’re gone. Judging by the crowds searching through the bins, folks were definitely intrigued. However, given Lidl’s positioning as a food retailer, these nonfood specials could potentially be a distraction for some shoppers. I couldn’t help but wonder if there’s a risk for trip mission confusion. That said, since nonfood specials have been central to its offer throughout Europe, Lidl is likely well-aware of the need to maintain offer clarity.

Figure 1. Lidl Surprises

Source: Kantar Retail

2.  Private label raises the game. Consistent with expectations, private label comprises about 90% of the overall assortment (which includes about 3,600 SKUs, according to the Lidl app). There is some variability across categories, however. For example, I counted only a handful of branded items in breakfast cereal, whereas supplier brands had a greater presence in personal care. Regardless of the category, private label is high (Figure 2). Lidl is clearly working hard to set the parameters of the value proposition for shoppers. 

Figure 2. Lidl’s “Preferred Selection” Line

Source: Kantar Retail

3. Pricing is highly competitive. This could be an understatement. We’ll have a more precise view after we complete our pricing analysis, but when you see bananas for 44 cents per pound and baby food pouches for 79 cents, it’s clear the retailer wants to live up to CEO Brendan Proctor’s assertion that Lidl will “beat the best prices in the market” (Figure 3). 

Figure 3. Baby Food Pouches for 79 Cents

Source: Kantar Retail

 4. Simplicity is a guiding principle. The stores are designed for an easy and stress-free shopping experience. That means simplicity permeates everywhere. For example:

  • Color-coded shelf-ready packaging (e.g., green for organic) that aids item selection
  • Easy-to-understand promotions with concise explanations (Figure 4)
  • Concise but informative signage conveying the brand promise

Figure 4. Lidl’s “Fresh 5” Promotion for Meat and Produce

Source: Kantar Retail

Simplicity doesn’t mean easy. It entails a lot of hard work behind the scenes. However, simplicity and efficiency have been central to Lidl’s success across Europe, and the retailer has certainly brought that ethic to the U.S.

5.  Supermarkets are in the crosshairs. The fresh bakery. The perishables. The store size. Most importantly, the midmarket shopper. Make no mistake: Lidl is (and is competing with) conventional big-box supermarkets — and Walmart, for that matter (Figure5). The dollar stores and the upscale retailers may get a glancing blow, but the grocers that lack sufficient differentiation are likely to have a difficult time staying competitive.

Figure 5. Lidl’s Checkout Lanes

Source: Kantar Retail

Lidl Price Review

America’s newest grocery store chain has an advantage that should terrify Walmart

Lidl   68 of 71Lidl is cheaper than Walmart and Aldi, according to Jefferies analysts.Business Insider/Hayley Peterson

The German supermarket chain Lidl just opened its first US stores last week, and it’s already dominating America’s largest grocer, Walmart, on prices.

Lidl is about 9% cheaper than Walmart, according to a price check on a basket of 20 items by Jefferies analysts.

The price check also found that Lidl was 3% cheaper than its German rival Aldi and 16% cheaper than Food Lion. Aldi disputes the analysts’ findings, however, and said according to its own price check, Aldi is 3% cheaper than Lidl.

This new competition is likely to put added pressure on US grocers to lower their prices at a time when food deflation is already weighing down margins.

In addition to low prices, the Lidl store also offered a premium shopping experience with impressive customer service and an attractive store design that seemed to come straight from US shoppers’ most beloved grocery chains like Publix and Costco, according to the Jefferies analysts.

Lidl price studyLidl is about 3% cheaper than Aldi, 9% cheaper than Walmart, and 16% cheaper than Food Lion, Jefferies found.Jefferies

“The retailer seemed to steal certain aspects from various retailers, such as hints of Publix (employees were extremely friendly and even escorted the elderly around in wheelchairs), Costco (random sample stations, concrete floors, display cases on pallets and still in shipping packaging), and insert any specialty grocer name here (wood grain decor, vibrant signage, and a respectable bakery/ethnic/organic offering),” they wrote.

Lidl has more than 10,000 stores worldwide and plans to open 100 in the US by next summer. Its entrance into the US market will cause disruption for years to come, according to Jefferies.

“Our findings show not just aggressive discounts, but also a far more favorable shop vs. its German peer Aldi,” the analysts wrote. “Given the results, Lidl’s plans for 100 units by summer 2018, continued Aldi expansion, and what reactions we have already seen from competition, the hard discounter threat is real and could prove highly disruptive over the next several years.”

Here’s the list of items analysts checked at the Walmart, Lidl, Aldi, and Food Lion stores in Winston-Salem, North Carolina:

Screen Shot 2017 06 19 at 10.54.57 AMJefferies

Logistics Costs Fall

Logistics costs fall for first time since Great Recession, new report says

Logisticians are continuing to squeeze efficiencies from the U.S. freight transportation system as total logistics costs fell for the first time in six years, an influential new report says. By John D. Schulz

June 20, 2017

Logisticians are continuing to squeeze efficiencies from the U.S. freight transportation system as total logistics costs fell for the first time in six years, an influential new report says.

U.S. business logistics costs decline for the first time since 2009 even as the booming e-commerce sector “propelled demand” for small parcel delivery services.

That’s the major takeaway from the 28th annual State of Logistics report co-developed by A.T. Kearney and the Council of Supply Chain Management Professionals (CSCMP). It was released today at the National Press Club.

Traditional transport modes – trucking, rail, water and air cargo – were challenged in 2016 by overcapacity, rate pressures and sluggish demand. But U.S. business logistics costs fell 34 basis points last year to near-record 7.5 percent of Gross Domestic Product. That is just off the record of 7.4 percent of GDP set in the Great Recession year of 2009.

By comparison in 1979, the last year before the Motor Carrier Act deregulated the interstate trucking industry, logistics costs were over 18 percent of GDP in the regulated environment.

The report entitled “Accelerating Into Uncertainty” said the logistics industry appears destined for a prolonged bout of “cognitive dissonance.” That’s because of frustration over subpar growth in overall GDP amid rising stock market, technology investments and consumer confidence data. But that uncertainty has not slowed the pace of change, the report warns.

“On the contrary, industries are churning with disruption as newcomers and incumbents vie for market share and innovation undermines old business models,” the report said before warning: “One thing is certain: ‘business as usual’ won’t return.”

U.S. business logistics costs fell 1.5 percent last year after rising at a five-year compound annual rate of 4.6 percent from 2010 to 2015, the report said. Costs fell across all three components—transportation, inventory carrying and miscellaneous costs.

“The declines reflect overcapacity, slack volumes, and rate pressures in several sectors, even as demand and prices rose in others,” the report added.

Logistics experts agreed. Marc Althen, president of Penske Logistics, struck an optimistic tone in the report.

“The good news is supply chain activity is accelerating,” Althen said in the report. “Warehousing is very active, and demand for our technological solutions is strong.”

But on the other hand, overcapacity is squeezing profit margins. Penske estimates a glut of 115,000 surplus Class 8 trucks are operating today, up from 75,000 a year ago.

Trucking, which hauls about 75 percent of goods by value in the U.S., continued to struggling with overcapacity in 2016, especially in the $270 billion truckload sector.

TL costs fell 1.6 percent last year, even as its five-year compound growth rate rose 4.3 percent from 2010 to 2015. The smaller $58 billion LTL sector, by comparison, enjoyed 0.5 percent rise last year even as its five-year CAGR fell 1.2 percent. The $268 billion private trucking market costs rose 0.7 percent as its five-year CAGR was up 5.7 percent, the report said.

Overall motor carrier costs fell 0.4 percent last year as five-year growth rates were up 4.3 percent. The trucking industry was estimated to be $595 billion of the total $894 billion transport market that includes $73 billion in pipeline and water.

Parcel carriers, namely UPS, FedEx and U.S. Postal Service, fared the best while riding the e-commerce wave. Parcel costs rose 10 percent in the $86 billion sector as five-year CAGR was 6.4 percent.

Transportation professionals of all political stripes are urging Washington not to risk anything close to a trade war even as politicians threaten to renegotiate the 23-year-old North American Free Trade Agreement (NAFTA).

Transport pros are saying that technological change will drive the new supply chains of the future across all borders regardless of mode.

“The demands on this new dynamic supply chain must be met with the promise of adoption and integration of technologies that bring us new efficiencies and value to the supply chain,” YRC Worldwide CEO James Welch says in the report. “It’s up to all of us to make it happen.”

American Natural

American Natural Aims to Be C-store of the Future

Prototype provides fuel for people’s vehicles and fuel for their bodies.

June 22, 2017, 03:58 pm By Danielle Romano, Convenience Store News

PITTSBURGH — Setting out to become the “convenience store of the future,” Pittsburgh-based American Natural’s business model is dedicated to offering choice in both fuel for people’s vehicles, as well as fuel for their bodies. This model was created from founder and CEO Jennifer Pomerantz’s belief that today’s convenience store shopping experience has become a “seemingly less human and unnatural experience,” where customers have traded good food for what’s convenient.

“American Natural was driven to create a new culture of convenience, a more natural culture. An accessible culture built on the belief that, despite your busy lives, you shouldn’t have to sacrifice what is important to you and your family,” Pomerantz explained. “Better food. Better service. Better choices. All delivered with a great sense of community.”

The American Natural brand was introduced in 2011 by parent company Cleopatra Resources. With an acquisition of operating fueling stations and a wholesale petroleum distribution fleet in 2012, the company established a growing footprint around its Pittsburgh base. Today, American Natural has 13 stores operating across Pennsylvania and Ohio.

Seeking a new store prototype for the American Natural brand, the chain enlisted Westport, Conn.-based retail consulting and design firm King-Casey to bring its vision of a “new culture of convenience” to life. Together, the two organizations cultivated a project objective: to create a next-generation c-store design that optimizes sales of freshly prepared food and beverages, according to Howland Blackiston, a King-Casey principal who worked on the American Natural project.

American Natural and King-Casey also had four sub-objectives for the project:

1. Develop a redefined concept definition for a world-class c-store;

2. Develop an enhanced brand positioning and new store design for American Natural;

3. Create a new interior layout that optimizes operations and products, including 3-D branded design concepts; and

4. Develop strategies for visual zone merchandising and customer communications.

To begin, King-Casey used its proprietary COZI (Customer Operating Zone Improvement) methodology to audit American Natural’s existing stores and determine how well they represented its desired brand positioning and attributes. COZI is an analytical assessment process that focuses on the customer and how retailers utilize “zones” to create an effective environment.

Looking at American Natural’s stores through the COZI lens, King-Casey identified several areas in need of improvement and, thus, opportunities for the new prototype.

For instance, King-Casey identified the need for a major upgrade in the Food Service Zone. Upon walking into “old” American Natural stores, the first thing customers saw was the same thing they’d see in every c-store: racks of candy and potato chips. This zone needed to become the showcase and center of attention for the new store prototype, Blackiston explained.

“Foodservice should be the first thing you see when you enter the store because American Natural is all about fresh, delicious food,” he said. “We even recommended that they showcase food equipment that underscores the ‘fresh choice’ concept, such as espresso machines, a rotisserie grill, and pizza ovens.”

American Natural’s new prototype debuted just outside Pittsburgh last September. The chain plans to roll out the new store design with future locations, and has begun implementing King-Casey’s recommendations at its existing stores, too.

“New” American Natural stores highlight The Eatery’s bevy of fresh foodservice options. Taking an upscale approach, the offer includes made-to-order premium sandwiches, gourmet salads, baked-fresh pizzas, and toasted paninis. There’s an in-store barista as well, while sweeter fare includes homemade ice cream and hand-scooped milkshakes.

Taking on a more café-style design, new American Natural stores feature counter and tabletop seating for sit-down dining, plus an upholstered lounge area for customers who want to enjoy their barista-made beverages. There is also exterior patio dining.

“The feeling you come away with is that this is a restaurant/dining concept that also happens to offer fueling options. That dining impression is so acute, and the food is so good and popular, that a store manager in the new prototype said that they received a call from a customer asking, ‘Do you take reservations for lunch?’” Blackiston shared.

Digital Encourages Basket Building

Digital Encourages Basket-Building: Report

1/3 of click-and-collect, digital coupon users buy more

June 22, 2017, 12:28 pm

Digital adoption is growing in retail, and that’s good news for retailers on the basket-building front: According to new research from New York-based firm WSL Strategic Retail, a quarter of shoppers who use digital devices add more products to their purchases.

The report, “The Shoppers’ Guide to Restructure Retail,” notes specifically that one-third of click-and-collect and digital coupon users said they buy more, while 39 percent of subscription service users said the same. Click-and-collect, digital coupons and subscription services are just two of the eight super-digital shopping tools that the report gauged in terms of shopper usage. While these tools make shopping easier, less stressful and faster, they also are restructuring shopper expectations.

“Retail and brand marketing have been forever disrupted by digital tools that have reshaped shopping trips. That’s no surprise to many,” said Wendy Liebmann, CEO of WSL Strategic Retail. “However, what is surprising is that they are also the foundation of how to restructure and improve retail because they solve fundamental issues that retailers have struggled with for decades.“

The report goes on to note, however, that fewer than 20 percent of shoppers use such tools as click-and-collect (15 percent) and subscription services (12 percent). Fortunately, these services show the greatest potential for growth: Almost all digital shopping tools, with the exception of personalized offers, generated satisfaction ratings of nearly 80 percent or higher.

While many retailers are growing sales through digital channels, the research suggests that they also have the opportunity to “restructure sales” in physical stores as well, if they take advantage of these digital tools to influence behavior and generate loyalty among shoppers.

WSL identified six essential truths that retailers and manufacturers need to consider:

  • Digital is not about disruption – it is about enabling and satisfying shoppers.
  • Sales recovery opportunities are plentiful using digital tools. For example, 40 percent of click- and-collect shoppers said that they also go into the store to shop – often on the same trip.
  • While a digital service appears to work for only some product categories for now, it has the potential to pull other categories along with it as shoppers’ expectations change.
  • Digital tools are reshaping the traditional trip framework. They’ve changed shoppers’ view of what it means to stock up, fill in and make quick trips.
  • Personalization needs to be better personalized. Most shoppers don’t feel offers are truly for them.
  • Nothing goes away. Sure, digital is the future, but lots of shoppers still prefer paper circulars and walking the aisles.