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PHOENIX – The Arizona Lottery reported earlier this week that it generated $551 million in revenue for fiscal 2010, a 13.8 percent increase over 2009, which represents the largest gain from any other state lottery in the nation, Phoenix Business Journal reports.

The record sales produced $142 million in net profits, which will be allocated for state programs including healthcare, homeless programs, economic development, and education. And as a result of the sales, lottery retailers earned $37 million in commissions for the year.

Arizona Lottery executive director Jeff Hatch-Miller credited the record sales to the state's $100 Million Cash Spectacular instant ticket, Mega Millions, more scratchers game winners and larger payouts.

Since 1981, the Arizona Lottery has realized $2.5 billion in net profit for the state and more than half-a-billion dollars in commissions for retailers.

Content Subject: Marketing/Merchandising

Formatted Article Date: September 2, 2010

Title: Arizona Lottery Posts Largest Lottery Gain in Nation

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WICHITA, KS – A Sedgwick County District Court judge earlier this week lifted a temporary restraining order that prevented the statewide indoor smoking ban from applying to Wichita business, The Wichita Eagle reports.

As a result, the statewide smoking ban is now in effect in Wichita; it took effect in the rest of Kansas on July 1.

"There is no question that the Kansas Legislature can...regulate smoking in the state," explained Judge Jeff Goering in his ruling. "The scope and breadth of that regulation is a matter of public policy, and it is not for this Court to second guess the wisdom of that policy."

Supporters of the ban hailed the judge's decision.
 
"Today's ruling was another victory for public health," said Kevin Walker, regional vice president for advocacy for the American Heart Association. "We applaud the judge's ruling and are very happy that Wichita has joined the rest of the state in clearing the air in public venues."

Content Subject: Marketing/Merchandising

Formatted Article Date: September 2, 2010

Title: Kansas Smoking Ban Applies to Wichita, Judge Rules

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CHICAGO – A new report from foodservice consultant Technomic reveals that restaurant chains consider franchise agreements to be a primary means for growth, as the recession has prompted franchisors to offer franchisees incentives that include enhanced credit support, fee reductions, and reduced royalty rates.

“A focus on growing the franchise system allows franchisors to spend less on restaurant-level operations and redirect capital toward system wide marketing and brand initiatives,” said Darren Tristano, executive vice president at Technomic.

The "2010 Technomic/Restaurant Finance Monitor Top 400 Restaurant Franchise Company Report" was produced by Technomic in conjunction with Restaurant Finance Monitor and includes details such as the following:  

• The Top 400 restaurant franchisors realized a 1.6 percent lift in sales in 2009, to roughly $31.8 billion.
• NPC International, a franchisee of Pizza Hut, was the top franchisee company, with sales of $845 million, a 22.5 percent increase over 2008.
• McDonald's, Subway, and Burger King franchisees recorded the greatest sales--$26 billion, $10 billion, and $7.7 billion respectively.

The report is designed to help operators identify the top restaurant franchise opportunities and understand where franchising opportunities exist with restaurant brands. It also details sales, units, and growth against top industry performers.

Content Subject: Foodservice, Research

Formatted Article Date: September 2, 2010

Title: Restaurants Pursue Growth Through Franchising

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CHICAGO – SymphonyIRI Group has released a new Times & Trends report, "The New Path to Purchase: An Escalation of Channel & Consumption Migration," that reveals consumers are cutting back on the number of stores that they visit and spending less per trip.

The report reveals that since the second quarter of 2009, the number of shoppers visiting less than five stores has increased every quarter. By contrast, those who stop between five and nine stores during the same timeframe has dropped every quarter except one, and the number of consumers shopping at 10 or more stores has remained steady.

While average basket size has decreased over the past year for grocery stores, supercenters, and club channels, the average basket size for convenience stores, dollar stores, and drug stores has increased 8%, 3.8%, and 1.7%, respectively.

"Trip missions" for nearly all categories has declined sharply since the second quarter of 2009, except for quick trip shopping excursions, which jumped sharply in the second quarter of 2010. 

Overall, grocery remained the dominant channel with 98.4% penetration during the year ending June 27, 2010, followed by drug (77%), mass merchandise (71.6%), and supercenters (69.5%).

“Shoppers are not enjoying the same financial success as corporations this spring and summer, and their continued search for lower cost retail channels reflects this," said John McIndoe, senior vice president, marketing, SymphonyIRI, said. “In addition to potential pressure on retailer revenues and margins, these trends point to managers having fewer chances to ‘get it right’ with shoppers. If a shopper visits a store and is unhappy with the experience, she will quickly go elsewhere."

Content Subject: Research

Formatted Article Date: September 2, 2010

Title: Consumers Reduce Number of Shopping Trips

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GAINESVILLE, FL – The Pantry Inc. announced yesterday plans to target University of Florida football fans with its "Freeze the Swamp" campaign, a football-themed promotion kicking off the chain's introduction of Icee products to 92 Gainesville and Ocala area Kangaroo Express stores.

Kangaroo Express is partnering with The Icee Company on the campaign and will co-promote the frozen beverages during the Gators' football season.

“The ‘Freeze The Swamp’ campaign is our way of saying ‘thank you’ to our Gainesville customers and University of Florida fans,” said John Fisher, senior vice president of marketing, The Pantry. “Gainesville has historically been The Pantry’s highest performing frozen market across our 11-state footprint making it an ideal location to work with Icee to launch this program."

The "Freeze the Swamp" promotion will begin during the Gators' season opener this Saturday, when fans can enjoy an Icee sample at a Kangaroo Express Fan Fest booth while tailgating.

Throughout the 2010 season during home games, the stadium's announcer will encourage fans to stand up and cheer and "Freeze the Swamp" each time an opponent attempts a field goal.

Two exclusive Gator flavors will be available during the promotion, and all sizes will be priced at 99 cents, including a 32-ounce "Freeze the Swamp" souvenir cup.

“Collaborating with Kangaroo Express is a great opportunity to expand our reach in the Gainesville area to both new customers trying our products for the first time and loyal customers looking for a more convenient location to purchase an Icee,” said Dan Fachner, president of The Icee Company. “We look forward to helping Gator fans ‘Freeze The Swamp’ and engaging with the local community.”

Content Subject: Foodservice

Formatted Article Date: September 2, 2010

Title: Kangaroo Express Introduces Icee Offering to Gator Nation

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NEW YORK – A recent study concludes that despite corporate efforts to convince shoppers of their commitment to environmental sustainability, consumers remain unpersuaded, Brandweek reports. 

The study by Gibbs & Soell Public Relations, fielded in July by Harris Interactive, found only 16 percent of consumers believe that most or all businesses "are committed to 'going green' — that is, improving the health of the environment by implementing more sustainable business practices and/or offering environmentally friendly products or services." Additionally, forty-eight percent said "some" companies have such a commitment, and 24 percent said it's true of only "a few." (One percent said it's true of "none.")

As for consumer skepticism with companies' motivations, Ron Loch, senior vice president for greentech and sustainability at Gibbs & Soell, said companies that try to promote their green practices must do so delicately.

"I think the important message for marketers is that they can't let enthusiasm for promoting green features and benefits result in not talking enough about the product's performance," Loch said.  "Consumers care about the environment, but they are skeptical and pragmatic. They still need to understand the full value proposition before they're going to shell out their hard-earned dollars."

As such, according to Loch, companies whose commitments are genuine must fight hard to overcome this pervasive marketplace skepticism.

"As long as companies are transparent in their communications and don't overstate the social and environmental impact of their efforts, they can avoid being painted with the greenwash brush," Loch said. "It gets back to the need of really taking inventory of what is happening throughout the organization and then weaving that into a compelling, credible and defensible narrative."

Content Subject: Green, Management/Leadership/CEO

Formatted Article Date: September 2, 2010

Title: Thumbs Down on Corporate Green Efforts

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PURCHASE, NY – PepsiCo announced yesterday a change of distribution for Gatorade products in the convenience, UDS (up and down the street) and dollar store channels.

The change moves the company's current warehouse-delivered go-to-market system to direct story delivery (DSD) through bottlers in the U.S. and Canada and is expected to take effect January 1, 2011.

"This is a clear example of using PepsiCo's broad set of go-to-market systems to best serve our customers. We remain dedicated to the existing warehouse distribution system for some of our beverage products, but the change to direct store delivery makes sense for Gatorade as we redefine the sports nutrition category through the G Series," said Massimo d'Amore, CEO of PepsiCo Beverages Americas. "As a company, we are committed to bringing a wider variety of products to market more quickly and efficiently than ever before."

The change represents the first large-scale move toward optimizing PepsiCo's delivery systems resulting from its bottling acquisitions earlier this year. The savings will go toward the company's target of $400 million in pre-tax annualized synergies from its bottling acquisitions, once fully implemented in 2012.

"The distribution of Gatorade in key trade channels of convenience, UDS and dollar is well suited to the direct store delivery model due to its high velocity, so the switch will result in better store-level customer service," said Eric Foss, CEO of Pepsi Beverages Company. "By achieving greater speed, simplicity and flexibility, we will be able to better serve the current and future needs of both our retail customers and consumers in the marketplace."

Content Subject: Finance & Metrics, Operations

Formatted Article Date: September 2, 2010

Title: Gatorade To Be Distributed Via Direct Delivery

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ALBANY, NY – The New York Association of Convenience Stores yesterday asked Governor Paterson to issue an executive order suspending the 58% tax hike on cigarettes that took effect July 1, in fairness to long-suffering retailers whom state and federal courts have now deprived of the "other side of the bargain" — the promised level playing field starting September 1.

"In light of the court rulings blocking the start of tax collection on Indian sales of cigarettes to non-Indians, the New York Association of Convenience Stores respectfully requests that you temporarily suspend the cigarette excise tax increase that was enacted July 1," wrote NYACS President James Calvin.

"The double-edged bargain you made with the Legislature in June was to sharply increase the cigarette tax rate on July 1, but to mitigate its negative effect on tax-collecting retailers by capturing taxes on tribal sales to non-Indians starting September 1. If one side of this bargain has been placed on hold, it's only fair that the other should be put on hold as well."

Since the cigarette tax hike jumped from $2.75 a pack to $4.25 a pack July 1, NYACS said mom-and-pop stores have lost 25% to 45% of their cigarette unit sales, virtually all of it because of the ensuing wave of cigarette tax evasion it triggered. "They shouldn't have to continue to endure this economic hardship while courts allow their Native American competitors to keep thumbing their noses at New York State's tax law," Calvin wrote.

"We share your deep disappointment in the federal and state court rulings on the cigarette tax collection issue," he told Governor Paterson. "We were looking forward to a level retail playing field finally being restored. We nonetheless commend you for your courageous leadership on this issue, and look forward to supporting your efforts to lift the temporary restraining orders."

Content Subject: Operations

Formatted Article Date: September 2, 2010

Title: Convenience Stores Call for Suspension of 58% Cigarette Tax Hike

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CHICAGO – MillerCoors announced that for the 11^th consecutive years, it is offering small business the opportunity to vie for $150,000 in business grants with its MillerCoors Urban Entrepreneurs Series (MUES) and Business Plan Competition. Since 1999, the program has awarded more than $1.4 million in small business grants.

"The MillerCoors Urban Entrepreneurs Series (MUES) was created to help empower small urban businesses and we are proud to continue our commitment. In this tough economic climate, we recognize that entrepreneurship is the driving force to our country's economic recovery," said Larry Waters, director of multicultural relations for MillerCoors. "The talent we see through our competition is quite impressive and we hope that that these businesses will one day become MillerCoors suppliers.”

A Business Plan Competition is an integral component of MUES, and it awards professional start-up capital for a new or existing business.

This year’s top winner will be awarded a $50,000 grant, and four runners-up will win $25,000 each. Competitors also have the opportunity to become a qualified MillerCoors supplier.

Entries are due by Friday, October 1, 2010.

Content Subject: Corporate

Formatted Article Date: September 1, 2010

Title: MillerCoors Assists Small Businesses

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NEW YORK – Inc. Magazine announced last week the inclusion of 7-Eleven on its fourth annual Inc. 5000, a ranking of the nation’s fastest-growing private companies.

"The leaders of the companies on this year's Inc. 5000 have figured out how to grow their businesses during the longest recession since the Great Depression," said Inc. president Bob LaPointe. "The 2010 Inc. 5000 showcases a particularly hardy group of entrepreneurs."

In addition to 7-Eleven, the comprehensive list includes the music website Pandora, Brooklyn Brewery and Radio Flyer among its prominent brands making this year’s list.

7-Eleven was recognized at #4929 on the list, and Inc. noted that the company’s four percent, 3-year growth rate generated a revenue increase from $14.5 billion in 2006 to $15.1 billion last year.

“7-Eleven, Inc. is a very large company that has been in business for 83 years and is currently operating in a shrinking economy.  Despite obstacles, we continue to grow rapidly and find new opportunities to serve the convenience needs of consumers,” said 7-Eleven spokesperson Margaret Chabris. “ The fact that our company is among the fastest growing 5,000 private U.S. companies is certainly worthy of recognition, and we thank Inc. magazine for including us on their annual list.”

7-Eleven earned several other distinctions on the Inc. 5000, including Top 100 Companies by Employee Count (20,958), Top 100 Companies by Gross Dollars of Growth, and Top 100 Companies by Revenue.

Content Subject: Corporate

Formatted Article Date: September 1, 2010

Title: Inc. Magazine Cites 7-Eleven on Fastest-Growing Private Companies List

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LONDON – U.S. consumers have diverged into two distinct segments, with one splurging on indulgences, and the other concerned about unemployment and without discretionary income, the Financial Times reports.

On the far end of the spectrum are people who have survived the downturn and are spending what consumers normally do at the end of a recession. However, unlike after previous U.S. recessions, an entire segment of consumers appear to have been left behind.

“There are some people that still feel challenged and there are others that don’t,” said Steven Burd, chief executive of Safeway. “There’s an element of the economy [where people] haven’t been laid off, it’s been two-plus years; they’re comfortable it’s not going to happen [and there’s been] some recovery in their investment portfolio.

“They feel safe. They’re starting to spend. And then you’ve got another chunk of the economy that isn’t quite in the same position. So I think really consumer behavior is a bit bifurcated here.”

Sung Won Sohn, a professor of economics at California State University, described the consumer behavior as “barbell” shaped.

“People with money are not accelerating spending but are spending probably at the same levels as they have in the past — Mercedes and BMW are still going well,” Sohn said. “But the middle-income folks in America have become extremely value-conscious.”

Except for McDonald’s, most low-priced QSRs have posted weak growth numbers in 2010, while same-store sales at higher-priced chains such as Starbucks and Panera have grown this year.

“Selected brands are doing well, but the whole low end is doing poorly now,” said Bump Williams, a Connecticut-based beer industry consultant. Year-to-date, beer shipments in the U.S. are down 2.6 percent, Williams said. However, the craft-brewing segment has grown 15 percent in 2010.

Content Subject: International

Formatted Article Date: September 1, 2010

Title: A Tale of Two Cities

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ALBANY – The ongoing cigarette tax battle between New York State and the Seneca Nation tipped in favor of New York earlier this week, the Buffalo News reports.

New York’s State Supreme Court lifted two injunctions that had prevented the state from taxing cigarette sales on Indian reservations, after the justices heard more than three hours of legal arguments from both sides.

"I find that the state has met its burden," said State Supreme Court Justice Donna Siwek. As such, the law is scheduled to take effect today.

However, lawyers for the Senecas and other tribes have now challenged the state’s law in federal court.

The contentious issue has some Seneca leaders concerned about the outbreak of violence if the law takes effect as planned.

“Everyone's top goal is the public safety of our community and the surrounding communities," said Seneca President Barry Snyder Sr. "There have been many statements made about the potential for violence tied to the tobacco tax situation, even by New York State's governor. As I have said several times, the Seneca Nation is committed to working through this in an orderly, peaceful process."

At stake in the conflict is the collection of what New York estimates would be $110 million in cigarette taxes from Native American tobacco retailers in the first six months after the law takes effect.

Content Subject: Operations

Formatted Article Date: September 1, 2010

Title: State Lawyers Win Latest Round In Cigarette Tax Battle

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WASHINGTON – The American Petroleum Institute (API) has announced the publication of a document detailing recommended practices for storing and handling ethanol and gasoline ethanol blends at terminals and gas stations.

NACS advises members to ensure their fuel dispensing equipment is legally certified and compatible with renewable fuel blends, especially the soon-to-be-approved E15. The API document clarifies these compatibility requirements as well as details other issues related to selling higher blends of renewable fuels.

The 74-page document, “Storing And Handling Ethanol And Gasoline-Ethanol Blends At Distribution Terminals And Service Stations,” is available in hardcopy and PDF format for $150. Purchasing information is available here or by calling (800) 854-7179. Questions about the document should be directed to Stephen Crimaudo.

The September NACS Magazine focuses on selling renewable fuels such as E15.

Content Subject: Petroleum Retailing

Formatted Article Date: September 1, 2010

Title: API Details Practices for Storing and Handling Ethanol

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OLYMPIA, WA – Two Washington State ballot measures would abolish Washington's restrictions on liquor sales, a move that club retailer Costco is watching closely, the Associated Press reports.

Initiative 1100 (I-1100) would do away with Washington's liquor distribution and sales system and place that authority with private businesses. It would also eliminate beer and wine price controls and bans against volume discounts. Of particular interest to Costco, retailers with licenses to sell beer and wine would be able to add a liquor license, gaining the ability to purchase directly from manufacturers.

Currently, Washington residents can only purchase liquor from the state's 315 state and contract stores, while beer and wine are available in grocery and convenience stores.

"It's a matter of convenience," said Costco spokesperson John Sullivan. "People who move up from California really scratch their heads over this system."

Opponents to I-1100 maintain that the law would go too far in eliminating the three-tier system of producers, distributors and retailers, which would allow Costco to cut out the middleman distributor.

"It destroys the entire system," said Craig Wolf, president and CEO of Washington, D.C.-based Wine & Spirits Wholesalers of America.

Costco has invested heavily in the I-1100 campaign, donating more than $800,000 in contributions and $380,000 in in-kind contributions that include gathering signatures, placing web ads, and organizing staff support.

National liquor wholesalers and distributors are closely monitoring the campaign, with some predicting it could be the first step for Costco in trying to change the system in other states where liquor is also state-run.

"They'll try to replicate the rules in Washington State across the country," Wolf said.

A second initiative threatens the success of I-1100 — I-1105 would also privatize the liquor retail system, but it would retain state laws that protect liquor distributors, including prohibitions on bulk discounts for beer and wine.

Unions have opposed both measures, saying they will increase liquor sales and place state tax revenue at risk. Governor Chris Gregoire also opposes both measures.

 For more on the three-tier system, see the 2008 NACS Magazine.

Content Subject: Marketing/Merchandising

Formatted Article Date: September 1, 2010

Title: Do Away With the Middleman?

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WASHINGTON – Today marks the start of the Federal Emergency Management Agency's (FEMA) seventh annual National Preparedness Month (NPM), a month-long awareness program designed to encourage Americans to prepare for emergencies in their homes, businesses, and communities.

NACS is a coalition partner with FEMA, an association a partnership that signals members' commitment to inform fellow members, employees, and customers about the importance of being prepared for emergencies.

As a coalition partner, NACS members have access to and are encouraged to distribute information about FEMA's NPM materials, including:

• Website Widgets: These can be used on your websites to target geographically appropriate disaster events, for instance Kentucky disaster information, Tennessee flood recovery, and hurricane preparedness.
• Downloadable Materials: These speak directly to businesses and families and instruct them on the steps they can take to be prepared in a disaster, including getting an emergency supply kit and drafting a family emergency plan.

Content Subject: NACS

Formatted Article Date: September 1, 2010

Title: FEMA’s National Preparedness Month Begins Today

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ALEXANDRIA, VA – NACS sent a letter last week to the Financial Crimes Enforcement Network (FinCEN) regarding its proposed regulations on prepaid access gift cards, which it maintains would create an undue burden for retailers under its current form.

FinCEN’s Bank Secrecy Act proposes an exemption for closed-loop prepaid access and prepaid access, limited to a $1,000 maximum. However, those exemptions would only apply if a prepaid access device does not permit international transmission, which creates problems for Internet redemptions , redemptions outside of the U.S., and transfers among users.

Accordingly, as written, the rules would require retailers to register with FinCEN as a Money Services Business, with Providers and sellers of prepaid access required to verify, collect, store, and retrieve personal information, file suspicious activity reports and current transaction reports, and maintain anti-money laundering (AML) programs.

NACS urged FinCEN to construct the Act with a reasonable balance between the regulatory burdens and the anticipated benefits, commenting that the proposed exemptions “are drawn too narrowly to benefit those retailers engaging in transactions that pose a low risk of illicit activity.” It also said that the network should not impose a $1,000 threshold aggregated across all types of prepaid access, maintaining that such a requirement “ would be impossible to administer, and even if it could be implemented, would threaten the continued viability of prepaid access products.”

Content Subject: Government Relations

Formatted Article Date: August 31, 2010

Title: NACS Comments on FinCEN’s Proposed Gift Card Regulations

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SEATTLE – Starbucks announced earlier this week the introduction of Starbucks VIA Flavored Coffee in U.S. and Canada stores this fall.

The ready-brew flavored portfolio will be offered in four varieties: Vanilla, Mocha, Caramel, and Cinnamon Spice, all that use only natural flavors and other natural ingredients, including natural cane sugar as a sweetener.

“We know 60 percent of our customers drink coffee with flavor, and now they will have access to high-quality Arabica coffees with natural flavors as only Starbucks can deliver,” said Annie Young-Scrivner, Starbucks chief marketing officer. “The launch of Starbucks VIA® Flavored Coffees demonstrates our drive to inject innovation into the coffee category, deliver products our customers are looking for, and allows us to grow the business globally.”

With approximately 11 percent of American households purchasing flavored coffees, Starbucks is charging into the $377 million flavored market, trying to capitalize on the initial success of its VIA brand. Earlier this year, it launched Starbucks Natural Fusions, a ground flavored coffee that is sold in grocery stores and at large retailers.

Content Subject: Foodservice

Formatted Article Date: August 31, 2010

Title: Starbucks Launches Naturally Flavored VIA Coffees

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WOOD DALE, IL – Several U.S. tobacco retailers are selling deeply discounted roll-your-own-cigarettes, taking advantage of a federal tax loophole, the Wall Street Journal reports, a practice that has attracted scrutiny from regulators and tobacco companies.

Roughly 150 tobacco outlets across 20 states have deployed high-speed roll-your-own machines that produce a carton of cigarettes in just eight minutes, a cost that is in many cases half that of a carton of premium smokes. However, some regulators maintain the stores may be violating U.S. and state laws regarding cigarette manufacturing.

"These machines raise a number of questions," said David Rienzo, an assistant attorney general in New Hampshire, which has sued several roll-your-own retailers alleging they are acting as cigarette manufacturers and should therefore pay applicable fees.

The retailers are exploiting the tax loophole, using tobacco labeled “pipe tobacco.” Such a designation presents (for now) a substantial cost savings, as the federal excise tax on pipe tobacco is $2.83 a pound, compared with $24.78 a pound for rolling tobacco.

Tobacco manufacturers, too, are crying foul at the loophole that has created low-priced competition. "We are complying with the law, but some companies are not doing so in order to gain an unfair advantage," said Ron Bernstein, chief executive of Liggett Vector Brands Inc., a unit of Vector Group Ltd. that is the fifth-largest U.S. cigarette maker by sales.

Since the tax on rolling tobacco increased 14 months ago, the volume of pipe tobacco sold in the U.S. has more than tripled to roughly 21 million pounds, according to the U.S. Treasury's Alcohol and Tobacco Tax and Trade Bureau. During the same time, rolling tobacco sales volume has dropped about 60 percent. 

Meanwhile, the Treasury’s tobacco-tax bureau is working on clarifying the distinction between pipe tobacco and rolling tobacco, a process that is expected to take months.

Content Subject: Marketing/Merchandising

Formatted Article Date: August 31, 2010

Title: Roll-Your-Own Cigarette Machine Use on the Rise

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NEW YORK – While the Obama Administration has provided a tax credit of as much as 35 percent of the insurance premiums companies pay for employee health care insurance, many are finding that they do not qualify, and thus are finding it difficult to pay or continue paying for full employee coverage, Bloomberg reports.

Companies whose average employee wage exceeds $25,000 lose part of the credit, and those whose average wage exceeds $50,000 are not eligible for any savings. And with rising health-care premiums, small business owners are facing difficult decisions.

James Stenger, director of business development for BenefitMall, which sells group health plans, said most of his clients pay their workers more than $25,000 a year. As a result, the average tax credit they would receive is only about 10 percent of each policy's cost. That results in less than $200 per worker, hardly enough to spur companies to begin providing coverage.

"[The legislation] is just not doing what we had hoped," said Steven Selinsky, the incoming president of the National Association of Health Underwriters.

Countering those concerns, U.S. Small Business Administration chief Karen Mills said tax credit complaints are premature. "This is all still in anecdote land," Mills said, adding that the income cap was necessary to ensure those people with the greatest need were assisted.

"[Companies] want to provide health insurance [because] they're losing good employees when they don't," Mills said. "The math says [the program] is likely to be positive."

Content Subject: Operations

Formatted Article Date: August 31, 2010

Title: Small Businesses Skip the Health-Care Tax Credit

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WASHINGTON – With economic news last week that showed the economic recovery is stumbling, Fed Chairman Ben Bernanke vowed that the central bank would do all it could to prevent the U.S. from slipping back into a recession, the Los Angeles Times reports.

Bernanke's pledge came after the Commerce Department downgraded second-quarter growth, an indicator that the risk of a "double dip" recession had increased.

"We have come a long way, but there is still some way to travel," Bernanke said, adding that the Fed "will do all that it can do to ensure continuation of the economic recovery."

He predicted economic growth to resume in 2011, stressing that the economy was still improving. The annualized growth rate of 1.6 percent was sharply down from last month's estimate of 2.4 percent.

"He had to walk a fine line between worrying people about the outlook yet saying if the outlook does worsen, we will take the steps necessary to come to the aid of the economy," said Chris Rupkey, chief financial economist at Bank of Tokyo-Mitsubishi in New York. "I think the market kind of likes the idea that he stands ready to do things."

Bernanke outlined three options for buttressing the fragile economy: The Fed could expand purchases of long-term securities, lower the interest rate it pays to commercial banks for their reserves, or make more public assurances.

"They still have some pretty good ammunition," said Brian Bethune, chief U.S. economist at IHS Global Insight.

Content Subject: Finance & Metrics

Formatted Article Date: August 31, 2010

Title: Fed Committed to Prevent Second Recession

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MIAMI – Black Enterprise magazine named Burger King Corp. one of the "40 Best Companies for Diversity" in the publication's sixth Annual Diversity Report, an analysis of the top 1,000 publicly traded companies and 50 leading global companies with U.S. operations. This is the third year the home of the Whopper has been recognized for demonstrating diversity among its suppliers and employees.

“At Burger King Corp., we have always strived to foster an inclusive work environment and have ensured that inclusion and diversity are woven into not only our business strategy, but also our culture,” said Robert Perkins, vice president, inclusion and talent management, Burger King Corp. “We are proud to see such efforts come to fruition, and we are honored to be recognized by such an esteemed publication as Black Enterprise.”

Burger King has committed substantial resources to creative a diverse workplace, with inclusion efforts focused on the workforce, community, restaurant guests, and operators/suppliers. It has also strived to create business opportunities for qualified suppliers owned by women and minorities.

“We are proud that our efforts and accomplishments have garnered the attention of such a prominent and established publication for African American professionals as Black Enterprise,” said Perkins. “By continually recognizing and appreciating the differences in each individual, BKC is committed to helping our employee base grow both personally and professionally.”

Content Subject: Corporate

Formatted Article Date: August 31, 2010

Title: Burger King Corp. Named One of “40 Best Companies for Diversity”

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NEW YORK – Governor Paterson said last week that he is concerned about possible "violence and death" over New York State's plan to collect taxes on cigarettes sold on Indian reservations, Gothamist reports.

"There will be quite an uprising and protest to this, but I am going to maintain this policy...The state police tell us over and over again that there could be violence and death as a result of some of the measures we're taking," Paterson said.

A U.S. District Court has reserved a decision as to whether to grant the Seneca Nation a temporary restraining order against New York State's enforcement of new tax laws. Regardless of the court's ultimate decision, though, the Senecas are preparing for a fight.

"Let's start setting up some fires here and there just to let the public know that we are serious and we are ready to battle if this is what it is going to come to," read one post on the Seneca Voice blog.

Because of the impending tax collection, the Onondaga Nation said it would probably stop selling national brand cigarettes this week and instead sell Indian-made brands, a move that Paterson said suits him just fine.

“They can make their own cigarettes and they can sell the cigarettes on the reservation as they are entitled to by federal law," Paterson said. "Once they come off, or anyone else comes off, of their sacred land with cigarettes that are not being taxed by New York State, we are going to address that issue."

Content Subject: Marketing/Merchandising

Formatted Article Date: August 31, 2010

Title: Governor Paterson Predicts "Uprising" Over Cigarette Tax Collection

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NEW YORK – Analysts are predicting that movie rental chain Blockbuster could file for bankruptcy as early as next month, TheStreet.com reports.

The company met earlier this month with its senior debt holders and six major movie studios, discussing a preplanned bankruptcy.

TheStreet.com said that for Blockbuster to continue business uninterrupted, it would be essential for it to receive the continued support of movie studios.

A preplanned bankruptcy would last about five months and allow the chain to break leases at some of its underperforming stores, which could lead to a closure of up to 800 locations.

The retailer is due to repay $42 million from its escalating $1 billion debt on September 30, which could lead to a bankruptcy filing as early as mid-September. It has already postponed the payment two times.

"The company does not have enough assets to cover its debt, and debt is superior to equity in bankruptcy," said Wedbush analyst Micael Pachter. "This is not a liquidation, so shareholders won't be wiped out, but in the reorganization, it's unlikely that shareholders will get much more than a hope that the company can recover, repay all of its debt, and return to a positive equity value."

The company recently reported a second quarter loss of $69 million, significantly larger than what analysts had expected. Its revenue has dipped 20 percent to $788 million from $982 million.

Blockbuster has attributed its popularity decline to worse-than-expected results from closing its stores, fewer store customers, and a nearly 30 percent drop in average subscribers to its by-mail service.

Despite the economic uncertainty, the company has continued its operations without pause, announcing plans to roll out more DVD kiosks, adding video games to its by-mail service, and teaming with Comcast to launch DVDsByMail.com, which grants Comcast subscribers a discount for its mail service.

Content Subject: Corporate

Formatted Article Date: August 31, 2010

Title: Death of a (Video)Salesman

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CHICAGO – 7-Eleven began testing sales of roasted chicken at some of its downtown Chicago stores last week, trying to grab some of the city's grab 'n go dinner business.

"It's to see if we can capitalize on home meal replacement," said Carole Davidson, senior vice president of strategic planning for the convenience store retailer.

The whole chickens sell for $7.999 and follow the company's recent introduction of chicken wings and pizza in hot food cases, as well as grilled chicken with cheese and tortellini and sun-dried tomatoes in refrigerated sections.

Select stores also began stocking packaged-fresh fruits, including sliced mango and watermelon, as well as artisanal red velvet- and chocolate-flavored cupcakes.

For more on dinner programs for convenience stores, see the August issue of NACS Magazine.

Content Subject: Foodservice

Formatted Article Date: August 30, 2010

Title: 7-Eleven Tests Roasted Chicken

Page Content:

MINNEAPOLIS, MN – Target announced last week an innovative online weekly ad that enables consumers to customize their savings.

“My TargetWeekly” is a customizable version of the retailer's popular online weekly ad, which draws more than 1.2 million visitors each week. With My TargetWeekly, consumers create customized deal alerts and customized views to focus on their preferred products. They can also share deals via Facebook and Twitter and create customized mobile shopping lists.

“We are excited to provide our guests with yet another innovation to simplify their lives and improve their shopping experience,” said Steve Eastman, President, Target.com. “As the only retailer offering this technology, we are proud to give our guests more ways to make the most of their dollar, which helps us deliver on our ‘Expect More. Pay Less.’ brand promise.”

Content Subject: Marketing/Merchandising

Formatted Article Date: August 30, 2010

Title: Target Unveils Customized Ad Technology

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PHOENIX – Phoenix-based Mobile Bytes L.L.C. announced last week the availability of its YWaiter White-Label Program, a smartphone app that allows foodservice operators to offer their customers a branded smartphone app experience "at a fraction of the cost" of launching their own app.

"YWaiter allows a restaurant to escape the $100,000 + price point that it would cost to build their own app," said YWaiter President/CEO Dan Calderone. "When you compare the cost, hassle and time of building your own app, versus the simplicity of buying the white label service through us, it really makes economic sense."

YWaiter White-Label is PCI-DSS certified and is available on iPhone and Android platforms. Glendale, Arizona-based Pie Zanos, a pizzeria, was the first to go live with the service.

"As far as building my own app, I wouldn't even know where to begin," said Pie Zanos owner Jayce Elliston. "There are $99 apps out there, but what kind of support do you receive? With YWaiter's White-Label service, I have the comfort level of a company that supports restaurants — they want to build a long-term relationship with me and my establishment."

For more information, visit ywaiter.com.  

Content Subject: Technology

Formatted Article Date: August 30, 2010

Title: Want to Drive Customers to Your Foodservice Program? There's an App for That!!!

Page Content:

WASHINGTON – The U.S. Department of Agriculture said last week that it expects food prices to increase this year at the lowest rate since 1992, the Associated Press reports.

The figure represents a revised estimate for the agency, a reflection of a downward-adjusted estimate for the consumer price index for food, which it said would increase only 0.5 to 1.5 percent this year, compared to its earlier expectation of a 1.5 to 2.5 percent increase.

"Although global economies have recovered somewhat from the 2008-9 recession, world economic activity remains below pre-recession levels, resulting in overall food price inflation ... below historical averages," the agency said.

If the agency's forecast holds true, the food price increase would be the lowest since 1992, when prices rose 1.2 percent.

The minimal price growth comes despite rising prices for commodities such as sugar, wheat, and coffee.

The USDA said prices for food consumed at home will increase at the same rate, while food eaten at restaurants is expected to rise between one and two percent.

Content Subject: Foodservice

Formatted Article Date: August 30, 2010

Title: USDA: Food Prices Increase to the Lowest Levels Since 1992

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NEW YORK – Foregoing traditional newspaper ads and circulars, Save-A-Lot supermarket has drummed up community good will and great PR by giving away free groceries delivered to prospective customers' homes, reports Advertising Age.

The test case in Opelousas, Louisiana, a small town an hour west of Baton Rouge, played out with the supermarket retailer delivering a free bag of groceries--unannounced--to roughly 1,000 homes within a one-and-a-half mile area surrounding the store.

Match Kotcher, director of brand marketing and design for Save-A-Lot, said the company wanted to try something new to engage the community.

"We're always looking for new ways to break through," Kotcher said. "A lot of grocery advertising today is people saying 'Our prices are the lowest, our prices are the lowest.' Well, we believe in proof points and what better way than to take it right to [the customer's] front door?"

Each bag was filled with up to $20 in groceries, mainly household staples as well as Save-A-Lot's private brands. And the promotion has generated far more value than would have been possible with a traditional ad spend.

"It's been tremendously successful," Kotcher said. "We're not a huge retailer; we prefer to put all the savings into a product. So we wanted to think of something that was nontraditional but resonated on an emotional level. A lot of grocery companies do sampling, but it's in-store. What's easier than coming home to a bagful of groceries?"

Content Subject: Foodservice

Formatted Article Date: August 30, 2010

Title: No Foodservice Ad Budget? Try Door-to-Door Giveaways

Page Content: NEW YORK – While oatmeal has been resonating with consumers outside the home — "it's been a big win for Starbucks and Jamba Juice," according to Advertising Age, and McDonald's is planning its own oatmeal launch early next year — Quaker is planning to revamp its oatmeal line with the intent of stimulating at-home oatmeal consumption.

Quaker's CMO Kirsten Lynch acknowledged that consumption of oatmeal outside the home is on the rise, with an inverse decrease inside the home. According to SymphonyIRI Group, oatmeal sales dropped 2 percent to $872 million in 2009 and are down five percent year-to-date in supermarkets, drugstores, and mass-market retailers (excluding Walmart). And Quaker's hot cereals and oatmeal are also down. Last year, its sales dropped eight percent, and year-to-date sales are down six percent.

However, Lynch said she doesn't view Starbucks, Jamba Juice or McDonald's as competitors. "Quaker is excited that these companies are adding healthy options, such as oatmeal, to their breakfast menus," she said. "Our research tells us that out-of-home oatmeal consumption is growing, so this is great for the category. This type of trend usually translates to retail sales within 12 months."

Trying to leverage that interest, Quaker's "Amazing Mornings" campaign will include an ad spending commitment that's up 50 percent in the second half (Last year, Quaker spent $13 million on measured media promoting its hot cereal and instant oatmeal in the second half).
Quaker's instant-oatmeal products are all being upgraded to a larger, whole-grain oat, with sugar slashed by 25 percent. The company is adding two new products: Mix-up Creations Instant Oatmeal for kids; and Hearty Medleys Instant Multigrain Hot Cereal, featuring real nuts and fruits.

Content Subject: Marketing/Merchandising

Formatted Article Date: August 30, 2010

Title: Quaker Ups its Oatmeal Game

Page Content:

ALEXANDRIA, VA – The head of NATSO, the trade association representing travel plazas and truckstops, responded sharply to attempts by government entities to commercialize rest areas along interstate highways, The Trucker News Service reports.

NATSO President and CEO Lisa Mullings responded to a recent video released by the Arizona Department of Transportation that sought a government amendment to a 1956 federal law that bans rest area commercialization:

“In a recent video press release issued by the American Association of State Highway and Transportation Officials, the Arizona Department of Transportation proposes that states should compete with small-town businesses, siphoning jobs and customers to fix state budget shortfalls, by establishing commercial rest areas along the Interstate right-of-way.

Congress outlawed commercial activities at interstate rest areas to foster competition and the growth of local communities near the Interstate Highway System. Today, this policy continues to promote a vigorous competitive environment. In Arizona alone, nearly 1,200 businesses are located within a quarter mile of an interstate highway, employing more than 31,000 people.  Nationally, 97,000 businesses, including truckstops, gas stations, convenience stores and restaurants, thrive along the Interstate Highway System, employing 2.2 million Americans.

ADOT’s plan to overturn this law and allow commercial rest areas would drain local businesses of customers, jobs and local tax revenues by putting established businesses in direct competition with the state. At the same time, it would give the state an unfair competitive advantage by granting the state direct access to highway motorists.

Arizona’s plan represents a deliberate attempt to set up businesses on the Interstate right-of-way with full awareness that there are no new dollars or new traffic on the Interstate Highway System.

State budgets nationwide are stressed because of the economic downturn. But addressing those budget problems by adopting measures harmful to small town businesses and local communities is counterproductive and stands to create more problems in the long-term than they solve.

State financial budget problems are not a burden that should be handed to local business owners and local communities. Now is not the time to threaten businesses that will suffer in the form of lost jobs and property taxes used to support schools, police, fire and other public services.

Despite claims that commercial rest areas represent a positive public-private partnership, the reality is they represent state-controlled monopolies on travelers’ food, beverage, retail and fuel purchases because they alone will enjoy the best, easiest-to-access locations. Well-established local businesses that rely on motorists exiting the interstates will no longer be able to compete.

What’s more, while nearby businesses are left to flounder, consumers will pay hidden taxes in the form of higher costs for goods and services at commercialized rest areas as the large multi-national corporations contracted to run them seek to recoup investments and turn a profit for shareholders and the state.”

Read more about the NACS position on rest area commercialization.

Content Subject: Petroleum Retailing

Formatted Article Date: August 30, 2010

Title: NATSO Chief Responds to Rest Area Commercialization Video

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Wage Hour Webinar Questions Answered
The risk of high-exposure wage claims is far greater than ever and you need to make sure you are protected. Lawsuits under the federal Fair Labor Standards Act (FLSA) alone have exploded into one of the biggest sources of employment-law claims, and the U.S. Labor Department is stepping up FLSA investigations.

On August 12, 2010, NACS hosted a webinar for its members to review Wage-Hour Laws and how they affect the convenience store industry. The webinar consisted of a PowerPoint presentation by John Thompson, a wage-hour attorney at the law firm of Fisher & Phillips, and a question and answer session (the full audio archive of the webinar is available here). We did not have enough time to answer all of the wage-hour questions during the one-hour webinar so please visit the questions and answer document to see the answers to your questions.

NACS Staff Contact: Corey Fitze, cfitze@nacsonline.com

NACS Sends Letter to Federal Reserve Bank on Debit Fees Survey
The Federal Reserve Bank (the Fed) has issued a draft of a survey that will be sent to all debit card issuers in an effort to collect information that will be used to determine how they regulate debit card interchange fees. The Fed has requested that impacted industries comment on the proposed survey so as to gather the best possible information.

NACS submitted its comments on behalf of the industry on August 20, 2010. Click here to see the letter in its entirety.

NACS suggests the Fed address four specific areas of the survey:

• the need for historical data dating back to 1990
• the need for data on the paper check system
• the need to determine the specific costs not related to the transaction which must NOT be considered when setting the rates for debit cards
• the need to collect fraud and fraud prevention data

NACS Staff Contact: Lyle Beckwith, lbeckwith@nacsonline.com

Menu Labeling Guidance and Upcoming NACS Comments
This week the FDA put out two guidance documents on menu labeling provisions that were enacted in the Patient Protection and Affordable Care Act.

The first guidance is titled, “Questions and Answers Regarding Implementation of the Menu Labeling Provisions of Section 4205 of the Patient Protection and Affordable Care Act.”  The guidance addresses the current thinking of the FDA on:

1. disclosing the number of calories in each standard menu item on menus and menu boards
2. making additional written nutrition information available to consumers upon request
3. providing a statement on menus and menu boards about the availability of the additional nutrition information
4. providing calorie information (per serving or per food item) for most self-service items and food on display, on a sign adjacent to each food item. 

In addition, FDA confirms that the requirement that chain vending machine operators disclose the calories of any article of food that does not permit examination of the Nutrition Facts panel prior to purchase also became effective immediately upon enactment. It is requested that impacted parties submit comments on the entire document. Draft guidance is here.

The second document is titled, “Questions and Answers Regarding the Effect of Section 4025 of the Patient Protection and Affordable Care Act of 2010 on State and Local Menu and Vending Machine Labeling Laws.” 

FDA states that the guidance should serve to inform industry and state and local governments of the impact on state and local menu and vending machine labeling laws, and to ensure that these stakeholders understand the immediate effects of the law. The guidance permits comment, but will be implemented immediately as a final guidance because public participation is deemed to be unnecessary or inappropriate in light of the need to respond expeditiously to the mandates in the law. Final guidance is here.

NACS Staff Contact: Julie Fields, jfields@nacsonline.com

Content Subject: Government Relations

Formatted Article Date: August 27, 2010

Title: Washington Report: Labor Update- Wage Hour Questions Answered

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CHICAGO – For customers who don’t want fast food or an expensive full service meal, a fast casual restaurant might be the ticket.

According to a recent Mintel foodservice report, the fast casual restaurant category accounted for estimated sales of $23 billion in 2010, up nearly 30% since 2006. Restaurants in this market claim to combine the quality of family casual with the convenience of fast food. At $6-$12 per ticket, pricing falls between fast food and casual dining. Fast casual restaurants distinguish themselves from fast food through their modified table service, higher food quality, greater attention to healthful foods and, in some cases, availability of beer and wine.

“The relatively new fast casual category has fared well through the recession as people can see the added value in the food and atmosphere, despite the slightly higher price point,” comments Eric Giandelone, director of foodservice research at Mintel. “The majority of restaurant-goers say quality is the most important determinant in their choice of a restaurant, which will continue to help this category grow.”

Fast casual restaurants have not yet displaced fast food, casual dining, pizza or family dining restaurants, but this fairly young category makes its strongest statement during the lunch hour, with patronage levels almost equaling that of casual dining (26% of respondents have visited a fast casual restaurant in the past month and 28% a casual dining restaurant.) However, fast food still holds a strong lead with nearly 60% of Mintel respondents frequenting a fast food establishment for lunch within the past month.

According to Eric Giandelone, the main reason fast casual restaurants lag so far behind fast food is simply that there aren’t as many of them. One of the most successful fast casual chains, Panera Bread, had 1,388 locations as of March 2010, meanwhile fast food leader, McDonald’s had 10 times that number of restaurants in the United States.

Nearly 30% of those surveyed cite the reason for not frequenting a fast casual restaurant in the past month as “there are no/not many fast casual restaurants by me.” Just over a quarter of respondents (26%) claim they are too expensive and 22% prefer a regular wait staff when they dine out.

Content Subject: Foodservice

Formatted Article Date: August 27, 2010

Title: Fast Casual: Niche Restaurant Segment?

Page Content:

ATLANTA – In today’s climate of flu and communicable disease scares, hygiene and wellness education is more imperative than ever. According to a 2009 study by the Soap and Detergent Association, 39 percent of people seldom wash their hands after coughing and sneezing.

Because Georgia-Pacific Professional believes everyone should wash their hands with soap and dry them with a paper towel, the company is launching Spread Wellness, a campaign aimed at teaching people proper techniques for washing and drying hands when away from home. The campaign also encourages everyone to be a Spread Wellness ambassador by sharing the importance of hand hygiene practices wherever they go.
 
The Spread Wellness website is a resource center that provides links, tips, education materials, news and tools to share with those around them. The website also offers an interactive hygiene poll and downloadable signs that promote hand washing. Additionally, visitors can sign up to be a Wellness Ambassador and receive a welcome kit with a Spread Wellness wristband.
 
“With the easy transfer of germs and diseases, we all need to be more aware of our surroundings,” said Bill Sleeper, president of Georgia-Pacific Professional. “We need to practice good hygiene habits ourselves and share these tips with those we interact with. This campaign is about educating the public on how to use the best hand washing practices to stay healthy and potentially take steps to help improve cleanliness and wellness wherever they go.”
 
Through the Spread Wellness website, consumers and facility managers are provided a way to take action to further promote hygiene away from home. Beyond hand washing materials, consumers can request enMotion Automated Touchless Towel Dispensers in places they go and where they work, and facility managers can learn more about leasing enMotion Automated Touchless Towel Dispensers for their facilities.

Learn more about Spread Wellness on Facebook and Twitter @GPProfessional.

Content Subject: Corporate

Formatted Article Date: August 27, 2010

Title: Georgia-Pacific Launches Hygiene Campaign

Page Content:

CHICAGO – Shoppers are cutting back on the number of stores they are visiting, concentrating visits on stores known for lower prices, generally visiting stores less frequently and spending less per trip. These are the principal findings of SymphonyIRI Group’s new Times & Trends report, “The New Path to Purchase: An Escalation of Channel & Consumption Migration.”

“In addition to potential pressure on retailer revenues and margins, these trends point to managers having fewer chances to ‘get it right’ with shoppers. If a shopper visits a store and is unhappy with the experience, she will quickly go elsewhere.”

“Shoppers are not enjoying the same financial success as corporations this spring and summer, and their continued search for lower cost retail channels reflects this,” said John McIndoe, senior vice president, marketing, SymphonyIRI. “In addition to potential pressure on retailer revenues and margins, these trends point to managers having fewer chances to ‘get it right’ with shoppers. If a shopper visits a store and is unhappy with the experience, she will quickly go elsewhere.”

Grocery remains the dominant channel, with 98.4 percent penetration during the 52-weeks ending June 27. Other leading channels include drug (77.0 percent penetration), mass merchandise (71.6 percent) and supercenters (69.5 percent). Supercenters enjoyed the largest penetration increase of 1.9 points, followed by dollar stores with a 0.5-point increase. Mass merchandise penetration decreased 2.3 points, while convenience store penetration declined 1.9 points and drug fell 0.5 points.

The number of shoppers visiting fewer than five stores has increased every quarter since the second quarter of 2009. In contrast, those shopping at 5-9 stores in the same timeframe has dropped every quarter but one. The number of people shopping at 10 or more stores has remained approximately the same.

Overall, trip frequency began to consistently decline starting in Q4 2009, and in Q2 2010, declined nearly 2 percent versus the same period the prior year, driven by declines in the convenience store and mass merchandise channels, which experienced slides of 9 percent and 7 percent, respectively. Across most other channels, average purchase occasions remained fairly steady.

Dollars per purchase occasion, which were growing at approximately 5 percent in Q3 2008 versus the same period the prior year, fell flat in Q3 2009 and are now declining by more than 1 percent. While grocery, supercenter and club channels have seen average basket size slide over the past year, convenience, dollar and drug stores enjoyed significant increases of 8 percent, 3.8 percent and 1.7 percent, respectively.

A majority of trip missions have seen total trips to retailers decline steadily for nearly all categories since Q2 2009. The exception is quick trips, or small “need it now” shopping excursions, which remained constant for the second half of 2009 and then jumped dramatically in Q2 2010. Similarly, basket size across trip missions has declined most quarters since Q2 2009. Once again, quick trips were the exception, consistently demonstrating increased basket size each quarter, beginning in Q3 2009.

Factors driving performance of these channels include:

• All retailers are instituting aggressive pricing, merchandising and promotion strategies to woo shoppers
• Channels known for low prices are tending to perform better
• Many mass merchandisers are shifting to a supercenter format, temporarily depressing trips and dollar share performance
• Convenience stores, known for carrying more discretionary items, are feeling the pinch, as shoppers remain wary about non-essential spending

The report offers strategies for manufacturers and retailers. Among the recommendations, SymphonyIRI suggests identifying new growth opportunities and risks through ongoing category- and brand-level channel migration analyses, aligning distribution, marketing and merchandising strategies with channel migration patterns and focusing on protecting and growing dollar and unit share among high-value shoppers.

Content Subject: Research

Formatted Article Date: August 27, 2010

Title: Shoppers Scale Back on Channel Shifting

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WILMINGTON, DE – The number of Americans traveling during the three holidays of summer is increasing this year. In fact, the Labor Day holiday weekend, which is normally the smallest of the three travel holidays, is a case in point.

Across the nation, the number of holiday travelers will increase 9.9 percent from 2009, AAA today projected.

Approximately 34.4 million travelers taking a trip at least 50 miles away from home, according to the forecast by the nation’s largest leisure travel organization. Last year, 31.3 million Americans traveled during the Labor Day holiday.

“While media reports on the state of the U.S. economy are mixed, many Americans are still interested in taking one more trip as the summer travel season comes to a close,” said Jim Lardear, director of public and government affairs for AAA Mid-Atlantic. “It is encouraging to see more Americans planning to travel to visit family, friends and exciting vacation destinations.”

The increase in travel for Labor Day appears to be the result of economic improvement over the past year. While job growth has been disappointing, gross domestic product, household net worth and consumer confidence have increased, while consumer debt has decreased. The U.S. travel industry began to gain traction in the fourth quarter of 2009 and that momentum has continued this year.

“AAA travel agents are continuing to report strong increases in the number of travelers making advanced reservations,” Lardear added. “Hotel, car and vacation package reservations for the upcoming Labor Day weekend are up over ten percent compared to last year.”

The 2010 Labor Day holiday travel period is defined as Thursday, September 2 to Monday, September 6.  In addition to economic data, the date of the Labor Day holiday is another variable considered in the forecast.

It works like this. The earlier the holiday falls in September, the more travel tends to occur. Although the growth in Labor Day travel is predicted to be strong at 9.9 percent, had the holiday fallen earlier in the month the forecasted number of travelers would likely be even higher, says AAA.

Trips by automobile are expected to increase in popularity with 91 percent of travelers, or 31.4 million people, reaching their destination by driving. This is an increase of 10.3 percent from last Labor Day when 28.5 million travelers went by motor vehicle. Barring any major tropical storm activity in the Gulf Coast region, AAA expects the national average price of self-serve regular gasoline to be between $2.65 and $2.75 per gallon during this holiday weekend.

Leisure air travel is expected to account for just five percent of overall travel with 1.62 million holiday flyers. This is an increase of 4.6 percent from one year ago when 1.54 million flew. Trips by other modes, including rail, bus and watercraft, will be the dominant means of travel used by four percent of all travelers.

Based on a survey of traveler intentions, the average distance traveled by Americans this Labor Day holiday weekend is expected to be 635 miles, slightly less than one year ago (645 miles). Median spending is expected to be $697 this Labor Day, nearly $50 more than last year when median spending was estimated at $650.

AAA’s projections are based on economic forecasting and research by IHS Global Insight. The Boston-based economic research and consulting firm teamed with AAA in 2009 to jointly analyze travel trends during the major holidays. AAA has been reporting on holiday travel trends for more than two decades. The complete AAA / IHS Global Insight 2010 Labor Day holiday forecast can be found at AAA.com/news.

Content Subject: Operations

Formatted Article Date: August 27, 2010

Title: Expect More Labor Day Travelers, Says AAA

Page Content:

ALEXANDRIA, VA – NACS Show attendees interested in attending a NACS-sponsored training session are encouraged to register this month to secure a spot.

The sessions offer a valuable mix of relevant industry information — some that lead to nationally recognized certification.

Small Operators Only
Mark Wells, president of LJT Management Services Inc., will facilitate the following sessions, which are limited to individuals from companies with fewer than five stores. Class size is limited to 35 participants, and all necessary materials will be supplied.

• Operational Efficiencies: October 5, 12:00 pm – 2:00 pm
• Developing New Employee Training Programs: October 5, 2:00 pm – 5:00 pm
• Financial Management: October 6, 7:30 am – 10:30 am
• Developing Employee Incentive Programs: October 7, 7:30 am – 10:30 am

Certification Training Sessions
Tara Paster, president of Paster Training Inc., will facilitate the following certification training sessions, which are open to all show attendees. Class size is limited to 50 participants per session, and all applicable materials will be supplied.

• ServSafe® Certification - Examination Only: October 5, 2:00 pm – 4:00 pm
• Basic HACCP Certification: Part 1, October 5, 2:00 pm – 5:00 pm
• Basic HACCP Certification: Part 2, October 6, 7:30 am – 10:30 am
• TIPS® Off Premise Certification: October 7, 7:30 am – 10:30 am

Click here for more information and to register.

Content Subject: NACS

Formatted Article Date: August 27, 2010

Title: Registration Open for NACS Show Training Sessions

Page Content:

WASHINGTON – A report earlier this week at BusinessNewsDaily.com revealed five key trends that small business owners would like to see emerge from Washington to help put their businesses back on track:

(1) Ease lending requirements: Despite the theoretical ease of obtaining a SBA loan, requirements are still too stringent, small business owners said.

“I had the opportunity to acquire inventory at pennies on the dollar,” said Jeremy Shepherd, owner of Los Angeles-based jewelry retailer, Pearl Paradise. “The only type of loan or line of credit [the bank] would consider would be a cash-collateralized loan. The best we could do was [the equivalent of] a prepaid credit card.”

Execs said banks must "lighten up," even if that means the government must back the loans 100 percent. Additionally, they argued for the SBA to raise the cap on 7(a) loans and American Capital Recovery (ARC) loans, which they said would allow for substantial gains.

“Without adequate financial assistance, the new generation of entrepreneurs will find it difficult to acquire existing business operations,” said Grover Rutter, a CPA based in Findlay, Ohio. “This deficiency in adequate capital is a detriment to current and future employment.”

(2) Repeal 1099 reporting requirements: “The government needs to repeal or amend the 1099 reporting requirement in the health care bill,” said Mariette Knoblauch, an accountant at Blue Stone Accounting in Seattle.

Set to take effect next year, it would require businesses to file a 1099 for every company from which they purchase more than $600 in goods or services.

“It’s totally unworkable,” said Rick Smith, owner of Chef’s Resource, an online cookware retailer based in Laguna Hills, Calif.

(3) Make it easier to get government contracts: “The federal government needs to simplify its bid process so small manufacturers can bid for government contracts without having to spend days and pay lawyers to fill out paper work to just place a bid,” said Garvey Rich, vice president of product development at KD dance, based in the Bronx, N.Y.

(4) Communicate better: Small business owners are demanding straight talk from Washington.

“The ability to clarify the implications of past and future legislation would go a long way,” said Mike Bucci, president of K&M of VA, a Richmond, Va.-based company that makes paint and craft products. “When legislators say that they don't understand the implications of what they have enacted, it makes them sound idiotic and scares us all.”

(5) Get out of the way: Many owners reported feeling that the government is regulating them out of business.

“Let business do what it does best: Make stuff and provide services that meet the needs of the customers,” said Paul Chase, a Pennsylvania-based real estate agent. “There is certainly a need for some regulation, but companies are being regulated to death.”

Content Subject: Operations

Formatted Article Date: August 26, 2010

Title: Five Things Small Businesses Want From Washington

Page Content:

TORONTO – For those retailers looking to reap dual U.S.-Canadian success, consider a recent Quadrant Marketing study that found sharp distinctions between U.S. consumers and their neighbors to the north, as reported in Digital Journal.

Some of the differences highlighted in the study include:

• While in the U.S., list-making is common, with roughly three in four consumers preparing a list before setting out to a store, more than half of all Canadians are list-less when it comes to shopping.
• Americans are price-conscious, with 79 percent looking at price when choosing a retail location, while only 55 percent of those north of the border focus on price, with the rest concerned about convenience, assortment and reward programs.
• POS displays take on a greater importance in Canada, with 48 percent of shoppers influenced by in-store signage, compared with 20 percent in the U.S.

"In the absence of specific insights about Canadians, marketers often try to leverage U.S. shopper research," said Molly Spinak, president of Quadrant Marketing. "There are vast differences between Canadian and U.S. ethnographic and retailer landscapes. What works in the U.S. doesn't necessarily work in Canada. ... Point-of-purchase is an important battleground for brands today, so we took on this first-of-a-kind Canadian study as a way to help our clients with spending their dollars more effectively."

Content Subject: International, Research

Formatted Article Date: August 26, 2010

Title: Study Highlights Canadian-U.S. Shopper Distinctions

Page Content:

GREECE, NY – While New York’s recent cigarette tax hike has prompted many smokers to quit--as many as 86,000, according to state health officials — they have also led to an increase in theft of the nearly $10 packs, MPNnow.com reports.

Since Governor David Paterson $4.35 excise tax on a pack of cigarettes took place July 1, over-the-counter and “smash and grabs” have spiked in Monroe County. Of the 18 cigarette-related thefts reported this year in the county, nearly half of those happened in July.

The thefts have occurred as either a “smash and grab,” whereby the suspects have smashed windows or doors and then grabbed packs of cigarettes, or by distracting cashiers and then stealing the cigarettes and fleeing.

The thefts have focused on Newport cigarettes, a specificity that has police puzzled. Irondequoit Police Sgt. Barry VanNostrand said many of the thefts are made for an intended resale on the streets.

“The environment isn’t such in Irondequoit where it is conducive to people selling individual cigarettes as it might be in the city,” he said. “There are people more frequently out on street corners in the city.”

The New York Association of Convenience Stores said theft is not the only law smokers may be breaking. The association said some are crossing into border regions where the New York tax isn't applicable, while others are making trips to Indian reservations.

Content Subject: Operations

Formatted Article Date: August 26, 2010

Title: NY Cigarette Thefts Spike

Page Content:

WASHINGTON – Before the recent salmonella outbreak traced to eggs, only half of the scientists at the Food and Drug Administration (FDA) reported having "full confidence" that their organization adequately safeguards consumers from food-borne illnesses in eggs, the Los Angeles Times reports.

The survey, conducted by the Union of Concerned Scientists (UCS), has triggered an outpouring of reaction from watchdog groups.

"What is scary to me is that this is indicative of a much larger problem," said Francesca T. Grifo, director of the group's Scientific Integrity Program. "This is an agency in need of additional resources and authority, and I would add transparency to that list."

The survey's finding were released earlier this week as the FDA continues to search for the cause of the outbreak at two Iowa egg producers that has sickened hundreds and led to the recall of more than half a billion eggs.

FDA Commissioner Margaret Hamburg said new egg safety rules that took effect July 9 were too late to help prevent the recent outbreak, but would "very likely" have allowed it to "head off" the outbreak.

The UCS polled 2,874 FDA scientists earlier this year, and 17 percent responded to an egg safety question — a standard response rate for a study of that nature, according to Grifo. 

The question read: "How confident are you that the (current food safety system) adequately protects the consumer from food-borne illness from the following foods?" In the case of eggs, half of the respondents said that they were "completely" or "mostly confident" in the results, and a quarter said there were "somewhat confident." Five percent reported "no confidence," while the rest responded that they didn't know.

Earlier this week, Hamburg asked Congress to pass pending legislation that would provide the agency with enhanced enforcement power

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Title: Half of FDA Scientists Had Full Confidence In Egg Safety

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LONDON – According to a survey conducted by the Economist Intelligence Unit (EIU), while Western companies have been counting on China to deliver solid economic growth numbers, its country's consumers have been reluctant to increase their domestic spending, the Financial Times reports.

“Chinese consumers, both urban and rural, although optimistic about the future, remain big savers and cautious spenders, despite their government’s concerted effort to stimulate domestic demand,” the EIU said.

Despite the equivalent of a $589 billion stimulus package and other incentives to help stimulate sales of cars and appliances last year, “concerns about healthcare, education and retirement continue to restrain consumption”.

The EIU revealed that while 91 percent of respondents said they were optimistic about the future, even wealthy urbanites save a high percentage of their income.

Two-thirds of Shanghai residents save a quarter or more of their income, with one-third saving more than one-third. In less developed cities, the figures are even higher.

Among the survey's rural respondents who do not own a refrigerator, only 40 percent plan to purchase one, with one-third of those saying it would be a "distant" purchase. “This suggests that more needs to be done to address their broader concerns about the future before programs aimed at stimulating consumer demand can be more effective,” the EIU said.

Despite being frugal, Chinese consumers are also increasingly demanding and very brand-conscious.

“We are seeing more maturity in consumer behavior,” said Yuval Atsmon, retail expert at McKinsey in Shanghai. “Consumers are not just swayed by the big brand names, they are willing to pay for products that are better, but are also weighing the different dimensions [of a purchase] in a more mature way.”

Content Subject: International, Research

Formatted Article Date: August 26, 2010

Title: Chinese Consumers Reluctant to Spend

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SACRAMENTO – California's Secretary of State Debra Bowen announced earlier this week a ballot proposal for the February 7, 2012 presidential primary election that would add five cents for every cigarette, the Central Valley Business Times reports.

Under the measure, there would be an increase in taxes on all other tobacco products, with the revenues deposited into a special fund to finance cancer research. It would also establish a nine-member committee that would administer the fund.

 Officials estimated that the increased tax could generate roughly $855 million.

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CHICAGO – U.S. restaurant growth will increase one percent a year over the next decade, lower than the 1.1 percent a year growth in the U.S. population, The NPD Group announced in its new foodservice market research report, "A Look into the Future of Foodservice," which also forecasts that the number of annual visits to restaurants will climb eight percent during that same time period.

The report provides forecasts of restaurant segments, visit situations, population growth and foodservice trends in the context of the aging of the U.S. population. Collectively, the data led NPD to conclude that the aging of the U.S. population will not benefit the restaurant industry over the next decade.

“The aging effect on the restaurant industry will be slightly negative because of aging Baby Boomers,” said Bonnie Riggs, NPD’s restaurant industry analyst and author of the report. “A greater share of visits will source to those 50 years and older in 2019, but as consumers age they become less frequent restaurant users. This means the restaurant industry will have heavier dependence on lighter buyers.”

Riggs cited trend momentum, which captures behavior momentum of the previous nine years and includes factors such as menu items, promotions, and restaurant closings as not having worked in the industry's favor.

“In addition to being hit hard by the recession, Americans are eating more suppers at home, and fewer women entering the workforce have negatively impacted restaurant industry traffic,” Riggs said. “The current trend momentum may not appear favorable for the industry moving forward, but it’s the area where the industry has the greatest opportunity to change the direction of the forecast. There isn’t much that can be done about the aging of the population and population growth.”

However, all is not lost. Riggs pointed to breakfast and afternoon snack trends as presenting foodservice opportunities.

“Forecasts are something to be worked against, but are not cast in stone,” Riggs said. “They are used to assess potential opportunities and risks for the purpose of long-term planning. The future course can be altered.”

Content Subject: Research

Formatted Article Date: August 26, 2010

Title: U.S. Restaurant Traffic Will Grow Less Than Population Growth Over Next Decade