Jonathan Witmer

🌍 ☕ Pausefika news: Amidst all the buzz surrounding the proposed $47bn buyout of Seven & i Holdings by Couche-Tard, let’s not forget another major development in the world of convenience retail — Żabka Polska (aka the "Polish 7/11") just went public! 🚀 (see: https://lnkd.in/dSrUjvdv ) On October 17th, Żabka's owner, CVC, listed a third of its shares on the Warsaw Stock Exchange (GPW) at a valuation of 21.5bn zlotys ($5.5bn), making it one of the largest IPOs in Poland's history. This move is giving a fresh boost to Poland’s stockmarket, which has been in need of a revival. 📈 With over 10,500 outlets and plans to expand with 4,500 more stores by 2028, Żabka is already Europe’s largest convenience-store chain by number of outlets. It’s a brand deeply integrated into Polish life — half of the country’s population lives within 500 meters of a Żabka. And its innovative solutions like the cashierless “Nano” stores and a top-notch mobile app are part of the reason why it's become so popular. 🛒💡 But this IPO isn’t just about Żabka’s growth — it’s also about the revitalization of the Warsaw Stock Exchange (GPW). The 🇵🇱 stockmarket has been struggling in recent years, but Żabka’s IPO is sparking new life into the bourse, drawing in retail investors and setting an example for other companies. More headline IPOs like this could put Warsaw’s market back on the map. 🌟 Let’s see how this little frog leaps! 🐸💚 Join IPO experts on Pausefika ! #IPO #Zabka #Poland #WSE #Retail #ConvenienceStore #BusinessGrowth #Investment #Couchetard #Pausefika

4

Aggregate demand across a multitude of manufacturing markets are directly impacted by the state of retail demand. This article/interview of former US CEO for Walmart is confirming details of an "inferior market" situation in the US that is already evident in key markets like automotive. Arguably, entire demand markets like electronics are taking hits as well. For manufacturers tied directly to GDP value chain demand, or in the case we find ourselves "True GDP Demand", finding better ways to assess their immediate and intermediate demand will be critical. Those late to the intersections of market dynamics will be behind. A recommendation: stop focusing on dollar based demand and dollar based activity! Unless your fixed costs can be managed with high variability, watching dollars movements inflated by government spending will not result in volume demand to spread out those fixed costs. Worse you will be carrying capacity for which there is no need. #USEconomy #Market #B2B #B2Bmanufacturing #macroeconomics #fractionalmangement #materials #chemicals #paper #packaging

2

Crystal Ball Time - What's Next - Part 1 While these are certainly "Interesting Times…" I will not follow the axiom that we are cursed, in fact I am optimistic for our industry, but perhaps a bit guarded and concerned... Trump 2.0 is upon us, and this is where it gets interesting. Politics aside and policy forward, there are reasons to be enthusiastic and reasons to be (very) concerned.  Chief among the concerns is the campaign promises of formidable (60%) tariffs on Chinese imports to the US. If enacted, they would immediately increase key input prices (Vitamins, Amino Acids, and some botanicals) and trigger system wide price increases. The proposed tariffs if enacted would also likely induce countermeasures from our sanctioned trading partner impacting any brands with significant sales in China (Utah, this is going to sting). There will be significant spill over disruption into supply chains and pricing sufficient to foil the solid growth expectations for the EU, MINA, Southeast Asia, and many other key global markets beyond the US. I will note that the pain our segment will experience with new tariffs is small compared to what may happen to big agribusiness like poultry and eggs, pork, beef, and other feed intensive industries. On the other hand, this would certainly spur investment in non-Chinese supply. India will benefit in the near term but ultimately, we may see some re-shoring of production and perhaps some new production technologies that are more efficient and less environmentally challenging. I will note that a tariff-based strategy is the equivalent of jumping out of a plane, then figuring out how to design and manufacture a parachute or a new plane. The CHIPS act of 2022 took a different approach and determined that 39 billion domestic investment and government matching grants would spur domestic development.   Trump has also platformed Robert F Kennedy, a long-time natural health advocate and critic of the FDA, & Elon Musk, a business tycoon who says he can cut government expenditures by trillions of dollars. While some in the "industry" applaud this opportunity and enthusiasm for our sector, this could potentially be beneficial or problematic (or both). The RFK effect of boosting nutrition, going after the global industrial food complex, and advocating for non-allopathic medicine may boost our categories. The promise of deregulation and Elon Musk's potential engagement to finding savings (the same way he trimmed the staff of X) will likely “remove some of the guardrails” and potentially unleash and enable the worst elements in our category. The mantra that "The government that governs least, governs best" is, in my opinion, not the best option for an industry that has struggled with safety and compliance issues and hardly has consumer trust. Let’s hope for the best and prepare for the worst. Part two will cover specific industry trends #BeyondBrands #Nutraceuticals #Vitamins #NPA #WomenInNutraceuticals

33

9 Comments

According to new data from Circana’s consumer tracking service, running shoes — one of the hottest categories in the U.S. footwear market in 2024 — is a $7.1 billion business, with the women’s segment growing even faster than men’s and has almost caught up to its size in the past 12 months. Running shoe sales have grown by $1.3 billion in the past three years, Circana noted, with running footwear dollar sales increasing by 12 percent in the 12 months ending April 2024. As for how consumers are wearing these shoes, it varies. Circana added that it found that 43 percent of consumers bought running shoes for sport and exercise, while over half of the dollars spent are attributed to non-athletic uses, including casual or everyday use (33 percent) and work (7 percent). “While performance is paramount in running footwear, the innovation in the category is also attracting casual wearers that are looking for everyday comfort,” Beth Goldstein, footwear industry analyst at Circana, said in a statement. “The visible functional elements have become fashion for both runners and non-runners alike, commanding premium price points." ”https://lnkd.in/eFdHvGbi

35

1 Comment

Great article by Don Davis. The acquisition of SRS Distribution by Home Depot is a strategic move that highlights the evolving landscape of the distribution market. As the article rightly points out, Home Depot is transitioning from a retailer to a formidable distributor, positioning itself to better serve larger business buyers who require bulk deliveries directly to their job sites. It's worth noting Home Depot's digital marketplace is one component of its strategy and I suspect it will ingest highly fragmented SRS wholesale operations and adjust its services to the needs of large B2B and complex project buyers. That being said, unlike many distributors still grappling with the initial phases of e-commerce, Home Depot has effectively created a digital marketplace where vendors and manufacturers spend ad dollars to garner better placement on their website and reach targeted customers. This marketplace enhances product discoverability for paying brands (just having aisle placement alone doesn't suffice for some categories), but it also provides unparalleled insights into consumer shopping behavior, B2B activities, and market trends. As other big players like Amazon and Walmart aggressively expand into distribution, leveraging their technological prowess and deep pockets, the need for existing distributors and related associations to innovate becomes increasingly urgent. Act now or ...

2

While market dynamics for all grocers are more challenging than ever, consumers are likely to benefit from the improved value, variety, and service offerings as businesses strive to adapt and thrive in a hyper-competitive Connecticut food frontier. 🤠 🛒 🍷 #ShopSmartCT #MarketMakeover #GroceryGameChanger

5

NOSTALGIC RETAIL SERIES: 20 - KB TOYS KB Toys was founded in 1922 as Kaufman Brothers, a wholesale candy store.Kaufman Brothers opened a wholesale toy store in 1946. The toy business was an acquisition from a candy client who could not pay its outstanding debts. The retailer ended its candy wholesale business two years later to to focus on toys. Retail sales began in 1973 as the company moved away from wholesaling to become a mall-based toy retailer, using the name Kay-Bee Toy & Hobby. In 1981, Melville Corporation purchased the 210 store Kay-Bee chain from the Kaufman family for $64.2M. The retailer and Melville Corporation went through a series of acquisitions in the 1980s and early 1990s causing a major restructuring and closing of 250 underperforming stores in the new portfolio. In 1996, Kay-Bee was sold to Consolidated Stores Corporation (now known as Big Lots) for $315M. By 1999, the company operated 1,324 stores and was the second-largest toy retailer in the U.S.. It also changed its name to KB Toys that same year. In 2000, Bain Capital entered the picture after Consolidated Stores could not create a profitable company and purchased KB Toys for $305M (notice we are going in the wrong direction!) KB Toys declared bankruptcy in both 2004 and 2008 due to competition, expensive mall rent structures and poor sales. It officially threw in the towel in February, 2009. closing all 461 stores (this from a peak of over 1,300 stores). Toys "R" Us acquired the remains of K·B Toys (website, trademarks, and intellectual property rights). "Strategic Marks, a company that buys and revives defunct brands, purchased the brand in 2016, and planned to open new stores using the name beginning in 2019; plans for this revival, however, were cancelled due to a lack of funding. As of 2020, all trademarks for K·B Toys have been abandoned by Strategic Marks and is currently not used by any company." [Wikipedia] Missed any posts in the series? Click here for the website with the full list: https://bit.ly/3YxvVfR #nostalgicretail hashtag#retail hashtag#shopping hashtag#brands hashtag#retailrealestate

18

2 Comments

In Best Life's recent article, "Is Ceramic Cookware Safe? How to Use It Correctly," I discuss the importance of proper ceramic cookware maintenance. Beyond preserving the non-stick coating, we need to think about the health implications of using high temperatures and harsh tools. Embracing these best practices can lead to safer and more sustainable cooking environments. Let's elevate our kitchen standards together. #FoodSafety #KitchenTips #KitchenHacks 

3

1 Comment

INVENTORS - How do you know how to correctly create a retail selling price your product? This is where many inventors get lost and either undervalue or in many cases way over value their product. Having a fair and reasonable price for your product is key to it selling. Sell it for too much and people won’t buy it. Sell it for too little and you may not make a profit. But you have to take emotions out of the equation and really understand what it should be selling for. The first step is to look at other similar products to yours that are already selling at retail and seeing if yours should be priced lower because it doesn’t offer as much or more because it has more benefits and features that people can appreciate. For example, an apron you use when you cook can sell for more if it has multiple pockets on it versus it just being a plain apron with no pockets. The pockets add value. So if the basic apron sells for $20, maybe you can sell yours for $25 because people can appreciate having a place to put cooking utensils temporarily or a hand towel in it while they cook. Researching your product category and seeing what others offer and for what price can help you determine what price you may be able to offer! #inventing #licensing #retail

12

3 Comments

I had an incredible conversation with Eugene Alletto, CEO of BEDGEAR, about how he is additive versus disruptive to the bedding industry! Eugene's journey from a million-dollar salesperson to an industry innovator is nothing short of inspiring. He shares valuable insights on the importance of education, innovation, and being additive rather than disruptive. Tune in, and leave your favorite quote in the comments.

27

3 Comments

US consumers are struggling to pay their bills, but that doesn’t mean they are pulling back on spending. Bank of America last week reported that net charge-offs, which are debts that a bank does not expect to be repaid, jumped to ~$1.5 billion in the first quarter, up from $807 million the year before, and they stemmed primarily from credit card losses, according to the bank in its latest earnings call. #consumerspending #retailsales #consumerinsights

1

Channels, retailers, consumers. A headline for a Retail Dive article yesterday was "Off-price retailers poised to take even more market share from department stores". Walmart, KMart, 40 years ago were described as department stores. Department stores were meant to be convenient. Department stores are dying, because convenience includes proximity, luxury is shopped in major urban centres, and 3-6 floors of inventory that is slow turning and expensive is a brutal business model to operate. But maybe what matters isn't the name of a channel "Department store". Do people outside of our industry even use words like that? Has your mom or dad ever said "Mass Merchant"? Maybe what matters is that people have needs, brands fulfill those needs, and brands grow when they make themselves available where and when people want to fulfill those needs.

12

1 Comment

NOSTALGIC RETAIL SERIES: #7 - ZAYRE Brothers Max and Morris Feldberg founded a company in Boston in 1919 to supply undergarments to department stores. When sales began to decline, they ventured out to create a new discount department store. The first Zayre location opened in Hyannis in 1956. Zayre which was a transformation from the Jewish saying “Zehr fgut” which means very good, grew into one of the largest retail chains in the country with almost 1,200 locations nationwide. In the '70s, Zayre tried to buy Marshalls but failed. Their answer was to create a Marshalls clone, TJ Maxx, in 1977. Yes....TJ Maxx❗ In the mid 1980’s profits began to decline which eventually led to Zayre filing for Chapter 11 bankruptcy in 1988. The department store chain was then sold to Ames and by 1990 Zayre ceased to exist. Ames, kept the exterior similar to the style of the shuttered Zayre locations. Ames filed for bankruptcy protection in 2001 and their remaining stores were closed shortly after. Zayre’s one-time subsidiary TJX (TJMaxx, Marshalls, and HomeGoods) is thriving. Missed any in the series? Click here: https://bit.ly/3U8etfa #nostalgicretail #retail #shopping #brands #retailrealestate

38

14 Comments

Letter to the toy industry: A headline in 10-20 years will read; “The magic has evaporated as indie toy stores melt away.” More closures are coming, less risks are taken, most young people do not want retail careers and Amazon is growing 5-10 percent squeezing out everyone. Yes, hot products extend the cycle for toy stores and The Covid effect was once in a century. But if you understand trends, the ending is clear. What a shame. However, I’m not about to stop trying and implementing new ideas and strategies to create a new local toy space, but it needs to be much different than the small incremental changes we all have made. We will fight to find ways that can increase our value proposition over low prices, same day delivery and millions of products at one’s fingertips. Can’t be done some say and I personally see no real strategic direction from any organization, so why even try? Well when you experience the “magic” for our children (and adults) 6 days a week it’s worth the fight. Our work has begun in earnest. #toys #toyindustry #retail #retailindustry #amazon #games #inventors #brickandmortar

90

17 Comments

Every #emergingbrand should be paying attention to this case. I'm not going to comment on the specifics of these allegations, you can read those and judge for yourself. However, I will comment on what I've seen a LOT over the past decade in this space. Too many early stage brands are VERY aggressive, condescending, and straight-out insulting to the big #cpg brands that are the conventional category leaders in spaces where they want to compete. This is especially true in language and words used in side-by-side comparisons, and in social media content that they pump out in high volume in their channels. You even see a lot of it in investor and customer presentation decks. A recent (jaw-dropping) example was a viral Youtube video of #lunchly going after #lunchables at their launch. Not just comparing side by side but in a very insulting and disparaging manner. There are so many others. My take: It's always been a terrible idea, and IMO more a sign of weakness than strength. If your products are so good that should be the story and the focus. The other thing people miss is that there are real people on the other side of these big CPG brands. Smart and passionate people, with lots of resources. They get angry too, like anyone would and if you poke the bear enough you are begging a response. These things are very expensive to litigate, and there's lots of bad karma involved. It's not worth it. Nosh.com

241

53 Comments

Experiential retail is evolving, for example, Ace Hardware’s focus on experiential store models, like Elevate Ace. Their efforts have been driving growth by offering expanded product assortments and brand showrooms. On top of in-store success, online sales are up 16%, showing that brick-and-mortar stores can thrive in the age of e-commerce. With a commitment to opening 200 new stores this year, Ace is proving that physical retail is still relevant in today's digital world. Keep an eye out for innovators that are leading the way in retail trends! #AceHardware #InnovativeStores #BrickandMortar #Retail #Ecommerce

10

1 Comment

I just bought a hoodie and sweats combo from TEMU. I wanted to see what one gets. Also got sunglasses, a few, but it’s my favorite accesory and I am to get 300X ROI out of the $3 investment. Looks great in photo and out of box but after just one washing the exterior is already pilling. I won’t wear it out out now. Useless as sportswear. Great pajamas. At one point, a family analyzing their budget would see that at the rate they spend on fast fashion, they could purchase quality driven goods, and end up spending less on apparel, than they would over the same period, had they not wasted money on fast fashion purchases. And as the factories in China compete for position, quality will likely degrade, amplifying the family budget deficit. And as we move away from Me Me Me, the fall of the influencer and rise of curator, celebration of the intellectual rabbit holes, one wonders if impulsive fast fashion buys for daily fit likes, will continue in such bloated fashion.

2