Cake Ladies: Inside The Box Thinking

The New York Times: “Elsewhere, the American appetite for packaged baking mixes is waning, according to the market research firm Mintel, as consumers move away from packaged foods with artificial ingredients and buy more from in-store bakeries and specialty pastry shops. Yet in the small, mostly indigenous communities that dot rural Alaska, box cake is a stalwart staple, the star of every community dessert table and a potent fund-raising tool.”

“The offerings in village stores often resemble those in the mini-marts or bodegas of America’s urban food deserts, at two and three times the price. Food journeys in via jet, small plane and barge. Milk and eggs spoil fast. Produce gets roughed up. Among the Hostess doughnuts, Spam and soda, cake mix is one of the few items on shelves everywhere that require actual cooking. As a result, tricking out mixes has become a cottage industry, and many villages have a ‘cake lady’ with her signature twist. Some bake as a hobby, while others do a brisk business selling cakes in places where getting to a bakery requires a plane ticket.”

“In America’s northernmost town, Utqiagvik (formerly known as Barrow), the baker Mary Patkotak is an expert at gaming cake economics. She uses Betty Crocker triple chocolate fudge mix for her famous cherry-chocolate cake. In the village store, it costs $4.59 a box. On Amazon, where Ms. Patkotak orders it, it’s $1.29. Alaska’s many weather delays mean the mix never shows up on time, but she doesn’t care because it qualifies her for partial refunds on her annual Prime membership.
‘I can’t remember the last time I paid the Amazon Prime fee,’ she said.”


Open Air Stores: All-Season Retail

The Wall Street Journal: “Come autumn, ice-skating rinks, fire pits and programmed entertainment such as tree-lightings will beginning popping up in open-air centers across the northern and central U.S., landlords say … While shopping centers typically attract shoppers focused on transactions during the fall and holiday seasons, more landlords want to create destinations for the community that might not be entirely focused on buying something.”

“You can still have a vibrant place even in the winter time,” said Don Briggs, executive vice president of development at Federal Realty.

“Real-estate investment management and operating company Madison Marquette Inc. is opening the first phase of a $2 billion mixed-used waterfront development in Washington, D.C., in October that includes residences, hotel, office and 335,000 square feet of restaurant and retail space. Located adjacent to the National Mall, the project, known as the Wharf, will have 10 acres of parks, open spaces and civic areas, as well as a fire pit and a temporary ice-skating rink on two of its three piers. Madison Marquette will also organize free concerts and fireworks at its expense.”


Retail Apocalypse: Fact or Fiction?

USA Today: “In 2017, U.S. retailers have opened, or plan to open, 1,326 more locations than they will be closing, according to IHL Group’s Debunking the Retail Apocalypse report, which was sponsored by several companies. When you add in restaurants, the increase jumps to 4,080 new openings in 2017 with another 5,050 planned in 2018. Or, to look at it another way, between chain stores and restaurants, 10,123 will close in 2017, but 14,239 will open.”

“To compile the study, IHL looked at over 1,800 retailers and restaurant chains with more than 50 U.S. locations across 10 retail vertical segments. It found that for every chain with a net closing of stores, 2.7 brick-and-mortar retailers would be posting a net gain in locations. The research firm also noted that if you add in retail chains smaller than 50 locations (including restaurants) the number of new openings in 2017 climbs to over 10,000.”

“It’s not a retail apocalypse, but how Americans shop is changing. The ease of online shopping means physical retailers need to be about more than the ability to put goods immediately into consumers’ hands. That does not mean that brick-and-mortar retail is dead or dying, it’s simply shaking out the winners and losers.”


Strategic Selection: Less is More for Aldi

The Wall Street Journal: “German discounter Aldi, is betting billions it can win over spoiled American shoppers. How? By offering them fewer choices—way fewer—than rival retailers. The unlikely proposition has worked nearly everywhere Aldi has set foot … It offers a deliberately pared-down selection, sometimes a tiny fraction of the number of items sold by rivals, which helps Aldi cut costs to levels U.S. grocers can only dream of. Among other benefits, fewer items means faster turnover, smaller stores, less rent, lower energy costs and fewer staff to stock the shelves.”

“About 70 years ago, brothers Karl and Theo Albrecht, fresh from military service in World War II, took over their family’s store in Schonnebeck, a mining neighborhood of the bombed-out industrial city of Essen. In the early 1950s, they began rolling out their ascetic concept to other branches throughout the region. Back then, their stores offered just 250 items, the essentials miners’ and steelworkers’ families needed to survive—flour, sugar, coffee, butter, bacon, peas and condensed milk. In the 1950s and ’60s, Germany’s economic miracle took off, and a wave of glitzy supermarkets selling thousands of items sprouted up to serve the newly affluent middle class. Aldi didn’t flinch.”

Today: “Aldi is gambling it is more in tune with the American tastes, rolling out small, nimble stores instead of sprawling warehouses and supermarkets that take longer to navigate … One of Aldi’s strengths that has eluded many discounters is its ability to draw middle-class shoppers—those with more money to spend—despite its limited array of goods. It did this by cultivating the image of a company focused on quality rather than pinching pennies … There too, executives say, the limited assortment played a central role. The small number of items ensured that staff could carefully choose, taste-test and quality-control each item.”


Extreme Aging: Rotting Beef Commands Top Dollar

The Wall Street Journal: “The hottest menu item at New York restaurants may be a plate of rotting beef. Dining spots around town are offering steaks that have been aged anywhere from 90 to 180 days, pushing the limits well beyond the typical aging period of 21 to 45 days. Restaurateurs and chefs say the added time allows for greater tenderness and depth of flavor than the norm.” Billy Oliva, executive chef of Delmonico’s, describes it as “like the taste of roasted hazelnuts and dehydrated mushrooms.”

“The lower Manhattan restaurant is marking its 180th anniversary by offering a 180-day dry-aged bone-in rib eye, served on a keepsake plate, for $380. The special is offered through Oct. 14. The reason for the high cost? Beef that has been aged loses a considerable amount of its weight over time, Mr. Oliva explains, so diners are essentially paying for that shrinkage.”

“While beef that sits in a meat locker for months on end may sound like a dicey dietary proposition, food-safety experts say it is generally fine for consumption because of how the steak is prepared. Before cooking, chefs trim the exterior of the meat where any bacteria might grow, reducing the safety risk. And the cooking process itself adds another layer of protection … Which isn’t to say the flavor of the steak is one that every carnivore appreciates … ‘It’s like blue cheese on a bone,’ says Michael Lomonaco, chef and owner of Porter House Bar and Grill, a steakhouse in Midtown Manhattan’s Time Warner Center.”


Heinz 57: Souped Up Car Giveaway

The Wall Street Journal: “In the mid-1960s, Heinz launched a contest in Britain. The entry form, which appeared in magazines, read ’57 Unique Cars to Be Won!’ after the company’s ’57 Varieties’ tagline that it still uses today. Contestants had to match a Heinz soup flavor (Cream of Celery, Cream of Green Pea) with the picnic item that best went with it (Liver Sausage Salad, Beefburgers). Contestants who got the matches right were put in a drawing, and 57 cars were given away.”

“The convertible cars were custom-built by a British company called Crayford, based on a model called the Wolseley Hornet. The vehicles came with a picnic basket, a Max Factor cosmetics tray, a tea kettle and the same carpeting used in Rolls-Royces. Nowhere did the vehicle say Heinz … Today there are reportedly 41 of the original 57 cars in existence.”


Ikea’s Vending Machine

Business Insider: “Earlier this month, Ikea opened a kitchen pop-up store in central Stockholm. To advertise its new and path breaking retail concept, the Swedish furniture giant has placed a vending machine selling kitchen tools inside the subway station of Hötorget, in the city center.”

“Although its main job is to nudge bypassing commuters to a visit in the 400 square meter kitchen showroom just a stone’s throw away, Ikea’s vending machine is a pop-up store unto itself – where customers can buy items like the classic garlic press KONCIS … The vending machine, due to stay up for a couple more weeks, is outfitted with a message encouraging customers to “get a kitchen to go with their garlic press’.”


Nestle’s Supermarket Barge

Business Insider: “Nestlé, the world’s largest packaged food conglomerate, came up with a way to spread its presence abroad: sponsor an Amazonian river barge to sell its products to the backwoods of Brazil … the boat was a way to expand in hard to reach parts of Brazil, reports the New York Times. Since 2010, the boat delivered tens of thousands of cartons of milk powder, yogurt, chocolate pudding, cookies, and candy to isolated communities in the Amazon basin.”

“According to The New York Times, the boat was taken out of service in July 2017, but private boat owners have taken over to fill the demand.”

“The program, called ‘Nestlé Takes You Onboard,’ was part of a larger effort of Nestlé’s door-to-door marketing campaign … Nestlé currently also employs thousands of local vendors, who sell its products to quarter-million households, many of which are in isolated, low-income areas of Brazil … The ‘supermarket’ boat, which measured 1,076 square feet, journeyed to 18 cities and up to 800,000 consumers on the Para and Xingu rivers in Brazil … It carried 300 different items, including chocolate, yogurt, ice cream, and juices.”