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Cash might not be king, but it’s still useful.
Morning Brew August 31, 2022

Retail Brew

Wunderkind

Happy Wednesday. Never underestimate that retail stalwart: the bodega…or its cat. After one Washington Heights bodega cat, Negrito, encountered a pit bull puppy, the dog’s owner claimed the cat attacked it, resulting in a substantial veterinary bill. However, this month, a judge ruled the bodega owner was not on the hook for the bill.

In today’s edition:

—Andrew Adam Newman, Erin Cabrey, Maeve Allsup

PAYMENTS

The buck shops here

A sign on the door of a Van Leeuwen Ice Cream store that says Andrew Adam Newman

It wasn’t so long ago that businesses spurned credit cards because of swipe fees. These days, it’s not plastic, but rather cash, that seems to be the scourge of payments. You often can’t even use cash to pay for those peanuts and Cracker Jacks at the ball game, since most MLB stadiums have gone cashless.

Buck-ing the trend: But don’t throw out that cash register yet.

Not everyone is complying, according to New York’s Department of Consumer and Worker Protection.

  • It received 600 complaints–and issued 164 violations–over businesses not accepting cash since the city’s law took effect in November 2020, according to data it provided to Retail Brew.

Taking their licks: In 2021, Van Leeuwen Ice Cream, which has 19 locations citywide, was fined $12,750 for violating the city’s cash-acceptance policy, after the city received “a half-dozen” complaints, according to the New York Post.

Van Leeuwen did not respond to a request for an interview.

So I (Andy) visited Van Leeuwen’s East Village location on August 17. After photographing a sign on the door that declares “We’re cashless,” I went in, ordered a bowl of pistachio ice cream, and tried to pay with a $10 bill. True to the sign, but in violation of a New York City law that had been in effect nearly 21 months, the counter employee said they were “card only” and did not accept the cash.

Pay attention: Joel Bines, a managing director at the consulting firm AlixPartners, and author of The Metail Economy, cautions against no-cash policies.

“For it to have reached the level where politicians feel as though they need to step in and protect consumers from the retail and restaurant businesses is just absurd to me,” Bines said. “Because if making it harder for your customers to buy stuff from you is part of your long-term strategy, then please tell me about it so that I can short your stock.”

Keep reading here.—AAN

        

TOGETHER WITH WUNDERKIND

OMG txt message marketing is gr8 :D

Wunderkind

Well-crafted texts can go a long way—not just for laughs in the group chat, but also for your brand’s consumers. Text message marketing is one of the fastest-growing, most successful revenue channels out there.

Wunderkind’s Text Message Marketing Playbook includes real-world examples of how leading brands turn texting into a major moneymaker. It lays out all the need-to-knows, from strategizing message cadence to developing your subscriber list.

While 48% of consumers prefer brand comms via text, they’re sensitive to the volume of messages they receive. We were serious when we called texting an art—there’s some serious strategy and nuance that goes into making this marketing channel a success.

Create your SMS masterpiece and download your playbook here. Kk, TTYL.

        

COMMUNITY

Coworking with Mary O’Donnell

Coworking with Mary O’Donnell Mary O'Donnell

On Wednesdays, we wear pink spotlight Retail Brew’s readers. Want to be featured in an upcoming edition? Click here to introduce yourself.

Over her 30+ years in the retail industry, Mary O’Donnell has category-hopped from greeting cards (American Greetings) to toys (Little Tikes) before landing in specialty food as president and CEO of Robert Rothschild Farm. Then, in 2010, she teamed up with friend Brian Coughlin to buy another specialty food brand, Terrapin Ridge Farms, which she’s led as CEO since 2010.

How would you describe your job to someone who doesn’t work in retail? I am the CEO of a retail brand. We make food products that retailers (Publix, Fresh Market, TJ Maxx) put on their shelves and sell at a higher price.

One thing we can’t guess about your job from your LinkedIn profile? Taste-testing galore! My team and I come up with ideas for products, our food scientist creates it, and we get to test, and test, and test, and test until it is perfect.

What’s your favorite project you’ve worked on? Developing the company of Terrapin Ridge Farms over the years. Seems like every day there is a new project in the works and I love it!

Which emerging retail trend are you most excited about this year, and why? Experience shopping—going to the store not to just grab what you need, but going for the experience. We've always been a brand that encourages hands-on sampling and tasting in store (we give our retail partners a sampling allowance on each order) and we work with many successful boutique stores that have forever been “experience-based.” Those stores bring so much joy and are hard to forget. Plus, when the customer is enjoying themselves, they are more encouraged to browse and try new things! We are glad this trend is becoming mainstream. For example, a few Kroger and Publix locations offer beer or wine while you walk around now.

What’s your go-to coffee order? My husband makes my coffee at home. It’s the best! He’ll mix the beans from the grocery store and create a special blend. Just coffee from the pot with creamer.

Worst piece of advice you’ve received? When I first started my career and was leaving a large company to work for another company, my parents and aunts and uncles thought it was a bad idea. This was more than 30 years ago, when that generation thought getting in with a good company and working there for your entire career was the way to go.

What was your favorite retail product when you were 15, and what’s your favorite retail product now? Favorite product 15 years ago: black eyeliner. Favorite product now: Aveda Phomollient Styling Foam.

        

LABOR

In the air

SAN ANTONIO, TEXAS - DECEMBER 11, 2018:  A McDonald's fast food restaura... Robert Alexander/Getty Images

California’s Assembly Bill 257, The Fast Food Accountability and Standards Recovery Act, would create the Fast Food Sector Council, which would be tasked with establishing industry-wide standards on wages, working hours, and safety for fast-food restaurant workers.

  • The council’s 13 members would include government officials as well as representatives from franchisees, corporate brands, and worker groups.
  • The bill passed the Senate and Assembly on August 29th, and now awaits approval by Governor Gavin Newsom.

Making change: Working in fast food has long been associated with health and other risks, including sexual harassment, lack of healthcare coverage, and lower wages (in May 2021, the average annual wage for fast food workers was $26,060, according to the US Bureau of Labor Statistics.)

Supporters say AB 257 invites workers to design solutions to issues they face in the workplace. It may increase “power and protections” for workers, of whom nearly 80% are Latino/a, AAPI, Black, and immigrants, the Economic Policy Institute and the National Employment Law Project said in a January letter written to lawmakers.

Not so fast: On Wednesday, Joe Erlinger, president of McDonald’s USA, criticized the bill in a letter posted on the company’s website, calling it “lopsided, hypocritical, and ill-considered.“ Other opponents of the bill claim it will be a “de facto restaurant tax” that will lead to higher consumer prices and could spread beyond California to New York, Oregon, Washington, and Illinois, among others.

AB 257 may “fundamentally alter” the franchise model of the fast food industry, US Chamber of Commerce VP of labor policy Sean Redmond said in June.

  • Census data has estimated that franchise restaurants make up over half of fast food restaurants in the US.
  • AB 257 would make franchisers (corporations) jointly liable for labor violations at their franchises.
  • The changes may convince some franchisers to cease operations in California altogether, Redmond said, calling the bill a “radical proposal to micromanage the fast food industry.”—MA
        

TOGETHER WITH OPENSTORE

OpenStore

Sell your store in 24. Time to move on? With OpenStore, you can get a price for your Shopify-based e-commerce store in just one day. Just answer a few short questions to get your cash offer and collect payment in 1–2 weeks. Take the first step here.

        

SWAPPING SKUS

Today’s top retail reads.

The big engine that couldn’t: Freight rail service is running chronically late and could be the cause of—wait (and wait, and wait) for it—more supply-chain bottlenecks. (Wired)

Believe it or aught: Nike Air Force 1s, Avirex leather jackets, and baggy-fit jeans: menswear and streetwear are seeing a Y2K revival. (WWD)

Shrink different: Shrinkflation is becoming a household word, and now 30% of consumers say they’ve stopped buying from brands when they notice it. “No one likes to pay more for less,” said Morning Consult’s Emily Moquin. (Supermarket News)

RETAILERS: THE CLOCK IS TICKING

Don’t forget! The SKU: A Retail Brew Summit is coming to NYC this fall. Join a community of corporate retail leaders for a day of networking and insightful conversation about meeting demand and maximizing profit, using technology to drive sales, sustainability, and more. Tickets are only $549 for a limited time!

Register now

WHAT ELSE IS BREWING

  • Walmart has invested in Sustainable Beef to expand its supply of angus beef.
  • Gopuff is looking to negotiate a credit line of up to $300 million, sources told the WSJ.
  • Trish Donnelly, CEO of Calvin Klein Global and PVH Americas, will leave the company to pursue other opportunities.
  • Bed Bath & Beyond shares tumbled after announcing layoffs and store closures.

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Written by Andrew Adam Newman, Erin Cabrey, and Maeve Allsup

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