for $13.7B (all cash). Didn't see this one coming.
So many big mergers and acquisitions lately.
Walgreens and Rite Aid (pending FTC), Cabelas and Bass Pro, Staples and Office Depot (DOJ rejected) but those all made sense to me even if I thought they were bad ideas or good ideas. Plus more...
Amazon and Whole Foods? I don't initially see how they complement each other unless Amazon plans on an Amazon drone delivery in every city where Whole Foods exists or they're trying to horn in on the meal delivery market which seems slim.
What am I missing?
Link - (
New Window )
People think WF is unaffordable, which is probably true
I am also involved in some of that Amazon fresh business. We are selling to them and in speaking with some of the distribution partners, Amazon at some point will also be targeting small mom and pop restaurants and stores. Most of them are too small to get deliveries from larger distributors like Sysco or US Foods. So, they drive over to Costco, buy from Restaurant Depot, etc. Amazon will be targeting that market but will be delivering with their own trucks/vans vs over night type of mail like they do now with non-foods.
I own a small pizza shop and we save a lot of money with our regular trips to Costco and Sams club. We're big enough that Sysco would love our business and we use them occasionally, but in the small restaurant game it's about keeping costs down.
If Amazon can find a way to bring delivery at or very near to the prices paid in the wholesale clubs I think they will have a market. If they price it at the same level as Sysco or others they aren't going to get many small restaurants to switch, imo.
I'd also point people to the linked Economist piece from March. Lack of competition and shareholder overlap leading to excess profits. Profits arent a bad thing. But if industry after industry is pulling down record profit margins, you have to ask why there isnt more competition eating into that.
Link - ( New Window )
Macy's
BJ's
Whereas Amazon has ridiculous growth, they still are in the single digits in market share for most categories.
The question is, what is their retail plan??
For BJ's, I think if they make that acquisition it will be for clearance and hot buys.
Macy's would be their foot in the door in apparel. Amazon's biggest struggle with apparel is the obvious.. people like to try things on, see different styles and shop for clothing.
What's next? Where is Amazon not the strongest? Home Centers? DIY? Sporting Goods?
I just did a big market research presentation for the Home Centers.. one thing that's painfully obvious is Amazon has little marketshare in this category and it's not even close.
I'd also point people to the linked Economist piece from March. Lack of competition and shareholder overlap leading to excess profits. Profits arent a bad thing. But if industry after industry is pulling down record profit margins, you have to ask why there isnt more competition eating into that. Link - ( New Window )
I was surprised the Staples and Office Depot was rejected, but Cabelas and Bass Pro approved.
I thought both should have been rejected (or approved) their arguments for competition are pretty similar - Amazon, Target, Walmart, WB Mason, etc. for Staples/OD and And Amazon, REI, EMS, Target, Walmart, etc. for Cabelas/Bass Pro.
Link - ( New Window )
Retail bloodbath: Bankruptcy filings pile up
PJ, the Bass Pro/Cabela's merger shocked me for the opposite reason.. what took it so long to go through? It's NOT a monopoly.
The leader in sporting good sales is Walmart and Target.. put them aside. In the "outdoor" world you have big players besides Bass Pro/Cabela's:
Dick's
Academy
Sportsman's Warehouse
REI
Big 5
Dunham's
I'm sure I'm missing a regional one, but those are the big volume drivers.
I know Dick's/Academy/Sportsman's Warehouse have large growth plans over the next 5 years. Dick's is also concentrating on growing their Outdoor Sports market by opening more Field & Stream stores to compete directly with Bass Pro & Cabela's.
Bass Pro/Cabela's/Field & Stream are mainly destination retailers. Cabela's has struggled because the apparel sales took a huge hit. Why? You can go into Dick's or Academy and buy a very similar brand name and quality for 1/2 the price.
Retail landscape screams "discount retailers with name brands". That is why retailers like Dick's/Academy/Walmart are very healthy and others are not:
Gander (bye)
Sport Chalet (bye)
MC Sports (bye)
Eastern Mountain Sports (bye)
Sports Authority (just a hot mess, bye)
Walmart is putting a TON of concentration on Jet.com. The problem is, Amazon has such a head start it's not even close.
To make it work, they will have to offer the service free for a year and add free perks to get people to switch. I'm not sure if a publicly traded company is willing to do that. Stockholders don't like the word "free".
In a recent salvo fired at Wally's World, Amazon will discount it's Prime membership for those with EBT. If you qualify for food stamps, it is an attractive incentive to have free shipping of your grocery items. Those lower income individuals can now have their non-perishable food items shipped and Amazon captures a larger market segment.
PJ, the Bass Pro/Cabela's merger shocked me for the opposite reason.. what took it so long to go through? It's NOT a monopoly.
The leader in sporting good sales is Walmart and Target.. put them aside. In the "outdoor" world you have big players besides Bass Pro/Cabela's:
Dick's
Academy
Sportsman's Warehouse
REI
Big 5
Dunham's
I'm sure I'm missing a regional one, but those are the big volume drivers.
I know Dick's/Academy/Sportsman's Warehouse have large growth plans over the next 5 years. Dick's is also concentrating on growing their Outdoor Sports market by opening more Field & Stream stores to compete directly with Bass Pro & Cabela's.
Bass Pro/Cabela's/Field & Stream are mainly destination retailers. Cabela's has struggled because the apparel sales took a huge hit. Why? You can go into Dick's or Academy and buy a very similar brand name and quality for 1/2 the price.
Retail landscape screams "discount retailers with name brands". That is why retailers like Dick's/Academy/Walmart are very healthy and others are not:
Gander (bye)
Sport Chalet (bye)
MC Sports (bye)
Eastern Mountain Sports (bye)
Sports Authority (just a hot mess, bye)
It took like 5 months for Cabelas/Bass Pro to merge. I think that's pretty fast for a $5B transaction to get through all necessary hoops to close.
My point wasn't it should have taken a long time, my point was I don't see too much difference between Staples and Office Depot and Bass Pro and Cabelas.
and the decisions on both should have been the same.
The concept is you walk in, grab what you want and walk out. All the items you selected are charged or debited to whatever card you want to use. I've vastly over simplified how this would work but you get the picture.
I'm not saying the WF acquisition is towards this end but it wouldnt surprise me if long term some of these stores are converted. Assuming they can perfect the technology.
Quote:
coffee spitting moment for me..serious. Thanks Filth lol
PJ, the Bass Pro/Cabela's merger shocked me for the opposite reason.. what took it so long to go through? It's NOT a monopoly.
The leader in sporting good sales is Walmart and Target.. put them aside. In the "outdoor" world you have big players besides Bass Pro/Cabela's:
Dick's
Academy
Sportsman's Warehouse
REI
Big 5
Dunham's
I'm sure I'm missing a regional one, but those are the big volume drivers.
I know Dick's/Academy/Sportsman's Warehouse have large growth plans over the next 5 years. Dick's is also concentrating on growing their Outdoor Sports market by opening more Field & Stream stores to compete directly with Bass Pro & Cabela's.
Bass Pro/Cabela's/Field & Stream are mainly destination retailers. Cabela's has struggled because the apparel sales took a huge hit. Why? You can go into Dick's or Academy and buy a very similar brand name and quality for 1/2 the price.
Retail landscape screams "discount retailers with name brands". That is why retailers like Dick's/Academy/Walmart are very healthy and others are not:
Gander (bye)
Sport Chalet (bye)
MC Sports (bye)
Eastern Mountain Sports (bye)
Sports Authority (just a hot mess, bye)
It took like 5 months for Cabelas/Bass Pro to merge. I think that's pretty fast for a $5B transaction to get through all necessary hoops to close.
My point wasn't it should have taken a long time, my point was I don't see too much difference between Staples and Office Depot and Bass Pro and Cabelas.
and the decisions on both should have been the same.
I'd agree with that for the most part.
I think Staples/Office Depot/Max is a true monopoly, though.
Take away Walmart and possibly Target, and that's it.
Alexa: Sure, Jeff. Buying Whole Foods now.
Jeff: WHA- ahh go ahead.
Alexa: Sure, Jeff. Buying Whole Foods now.
Jeff: WHA- ahh go ahead.
Nice try twitter thief.
JESAL @JesalTV 1h1 hour ago
Jeff Bezos: "Alexa, buy me something from Whole Foods."
Alexa: "Sure, Jeff. Buying Whole Foods now."
Jeff Bezos: "WHA- ahh go ahead."
I was at a Bass Pro function 2 months ago and heard one of their executive's talking like it was a done deal and will be announced in July.
Hearsay, so take it for what it's worth.
sorry, you are right, it's expected to be finalized 3rd quarter. still fast. Walgreens/Rite Aid has been going on for almost 2 years by the time it closes.
Quote:
The last I read (albeit sometime back) they had to restructure and change the asking price for Cabelas due to some regulatory concerns.
sorry, you are right, it's expected to be finalized 3rd quarter. still fast. Walgreens/Rite Aid has been going on for almost 2 years by the time it closes.
That one should be interesting to watch unfold.
Pharmacy customers are loyal. I think Walgreens will keep the Rite-Aid stores as is, like they did with Duane Reade. Just for the fact that they don't want to see anybody switch to CVS.
The older generations HATE change.
I know little about the businesses in question, but it seems like Cabelas had to divest a bank before moving forward? Store credit/loans I'm assuming? How many of these companies, from retailers up to car manufacturers, have become banks (essentially) in order to keep customers shopping with readily available credit?
Or is he just a total hypocrite?
From the article:
"these guys just want to sell us, because they think they can make forty or fifty percent in a short period of time."
Link - ( New Window )
Annnnnnd.....Filthy for the win!!!
Quote:
Jeff Bezos: Alexa, buy me something from Whole Foods.
Alexa: Sure, Jeff. Buying Whole Foods now.
Jeff: WHA- ahh go ahead.
Nice try twitter thief.
Quote:
JESAL @JesalTV 1h1 hour ago
Jeff Bezos: "Alexa, buy me something from Whole Foods."
Alexa: "Sure, Jeff. Buying Whole Foods now."
Jeff Bezos: "WHA- ahh go ahead."
I didn't say I wrote it, was just sharing with the class and I can't get to twitter on this computer
Quote:
In comment 13501777 YAJ2112 said:
Quote:
Jeff Bezos: Alexa, buy me something from Whole Foods.
Alexa: Sure, Jeff. Buying Whole Foods now.
Jeff: WHA- ahh go ahead.
Nice try twitter thief.
Quote:
JESAL @JesalTV 1h1 hour ago
Jeff Bezos: "Alexa, buy me something from Whole Foods."
Alexa: "Sure, Jeff. Buying Whole Foods now."
Jeff Bezos: "WHA- ahh go ahead."
I didn't say I wrote it, was just sharing with the class and I can't get to twitter on this computer
I know, just busting your balls.
F@#$ Whole Foods
Quote:
In comment 13501777 YAJ2112 said:
Quote:
Jeff Bezos: Alexa, buy me something from Whole Foods.
Alexa: Sure, Jeff. Buying Whole Foods now.
Jeff: WHA- ahh go ahead.
Nice try twitter thief.
Quote:
JESAL @JesalTV 1h1 hour ago
Jeff Bezos: "Alexa, buy me something from Whole Foods."
Alexa: "Sure, Jeff. Buying Whole Foods now."
Jeff Bezos: "WHA- ahh go ahead."
I didn't say I wrote it, was just sharing with the class and I can't get to twitter on this computer
my college journalism professor would kick your ass for plagiarism or not sourcing.. but he's dead * (source, NYT Obitiuary, 2010)
Or is he just a total hypocrite?
From the article:
"these guys just want to sell us, because they think they can make forty or fifty percent in a short period of time." Link - ( New Window )
While I think Amazon is in for the long haul, I do question the fit with Whole Foods. The employee culture and benefit structure seems very different than the (what I believe to be) bare bones culture of Amazon. And the customer profile of what I've seen when I shop (rarely) at Whole Foods would seem to be in line with the existing culture. This will be interesting to follow.
Today marks the beginning of an exciting new chapter in Whole Foods Markets history with the announcement that weve entered into an agreement to merge with Amazon.
Amazon is an innovative company and we are excited about our partnership. We believe it presents an incredible opportunity to take Whole Foods Markets mission and purpose to new levels and will create significant value for our stakeholders including you, our most loyal customers.
We want to assure you that Amazon shares Whole Foods Markets deep commitment to quality and customer service. We will continue to operate our stores and deliver the highest quality, delicious natural and organic products that youve come to love and trust from Whole Foods Market.
No artificial flavors, colors, preservatives, sweeteners or hydrogenated fats will ever be in any of the food we sell. Meat will still come from animals raised with no-added growth hormones, ever. And all eggs in our dairy cases will continue to come from cage-free hens that arent given antibiotics. Those standards are core to Whole Foods Market and we will remain committed to them.
Whether youve been a Whole Foodie for 30 days or 30 years, you have been an important part of making Whole Foods Market what it is today. We look forward to sharing the next chapter with you.
From,
Your Whole Foods Market Team
Or is he just a total hypocrite?
From the article:
"these guys just want to sell us, because they think they can make forty or fifty percent in a short period of time." Link - ( New Window )
What's the argument? Immediate 40-50% return is great for shareholders. Only LEGIT counter argument is that the stock is even more undervalued than that. Which suggests mismanagement.
I hate this kind of bullshit. Where management forgets that the shareholders own the company.
Quote:
So, they drive over to Costco, buy from Restaurant Depot, etc. Amazon will be targeting that market but will be delivering with their own trucks/vans vs over night type of mail like they do now with non-foods.
I own a small pizza shop and we save a lot of money with our regular trips to Costco and Sams club. We're big enough that Sysco would love our business and we use them occasionally, but in the small restaurant game it's about keeping costs down.
If Amazon can find a way to bring delivery at or very near to the prices paid in the wholesale clubs I think they will have a market. If they price it at the same level as Sysco or others they aren't going to get many small restaurants to switch, imo.
Sounds like you are being quoted "street" pricing from the distributors which means their markup to you is much greater than for others.
Some foodservice operators are going to Costco to save pennies. Pushing shopping carts and loading vans rather than focusing on building their businesses. If you are saving a ton of money then it is worth it. I DO see people doing it for pennies though.
Look into joining a buying group. One in particular would put that pricing in the Costco range through one of the broadline distributors but I am not sure whether they are accepting pizza shops as members. At least 50% of their membership consists of healthcare accounts.
People think WF is unaffordable, which is probably true
Think? If you want to over spend for groceries thats fine but they are insanely over priced. There are plenty of studies that show what foods are and are not worth spending for organically that's a personal choice. But you are paying through the nose.
They honed in on a segment of the population that was looking for those products. Now like all markets competion showed up. Plus the amount of small farms that have flourished has increased. Not sure how it will work out. I don't shop there often at all personally. $30 a pound for sea bass?
Today marks the beginning of an exciting new chapter in Whole Foods Markets history with the announcement that weve entered into an agreement to merge with Amazon.
Amazon is an innovative company and we are excited about our partnership. We believe it presents an incredible opportunity to take Whole Foods Markets mission and purpose to new levels and will create significant value for our stakeholders including you, our most loyal customers.
We want to assure you that Amazon shares Whole Foods Markets deep commitment to quality and customer service. We will continue to operate our stores and deliver the highest quality, delicious natural and organic products that youve come to love and trust from Whole Foods Market.
No artificial flavors, colors, preservatives, sweeteners or hydrogenated fats will ever be in any of the food we sell. Meat will still come from animals raised with no-added growth hormones, ever. And all eggs in our dairy cases will continue to come from cage-free hens that arent given antibiotics. Those standards are core to Whole Foods Market and we will remain committed to them.
Whether youve been a Whole Foodie for 30 days or 30 years, you have been an important part of making Whole Foods Market what it is today. We look forward to sharing the next chapter with you.
From,
Your Whole Foods Market Team
That assurance isnt worth the paper it isnt printed on.
Amazon is well known for failing to police its marketplace for knock offs and fraud. If you want to say WFM will be operated differently/separately, say it. But dont bullshit about Amazon's commitment to quality and assurance.
Quote:
Dear Valued Shopper,
Today marks the beginning of an exciting new chapter in Whole Foods Markets history with the announcement that weve entered into an agreement to merge with Amazon.
Amazon is an innovative company and we are excited about our partnership. We believe it presents an incredible opportunity to take Whole Foods Markets mission and purpose to new levels and will create significant value for our stakeholders including you, our most loyal customers.
We want to assure you that Amazon shares Whole Foods Markets deep commitment to quality and customer service. We will continue to operate our stores and deliver the highest quality, delicious natural and organic products that youve come to love and trust from Whole Foods Market.
No artificial flavors, colors, preservatives, sweeteners or hydrogenated fats will ever be in any of the food we sell. Meat will still come from animals raised with no-added growth hormones, ever. And all eggs in our dairy cases will continue to come from cage-free hens that arent given antibiotics. Those standards are core to Whole Foods Market and we will remain committed to them.
Whether youve been a Whole Foodie for 30 days or 30 years, you have been an important part of making Whole Foods Market what it is today. We look forward to sharing the next chapter with you.
From,
Your Whole Foods Market Team
That assurance isnt worth the paper it isnt printed on.
Amazon is well known for failing to police its marketplace for knock offs and fraud. If you want to say WFM will be operated differently/separately, say it. But dont bullshit about Amazon's commitment to quality and assurance.
Amazon's main value is in it's customer service and convenience. If you can wait 2 days, it's great. You feel like you've gotten a deal and you know you can return it if it's not what you want.
I agree that it's pretty comical that WFM would emphasize quality as a value of the merger.
Quote:
In comment 13501783 pjcas18 said:
Quote:
In comment 13501777 YAJ2112 said:
Quote:
Jeff Bezos: Alexa, buy me something from Whole Foods.
Alexa: Sure, Jeff. Buying Whole Foods now.
Jeff: WHA- ahh go ahead.
Nice try twitter thief.
Quote:
JESAL @JesalTV 1h1 hour ago
Jeff Bezos: "Alexa, buy me something from Whole Foods."
Alexa: "Sure, Jeff. Buying Whole Foods now."
Jeff Bezos: "WHA- ahh go ahead."
I didn't say I wrote it, was just sharing with the class and I can't get to twitter on this computer
my college journalism professor would kick your ass for plagiarism or not sourcing.. but he's dead * (source, NYT Obitiuary, 2010)
Thanks radar
Quote:
In comment 13501812 YAJ2112 said:
Quote:
In comment 13501783 pjcas18 said:
Quote:
In comment 13501777 YAJ2112 said:
Quote:
Jeff Bezos: Alexa, buy me something from Whole Foods.
Alexa: Sure, Jeff. Buying Whole Foods now.
Jeff: WHA- ahh go ahead.
Nice try twitter thief.
Quote:
JESAL @JesalTV 1h1 hour ago
Jeff Bezos: "Alexa, buy me something from Whole Foods."
Alexa: "Sure, Jeff. Buying Whole Foods now."
Jeff Bezos: "WHA- ahh go ahead."
I didn't say I wrote it, was just sharing with the class and I can't get to twitter on this computer
my college journalism professor would kick your ass for plagiarism or not sourcing.. but he's dead * (source, NYT Obitiuary, 2010)
Thanks radar
no problem Major Winchester
Amazon's main value is in it's customer service and convenience. If you can wait 2 days, it's great. You feel like you've gotten a deal and you know you can return it if it's not what you want.
I agree that it's pretty comical that WFM would emphasize quality as a value of the merger.
Also price. Amazon competes like crazy on price.
This merger is a little weird for me. It can be justified as "well Amazon wants to sell food". But look any deeper and it is a weird fit.
I suspect Amazon thought it was a decent price/toy, and the WFM CEO got a promise that he'd keep running the company.
that's what's confusing. It's distribution of a very specific category of food. It's not mass distribution that Amazon is known for.
This sale gets Amazon even closer to those consumers.
Im not a trader and don't invest in retail but this looks like an huge over reaction Walmart, Kroger, target etc.
if you work in the markets would like to hear your view.
Krogers was already getting slammed this week with a bad report. Unlikely that they will be the #2 for long. Not just Amazon, but Aldi is going to eat their lunch as it expands.
Krogers was already getting slammed this week with a bad report. Unlikely that they will be the #2 for long. Not just Amazon, but Aldi is going to eat their lunch as it expands.
I made my first and Last visit to an Aldi yesterday. Thoroughly unimpressed. What am I missing?
But it's a cash deal, so in reality it's not paying for itself.
this AND it's just super easy to shop.. follow the road as you're going, nobody is going towards you, it's laid out nicely. Less stress.
Aldi owns Trader Joes, so there's a lot of the same food under different brand labels.
and I know this will come out the wrong way, but the first two years it was open I never went in it. I thought it was a middle eastern grocery (no clue why, maybe their design or name seemed middle eastern to me). I have zero against anyone from the middle east or middle eastern groceries, and I love some middle eastern food, but I felt like I do about any of the other ethnic groceries near me (we have brazilian and asian groceries to name a couple) and unless I need a brazilian or asian ingredient I have no need to shop in them.
So come to find out it's German and organic (once they marketed it) I tried it a couple times and was also thoroughly unimpressed.
I doubt I ever shop at Aldi again - not that I'm a huge shopper anyway, but Aldi doesn't do themselves any favors with me.
and I know this will come out the wrong way, but the first two years it was open I never went in it. I thought it was a middle eastern grocery (no clue why, maybe their design or name seemed middle eastern to me). I have zero against anyone from the middle east or middle eastern groceries, and I love some middle eastern food, but I felt like I do about any of the other ethnic groceries near me (we have brazilian and asian groceries to name a couple) and unless I need a brazilian or asian ingredient I have no need to shop in them.
So come to find out it's German and organic (once they marketed it) I tried it a couple times and was also thoroughly unimpressed.
I doubt I ever shop at Aldi again - not that I'm a huge shopper anyway, but Aldi doesn't do themselves any favors with me.
I agree with the produce. It's delicious and fresh, but needs to be eaten within a few days of purchase.
Our Aldi sells local fresh produce, I'm not sure if that's a chain wide thing.
I saw him speak -- literally one week ago -- and he was complaining about the activist shareholders. Looks like he forgot who really owns the company.
Quote:
So, they drive over to Costco, buy from Restaurant Depot, etc. Amazon will be targeting that market but will be delivering with their own trucks/vans vs over night type of mail like they do now with non-foods.
I own a small pizza shop and we save a lot of money with our regular trips to Costco and Sams club. We're big enough that Sysco would love our business and we use them occasionally, but in the small restaurant game it's about keeping costs down.
If Amazon can find a way to bring delivery at or very near to the prices paid in the wholesale clubs I think they will have a market. If they price it at the same level as Sysco or others they aren't going to get many small restaurants to switch, imo.
Wait, your run a restaraunt but buy FROM costco?
Aside from getting supplies, that would concern me, I want restaraunts making their own food, not buying & re-selling Costco.
Quote:
In comment 13501718 EricJ said:
Quote:
So, they drive over to Costco, buy from Restaurant Depot, etc. Amazon will be targeting that market but will be delivering with their own trucks/vans vs over night type of mail like they do now with non-foods.
I own a small pizza shop and we save a lot of money with our regular trips to Costco and Sams club. We're big enough that Sysco would love our business and we use them occasionally, but in the small restaurant game it's about keeping costs down.
If Amazon can find a way to bring delivery at or very near to the prices paid in the wholesale clubs I think they will have a market. If they price it at the same level as Sysco or others they aren't going to get many small restaurants to switch, imo.
Wait, your run a restaraunt but buy FROM costco?
Aside from getting supplies, that would concern me, I want restaraunts making their own food, not buying & re-selling Costco.
You can buy 'raw materials' at Costco. For a pizza shop, I imagine that consists of giant bags of flour, enormous cans of tomato sauce, and gigantic blocks of whatever cheeses he uses. Why would that be an issue?
Aldi's thing is pricing. If you're going to ignore pricing, it's nothing to rave about. The pricing vs. NYC supermarkets is insane.
Wait, your run a restaraunt but buy FROM costco?
Aside from getting supplies, that would concern me, I want restaraunts making their own food, not buying & re-selling Costco.
You have high expectations. What - you expect your restaurants to grow their own food, raise and butcher animals?
Quote:
In comment 13501723 Dan in the Springs said:
Quote:
In comment 13501718 EricJ said:
Quote:
So, they drive over to Costco, buy from Restaurant Depot, etc. Amazon will be targeting that market but will be delivering with their own trucks/vans vs over night type of mail like they do now with non-foods.
I own a small pizza shop and we save a lot of money with our regular trips to Costco and Sams club. We're big enough that Sysco would love our business and we use them occasionally, but in the small restaurant game it's about keeping costs down.
If Amazon can find a way to bring delivery at or very near to the prices paid in the wholesale clubs I think they will have a market. If they price it at the same level as Sysco or others they aren't going to get many small restaurants to switch, imo.
Wait, your run a restaraunt but buy FROM costco?
Aside from getting supplies, that would concern me, I want restaraunts making their own food, not buying & re-selling Costco.
You can buy 'raw materials' at Costco. For a pizza shop, I imagine that consists of giant bags of flour, enormous cans of tomato sauce, and gigantic blocks of whatever cheeses he uses. Why would that be an issue?
if my local Mexican restaurant WASN'T buying their avocados from Costco, I'd be shocked. The price for those huge bags are ridiculous.
And there was nothing about that store that even hints at Trader Joes which I do shop at occasionally.
No one else found this funny?!
Quote:
.
No one else found this funny?!
there were a couple of comments about it, including my coffee spitting one.
And there was nothing about that store that even hints at Trader Joes which I do shop at occasionally.
The one in NYC is a lot smaller than the suburban one I've been too. At the one I use I dont do all my shopping there. I mix my shopping up. I do a Costco/Aldo/Target big run (all in the same place in NY). I use Fairway and Keyfood near my house in between the big runs. Arthur Avenue shops for Italian foods. Zabars for coffee and specialty/Jewish foods.
I think a big suburban Aldi should cover most needs. But the selection is that they tend to have 1 brand (house) and 1 size for most things.
Aldi's thing is pricing. If you're going to ignore pricing, it's nothing to rave about. The pricing vs. NYC supermarkets is insane.
read this, they're selling themselves as a cheaper replacement for Whole Foods and Trader Joes.
and google, Aldi whole foods and there are tons of links about this being their goal.
Link - ( New Window )
Quote:
Wait, your run a restaraunt but buy FROM costco?
Aside from getting supplies, that would concern me, I want restaraunts making their own food, not buying & re-selling Costco.
You have high expectations. What - you expect your restaurants to grow their own food, raise and butcher animals?
Produce (tomatoes) is one thing.
Tomatoe sauce?
If I'm eating out I'd rather they make their own sauce.
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It's a great place to fill your pantry with good, non-organic stuff cheap. Although more of their stuff is going organic now. I like their cheeses and salami. Produce is hit or miss.
Aldi's thing is pricing. If you're going to ignore pricing, it's nothing to rave about. The pricing vs. NYC supermarkets is insane.
read this, they're selling themselves as a cheaper replacement for Whole Foods and Trader Joes.
and google, Aldi whole foods and there are tons of links about this being their goal. Link - ( New Window )
Trader Joes yes. WF, I think their fresh food selection isnt there yet. Not close. At least where I shop (the Harlem NYC location).
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In comment 13502033 Rover said:
Quote:
Wait, your run a restaraunt but buy FROM costco?
Aside from getting supplies, that would concern me, I want restaraunts making their own food, not buying & re-selling Costco.
You have high expectations. What - you expect your restaurants to grow their own food, raise and butcher animals?
Produce (tomatoes) is one thing.
Tomatoe sauce?
If I'm eating out I'd rather they make their own sauce.
You think regular pizzerias make sauce with fresh tomatoes? If they dont use canned sauce, they use canned tomatoes. Which are sold at Costco. #10 cans of Ninas -- Im not sure you need to do anything to them other than buzz them to call them pizza sauce.
if my local Mexican restaurant WASN'T buying their avocados from Costco, I'd be shocked. The price for those huge bags are ridiculous.
Actually, I would bet that a mexican restaurant is buying the Avocados from a produce distributor if they are price competitive. With all of the lettuce, tomatoes and other produce that a mexican restaurant would use, that would be my guess as to where they get the avocados.
Amazon quietly bought land in my town (98% of DC had not even heard of the town then) 20+ years ago - no one paid attention or thought about data centers then. Now they are building and need 180-foot high power lines brought in and do not want to pay for protecting the community by burying them. And their lobby has some government people in line on their side. BTW - the project will deliver minimal jobs and taxes so there is little upside.
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So, they drive over to Costco, buy from Restaurant Depot, etc. Amazon will be targeting that market but will be delivering with their own trucks/vans vs over night type of mail like they do now with non-foods.
I own a small pizza shop and we save a lot of money with our regular trips to Costco and Sams club. We're big enough that Sysco would love our business and we use them occasionally, but in the small restaurant game it's about keeping costs down.
If Amazon can find a way to bring delivery at or very near to the prices paid in the wholesale clubs I think they will have a market. If they price it at the same level as Sysco or others they aren't going to get many small restaurants to switch, imo.
Hey Dan, do you have an email I can reach you at? Or can you shoot me a quick email on the one I have attached to my profile? I have a quick inquiry for you. Thanks
Produce (tomatoes) is one thing.
Tomatoe sauce?
If I'm eating out I'd rather they make their own sauce.
Tomatoe sauce? Who knew Dan Quayle was a Giant fan?!
And you're fooling yourself if you think pizzerias make their own sauce. High end restaurant pizza sure. But your typical mom and pop corner pizzeria uses canned.
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Produce (tomatoes) is one thing.
Tomatoe sauce?
If I'm eating out I'd rather they make their own sauce.
Tomatoe sauce? Who knew Dan Quayle was a Giant fan?!
And you're fooling yourself if you think pizzerias make their own sauce. High end restaurant pizza sure. But your typical mom and pop corner pizzeria uses canned.
When they crush the tomatoes with their feet, they call it tomatoe sauce.
I also buy dough for sub bread from Sam's. No way I can make it at even close to the quality and price that Sam's can give it to me at.
It's one thing to think about making pizza for yourself at home. It's entirely another to consider selling 75 or more pizzas a night plus everything else on the menu.
And the margins in the business aren't great either. My point is that you have to find the best ways to keep costs down. If you have capacity to store supplies cheap (walk-in freezers, refrigerators, and storage supplies) and are within a decent distance of a wholesale club,
We buy a lot of other supplies from Costco, including produce and consumables like paper napkins, towels, cleaning supplies, etc. We would likely buy all of it from Sam's but the Costco is a little closer to us so we make quick trips, generally, and occasionally they will deliver to us (no fees if the order is big enough).
And there isn't a need to walk aisles. When you buy for your store you can fax what you want over to them and they will have it ready on a pallet - help you load your truck and everything. Very simple operation.
When I asked him why the boss didn't just buy a giant dough mixer instead of having him (and 2 other employees) sit and do that all day, or why he didn't just buy it pre-made, he said that was the cheapest way of cranking out dough. The eventual mixer failures made it more expensive than manual labor.
On a good night, that store would sell about 500 pizzas, though.
And the margins in the business aren't great either. My point is that you have to find the best ways to keep costs down.
yeah the margins are very slim in the pizza business. Everyone has an expectation as to what a slice of pizza should cost. Price if flour went through the roof years ago which also drove costs up for the pizza shops but many of the could not take their prices up enough to compensate for that. Not sure how that impacted you.
Nice sugar high short term
Could hurt them long term
I.e. Sears Kmart
Your welcome and congrats on owning that stock!!
piece of advice, do not ever listen to denny. About anything.
I have no idea what this means for your amazon stock, but it's a safe bet that denny doesn't either
One of the reasons I find it better to just make my own stuff.
What you are paying for is simply convenience.
One of the reasons I find it better to just make my own stuff.
What you are paying for is simply convenience.
You learned the wrong lesson.
While ingredients matter, other things matter too. Knowing how to put the ingredients together. Knowing to let something rest for a certain period. Knowing what temperature to cook something at, and what method to use. Knowing the right tools to use. Having the right tools to use.
With identical ingredients, I would bet you wouldn't make as as good a pizza as your corner pizzeria.
I'd also point people to the linked Economist piece from March. Lack of competition and shareholder overlap leading to excess profits. Profits arent a bad thing. But if industry after industry is pulling down record profit margins, you have to ask why there isnt more competition eating into that. Link - ( New Window )
So how does his M&A bonanza end? Since the economic collapse in 2008, it seems like our economy is moving further and further away from capitalism. If more and more barriers to entry create less and less competition, are we moving towards socialism by default? Will the Government eventually step in to prevent this? Would it even matter?
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but mergers of leading competitors are horrible for consumers. There has been some good reporting on how these get approved. Big school professors hired as expert witnesses to argue that each merger will be pro-consumer and pro-competition by driving prices down. It doesnt pan out. For a lot of these professors, they make many multiples of their univ salary by being experts. And merger approval is increasingly a battle of the experts.
I'd also point people to the linked Economist piece from March. Lack of competition and shareholder overlap leading to excess profits. Profits arent a bad thing. But if industry after industry is pulling down record profit margins, you have to ask why there isnt more competition eating into that. Link - ( New Window )
So how does his M&A bonanza end? Since the economic collapse in 2008, it seems like our economy is moving further and further away from capitalism. If more and more barriers to entry create less and less competition, are we moving towards socialism by default? Will the Government eventually step in to prevent this? Would it even matter?
The FTC has to start doing a better job, and judges need to use their brains a little more. I think the impetus will have to come from the media, but that's a problematic thing since institutionally media orgs like mergers -- they do them. The Washington Post is owned by Bezos. NBC is Comcast. Fox News is News Corp. etc.
I dont think it's socialism that will result. I think it's late 19th century style trusts. Sucking up all the gains.
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but mergers of leading competitors are horrible for consumers. There has been some good reporting on how these get approved. Big school professors hired as expert witnesses to argue that each merger will be pro-consumer and pro-competition by driving prices down. It doesnt pan out. For a lot of these professors, they make many multiples of their univ salary by being experts. And merger approval is increasingly a battle of the experts.
I'd also point people to the linked Economist piece from March. Lack of competition and shareholder overlap leading to excess profits. Profits arent a bad thing. But if industry after industry is pulling down record profit margins, you have to ask why there isnt more competition eating into that. Link - ( New Window )
So how does his M&A bonanza end? Since the economic collapse in 2008, it seems like our economy is moving further and further away from capitalism. If more and more barriers to entry create less and less competition, are we moving towards socialism by default? Will the Government eventually step in to prevent this? Would it even matter?
see.. not to get all Darwinistic here, but I fundamentally disagree with this.
Capitalism thrives on competition. There are plenty of opportunities for retailers to thrive. The problem is some of them aren't smart enough to evolve or diversify to survive.
Take Bass Pro and Cabela's for example. Basically the same store, with Bass Pro focused more on fishing and Cabela's on hunting. MINOR differences between both destinations.
How is it that Bass Pro is thriving and Cabela's deep into debt?? Bass Pro has made it a priority to bring customers in with great deals on National Brands and promote the hell out of their private label brands (where they make most of their margin).
Cabela's has made a business of pushing National Brands at a low margin and their Private Label at VERY high retails.
Rite Aid didn't evolve, either did Office Maxx. BJ's failed to compete with Costo and Sams because it's the same store you walked in 1989.
Mergers happen for one reason.. one half of the merger is not making money and need to get bailed out.
If you look at thriving industries, you will see healthy competition. Look at the "discount" retailers. Not counting Target/Walmart.
TJX (Marshalls/TJ Maxx), Ross Stores, Kohls, Burlington...there are a bunch.
Not only are there a lot of them, they are all thriving and making a lot of money.
Yes.. when it comes to these mergers "the rich get richer".. but only in brand and real estate. Bass Pro is taking on a crap ton of debt. Same with Walgreens on the Rite Aid merger.
So yah.. I think Capitalism is very healthy in this example..
That being said, I think there are retailers who were brilliant in evolving and diversifying when in trouble. After Circuit City, CompUSA and eventually HH Gregg went belly up, Best Buy saw the writing on the wall as well as loss of sales and margins. They changed their business plan and are now a very healthy company.
That's not remotely true. There are a lot of reasons for mergers. One of the leading reasons is lack of executive succession option/plan. I.e. the CEO is retiring and there is no great replacement perceived. Another reason is empire building -- CEOs who want to run bigger companies. Another is "economies of scale" and synergies -- costs savings that can be realized by combining two firms. Another is pipeline, exclusive products/patents, and other increased capabilities. Access to certain customers, diversification, complimentary products, vertical integration, target growth (e.g. getting a good product into the hands of someone who can really sell/grow it). I could give you other reasons that dont have to do with the target struggling.
But more important to this story, you're missing the merger motivation to reduce competition. You think Facebook bought Instagram because it was failing as a business, or because Facebook was worried about a rival social network? The answer is obvious.
Your platitude about the ferocity of competition are nice, but they're not the way the world necessarily works. If they were, we wouldnt have anti-trust review of mergers.
In a retail platform, if you look at the major mergers in the past 10 years, MOST of them are acquiring a flailing company with something of significant value.
Kmart acquired Sears because of Craftsman. Sears was bleeding money at the time.
Bass Pro is acquiring Cabela's because of the brand.
Camping World bought a chunk of Gander for the real estate and to build their brick and mortar footprint.
I agree with you in the tech industry. The Facebooks of the world throw ridiculous money around to acquire companies with tech they do NOT have. Same with Google and so on.
I see the retail landscape differently. It's not often you see a successful retailer that is making money merging with another successful company making money.
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No one else found this funny?!
I did and commented above, but I agree, this thread has lost its way.
One of the reasons I find it better to just make my own stuff.
What you are paying for is simply convenience.
It's a bit of both. Definitely more convenient when you want a slice to walk in and have it all done for you. But there's more to it than simple assembly.
I always bring school kids into the kitchen and show them how to make pizza. Then I let them try to "assemble" their own. They can't even press a dough properly, even though I'm standing right there showing them how to do it.
Baking the pie is a trick in and of itself. You have to know your oven and how it heats really well. I have places on the brick that are slightly hotter than others. When I brick the pie if I don't know my oven well I'll burn them. It happens so fast - no margin of error.
Anyway - glad you've learned some more about the pizza business!