Patrick Henry no doubt was a fine American, although one with limited supermarket experience. But that shouldn't prevent us from picking up the clue that the past is quite capable of shining a light into the darkness of the future.
And, there's some truth to Patrick Henry's observation even if we acknowledge that the past can drag a red herring across our path to the future too. But in the spirit of the holiday season, and this week's issue of SN that reviews the industry events of 2000, let's see what the past suggests about the future.
Instead of reviewing the content of this special issue, let's take a separate and closer look at a couple of the events of recent days or weeks to see what they seem to foretell about the future:
Multi-channel success: In a Christmas address to associates, Cees van der Hoeven, the principal executive at Ahold, pointed to the company's "multi-channel strategy," which includes food service and e-commerce in addition to substantial retail holdings in this country and in 24 other countries worldwide. The idea is to "align the best aspects of each channel and add value," he said.
Look for more retailers to figure out that the multi-channel approach used throughout much of the world outside North America is a good way to go to market. That will be particularly the case as saturation continues in many markets in this country, causing the prospects for success by adding stores to dim.
Incidentally, Ahold is also making preliminary plans for a centralized distribution facility of some sort, maybe to be near Philadelphia, to help in the supply of product to its retail stores along the Eastern seaboard. The distribution facility could be outsourced to a wholesaler, which may in itself point a new direction for wholesalers. (More on that to come.) Ahold's new outlook on distribution could also signal a tighter integration of its retailing chains in this country. Maybe the move could also prove instructive for those newly merged chains now grappling with decisions about whether more integration with the acquired entity is better than promoting regional autonomy.
Mid-level risk: We've reviewed these developments recently, but it remains worth observing again that two venerable grocery retailing entities are disappearing, Jitney Jungle and Grand Union. Other small- to mid-sized companies are being bought up by larger entities. Included is this month's buyout of Genuardi's Family Markets by Safeway; a large list of such buyouts for recent months could be produced. Look for more buyouts of this sort to happen during the new year as the market position occupied by smaller retailers continues to soften.
This situation also has fallout at the wholesale level. Fleming has vowed to back off from its corporate ownership of this retail style and to revert to pure wholesaling and price-impact retailing. Fleming has been selling assets to accomplish these aims. Look for wholesaling to continue to change in similar ways next year.
Take a look through this issue for similar clues about how the past can be put to use to see what's next. By the way, the next couple of issues of SN will focus more on what's ahead for the industry as seen from the viewpoint of industry executives. We'll also have more on what the new administration in Washington may mean for the industry.
