Retail

Grocery Tracker: Wholesale For The Holidays

In this week’s Grocery Tracker: a sugar warning controversy, food prices on the rise in Canada, a class-action lawsuit and wholesale dominates the holidays.

A systematic review of sugar intake recommendations published in Annals Of Internal Medicine this week is facing criticism from public health experts after it was found that the review’s authors have ties to both the food and sugar industries.

The International Life Sciences Institute, a scientific group based in Washington, D.C., reportedly paid for the review but is largely funded by multinational food and agrochemical companies that include Coca-Cola, General Mills, Hershey’s, Kellogg’s, Kraft Foods and Monsanto. Additionally, one of the review’s authors has a position on the scientific advisory board to Tate & Lyle, which is one of the largest high-fructose corn syrup suppliers in the world, said The New York Times.

If you’re feeling a bit of déjà vu, it isn’t just you. Kellogg’s was just last month under fire for its less-than-impartial “independent” panel experts — some of whom published an academic paper on cereal in the Journal of the Academy of Nutrition and Dietetics and worked to influence the government’s dietary guidelines while working for Kellogg’s under the guise of impartiality.

But Kellogg’s is far from the only one implicated this time around, and recent reports show that this kind of corporate undercutting has been going on for decades. The lesson here is, unfortunately, that “scientific” studies are not a be-all, end-all for facts, especially when conflicting interests are at play.

Speaking of conflicting interests, the current political climate in North America has some researchers projecting that food prices will soon be on the rise in Canada. A recent report from Dalhousie University suggests that a falling Canadian dollar and anticipated U.S. protectionism under a Trump presidency could impact Canada’s food prices.

The current political and economic climate was projected by Dalhousie to cause a year-on-year rise in food prices between 3 percent and 5 percent higher than 2015 and considerably higher than the inflation rate. The study found that annual food costs for the average Canadian family could increase by as much as C$420 ($312).

In other pricey grocery news, Whole Foods Market is under fire from nine former managers alleging wage theft, wrongful termination and defamation. Each seeks $25 million in damages. The lawsuit claims Whole Foods engaged in a company-wide practice of not paying out bonuses that had been earned by its employees. When the nine employees attempted to blow the whistle, they alleged they were fired by Whole Foods.

Whole Foods, on the other hand, reportedly said it had fired the managers for manipulating the company’s gainsharing program, which awards bonuses to departments that come in under budget. Whole Foods spokeswoman Betsy Harden said in a statement: “These allegations are not consistent with the findings to date of our internal investigations, and we will respond appropriately.”

To round out this week’s tracker, new consumer spending data from Bank Of America projects that, during the holiday season, traditional grocers will continue to lose out on share to wholesale clubs.

Leveraging credit and debit data, Bank of America found that consumers spent 2 percent more at grocery stores this year than in Nov. 2015, and that spend was flat from 2014 to 2015. Additionally, mass-market chains saw spend decrease by 2 percent year over year. Meanwhile, wholesale club spend grew 22 percent during the same period, after growing only 4 percent from 2014 to 2015. However, wholesale transactions grew 16 percent per active account year on year in 2016.

Bank of America found that mass-market grocery lost 3 percent of its market share year on year in November (75 percent down from 78), while wholesale clubs gained 3 percent — from 15 percent in Nov. 2015 — to represent 18 percent of total grocery spend in 2016.

Given these yearly trends, grocers are projecting that they will continue to lose out to wholesale clubs as the holiday season comes to a close.

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