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Michael Furdyk
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rollerblading and the future of retail (are manufacturers screwed?)
July 15, 2002 - 11:46 AM
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So I was rollerblading around yesterday, taking a trip to pick up some supplies at Office Depot and a delicious Mandarin Chicken "Garden Sensations" salad from Wendy's, (which is the difference between Updates and Articles -- an irrelevant intro like that would be completely out of place in the zine!) when it hit me: we're going to see some exciting stuff happen over the next few years in the retail industry.
Okay, so I had somewhat discussed the idea over dinner the night before, but think about this: since many manufacturers have been discovering the Internet, and selling direct to their customers, what is a lonely betrayed retailer to do? Create their own product lines, of course!
It's been happening for years -- President's Choice being one of the more popular successes, but even Shoppers Drugmart brand items being plucked off shelves by yours truely more than once due to their appealingly lower prices.
I was especially thinking about it because Office Depot had convienently replaced their normal selection of plastic receipt holders (the enemies of my receipt messes) with their own brand, as well as much of the product selection in their store with their own brand products!
Who should be worrying about this? Companies that sell low-priced products that are easy to manufacturer. For example, other than Heinz ketchup and Coke/Pepsi, which probably have the strongest consumer food brands, who will survive? For now, most major supermarkets aren't replacing the mainstream brands with their own at risk of alienating customers (How dare they replace my favourite [x] with store-brand! I must never set foot in this store again), but is it far away?
What does this mean to us as young people looking for wise investments in companies that will be around for awhile? (many of the top 50 on the Fortune 500 weren't there 50 years ago)
Is brand still important?
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Michael Furdyk
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It is so good.
July 16, 2002 - 01:01 AM
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McDonalds recently copied it here, but theirs doesn't have the chicken or the almonds. Which is what makes it so good. Otherwise I could just get a can of mandarin oranges and some lettuce and stuff my face, but how bad would that be?
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Dex
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Re: rollerblading and the future of retail (are manufacturers screwed?)
July 16, 2002 - 01:12 AM
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Pretty bad Mike.. pretty bad.
See, human jobs will always be replaced by machines, unles of course, you are someone that makes the machines. But then there will be machines that make machines. And we all know what happens then.
Matrix revisited.
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Mike
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Careful...
July 16, 2002 - 07:57 AM
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Careful, the Matrix was only constructed because Machines knew how to adapt. They had A.I.
A machine making a machine isnt really A.I. That would call for a machine to design another machine from scratch, or; perhaps it could alter itself to perform more tasks???
Oh well. Off-topic anyway.
- - -
Pred.
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j
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??
July 16, 2002 - 10:13 AM
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The issue of effective branding or 'love marking' of products and the move away from that was your point.....?
Hmmm need to ponder the focus of your argument a little longer - fully acknowledge the emergence of new Fortune 500 companies and the focus on brand to drive sales as they successfully exploited the use of 20th century media..... guess I am doing the comparison with the "Marks & Spencer Exclusive" brands that attract additional buy price vs the Woolworths cheap generics .....need to consider the implications of "exclusive to our walk in store" and the "guaranteed not available online" buy lines in the light of those....
Also the idea of human foibles - re emotional reasons rather than fiscal often driving purchase choice .....
have I missed your point?
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Grant Price
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Re: rollerblading and the future of retail (are manufacturers screwed?)
July 16, 2002 - 12:45 PM
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I tried to read your update...But i couldnt get past the mandarin chicken salad! It just sounds too good!
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Nigel Kehler
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Re: rollerblading and the future of retail (are manufacturers screwed?)
July 20, 2002 - 04:24 AM
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I don't know why but this update reminded me about a game that I played called Capitalism 2. You kind of run a big corporation, and one of the thing is that you can take ordered products and put your own name over it if you see wish, if you do this you have to create brand awareness and stuff. Some of you may be interested in this game, but I don't think it sold well and may be hard to find. The way I ended up playing it after I couldn't find it anywhere was through sort of "unsavory" means. However, you may be interested in checking it out. Or looking for a place to get it on the net.
Here is a review and screen shots from gamespot:
http://gamespot.com/gamespot/filters/products/0,11114,538748,00.html
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Robert Lin
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Re: rollerblading and the future of retail (are manufacturers screwed?)
July 26, 2002 - 12:02 PM
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hey mike, to reply about investing. True, some of the top 50 companies werent around 50 years ago. But in terms of what I would want to invest in, I would invest in companies that are really adaptive and actually own other companies/brand lines.
Like Coca cola has been around a long long time, because they dont just sell coca cola, they sell carbonated lemonade like drink which they brand as SPRITE , they have fruit drinks with the FRUITOPIA brand (or maybe Pepsi owns fruitopia, i cud be wrong..), and Im sure there are many more drinks which I am not aware of, that are actually owned by coca cola but you think they arent because the label doesnt say coca cola unless u read the fine print.
So... figure out whos really behind the brand, if you look at the sprite can you will see it is "produced under license to Coca Cola Canada Inc" or wherever u are in the world.. so my thoughts are to invest in those mother companies who own other companies/projects, figure out who the real owner is, and invest in That company. To them, if one brand goes out of fashion they still have many other brands/products that they own, and can easily start other products.. so they are I think more enduring than a company who is just... itself and only itself.
Kebie - thanks for the gamespot URL, its got a great 8.5 rating ... particularly liked the screenshot of "buy this mansion" i might play that sometime !
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Øyvind Kildal Stangnes
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The brands wont vanish...
August 14, 2002 - 02:12 AM
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Most of the major grocery store chains in Norway (and we are probably not alone in the world  ) has done exactly what you are talking about. Introducing their own products for cheaper. This is mostly the most commonly used products, offering low-budget households a cheaper way out.
What they don't do however, is remove the brand names from the shelves. They stay, at a higher price and most likely - at a higher quality.
McDonalds arrival did not mean the death to high-cost restaurants 
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Susan
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Perspective from my new job
October 18, 2002 - 04:15 AM
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Now that I have been working for Sara Lee for 8 weeks, I would like to bring a different perspective to your arguement.
Take for instance the biggest retailer in Cincinnati, whose HQ happens to be located here as well: Kroger. YOu will find several products with a Kroger brand option next to them on the shelf, and, as you noticed, at a cheaper price. What you don't see in many cases is that Kroger, or other retailers, look to category experts to design that section of the store. In turn for putting the higher priced, brand names on the eye level shelf, Kroger also demands that X% of the manufacturers excess manufacturing line capacity has a private label...or what you would see as the "Office Depot" brand. In many cases, it is the same product, same quality, different name!
So next time you go to the grocery to buy ketchup...the store brand just might be Heinz! Brand is very important, that's why the generic or store brand is next to the well-known brand on the shelf.
As the consumer foods and retail industry conolidates, you will see more super-stores such as Wal-Mart, the largest retailer in the US today. With stores like Target chasing it's tail, to become the superior retailer, you will also see a consolidation with manufacturers.
A perfect example is Sara Lee. They have been known for years as a company that buys brands...each of those brands were competing with sister brands for the same business. Now that Sara Lee has consolidated its Food Group into one operating unit (Branded Apparel is doing the same), it's stock and performance is rising.
Any more questions?
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Michael Furdyk
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quality
October 18, 2002 - 05:18 AM
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I definately noticed that the quality of the private label products is very similar to brand names! It's just a question of now much longer people will buy the more expensive brand names?
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Ha Thi Lan Anh
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Re: rollerblading and the future of retail (are manufacturers screwed?)
February 21, 2004 - 10:48 AM
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people read no logo by naomi klein
its so damn long but worth reading
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Cicero
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Edikt 22
February 26, 2004 - 07:06 AM
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Edgar Vriesseth, Futurian minister for Finances had proposed new approach towards relation between producer and end user, due to advances in information tech.
" WE propose elimination or partial abolishment of trade as known today. To make economy move faster we need to close in the distance between producers and end buyers.
We will acomplish that goal if we use the latest techonological advances on the field of information technology. By that the end users will be able directly to effect production by the producer. He will have clear picture of the needs in the market and also good oversight making his buisness decisions easy. We will have to find jobs which will be eliminated by this actions to all effected.
But this is only the half of the necessary action needed. The second is radical lowering of transportation costs. Pehaps latest development in solar reusable electricy making will add a vital part in these efforts. Lowering transportation costs will also endanger jobs in transportation sector, but this will surely bring more benefits and losses.
Edgar L. Vriesseth
20.01.57 TR
Ave Futuria
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