After 52 years of writing about the grocery industry, it’s time for me to call it a day. During that half-century, I’ve written nearly 1,200 columns under the “Taking Stock” banner. Before that, in my nearly five years with The Griffin Report in Boston, I wrote another 50 opinion pieces under the title of “Counter Reactions” (yeah, that was a bad name, and I hope there are only a handful of readers left who remember my early years and struggles).
My decision to sell Best-Met Publishing (BMP) did not come easily. Not only has it been my career, but it’s also consumed most of my adult life – something I mostly consider to be a good thing.
However, at age 74, this just felt like the right time to move on. Mentally my acuity is still pretty good, and physically I’m generally fine, but the business continues to change rapidly – clearly, it’s become a younger person’s game, and the new owner of BMP, Alex Wissel, is not only much younger than me, he’s also very bright and creative and he has a passion that impressed me the first time I met him earlier this year.
The good news is also that our core team – Terri Maloney, Maria Maggio and Kevin Gallagher – will remain intact. They will help Alex navigate the nuances of the grocery industry and offer him a direct pipeline to the retailers, suppliers, brokers and distributors who read and advertise in our publications and on our website. All three are not only tremendous people, but they are also more skilled at what they do than anybody in the food trade media.
I will also be around for a while helping Alex connect the dots on the business side of things and also assisting with introductions. As part of the transition, I’ll also be writing “Taking Stock” for the foreseeable future. But since this is my first column since the business was sold, I thought it would be fitting to reflect a bit on the past while also thanking so many people of the people who supported me on the way up. Certainly, I can’t mention all of the hundreds of people who guided me over the past half-century that I’ve been part of this great business, but there were a handful who were most impactful.
From my Boston days, Sidney Rabb, co-founder and CEO of Stop & Shop (when it was one of the most powerful chains in the country), took me under his wing when I was greener than a seasick leprechaun, and helped teach me the “inside baseball” on how the grocery business really operated; the same with Leo Kahn, “Mr. Sidney’s” competitor and owner of Purity Supreme, who encouraged me to write what was on my mind, regardless of whether people liked it or not. Even after selling Purity Supreme, Leo continued to motivate me during his two “post-retirement” careers at Staples and Fresh Fields.
On the wholesale side, no one inspired me more than Adam Bozzuto, founder of the large Connecticut wholesaler that today remains successful and is led by his son, Michael. A passionate and sensitive man, Adam was the subject of my first feature length interview, in which he constantly reinforced the importance of customer service. It wasn’t just fodder for my story, Adam Bozzuto practiced what he preached throughout his entire life.
I also owe a big thanks to John Griffin, founder of The Griffin Report, the man who hired me in 1973 and gave me my first at-bat as a professional writer (that college newspaper stuff doesn’t count). Even though John was often temperamental, he was a man of great integrity who taught me that the quality of your product is by far the most important component of your success.
Also, Dave McElroy, who some industry veterans might remember as the New England sales manager for Golden Grain Macaroni/Rice-A-Roni (now owned by PepsiCo). When Dick Bestany and I acquired Food World in May 1978, McElroy helped provide the seed money to fund BMP in its early years.
As we relocated to Maryland, I was so fortunate to continue to meet influential people who went out of their way to help me. David Finkelstein and Dick McCready, the two largest food brokers in the market in the early years, made us a part of their world, not only in ad support but in the way they treated us as peers. And it was Finkelstein who introduced us to Izzy Cohen, the CEO and co-founder of Giant Food, still the dominant grocery chain in the B-W market. Izzy was simply a fascinating person. His street smarts and instincts were impeccable – he could read people like a skilled psychic and his passion and tenacity for Giant (and the grocery business in general) remains unrivaled among the thousands of people I have met in the retail food industry. How blessed was I when the most powerful man in the market would call a 30-year-old neophyte with tips about new store locations, both his own and his competitors? And when Izzy stepped down as chief executive in the early 1990s (he passed away in 1994), his successor Pete Manos went out of his way to treat me like I was royalty. There were many fruitful discussions about the industry and almost as many “fruitful” evenings continuing that dialogue over long dinners (usually at the late, great Boccaccio restaurant in Baltimore’s Little Italy). Pete could be tough, rough and gruff but he genuinely cared about people and loved Giant Food.
A shout out to Bob Santoni and his late brother Paul, the first supermarket owners we met when we arrived in the market. The Santonis taught us about independent retailing in B-W, and for many years their flagship store in the Highlandtown section in Baltimore was one of the best run supermarkets in the region.
And speaking of independents, nobody cared more about his customers than Bernie Green, who ran B. Green, the largest wholesaler in the B-W market who was a man of great kindness and wisdom (he and Adam Bozzuto could have been blood brothers). It’s not ironic that his son Benjy and nephew David remain two of my closest friends nearly a half-century later.
And then there was John Paterakis, CEO of H&S Baking and perhaps the greatest entrepreneur in the B-W market over the past 50 years (in any industry). “JP” was perhaps the most intuitive businessman I’d ever met. I watch in disbelief today as too many “skybox jockeys” crunch and analyze data to predict outcomes with mixed results. Mr. P. was like a skilled quarterback who almost always knew what play to call. How many people do you know who can say they’ve successfully worked with Ray Kroc (McDonald’s) and also helped rebuild the city where he was born in (Harbor East in Baltimore)? Today, H&S continues to be a dynamic organization run by John’s sons, JR, Steve, Chuck and Bill.
And who can forget Bob and Jim Ukrop? As we expanded into the Richmond market in those early years, the first family of food retailing in the Old Dominion’s capital welcomed us with open arms. The Ukrops’ stores were among the most progressive in the entire industry and the camaraderie we established with the two brothers was very special. While older brother Jim is now retired, Bobby Ukrop continues to be an important player in the industry with family-owned firms Ukrop’s Homestyle Foods and Threads Uniform Agency.
Later on, people like Bill White (Shoppers Food) and Jim Donald (Safeway, and now chairman of parent firm Albertsons) used the “Don Rickles” method to playfully poke at my shortcomings to create mutual trust. They kidded because they truly cared.
Late in 1978, we had an opportunity to acquire Food Trade News, an aging, struggling trade publication (much like Food World), this time in Philadelphia. Irv Borowsky, owner of parent company North American Publishing Co. called one day to tell us how much he’d been impressed by the turnaround of Food World. He then asked us if we’d like to buy his paper. We told him we were in no position to borrow any more money but thanked him for thinking of us. He wouldn’t take no for an answer and even introduced us to and backed us as we made a deal with the old First Pennsylvania Bank (now owned by Wells Fargo). A special salute to the late Mr. Borowsky.
Again, so many people in Philadelphia and Central PA helped us in the beginning. Retail executives like Allan Noddle at Giant/Carlisle (now The Giant Company); Robert Weis and Norm Rich at Weis Markets and Earl “The Chief” Redner, Redner’s Markets, in Central and Northeast PA; and Charles A. Genuardi (future CEO at Genuardi’s Family Markets in suburban Philadelphia); and George Zallie Sr., owner of Zallie’s ShopRites in South Jersey. They all helped teach me the retail ropes about markets much different from Baltimore-Washington. Moreover, it’s not a coincidence that I’ve had great relationships with some of their children – Jonathan Weis, David Zallie and the late Dick Redner (and now Dick’s son Ryan and nephew Gary Michael). As an analyst at heart, I find few things more rewarding than seeing family businesses perpetuate and continue to succeed.
And Jay Brown, president of c-store wholesaler Miller & Hartman, who actually sat me down in his Lancaster, PA office one afternoon and explained in painstaking detail how the convenience store distribution system works. It was one of many meetings with Jay that often continued late into the evening (and not at the local Temperance Union).
Moreover, executives at large food brokerage firms like Frank Bosworth (Fitzwater) and Pete Riley (Joseph W. Riley) provided me with the intelligence about their marketplace while also demonstrating how to entertain effectively in a business environment (it shouldn’t surprise anybody that Dick Bestany and Pete Riley were great friends).
As I said earlier, I don’t have the room to mention everybody, but there are so many people who went out of their way to make me a better businessman and more importantly, a better person, and I thank all of those who went the extra mile for me.
You can’t build a profitable business without the internal ingredients that lead to that success. At the very beginning Bill Speakman, our financial adviser, set up the infrastructure of the company that was an integral part of helping BMP become and remain profitable. His successor, Lisa Felts, has carried that torch admirably and has been especially invaluable over the past six months as we put this deal together. Another key piece of our success has come from E-ink, our pre-press partner for more than 25 years. They provide a most valuable link between our office and our printer. A tip of the hat to owner Matt Danielson and chief designer Jenny Jones.
Beth Pripstein, our office manager for nearly 30 years before she retired two years ago, ran the office professionally and kept me from going off the rails many times.
Oh, there’s one person you might think I’ve forgotten to mention. That’s not possible – I’ve been saving the best for last. My success and the success of BMP wouldn’t have been possible if it weren’t for my late business partner Dick Bestany (frankly, the “Best” of Best-Met) who retired in 2007. He was a once-in-a-generation superstar – larger than life, louder than a Broadway stage actor (it was once said that he learned to whisper in a sawmill) – who was filled with so much personality, passion and energy that he was truly a life force. Skill-wise nobody could sell advertising like Dick. Ads were sold in boardrooms, bathrooms and barrooms and ad designs were created professionally by our graphics team or on a cocktail napkin, often at Clyde’s restaurant in Columbia, MD. Dick Bestany was not only my business partner, he was my best friend and, as we were both only children, we were the brothers we’d never had. He passed away in 2023 and I think of him often.
While my engine hasn’t stopped, I’m intending to run it at a much lower idle. I will remain active in the industry but at my own pace. I’ve formed a consulting firm, Taking Stock LLC, to share my knowledge and experience in the industry with the companies and people I’ve come to know. I also plan to spend more time giving back to this great industry and mentoring new people in the grocery business, just like many of the people who helped me at the beginning.
I’ll also have the opportunity to travel more with my wonderful and caring wife, Terri, knowing that my recreational activities over the past 47 years were greatly curtailed by what I sometimes considered a nasty word – deadlines.
I know I’ll be spending more time with my two children – Dana who lives in Towson, MD and Andy who lives in Los Angeles, who I don’t see often enough. And then there’s Dana’s and her husband Michael’s two young children – Zeke and Thea. They’ll definitely be seeing a lot more of Grandpa – whether they want to or not.
Folks, it’s been a great ride. I’ve always viewed accurate reporting of the news to be vitally important to any industry. My style has not always been popular with everyone but I’m proud to say it’s always been “my style” – opinionated editorials, hard news covered accurately with a bit of social flavor thrown in.
Thanks to all of you for the opportunity. It really has been the pleasure of a lifetime!
‘Round The Trade
While Kroger might believe that the indiscretion that forced former CEO Rodney McMullen to exit the company is not relevant to reveal in more detail, apparently, its former dating partner Albertsons feels differently. The Boise, ID-based retailer, which saw its merger effort with Kroger collapse last December, is seeking additional information as part of a lawsuit it filed against the Cincinnati-based merchant (which is countersuing Albertsons) earlier this year. In a July 27 court filing, Albertsons said that “McMullen micromanaged the merger from the beginning to end, and his business ethics (or lack thereof) lie at the heart of this case.” The filing added, “Kroger has not explained why that conduct was so egregious that the Kroger board determined that McMullen was unfit to serve as CEO and forced him out within 10 days of discovery.” When referring to McMullen’s behavior, the filing also noted that (his conduct) “raises significant concerns not only regarding his credibility, integrity and compliance with the law, but also about his focus during the merger process and his ability to fulfill Kroger’s contractual obligations to Albertsons.” Ouch!
Wait there’s more. In a decision that could impact the Albertsons case, a Hamilton, OH judge has ordered McMullen to disclose the reason for his sudden resignation in March. In a lawsuit filed by pop singer Jewel and Inclusion Cos. concerning a health and wellness festival that the defendants organized on behalf of Kroger which was originally filed in 2023. Inclusion/Jewel claim that in 2018 Kroger agreed to sponsor a wellness-themed festival (“Wellness Your Way Festival”) to “gain awareness and credibility” for the health products and services the retailer offered in its stores.
According to the suit, Kroger ended the partnership in 2022 and essentially hijacked the festival for its own benefit. Inclusion/Jewel claim that Kroger is running the festival “using the know-how, marketing materials, contracts, and sponsor lists” they contributed and left them with $2 million in losses and at least $5 million in lost profits. Since Kroger disclosed McMullen’s ethics were a factor in his resignation, the defendants’ attorneys are seeking details to weigh along with his testimony. Judge Christian Jenkins agreed that McMullen must disclose the reason for his exit, but hasn’t yet ruled as to whether that testimony will be sealed or become public record. With a precedent having now been set, Albertsons should feel more confident that McMullen’s ethics might have impacted his decision making in the merger attempt process. Or as Jewel might have sung to Rodney: “Who Will Save Your Soul.”
While Kroger and Albertsons (and Jewel) continue to duke it out legally, one former litigant has settled its issues with the big Cincinnati chain. C&S Wholesale, which claimed that Kroger owed it a $125 million termination fee after the Albertsons merger attempt fizzled out, also countersued, accusing Kroger of repeated intentional material breaches and interference. As part of the merger proposal, C&S was slated to gain 579 stores that would have been divested. No terms of the settlement were disclosed…we recently heard UNFI CEO Sandy Douglas say that distribution conditions have returned to almost normal following June’s cyberattack shutdown, which might not be the case according to about a half a dozen of the company’s independent retailers in the Mid-Atlantic who we have continually spoke to over the past two months. They tell a different story – essentially that service levels have not returned to pre-cyberattack levels (typically 95-97 percent).
And then comes word from a UNFI customer that recently experienced a different service level issue at the wholesaler’s Mechanicsville, VA depot. Here’s the recap according to that multi-store merchant: “If you believe that UNFI’s distribution issues are behind them, think again. Their warehouse in Mechanicsville, VA experienced a power outage in late July, and they didn’t get back on track for more than a week. Dairy in particular was impacted. Some of our customers literally did a U-turn and walked out of our stores. We continue to lose customers because they no longer have confidence in our ability to consistently provide them with the products they want. Some might have tolerated the out-of-stock conditions caused by the cyberattack, but this outage lasted well over a week and was clearly unacceptable. Of course. UNFI communications were awful again!”
Online grocery purchases continue to increase with some retailers acknowledging that digitally-driven sales are now approaching 20 percent of the total pie. That number was recently substantiated by research firm Brick Meets Click which reported that U.S. online grocery revenue reached $10 billion in July, up 26 percent from a year ago. And here’s a key statistic that’s very telling: E-grocery penetration set a record (in July) as 81 million (61 percent of U.S. households) bought groceries online during the month, whether the order was shipped, picked up or delivered.
Local Notes
How about them fightin’ Demoulases! In an intra-family dispute that dates back more than 30 years, the family members are back at it with a vengeance. This time instead of dueling (legally and physically) with his cousin Arthur S. Demoulas (who was paid $1.6 billion in 2014 to essentially go away), current CEO Arthur T. (“Artie”) is fighting with his three sisters and the other three non-family board members. In late May, the board placed Artie T. on paid administrative leave following a festering dispute with the company’s board which accused him of intentionally not divulging key information about its 95 Market Basket stores and then about attempting to orchestrate a company-wide work stoppage, a claim Artie T. has described as “a farcical cover for a hostile takeover.
Thus far, two veteran Market Basket executives – Joe Schmidt and Tom Gordon – have been fired and two of Artie T.’s children – Madeleine and Telemachus – have also been put on paid leave. Over the past few months, the finger pointing between the two factions has gotten even more pronounced with both parties mounting aggressive PR campaigns defending their turf and accusing the other side of creating the friction. Both sides have agreed to mediate their conflicts on September 3, but one has to wonder whether non-binding third-party negotiations will lead to a resolution? It’s ironic that Artie T’s three sisters, who sided with him 11 years ago in their case against their first cousin, now are bitterly at odds with their brother. More importantly, it’s really sad that there’s been such intra-family hostility for an $8 billion (estimated annual sales) retailer that operates some of the best supermarkets in America
When it comes to having cojones, you’ve got hand it to Bob Facchina, CEO of Flemington, NJ-based Johanna Foods. The yogurt and orange juice processor, which has many private label customers, is suing the Trump administration, over its tariff policy specifically targeting Brazil, where the surcharge currently stands at 10 percent on juice and 50 percent on orange byproducts (used in making concentrated OJ). Brazil produces more than half of the fresh orange juice consumed in the U.S. and Johanna claims its import costs would increase by $68 million annually and lead to price hikes of up to 25 percent. As I’ve been saying for several months now, none of this tariff activity is helpful to the grocery industry on any level, and it’s questionable whether Trump’s tariff policies are ultimately going to provide net economic benefits to the American consumer.
From our obituary desk, two musicians, both sadly unsung, have left us. Chuck Mangione, the great trumpet and flugelhorn player, has left us at age 84. The Rochester, NY native learned his craft under such legendary horn players as Maynard Ferguson and Dizzy Gillepsie. Mangione attained his musical chops early in life, attending the Eastman School of music in his hometown and then launching a career that lasted more than 60 years. During that span, he was nominated for 14 Grammy Awards (winning twice) and is credited with being a pioneer in developing the ”jazz-pop hybrid” style of playing. And his roots are connected to the grocery business. His parents ran a grocery store – Mangione’s Market – for many years on Martin Street in Rochester.
Also passing away was Flaco Jimenez, 86, arguably the greatest conjunto accordion player ever. Conjunto (sometimes called Tejano or Norteño) is a musical genre developed in South Texas by Mexican-Americans that utilizes influences from Czech, Polish, and German polka traditions. Lyrics are typically sung in Spanish in the style of Mexican ranchera music. As great a musician as Jimenez was, it was also his tireless efforts to promote “Tex-Mex” music in American musical culture that made him also stand out. Jimenez was truly a “musicians musician,” widely admired by his peers and joining such great artists as Ry Cooder, Bob Dylan, the Rolling Stones, Doug Sahm, The Mavericks, and Dwight Yoakam both in live performances and on recordings. During his career which began in the early 1960s, Jimenez won six Grammy Awards and in 2015 he received a Grammy “Lifetime Achievement Award.” I saw Jimenez a couple of years ago during an intimate performance at the Smithsonian in Washington. His playing was still spot on and his passion for the music he learned from his father growing up in San Antonio was still burning.
