Whole Foods Expands Distribution of CBD Products
In response to the cannabidiol (CBD) industry’s explosive growth, both in terms of new product innovation and increasing consumer awareness, Austin, Texas-based Whole Foods Market is expanding distribution of topical CBD products to 13 additional states this month, making CBD products available in a total of 359 Whole Foods Market stores across the U.S.
U.S. sales of CBD and hemp oil products containing CBD reached $238 million in 2018, up 57% from 2017, according to a recent study from Boulder, Colo.-based New Hope Network. At Natural Products Expo East, held Sept. 11-14 in Baltimore, New Hope reported that sales of hemp-based CBD supplements alone are expected to hit $3 billion by 2023.
In January of this year, New Hope asked natural and organic manufacturers about their plans to launch CBD/hemp products in the next one to two years, at which time, 65% said “yes.” When New Hope asked again last month, 76% said “yes.”
Consumer awareness is also on the rise. According to a New Hope survey, 47% of consumers were familiar with CBD in late 2018. When New Hope polled consumers about CBD in July 2019, it found that 70% were familiar.
“Our shoppers have expressed a growing interest in CBD products,” Jennifer Coleman, global senior category merchant for Whole Foods Market, said in a statement. “We’re thrilled to roll out topical CBD products in even more stores and to share new, exclusive items from our long-standing supplier partner Pacha Soap Co.”
As of September 2019, Whole Foods now carries topical CBD products in 30 states. As with all body care items sold at Whole Foods Market, the new CBD products meet the grocer’s rigorous body care quality standards, which ban parabens, phthalates, triclosan and more than 100 other questionable ingredients used in conventional body care products.
From Oct. 4-6, beauty and body care products, including topical CBD and the new Pacha Soap Co. bath products, will be 25% off as part of Whole Foods Market’s fall Beauty, Bath and Body Care Sale. Amazon Prime members receive an additional 10% off the discounted price.
Save A Lot said Monday it has agreed to sell 51 company-operated stores in the Tampa, Fla. market to Fresh Encounter, which will operate the stores under their current banner.
The move represents a significant step in the St. Louis discounter’s transition to a wholesaler while nearly doubling the number of stores operated by Fresh Encounter, the Findlay, Ohio-based retailer owned by the Needler family. Fresh Encounter operates 61 stores in Ohio, Kentucky and Indiana under the Save A Lot, Great Scot, Community Markets, Germantown Fresh Market, Needler’s Fresh Market, Remke Markets, Sack n’ Save, King Saver and Chief Supermarkets banners.
Financial terms were not disclosed.
Save A Lot said the transaction builds on the completion of its recapitalization earlier this year and supports a strategic plan to shed more than 300 company-owned stores to independent licensees. When the recapitalization was announced in January, Save A Lot owned and operated 417 stores, with another 698 operated by independent licensees. Departures and closures since then place Save A Lot at about 1,000 stores.
The company said it intends to continue to operate its 21 stores in the St. Louis market, where they will serve as a “testing ground.”
We are excited to expand our partnership with Michael Needler and the Fresh Encounter team, who have been fantastic partners, strong operators and excellent ambassadors of the Save A Lot brand,” said Kenneth McGrath, Chief Executive Officer at Save A Lot. “Through the re-licensing transactions we are executing across our footprint, we believe that we will be even better positioned to continue to serve the communities in which we operate. We currently have a dedicated group of retail partners that we support and we look forward to helping other entrepreneurs own, operate and succeed in their own business.”
To date, Save A Lot has executed seven sale transactions, comprising 82 stores, including those being sold to Fresh Encounter. The company expects to complete its re-licensing program in 2021. A significant portion of Save A Lot corporate stores are in Florida and served from a Plant City distribution center there.
Save A Lot stores operate in 33 states and are served from 14 wholesale distribution centers. The company serves as a licensor and wholesale partner to over 200 independent owners and operators. Save A Lot is a hard-discount model with limited skus and a stable of private brand offerings that primarily targets lower-income shoppers. Through an emphasis on serving and supporting its retail partners, Save A Lot said it has built a “sustainable, high-growth and community-focused business,” with a mission of adding unmatched value to local communities. Owners are able to customize store assortments to cater to the tastes and preferences of their local customers.
“The Fresh Encounter family of companies has a culture that prioritizes being positive, appreciative and resilient and we are eager to onboard the new Florida associates. Over the past several months I have toured stores in the greater Tampa market and I’m impressed with the Save A Lot team,” Michael Needler, Jr. president and CEO of Fresh Encounter. “I am truly humbled to be joining them in delighting our customers, nourishing the communities and inspiring pride in the team. Kenneth and Kevin Proctor and the rest of the Save A Lot corporate team are transformative and we are equally eager to join their efforts in re-establishing the Save A Lot brand for tomorrow’s competitive environment.”
PJ Solomon served as financial advisor and Troutman Pepper served as legal counsel to Save A Lot in connection with the transaction.
Earlier this month, Stater Bros. Markets announced it would reinstate hazard pay in the amount of $2 an hour for its 18,000 grocery workers across 170 supermarkets in California. But as the Golden State’s COVID cases approach 2 million and its hospitalization rates surge, the risk to essential grocery workers is prompting local government and grocery chains to reevaluate compensation.
The San Bernardino, Calif.-based Stater Bros. recently decided to extend its additional $2-an-hour incentive for every hour worked for an additional two weeks, starting on the work period beginning Dec. 27, 2020. This incentive will apply to all of the company’s hourly employees that work in the stores, distribution, transportation, corporate offices and construction, the company said.
“I am extremely proud of our employees who remain dedicated to serving the needs of our Southern California shoppers. This incentive recognizes our employees for their ongoing extraordinary efforts during the holidays,” said Stater Bros. CEO Pete Van Helden in a statement.
Springfield, Mass.-based Big Y Foods Inc., one of the largest independently owned supermarket chains in New England, said it will be paying additional holiday bonuses to its front-line and distribution center associates including full-time, part-time and casual employees.
“This holiday bonus is part of the company’s ongoing recognition and appreciation for the efforts and sacrifices of employees which was instituted last March. Thank you bonuses are expected to continue during the first part of 2021,” the company said.
We continue to be grateful to all of our employees for their valiant efforts throughout this pandemic. They have all taken their role as essential workers both nobly and carefully in order to continue to provide for and support our friends and neighbors in our communities,” said Charles L. D’Amour, president and CEO, in a statement. “I am so very proud of their resilience and dedication to serving our customers during this past year. This bonus pay is just one way that we show our appreciation to our team of 12,000 who work so hard and tirelessly every day.”
While grocers across the country have approached hazard pay and worker compensation in a variety of ways from bonuses for Walmart employees to retroactive hazard pay for ShopRite workers, a California municipality has made a move to bump up grocery worker “hero pay” an additional $4 an hour.
This week, the Long Beach City Council passed a resolution that would require the $4-an-hour increase for all front-line grocery employees working in large supermarkets in the Southern California city. Companies with at least 300 employees nationwide would be required to pay the extra $4 per hour for at least 120 days, after which the ordinance would come back to the city council for a possible extension, reported a local NBC news affiliate.
The resolution was introduced to the City Council by United Food and Commercial Workers Local 324.
