Grocery Update #40: Our 2025 Priorities.

Also: The True Cost Of Amazon’s Free Shipping. And NYC's Happiest Grocer.

Discontents: 1. Our 2025 Priorities. 2. The True Cost Of Amazon’s Free Shipping. 3. Rick Antonelli’s Recap of Happier Grocery in NYC. 4. Tunes.

1. Our 2025 Priorities.

Greetings fellow Grocery Nerds!

Welcome to 2025 and The Checkout Grocery Update. What can you expect from us this year? No paywalls, no filters, no BS. No resolutions. No trend predictions, those are so tired. No sad faces. No toxic optimism. This shit is tough, but we got your back.

Here are our priorities for The Checkout Grocery Update for the coming year. We hope this vibes well.

(1) *Supporting Grocery Workers*

We are going to maintain a broad focus on working conditions, wages, safety and job security for people working at all levels of the grocery supply chain. We will continue to platform working people and let them speak for themselves, while providing intellectual and contextual ammunition to unapologetically support their goals and needs for better jobs and livelihoods. And we will be on the picket lines, in spirit or in real life. This pursuit of justice is a very simple and stubborn priority.

“Justice, justice you shall pursue”, Deuteronomy 16:20, for the perplexed.

And what do we mean by grocery workers? This could be anyone in the supply chain that brings your food to your pantry. Farm labor, logistics and trucking, warehousing, manufacturing, retail, delivery. Undocumented, H2A, or full citizenship. Union and non-union. Blue collar and white collar. Category managers, inventory specialists, data analysts, even those IT folks debugging your laptop. If you sell your labor to survive and that labor brings food to grocery shoppers, then The Checkout Grocery Update is here for you. Drop us a line, we can be discreet.

(2) *Highlighting Indie and Cooperative Retail*

At heart, this is a retail newsletter. Retail is where all of this rubber meets the road. There are literally ZERO compelling research and study programs about U.S. grocery retail in academia. Seriously, ZERO. We aim to fill that gap with first person, unfiltered, excrutiatingly detailed research on the grocery sector. Like CPG (consumer packaged goods), grocery retail is heavily consolidated, complicated, competitive and crrrrazy. And we are not going to be shy about who we are rooting for. We will be putting a focus on retail formats that are owned by and for the people, such as “high road” entrepreneurs that pay living wages and good benefits, consumers and community members, workers or employees, or even public agencies. We will be critical too, this ain’t no cake walk folks, there will be plenty of tough love.

And there will also be deep dives about the bigger established chains, what they do right, what they don’t, how their business models warp the marketplace and what needs to be done to build a grocery industry that can be more fair, sustainable, innovative and holistic, and not just hoovering up all the profits for a handful of billionaire shareholders. It will be so fun!

(3) *Platforming “BFY” Emerging Brands*

We love good food. And we really love food brands focused on innovation and sustainability. They are the future. There are over 100 categories of products sold in grocery stores. Many categories are monopolized by a handful of monopolies that work closely with retailers to stay on top and deflect and absorb threats to their dominance. Such concentration of ownership and wealth makes grocery aisles so boring, nor ready for a chaotic climate and shifting consumer priorities, like GLP-1s or zoonotic pandemics. We like those upstarts and disruptors, especially folks with inspiration and ideas to change the food industry beyond their little category niche, who are building supply chains more diverse and anti-fragile than the homogenous food monopolies dominating store shelves. This is true “better for you”, aka “BFY”. We will be platforming the brands that are truly making the world healthier, more just and sustainable. There are plenty out there.

AND: A BIG ANNOUNCEMENT!

We are going to partner with our new sponsor Specialty Food Association (SFA) to focus on many of these enterprises and founders. This sponsorship means we will NEVER have a paywall. SFA is mission aligned with The Checkout Grocery Update and is an organization we have worked with for almost twenty years. This relationship will give us access to some of the most compelling founders and supply chain stories in the grocery industry. Stay tuned for lots of really cool content on this front and maybe check out this little trade show in Vegas:

(4) #Pricing Is Bullshit.

Over the last few years, we have contributed over a dozen articles to the public dialogue about grocery prices, particularly in Forbes. We have had hundreds of thousands of views on these pieces and will continue to put the time into understanding and analyzing grocery pricing trends. In our previous life, we spent a dozen years negotiating costs and retail prices while balancing gross margins across thousands of brands and tens of thousands of products. Pricing was a huge part of the job in running a five billion dollars a year business unit. There is no one else writing about pricing that has this breadth of experience of actually setting prices in the real world.

And this is an area with very little cohesive public understanding, and is intentionally confused by the various schools of academic thought. There is a lot of weird economic theory/dogma about pricing, a lot of mythology about how prices are set, why prices go up or down, who sets prices and how prices need to be changed to enable greater food access and communication of actual real-world value. We will be writing about pricing a lot, including new inflationary pressures, who is benefitting from higher prices, who isn’t and how public policy is influencing what consumers pay on shelf. Remember: pricing is always, always bullshit.

>So these are our main focus areas. Our priorities.<

It doesn’t mean priorities won’t change. Who knows what stupidity our incoming president is cooking up for all of us. It will not be boring, that is for sure.

And we also have plenty of other areas of interest, like grocery retail technology, futuristic food-tech like precision fermentation and genetically modified organisms, or new production frameworks like regenerative organic and agroecology. But they aren’t the priorities right now, except folded into the topics above. Context is key.

So thank you to all our readers and paid subscribers for tuning in and hope you enjoy the ride! (And of course, perspectives are 100% our own and do not reflect those of our sponsors).

2. The True Cost Of Amazon’s Free Shipping.

Thousands of warehouse and delivery workers participated in the largest strike against Amazon in U.S. history. Strikers at several facilities aimed to bring attention to unfair labor practices (UPLs), such as Amazon’s industry-leading injury rates, and to force the E-commerce giant to come to the bargaining table.

The strike’s timing was strategic for warehouse workers and delivery drivers, who are unionizing with the Teamsters, one of the largest U.S labor federations. Amazon package volumes spiked during the holidays, or “peak season”, as do workplace injuries.

Gabriel Irizarry, a driver at DIL7 in Skokie, Illinois, stated, “They talk a big game about taking care of their workers, but when it comes down to it, Amazon does not respect us and our right to negotiate for better working conditions and wages. We can’t even afford to pay our bills.”

Teamsters General President Sean M. O’Brien noted, “If your package is delayed during the holidays, you can blame Amazon’s insatiable greed. We gave Amazon a clear deadline to come to the table and do right by our members. They ignored it.”

Amazon workers account for 36 percent of all warehouse employees in the U.S., but over 53 percent of warehouse injuries.

Amazon has a workforce of over 700,000, making it the largest warehouse employer in the nation. The Teamsters, with over 1.3 million members, represent nearly 10,000 Amazon workers at ten facilities and have made organizing Amazon a priority.

Amazon generated over $36.9 billion in profits in 2023, and the company’s current market capitalization is over $2.39 trillion, an amount greater than the GDP of all but seven countries. Amazon’s founder, Jeff Bezos, is the second wealthiest person in the world, with a net worth of approximately $238.6 billion, according to Forbes. Current CEO Andy Jassy received nearly $30 million in total compensation in 2023, and has received over $300 million in total compensation since 2021.

Amazon fiercely opposes union organizing efforts.

…and uses tactics like delaying elections or having employees attend captive-audience meetings. Amazon recently spent over $17 million on union avoidance consultants, sometimes even hiring them directly as managers.

Teamsters have been organizing Amazon workers around the U.S. for the past year, but the recent surge in unionization dates back to 2020 and 2021, after an attempt by workers and RWDSU (Retail, Wholesale, Department Store Union) to organize a facility in Alabama. That campaign is still ongoing. Worker-led organizing at Amazon picked up steam after former Amazon supervisor Chris Smalls was fired early in the pandemic after expressing concerns about unsafe working conditions. Workers at his facility, JFK8 in Staten Island, organized to form the Amazon Labor Union. They recently affiliated with the Teamsters and are participating in the strike.

The striking Amazon facilities included JFK8 and DBK4 in New York City, DGT8 in Atlanta, DFX4, DAX5, and DAX8 in Southern California, DCK6 in San Francisco, DIL7 in Skokie, Illinois and the KSBD air hub in San Bernardino. KSBD is Amazon’s largest air hub on the West Coast. Over 1,000 workers from the facility have unionized with the Teamsters.

“We don’t want to be on the picket line this close to the holidays, but Amazon left us no other option,” said Ayden Huett, a worker at KSBD. “Amazon has shown time and again that they will not improve how they treat us unless we fight.”

According to Jake Wilson, Professor of Sociology at California State University, Long Beach and co-editor of The Cost of Free Shipping, “The Teamsters strike at Amazon delivery stations represents a critical escalation in challenging Amazon’s power over workers. Amazon has strategically built this massive delivery infrastructure on the backs of hundreds of thousands of non-union, misclassified, contracted Delivery Service Partners (DSPs). The Teamsters have rightly targeted Amazon’s delivery choke points in order to build momentum to force Amazon to take on the responsibility of being a joint-employer that is responsible for the safety and working conditions of these workers.”

Amazon’s Corporate Culture Of “Systemic Safety Failures”

A recent report from the Center for Urban Economic Development, University of Illinois, Chicago found that Amazon workers have by far the highest injury rate in their sector:

• 41% of workers report being injured while working at an Amazon warehouse.

• 51% at the company for more than three years have been injured.

• 69% have had to take unpaid time off due to pain or exhaustion.

• 52% feel burned out from their work at Amazon.

• 41% always/most of the time feel pressure to work faster.

A July report from the Senate’s Health, Education, Labor and Pensions Committee found that injury rates skyrocket during Prime Day and the holiday season, or more than 10 annual injuries per 100 workers, double the industry average. Amazon’s total injury rate amounts to 45 injuries per 100 full-time workers.

So, if every day of the year was Prime Day or the holidays, nearly half of the Amazon workforce would be injured.

A more recent Senate committee investigation found that Amazon has a “corporate culture obsessed with speed and productivity… resulted in systemic safety failures and high rates of injury.” Amazon’s injury rate is also having a “significant and growing impact on the average injury rate for the entire warehouse sector”

• Amazon manipulates its workplace injury data to portray its warehouses as safer than they actually are.

• Amazon imposes speed and productivity requirements on workers, commonly called “rates.” These requirements force workers to move at an extremely fast and often dangerous pace. To ensure compliance with the requirements, Amazon closely tracks workers’ movements throughout each shift. When workers cannot keep up, Amazon uses automated systems to initiate disciplinary procedures. These disciplinary procedures progress in severity and eventually result in termination.

• Amazon forces workers to move in unsafe ways and to repeat the same movements hundreds and thousands of times each shift, resulting in extremely high rates of musculoskeletal disorders.

• Although Amazon has safety procedures in place, the company’s required rates make those procedures nearly impossible to follow.

• Amazon’s failure to ensure safe working environments results in debilitating injuries.

• Amazon refuses to implement injury-reducing changes because of concerns those changes might reduce productivity.

• Amazon actively discourages injured workers from receiving outside medical care.

• Workers who need short-term or permanent workplace accommodations for work-related injuries and disabilities experience significant challenges obtaining appropriate accommodations.

• Amazon terminates workers injured in the company’s warehouses who are on approved medical leave.

• Amazon deflates the injury numbers it records for federal regulators.

Strikers are clear that organizing with the Teamsters will help them win safer working conditions.

Some speak regularly with colleagues at Teamsters about UPS’s contract, who they also organized. “It’s amazing what you hear that they have,” notes Rubie Wiggins, who works for an Amazon DSP. “When you see that UPS is less profitable than Amazon… you really want to tell Amazon, ‘Please take care of me like that.’”

The Teamsters, including President Sean M. O’Brien, take this injury rate seriously. “The Teamsters are done asking nicely for Amazon to stop breaking the law. Amazon must commit to come to the table and bargain a Teamsters contract with its workers — or face the consequences of its inaction. Thousands of Amazon workers around the country have courageously united to take on one of the world’s most abusive employers. Amazon has a legal obligation to recognize the Teamsters and to start negotiating.”

An Amazon spokesperson said in a statement, “for more than a year now, the Teamsters have continued to intentionally mislead the public – claiming that they represent ‘thousands of Amazon employees and drivers’. They don’t, and this is another attempt to push a false narrative.”

Observers were mixed on whether the strikes impacted holiday deliveries. In a LinkedIn post, Jason Miller, a logistics professor at Michigan State University noted, “Less than ten facilities in Amazon's network are affected. Amazon has several hundred large fulfillment centers, in addition to other facility types such as air hubs, sortation centers, local delivery locations, etc. The scope of the strike is less than one percent of Amazon's workforce... Santa should still be able to get your Christmas presents there on time.” That is unless Santa twists an ankle at the sortation center.

Jake Wilson takes a longer view: “In recent years, Amazon workers have been at the forefront of taking on one of the world’s most powerful corporations, and this latest strike wave will likely serve to inspire more worker actions at Amazon.”

Dia Ortiz, a worker at DBK4 in New York, feels inspired by the strikes, “I’ve seen the Teamsters win big battles. We’re ready to do what it takes to win this one.”

This article originally appeared in Forbes, who commissioned the piece.

3. Happier Grocery, NYC.

Recap By Rick Antonelli.

My two cents summary: 1) Prepared Foods--- a major focus of Happier Grocery-- well done, high quality, a nice- mostly organic - selection of vegan, vegetarian and meat-based offerings, and deliciously prepared.

2) Grocery/ Frozen /Dairy—NO private label of any kind— either theirs ( except for in-house prepared and prepackaged items ) and NO distributor Private Label skus like Field Day or Cadia on shelf. What is on shelf is a really well curated, fun, and interesting mix of national, regional and new cutting-edge/ start up brands in these departments. Many unique brands (many of which I was unfamiliar) and a focus on NY based suppliers/brands of course.

3) Produce---- All Organic--- I believe. The section is small with many prepackaged items, presenting like an elevated Trader Joe’s set. Merchandising here not up to level of the rest of the store. However, everything looked fresh, Local when available and the merchandising does fit in with the “Grab and Go” focus the store features.

4) Beverage Bar---excellent smoothies as well as a standard issue beverage/coffee/latte selection. 5) Wellness – A modest focus at Happier Grocery, and again not a huge emphasis on large national brands of supplements and body care and many brands and skus I was unfamiliar with were featured. No private label.

6) Pricing--- NYC/LA high on Produce / Grocery/Wellness departments. Alternatively, I felt that the prepared foods and beverage bar were priced fairly and overall, quite reasonable (my daughter -who lives locally- eats many dinners purchased there and she’s on a tight budget for sure).

7) Staffing--- well staffed, very friendly, and helpful and (surprisingly these days) knowledgeable on product and brand attributes. When you ask about a product whereabouts, they escort you to the item without exception.

8) Demos – constant with a focus on unique/local/perishable. (9) Loyalty Program- two tiers--- one free (Green) and one that costs $9.99 a month( Black). Store was packed all weekend (Dec 13-15) and a buzz in the big city since they opened a year ago- ish. Many locals (including the press and social media sites) comparing it to Erewhon stores in LA--- fairly, accurately, or not. Worth a visit if you are in the area .

Rick Antonelli is currently advising Ace Natural Foods, a premier natural and organic food service distributor based in Mt. Vernon, New York. From April 2019 to August 2023, Mr. Antonelli served in an executive leadership role at the American Flatbread Co. (Pittsfield, NH). From 2009 to 2019, he held the positions of Chief Executive Officer and Chairman at Galaxy Nutritional Foods. Previously, he served as Executive Vice President, Chief Operating Officer, and President of Distribution at United Natural Foods from December 2005 to August 2008. Mr. Antonelli has also served on the Board of Directors of Zevia Beverage Company, the National Cooperative Grocers Association, Mary’s Gone Crackers, New England Natural Bakers, Healthy Living Markets, Homefree Brands, Shires Natural, GENA, and UNFI.

4. Tunes.

Rick’s Tune this week is “ I Know I’m Not Alone” from Michael Franti’s 2006 Masterpiece “Yell Fire”. Recorded at Anchor Studios, Kingston, Jamaica with Sly Dunbar and Robbie Shakespeare.

peace.