Wednesday, August 27, 2008

Be afraid. Be very afraid.

Wal-Mart treats competitors the way Moe worked through conflict with Curly or Shemp. If Al Qeda had controlled a market the retailer wanted, Osama Bin Laden would be straitjacketed in some Middle Eastern asylum right now, whimpering, “It’s yours. Just don’t lower your prices again.”

Which is why I have to play Paul Revere and warn you of a story we posted on our website today: Wal-Mart is trying a new concept called Marketside, which is positioning itself as the place to buy dinners a consumer might’ve otherwise purchased from a restaurant. Customers can pick up the ingredients to whip together a meal themselves. Or they can opt for one that’s ready to plate and serve the family. Indeed, “easy meal solutions” is the cornerstone of the venture. Except here you can get them for what the nation’s notorious discounter coyly terms “affordable prices.”

“With us,” says the one-time home-supplies source that now dominates virtually every merchandise category it’s entered, from music to toys, “you¹ll never have to compromise quality to get a lower cost.”

Wal-Mart says it has no plans to open more than the first four green-lighted Marketsides, all of which are slated for the Phoenix area. But it slipped up and acknowledged in ads for Marketside staffers that it envisions 1,000 units cranking $10 billion in annual sales. Darden Restaurants, the king of casual dining, garners about $6.7 billion.

News of Wal-Mart’s interest in stealing your customers follows a similar development during the Olympics: The retail chain exploited coverage of the games by advertising its in-house take-and-bake pizza as a more-economical alternative to restaurant-made pies. The primetime commercials sum it up bluntly: If your family buys only one pizza a week, it’d be saving $312 a year by grabbing a pie from the nearest Wal-Mart.

We in the United States are worried that the Olympics were reason to be more fearful of the Chinese. Restaurateurs should be more concerned about a rival named Wal-Mart. It’s a nightmare that appears to be coming true.

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Anonymous steakman said...

Meal replacement and dinner kits are alot more complicated than advertising a pizza special. Let them try, its not as simple as it looks. Do you smell the arrogance? Beware of the pride before the fall.

Sincerely, Steakman

August 28, 2008 at 7:41 AM  

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