“Any near-term recession fears are fading with each month of somewhat lower inflation and the continued economic boom,” Lehner said in the March edition of the Oregon Economic and Revenue Forecast.

“However, the Federal Reserve must still navigate the choppy waters of a tight labor market, fast wage growth, easing financial conditions and strong household finances and consumer spending. All of these are likely to keep the underlying trend in inflation above the Fed’s target for the foreseeable future.”

He added it is likely the Fed has more work to do, implementing additional interest rate increases and holding them higher for longer in an effort to cool demand and inflation.

“However, the clear near-term strength in the economy in terms of jobs, income and spending, along with the uncertainty of the exact timing of any potential recession, makes forecasting one so far in advance challenging, if not impossible. As Oregon heads into the upcoming 2023-25 biennium, the inflationary economic boom continues,” Lehner said.

With personal and corporate tax collections exceeding expectations, along with an improved economic outlook, he said policymakers should have additional General Fund revenues as they develop the 2023-25 budget during the current legislative session.

Lehner said as the biennium winds down, much more will be known when the May forecast is produced. It will determine the close of session forecast and be used to set the thresholds for the balanced budget and “any potential kicker calculations.”

In discussing inflation, Lehner said the important underlying driver of persistent inflation is income and spending growth. 

“The tight labor market and faster wage gains are likely to keep upward pressure on inflation in the months and quarters ahead.”

He added that Oregon’s labor market is nearly back to where it was on the eve of the COVID-19 pandemic and nearly higher than any other point in the past 30 years. “Yes, Virginia, the labor market is tight.”

Labor income growth is expected to slow as job growth slows, due to the fact there are few people available for work who do not already have a job. 

“To date we have seen labor income slow from double-digit growth rates during the reopening period to around 7 percent today (national figures are similar). And as job growth slows in a tight labor market, total income will as well, and back to something more consistent with historical periods and hopefully more consistent with 2 percent inflation.”

Bottom line, Lehner said the Fed is in a tough spot, not just due to possible banking concerns but to the “still hot inflation data.” Nominal growth continues to be strong and, from that perspective, he said the Fed still has more work to do.

“We shall see how they try to balance the near-term risks with the longer-term policy goals of maximum employment and price stability.”

To read more from Lehner and the Oregon Office of Economic Analysis, click here.

The post There’s Optimism In Oregon For Avoiding Mild Recession appeared first on Shelby Report.

Michael Rulli is a busy man. A fourth-generation grocer, he serves as the director of operations for Youngstown, Ohio-based Rulli Bros. But what sets him apart from the five other family members in the business is that he’s been a state senator since 2018.

Rulli has found a good schedule that allows him to balance those obligations. His week begins at 5 a.m. on Mondays. He works at the grocery store through the day before heading to Columbus, Ohio, that night or early Tuesday. He stays at the Capitol through late afternoon Thursday.

On Fridays and Saturdays, he’s at the location in Austintown, Ohio. As the company’s stores are closed on Sundays, he gets to spend time with family then. 

“I’m really lucky because I’m the one [in the family] that has all the kids. So my brothers or my dad, they’ll come and do paperwork on Sundays,” he said. 

Founded in 1917 by Rulli’s great-grandfather and great uncle, the company has always been family owned. In fact, Rulli’s grandmother had the original license framed. 

The Rulli brothers were known around Youngstown for their flair for business. During the company’s “heyday,” they owned five grocery stores, two restaurants and a movie theater, Rulli said. But after World War II, the original generation died over the course of five to six years. 

“My dad’s only 13 years old, his father dies, the last of the generation. So my dad took it over…he actually had to get a special driver’s license from the governor so he could drive to work and school.” He also maintained the family farm, an enterprise still in operation today. 

Rulli’s father, Frank, did away with all but one store – in downtown Youngstown – before it, too, was phased out as the township underwent an “urban renewal.”

“They kicked out a bunch of little stores [downtown] because they thought they were trying to rejuvenate, that Youngstown was to become a big city like Cleveland or Cincinnati,” he explained. “Unfortunately, Black Monday happened and they shut down all the steel mills.” 

In 1970, Frank Rulli opened a store in Boardman, Ohio. By the end of the decade, the location had expanded from 9,000 to 20,000 square feet. A second location, in nearby Austintown, debuted in 1987.

What has helped keep Rulli Bros. in business for so long is its dedication to old-fashioned practices. 

“Even in the early 1980s, there was an automation movement in groceries where they took away the full-service deli, the full-service meat, and they streamlined it,” Michael Rulli said. “We chose to stay old-fashioned…and we carry extremely unusual items.”

The company has nearly 43,000 SKUs and buys products from more than 500 different vendors. The stores also boast the largest selection of olive oil in Ohio, as well as 14 to 15 types of sardines. “We’ve never lost our connections over 110 years,” Rulli added.

Alongside the grocer’s extensive SKUs, Rulli Bros. is known for its prepared foods and deli. As Rulli noted, “everything from scratch.” That includes the kitchen and bakery, where one of the most popular items is homemade bread. “The joke is, you can’t even get home before you eat it,” he said. 

The deli is unique. “I have three different kinds of regular mortadella and I have four different kinds of mortadella with pistachios. We have all of these unusual things. We have over nine different kinds of genoa salami…we have the Black Hole salami, which is the real hot stuff.”

Rulli is excited for what could be the fifth generation of ownership. His son, a recent college graduate, works in the Boardman store. He’s being mentored by his uncles and grandfather. Just a sophomore in high school, Rulli’s daughter already has won awards for her baking.

But Rulli doesn’t want to push them into grocery. “My dad wanted us to find a love for the business because he was forced into it. I’m trying to do [the same] with my kids.”

For more information, visit rullibrothers.com.

The post ‘Everything From Scratch’ – Rulli Bros. Renown For Its Offerings appeared first on Shelby Report.

Florida is on the cusp of a recession, according to University of Central Florida economist Sean Snaith. In a recent article on the UCF Today website, Snaith said the impact shouldn’t be anything like what happened in 2020 or the housing collapse in the late 2000s.

While there is no escape from the recession, Snaith said Floridians won’t suffer like they did during the previous two.

In his quarterly Florida and Metro forecast, released in February, the director of UCF’s Institute for Economic Forecasting said the recession may actually provide some relief for residents and businesses. He cited as examples an end to rapidly increasing housing costs and alleviating supply chain issues. 

The recession also will help the Federal Reserve in its efforts to bring down inflation, Snaith said. 

“It means the Fed will not have to raise interest rates as high as they otherwise would if the economy was still growing at the pace that it was in 2020 and 2021, when inflationary pressures were much stronger,” he said in the UCF Today article.

“The result is that the trade-off we would typically see between lower inflation and higher unemployment rates won’t be as large as it historically has.”

Legislative activity

The Florida state legislature convened March 7 for its 2023 session. The Florida Retail Federation has been following bills that would affect its membership.

FRF has supported the tort reform legislation that was signed into law on March 24. The package limits frivolous lawsuits and brings balance to the Florida judicial system, according to Scott Shalley, FRF president and CEO. Previously, the state was considered the fifth worst legal climate in the nation.

“We are grateful to have strong leaders in Florida who have moved to combat the plague of frivolous lawsuits,” Shalley said. “Costly, unjust litigation is extremely harmful to retail businesses, costing them millions, putting jobs at risk and forcing them to increase costs on consumers just to break even. 

“With this legislation, we’re bringing justice back to the justice system, increasing protections for both businesses and consumers. 

The FRF stated the passage of this bill will benefit all Florida businesses, particularly through the following measures:

• It reduces the statute of limitations to file a negligence claim from four years to two years.
• Creates a uniform and transparent process for the admissibility of evidence to a jury when calculating actual medical damages in a personal injury or wrongful death action – this will allow the parties to present the actual medical costs rather than the inflated costs associated with “letters of protection.”
• When an action is brought against the owner of a property or business by a third party who was lawfully on that property and was injured by the criminal act of a third party, such as a negligent security action, the jury will be required to consider the fault of all persons who contributed to the injury – not just the premises owner.
• Except for cases dealing with medical negligence, it changes Florida’s comparative negligence system from a “pure” comparative negligence system to a “modified’ comparative negligence system. That means if a plaintiff is found to be more than 50 percent at fault for his or her injury, he or she may not recover damages from any defendant.

For more information about Snaith and his background, click here.

To read more market profiles from The Shelby Report, click here.

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Navid Sam Nayebi, owner/operator, said he has had many jobs as a person of color where he experienced “a fair share of ill treatment from former employers, leading me to create a work environment where employees are treated well and respected.”

The market has been in business for five-and-a-half years.

Nayebi said he chose the name to say that “we, as a people, want better than what is offered” from stores where there isn’t any connection to owners, sourcing, farms, circumstances affecting food supplies, relationships with vendors and reasons for out of stocks.

“Here, we seek to bridge that gap. At any point, any customer has access to myself or can get a great deal of insight from any employee, since I make it a point to keep everyone in the loop as much as possible. Ideally, we are a small, three-person seasoned team that makes for a well-informed staff.”

He said Bread & Roses Market offers a clean space with great music, great lighting, prices that are considerably lower or just below the best prices available from other stores in town. It also offers “a caring interaction” at the register.

Building the space from scratch allowed Nayebi the opportunity to create an ergonomically correct work environment. 

“There isn’t a lip on the floor where the mop bucket snags; the dishwasher is top of the line,” he explained. “An employee won’t find themselves reaching too low or too far in terms of repetitive movements. We aren’t walking on concrete floors; counter heights aren’t either too high or too low, everything is where you need it to be at all times. 

“I’ve personally worked more hours here as a general clerk than any single employee ever might, so these details have meant a great deal to me. I like to think that we are serving a comprehensive workforce, respecting the experience of employees as well as respecting our customers as workers as well.”

In choosing to open an organic market as opposed to a conventional grocery store, Nayebi said it “plays down all the way to the waters we sell. It’s the general belief that pesticides ingested into the body will have adverse effects. Not only pesticides, but also PFAs, BPAs, synthetic dyes, growth hormones. The greater conversation goes into strains of wheat (simple bonds vs. complex bonds), qualities of yeasts.”

He noted that Bread & Roses has a version of Frosted Flakes cereal that is corn, sugar and salt only and “tastes great.” The market offers more locally sourced brands than a typical grocery store may have. 

“The quality of products our local makers provide leans on thoughtfulness and sourcing,” Nayebi said. “The meats we sell are not factory farmed. Pork, beef and duck are all from a half-hour away; our chicken is from 45 minutes away. Bison and lamb are from farther down south. We sell wild-caught fish from the Oregon coast.”

Having those local sources was a definite plus during the COVID-19 pandemic.

“We currently have over 165 vendors, most of them local. It’s something that enabled us to provide for the community without interruption during the pandemic.” He said the store’s national products come from UNFI, “a company who held an extremely high standard throughout the pandemic and does so still.”

Nayebi said being a decision maker and buyer for the store allows him to replace items quickly, such as sriracha or black sesame seeds. “When an item or a replacement for an item is needed, I’m in the habit of quickly scanning through likely vendors and being able to pivot quickly, so the item or a substitute never goes missing from our shelves.”

Organic is Nayebi’s personal standard, although the store also offers non-organic items to meet demand.

A musician and performance artist with a bachelor’s degree in English, with an emphasis in creative writing and poetry, Nayebi’s grocery experience began at small store in San Francisco. There, he served as an assistant to the owner and learned how to run and operate a grocery store. It had been selling organic produce for more than 20 years when he began working there in 2005. He said Bread & Roses Market is “very much a recreation” of that store.

Nayebi said the grocery industry is complex, and he has been learning as he goes since opening the market.

“A grocery mentor of mine once said to me, ‘grocery is easy. Shipments come in through the back door and products get sold and leave through the front door.’ I try to keep that simplicity in mind since the industry is not simple at all.”

He said it is a hard business, “filled with perishables, relentless demand, continuous change and all at low margins with fierce competition. The plan is to keep on our path of growth and see where we’re headed.”

Effects of inflation

While inflation is something all grocers nationwide are dealing with, Nayebi said it has affected his business “in a positive way, mainly since our competitors’ prices have gone up, making those prices much easier for us to beat or match.”

Nayebi said he also has been able to “piggyback onto the new financial climate” by passing on credit card fees to customers for purchases under $12. That previously had been for purchases under $8. He said he also is aiming to charge his cost for paper bags so customers will pay for them rather than absorbing such costs. 

There are places where inflation is affecting the business adversely, such as fuel charges for deliveries and cost of materials. He noted that the cost of bulk packaging containers went from about $47 a case to more than $115. Electricity in the county also just went up about 15 percent, “which will surely bring our electrical bill to a new record this summer.”

Nayebi said keeping up with price changes has been one of the most difficult aspects of inflation. 

“We’ve done our best but still are finding items we’re selling at cost or even below cost, while under the assumption that we’ve been making somewhere close to margin, just like before.”

A bright spot for Bread & Roses Market is the fact that, just recently, all Walmart stores pulled out of Portland and a local grocery chain shuttered all three of its locations. This has allowed Bread & Roses to come into the spotlight with its higher quality items “at a price where you would pay to get half the quality elsewhere.”

The market also started running sales in January. “It feels great to have not only the everyday low prices we’ve offered but also incredible monthly rotating sales, as well.”

Love of grocery

Nayebi said he initially fell in love with small grocery because of its role in the community – providing wholesome, nutritious foods. His favorite part of the job since opening Bread & Roses Market has been watching the children of his customers grow. “I’ve already seen kiddos from the time they were born to preschool age.”

He also enjoys his customers. “Being able to provide great foods to them and keep everyone as informed and involved as possible, I think, is a great role to have. Not too long ago, I would have been able to say I know the names of 80 percent of the people who walk in through our door. Now it seems like that number may be closer to 60 percent as our customer pool continues to grow.”

Nayebi said he has “tremendous respect” for the businesses and people who provide raw materials and ingredients to people all over the world. 

“It’s amazing how necessary everyone’s roles are, yet we’re treated as if we weren’t filling those roles, someone else just would step in and take our place. As sourcing becomes increasingly difficult, brick and mortars become more expensive to maintain and hold; equipment, gasoline and other necessities go up in price. My deepest gratitude to those who get up and provide in a larger scale every day.”

To read more market profiles from The Shelby Report, click here.

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“This demographic shift is impacting the labor force and consumer demand for goods and services,” Pesce said. “Connecticut’s economy is also closely tied to global economic conditions, including trade policies and international markets, which has impacted the state’s manufacturing and financial sectors.”

Conversely, Pesce implied the younger generation is providing an optimistic light for the state’s economic future. “The state has a highly skilled young workforce, a diverse economy and a fairly stable business environment.”

In addition to a labor shortage, the state’s retailers are facing many of the same challenges as their counterparts nationwide. Inflation, rising energy and fuel costs and sporadic supply chain disruptions continue to hinder economic growth. 

Alongside these national-level issues, according to Connecticut Food Association’s website, the state implemented a new Truck Tax on Class 8 through Class 13 vehicles at the beginning of the year. 

The levy is expected to generate $45 million this fiscal year and $90 million the next. Pesce and the CFA are hoping to help educate retailers on how this tax could affect their overall bottom line and actions they should take. 

Still, Pesce said the state is showing signs of economic recovery. Its unemployment rate has been steadily declining and, as of February, sat at 4.6 percent. At the time, that was below the national average. 

“Additionally, the state’s GDP has been growing, with a growth rate of 5.2 percent in the first quarter of 2023…the state’s economy has a diverse range of industries – including healthcare, finance and manufacturing – that helps to cushion the impact of economic downturns,” Pesce said. 

Food retailers are experiencing a higher demand for locally sourced and sustainable products, something Pesce hopes will provide further opportunities and boost the economic outlook. 

“The CFA is facilitating collaboration and partnerships among our members, helping them to work together on common challenges and opportunities,” he said. “By promoting innovation, collaboration and advocacy among our members, we are striving to build a best-in-class trade association model.”

Consumers may have less disposable income, but changes in spending could create new avenues for retailers as they adjust their private label and sales offerings to drive shoppers’ dollars further.

Legislatively, the Connecticut Food Association is working to alter a “Prohibition-era law” that would allow wine sales in grocery stores. The organization also wants to expand the number of SNAP distribution days and to get the state’s unemployent trust fund solvent. 

“Defensively, there are numerous labor issues we are navigating, including minimum wage expansion, predictive scheduling and warehouse worker mandates,” Pesce continued.

The Connecticut Food Association has several events planned for the year, including its upcoming 2023 Golf Outing and the Connecticut Specialty Food Awards. Later in the year, the CFA will host the Retailer of the Year dinner.

To read more market profiles from The Shelby Report, click here.

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As various committees were engaged in work during the first half of the session, the newsletter noted that “the potential of changing environmental regulations continues to cause concern that progress will be limited again this year.”

The Vermont House of Representatives’ General Committee passed H.66, which the newsletter termed “the country’s most generous paid family and medical leave proposal.” The legislation offers employees 12 weeks of paid leave at 100 percent of their wages ($1,135 per week maximum). It also includes a 55-cent payroll tax split evenly between employer and employee.

The Vermont Treasurer’s Office, which would administer the program, stated it would require $100 million to establish the program, effectively doubling the number of employees in the office.

As of March 15, the bill was in the House Committee on Appropriations. It will face a full vote by the House before it can proceed to the Senate.

The Bottle Bill discussion “continues to highlight resounding frustration from stakeholders of all types, including haulers, beverage manufacturers and retailers, as the House Environment and Energy Committee continues consideration of H.158, the bill that would expand the scope of containers required to be pulled from the recycle bin and redeemed,” the newsletter stated.

VRGA staff was among the witnesses who expressed concern about labor shortages if the expansion were to happen now. According to the newsletter, two retailers reported their redemption businesses were unprofitable. VRGA staff noted that the bill has “a long road and battle” before the end of the session. As of March 21, it was in the House Committee on Ways and Means.

The VRGA newsletter also stated that, for the fifth year in a row, the Senate Health and Welfare Committee is poised “to pass out the bill that would ban the sale of all flavored tobacco products and expand the seizure and destruction of contraband.”

VRGA expects the bill will be considered by the Senate Finance and Appropriations committees near the end of the session.

The Affordable Heat Act, S.5, moved through the Senate and in the House Committee on Environment and Energy. It is “an act relating to affordably meeting the mandated greenhouse gas reductions for the thermal sector through efficiency, weatherization measures, electrification and decarbonization.”

According to the VRGA newsletter, the legislation would require “fuel dealers to get their customers to buy less of what they sell – or else pay someone else to do it for them.”

The newsletter stated it is expected to add at least 70 cents to a gallon of heating fuel. Businesses and residents will see higher heating fuel prices if this legislation is enacted. VPA lobbyist Matt Cota, who recently spoke at VRGA’s Legislative Day, reported that he anticipates that 70-cent increase will most likely be closer to $2 per gallon. 

This is similar to the Clean Heat Standard that passed the Vermont legislature last year, was vetoed by the governor and sustained by one vote. This bill, if enacted, would also set the precedent for motor fuels, according to the newsletter. 

The House Government Operations Committee passed H.127, which would legalize sports betting in Vermont. 

The bill was referred to the House Ways and Means Committee and is in the Appropriations Committee. It will be sent to the House floor prior to moving to the Senate for review. 

A bill that would expand on the requirements of data collectors was expected to “move swiftly” out of the House Commerce and Economic Development Committee. However, as of March 20, it was listed as still being in committee.

According to the VRGA newsletter, companies that collect personal information or biometric data would see stricter requirements surrounding notification to authorities and consumers in the event of a data breach and requiring an opt-out option for consumers. 

“If you maintain a database with customer information, whether it’s a website, loyalty program, gift card database, etc., we strongly suggest that information is securely stored, and you keep as little information as possible,” the newsletter stated.

The Vermont legislative session is scheduled to end May 9.

The post VRGA Wary Of Paid Family, Medical Leave Proposal appeared first on Shelby Report.

According to Kevin Daigle, president and CEO of the New Hampshire Grocers Association, Gov. Chris Sununu recently unveiled his proposed budget that will look to continue cutting and/or eliminating taxes and streamlining government by eliminating outdated licenses and regulatory boards.

In the 2023 legislative session, the NHGA is supporting a bill that involves licensing fees for retailers to sell keno.

“Last year, legislation allowed grocers to sell keno in towns where it was approved to sell,” Daigle said. “Working in partnership with our lottery commission, we are supporting a bill that would waive the annual cost of the keno license for retailers.”

Another bill that has NHGA’s support – and that of the business community – is a bill to reduce the Business Enterprise Tax, Daigle said. “Previous reductions in the tax have proved beneficial to the business community while still adding to the state’s surplus.”

He said the association is continuing to monitor bills that center around Extended Producer Responsibility, and it continues to seek a seat at the table so that its concerns can be heard if, and when, EPR is considered in New Hampshire. 

There are bills NHGA is opposing, specifically a few that deal with minimum wage increases. 

“Our opposition centers around mandating what private business should be paying their employees versus letting the free market dictate the wages,” Daigle explained. “Our concern is by forcing a minimum from the federal level, a laddering effect will occur where employees currently above the minimum would want similar increases in their wages as well.”

A bill the association is actively involved with – and opposed to – would allow municipalities to regulate the distribution and disposal of plastic bags. 

“As we’ve testified, the bill itself is not so much a bill about a ban on plastic bags, as it is a bill allowing for ‘home rule’ in New Hampshire. Currently, we are lucky that we don’t have a patchwork of regulations from town to town like some of our neighboring states.”

Daigle said that, like surrounding states, New Hampshire has “many a bill” centered around PFAS. These are a group of chemicals used to make fluoropolymer coatings and products that resist heat, oil, stains, grease and water. Because they don’t break down easily, they often are called “forever chemicals.”

“We are asking our legislators to work toward a federal regulation versus a state-by-state web of PFAS regulations that we would need to navigate.”  

Other bills of concern that NHGA opposes include those looking to increase the tobacco tax, and a measure that would ban service technicians from working on weighing or measuring devices owned by their employer, Daigle said.

Members try to hold pricing

Daigle said the grocery industry continues to face rising costs across the board for products and the costs of doing business. These include increased rates for electricity and natural gas, healthcare, transportation and wages.

“Our members do their best to hold their pricing for [products] as long as they can, but ultimately they need to pass along those rising costs,” he said. “To help with the sting of increases, we’ve seen many of our members increase their private-label offerings to help offset the higher costs of goods and have become creative in showcasing how products can be paired together for do-it-yourself meal kits.”

Labor issues remain an issue, with many stores having to adjust their operating schedules for the lack of coverage and to avoid employee burnout, Daigle said. Creative scheduling and additional employment benefits are ways employers are attempting to keep their workforce while trying to attract new employees.

And the New Hampshire grocery industry is not immune to the inflationary affects happening across the country. 

“We’ve seen increased costs in energy, costs of goods and supplies, as well as the cost of the products we sell to our customers,” Daigle said. “Again, our members do our best to keep pricing as steady as possible before having to increase the customer’s costs. Our retailers are resilient and continue to look for creative ways to continue offering the quality service and products they are known for.”

Daigle noted the frustration for retailers when customers think they are raising costs “to pad their profit margins.”

“If they only knew that our profit margins are very low single digits, and that we are just the last in the chain of supply and that grocers are doing their best to limit the increased costs to the customer.”

Education key for association

The NHGA has been working over the last six to nine months on a partnership to offer its members reduced pricing on their electric and natural gas usage. In early August, the state saw a spike in the standard utility pricing for both, increasing by as much as 10 to 20 cents per kw or therm, Daigle said.

“Luckily, our members were able to connect with our energy partner and lock in fixed pricing far below the standard utility rate, saving members hundreds to thousands of dollars each month. A few of our members have been able to stay open because of this switch to a much lower fixed pricing on their utility bill.”

Daigle said the NHGA will continue to offer workshops and access to industry experts for its members to assist with labor issues.

Also, its annual Government Day is scheduled for April 25 in Concord. Daigle said it will be the first live version since the COVID-19 pandemic began.

“Our members enjoy the interaction with legislative and regulatory leaders and getting to see their association in action, advocating on their behalf.

“New Hampshire’s grocery industry continues to be strong, and we work hard to educate our legislature about continuing to be a business-friendly environment for our industry, in addition to the benefits of cross-border sales benefitting members and as well as the state.”

For more information about the New Hampshire association, visit grocers.org.

To read more association news from The Shelby Report, click here.

The post New Hampshire Industry Remains Strong Despite Challenges appeared first on Shelby Report.

Nebraska has a new governor for 2023, and “everybody feels optimistic,” said Ansley Fellers, executive director of the Nebraska Grocery Industry Association.

While the state has a mostly business-friendly climate, Fellers said she believes Gov. Jim Pillen and the state legislature will continue to work on the tax burden.

“Our state revenue is actually up, so we’ve got some money in the coffers to provide some tax relief. I know that’s a big priority for our state leaders, and it’s a really big priority for the business community.”

Fellers said the taxes in the state put Nebraska at a bit of a competitive disadvantage, adding that the association is supportive of the tax relief effort.

With the state legislature in session, the association’s No. 1 priority this year is two bills addressing the minimum wage increase that voters approved on the November ballot. The wage, which was $9 per hour, increased in January to $10.50 per hour. It is scheduled to increase by $1.50 for the next three years until it reaches $15 an hour in January 2026, according to Fellers. It is slated to increase by the Midwest CPI every year following.

The NGIA is supporting bills that would establish a youth and training wage and cap the CPI increase. “I don’t think there is any desire to overturn the will of the voters, but we are trying to give businesses a little bit of flexibility,” Fellers said.

While there are a couple of years before the CPI cap would come into play, she said the association would like both bills to move through this year “for the sake of everyone’s peace of mind.”

Other legislation the association is supporting relates to retail pharmacies. One bill would allow pharmacy technicians to continue giving vaccines in the arm, which they were allowed to do during the COVID-19 pandemic via a waiver.

“Now that the emergency is expiring, it appears that our state is poised to allow that to continue.”

Early in the pandemic, retail pharmacies were hiring nurses to give shots, Fellers said. However, with a nursing shortage, having pharmacy techs continue to administer vaccines would allow nurses to stay where they are most needed.

The Nebraska association also will continue to work on the state’s limitation on the ratio of pharmacists to technicians. “Retail pharmacy is a big priority for us because a number of our members have retail pharmacies.”

As far as legislation the association is opposing, Fellers said that includes tax increases of any kind and unfunded mandates “that we have to battle every year.”

Grocers in Nebraska continue to face supply chain issues. “My understanding is that it’s never everything at once,” Fellers said. “It seems like every week or every couple of weeks, there’s something – especially for the rural independent – that is shorted or missing or out. It just doesn’t seem like we’re back to what we consider full capacity.”

She said pre-COVID, rural independents faced those supply issues on occasion and were used to working around being shorted sometimes. Now, however, it is a more regular occurrence.

“Sometimes the list of things they didn’t get is longer than the list of things they got. I think that’s something that we really need to continue focusing on,” she said.

While grocers in some states have been able to turn to local producers to help fill their shelves, Nebraska has limited options. Fellers said the climate and topography of the state is such that it can’t grow products that people demand year-round.

“We need to make sure that our supply chain works because Nebraska is not necessarily situated to fill the grocery store shelves. A lot of the states in the Midwest aren’t.”

Inflation also has impacted Nebraska grocers, but Fellers said it is “softening.” She said inflation is driven by many things – supply chain, weather, labor, the war in Ukraine and China’s lockdown (since eased), for example – but believes it will continue to soften.

Although many grocers are feeling some frustration, they also are optimistic about the future. Fellers added that, as far as supply chain problems, she hopes shoppers understand that grocers are doing the best they can to get products on the shelves. “Margins are so tight and costs are going up. It’s not like the local business is reaping a huge profit.”

To read more market profiles from The Shelby Report, click here.

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Blake Schwartz, owner of Hometown Market in St. Paul, Nebraska, has been in the grocery business since he was old enough to work.

He started as a bagger and rose to a department manager for a local grocer by age 21. He became co-owner of what is now Hometown Market in 2005 and became sole owner in June 2012.

Schwartz said he continues to face supply chain issues, although the situation has improved some from the manufacturers’ side. As far as labor challenges, he said there is a limited employee pool since St. Paul is a small town. “It’s just a little bit more difficult right now.”

Schwartz said his 10,000-square-foot store has about 30 employees, several of whom are part-time. 

Customer service is important to Schwartz. He said Hometown Market does not have any self-checkout lanes. While he understands why some grocers are going that route, he wants to create jobs, not eliminate them.

“Who knows, down the road we may have to make a change. But I don’t know how a store could go only self-checkout,” he said. “Customers want to have that interaction with the employees. We’re here to serve them. I think just a simple ‘hello,’ a simple ‘how’d you find things today,’ goes a long way. You don’t get that if there’s not a checker up there.”

While inflation has impacted business, Schwartz said he has tried to keep prices as low as possible. “Obviously, our costs have gone up…we’ve had to adjust some prices at the cost of our gross, our profit.”

He has held off on following suggested pricing on some items, even though “we take a hit on our profit. There comes a point where you can basically price yourself out of the market, so you’ve got to be sensitive to that…we just try and be as competitive as we can, and I think we’ve been able to do that.”

Schwartz said the past few years – first with COVID-19 and now with inflation – have been challenging. “It’s been tough for everybody, all these businesses – grocers and restaurants – we had two years of hell. And then, you get out from the COVID event and, boom, inflation just takes off.”

Schwartz said he has just rolled with the punches and tries to take care of his customers and community. “That’s where it starts and that’s where it ends. You just do the best you can, at store level – take care of the community and run a good store. I think we’ve been able to do that.”

Schwartz noted the Hometown Market location has served as a grocery store since about 1963, when it was built. The St. Paul community has supported the store throughout that time. “Our focus is here with the community, and we tailor this store around the community’s needs…we wouldn’t be here without them.”

Giving back to the community is important, and Hometown Market sponsors a variety of events throughout the year and supports  local organizations. 

When asked what he enjoys most about being an independent grocer, Schwartz said “freedom.”

“You’ve got freedom to tailor your store around your community…often what works in California doesn’t work in Nebraska.”

He added that he enjoys being able to think outside the box and not have to jump through hoops to get something done.

“There is freedom to run your store the way you want to run it, generated from the customers’ feedback. We’ve been doing it awhile – since ’05 – so we kind of have an idea of what the community wants.”

Hometown Market is supplied by AWG in Norfolk, Nebraska.

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A 9,000-square-mile, 13-county region, North Texas is home to 7.5 million people. It is made up of 150 cities – including Dallas and Fort Worth – with 15 of those boasting a population of more than 100,000.

Grocers in North Texas, as well as other regions across the state, are continuing to deal with post-COVID-19-pandemic challenges such as supply chain and workforce issues along with inflation. Despite these issues, grocery retailers are cautiously optimistic for 2023, according to Gary Huddleston, grocery industry consultant for the Texas Retailers Association.

“Our Texas grocery retailers continue to experience some headwinds with inflation and hiring opportunities. The market continues to be strong, with additional families moving into Texas daily.”

The Dallas-Fort Worth region of North Texas continues to grow, according to an article on commercial real estate in Dallas Innovates. Bill Sproull, an innovation-led economic development expert in DFW, told the online news platform that the number of people and companies moving to North Texas “staggers the mind.” 

Coming out of the pandemic, Sproull said he believes the DFW region leads the nation in recovering quickly and regaining lost jobs.

The article also quoted Robert Sturns, who leads the economic development efforts for the city of Fort Worth. In addition to growth in the city’s historical base, he said the area has “done a really good job across Dallas-Fort Worth of diversifying industries, looking at life sciences and biotech and expanding technology efforts.”

According to a report by the North Texas Commission, the region ranks among the top three U.S. metro areas for business expansion, relocations and employment growth. North Texas Fortune 500 companies have reported more than $1 trillion in revenue, the report states.

Legislature in session

The Texas Legislature began its biennial session in January. The Texas Retailers Association is supporting bills to reduce inventory tax, arrest and convict organized retail criminals, reduce credit card fees and protect data privacy, Huddleston said.  

“The association also supports the opportunity for retailers to expand the product assortment within alcoholic beverage sales.”

TRA is opposed to any legislation that would limit customer choice and raise the cost of doing business, Huddleston said. 

The association is “the voice of retailing,” he said, and as such works on behalf of its members. A proposed shopping cart ordinance in Fort Worth caught TRA’s attention. The ordinance was developed to “support a clean and safe community by controlling abandoned shopping carts.” 

TRA provided feedback to city staff regarding retailers who have “invested significantly in basket theft prevention systems,” Huddleston said.

“We believe the retailer who has made this investment should be exempt from the ordinance. The city recognized this fact and placed new language in the ordinance.”

The ordinance, which was approved by the city council in February, states the recovery fee shall not be assessed if the abandoned cart has a functioning wheel-lock installed.

TRA also gave feedback regarding the number of hours required to pick up the abandoned (stolen) basket.

“We believe 24 [hours] is not a reasonable amount of time to notify the correct staff member at the store and schedule staff to pick up the basket. We believe a more reasonable time frame is 72 hours or three days.”

The approved ordinance kept the 24-hour time period for abandoned shopping carts to be removed from public spaces.

It also contains a $50 fee for the retailer to recover its cart from a city drop-off station within 30 days.

Huddleston said TRA responded that a new basket costs between $150-$300, depending on size and type. In some cases, if the basket is older, the retailer might decide that investing in a new basket is a better use of assets.

“Our retailers in the city of Fort Worth realize the goal is to clean up the city. However, fundamentally, retailers have a tough time with the concept that they are responsible for abandoned baskets when the basket has been stolen from their property.”

Huddleston said Fort Worth retailers share the goal of a clean city.

“Many retailers participate in Adopt-A-Road and commit to clean-up days. We would have preferred the criminal, who took the basket off the parking lot without permission, be punished. 

“We will certainly make every effort to comply with the ordinance. I would add the more punitive measures a city puts on retailers makes it more challenging to open new stores in underserved areas.”

To read more association news from The Shelby Report, click here.

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