February 2019 Vol 73, Number 2
Also Inside MRA President & CEO to Retire, New Leader Named, pages 3 & 7 Food Assistance Benefits will be Issued Early in March and April, page 6 Legislative Roundup of Grocery Industry Bills, page 9
Michigan Retailers Association 603 S. Washington Avenue, Lansing, MI 48933
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A second set of winning numbers after each draw! ASK YOUR LOTTERY SALES REPRESENTATIVE FOR MORE DETAILS ABOUT THIS GREAT NEW ADD-ON GAME FOR LOTTO 47 AND FANTASY 5. $1 MORE PER PANEL PER DRAW Odds of winning Lotto 47/Double Play: Match 3 of 47: 1 in 50; Match 4 of 47: 1 in 873; Match 5 of 47: 1 in 43,649; Match 6 of 47: 1 in 10,737,573. Overall odds of winning: 1 in 47. *Jackpot and Double Play top prize winners will receive their prize in annual payments over a 30-year period, unless, within 60 days from the date they claim their prize, they request the Cash Option method of payment. Overall odds of winning Fantasy 5/Double Play: Match 2 of 39: 1 in 10; Match 3 of 39: 1 in 103; Match 4 of 39: 1 in 3,387; Match 5 of 39: 1 in 575,757. Overall odds of winning: 1 in 9. â€ If two or more persons win the jackpot, the prize is shared equally among winning persons. If more than two persons win the Double Play top prize, the prize is shared equally among winning persons. Knowing your limits is always the best bet. Call the Michigan Problem Gambling Helpline for confidential help at 1-800-270-7117.
president ’s message
Retirement Musings James P. Hallan Publisher Lisa J. Reibsome Editor
Advertising Index Campbell Group ............................................... 8 Michigan Lottery ............................................. 2 SpartanNash ................................................... 12 Star Truck Rentals .......................................... 10
Michigan Grocers Association is a division of the Michigan Retailers Association
Michigan Grocers Division Board of Directors James P. Hallan, President Michigan Retailers Association Rich Beishuizen, Country Fresh Craig Diepenhorst, H.T. Hackney Dave Duthler, AMRA Energy Jim Forsberg, Arctic Glacier Premium Ice Jim Gohsman, SpartanNash John Leppink, Leppink’s Food Centers Ken McClure, Kroger Company of Michigan Bryan Neiman, Neiman’s Family Market DJ Oleson, Oleson’s Food Stores Don Symonds, Lipari Foods Thom Welch, Hollywood Markets Jim Zyrowski, Ben’s Supercenters Michigan Food News is completely recyclable. Printed on recycled paper with soyoil-based ink. Publisher does not assume responsibility for statements made by advertisers in business competition. MICHIGAN FOOD NEWS © 2019 Michigan Retailers Services, Inc. All rights reserved.
Contact Information Lisa J. Reibsome, communications director 517.449.2256 MGAReibsome@comcast.net Michigan Food News advertising Michigan Food News all content, layout, and printing Michigan Retailer advertising Grocers Division Michigan Retailers Association 603 South Washington Avenue, Lansing MI 48933 517.372.5656 or 800.366.3699 www.Retailers.com
While my column typically gives me the opportunity to comment on a variety of subjects, this one has a single focus — my upcoming retirement, which rapidly approaches. After 34 wonderful years, it is time for me to turn the reins over to the next generation. I plan to retire on August 26, 2019. Coincidently, that will be my 67th birthday. While over half my lifetime has been spent at Michigan Retailers, it seems like yesterday that I walked through the doorway at our old headquarters and started my new job as General Counsel for the Association. Over the years, I’ve been honored to carry the retail banner and work with a terriﬁc group of board members, association members, employees, and elected oﬃcials. You should know that my retirement has been planned for several years. The board of directors put an excellent succession plan in place. I clearly remember when Joe Swanson was Board Chair, and he told me at the conclusion of one of our successful years that we must now concentrate on developing a successor in order to keep growing what we’ve built. Since its founding in 1940, Michigan Retailers has evolved into a complex organization, and the thought process was to identify and develop a candidate to ensure a seamless transition. We needed someone who could lead and grow our multi-faceted organization. Our business now operates an insurance company that is licensed to write three lines of insurance, a robust government aﬀairs department, an educational foundation, a successful Buy Nearby program encouraging consumers to “keep their money in the Mitten,” a $1.5 billion merchant-processing portfolio with accounts in all 50 states, and other various projects including publishing the Michigan Retailer and Michigan Food News. One of my favorite sayings is that “the only constant is change,” so Michigan Retailers had to seek change to survive in the ever-changing marketplace. We’ve not only survived, we have prospered over the years while adhering to our core mission of providing good value and service to members. We can proudly say that Michigan Retailers does not have any debt and is the largest state retail association in the country. Of course, it takes a lot of good people to keep the pieces on the chessboard moving in a positive direction. Michigan Retailers has always been blessed with strategic, forward-thinking board members and a wonderfully hardworking group of employees who excel at customer service. Looking ahead, I fully expect the organization to continue to grow and prosper under its new leadership team led by Bill Hallan. Many of you know Bill. He is our current Executive Vice President, Chief Operating Oﬃcer, and General Counsel. The board has chosen wisely, and he will be absolutely terriﬁc as your new President and CEO. We were fortunate to hire him away from the Dykema law ﬁrm eight years ago. See page 7 for more about Bill. Until August, I’ll continue to pen my column and perhaps add a memory or two for both humor and historical purposes. . MRA President and Chief Executive Oﬃcer
it ’s the law
Employers Must Post New Minimum Wage and Paid Sick Leave Posters
In response to new state minimum wage and paid sick leave laws, the state has released new minimum wage and paid sick leave posters for Michigan employers to display in a conspicuous place accessible to employees. The posters are available at no cost and can be downloaded from the state of Michigan website: Minimum Wage: https://bit.ly/2X96JdQ Paid Medical Leave: https://bit.ly/2DOFOLw Alternately, you may contact the Wage and Hour Division at (855) 464-9243 to have a copy of each sent to you. Also note: MRA will be consolidating all required labor law posters and will provide a comprehensive poster to all members for free.
Electronic Submission of OSHA Form 300 and 301 Data No Longer Required
The federal Occupational Safety and Health Administration (OSHA) has rescinded its requirement that establishments with 250 or more employees annually electronically submit data from their OSHA Forms 300 and 301 to the agency. However, as previously reported in the Michigan Food News, these establishments must still submit data from their 2018 OSHA Form 300A by March 2, 2019. February 2019 Michigan Food News 3
New Member Benefit
Partnership Gives Members Easy Access to Business Loans
If you are looking to ﬁnd the perfect loan for your business, Michigan Retailers Association can help. Members who are part of MRA’s Merchant Processing Program now have a new option for securing business loans. MRA partnered with Lendio, the nation’s leading marketplace for small business loans, in a pilot program to help members ﬁnd lenders and secure loans. Lendio is an online service that connects business owners with loan options from a network of more than 75 lenders. The company itself does not ﬁnance any loan products; instead, it has created a marketplace of vetted lenders to match with businesses looking for loans. “Lendio is a trusted platform that has a strong reputation for pairing experienced lenders with businesses in need of capital,” says MRA Executive Vice President Bill Hallan. “At times our members need access to funds to buy equipment, expand, open a new location, and so forth. With this new partnership, we can oﬀer our members a simple, fast, safe way to secure a small business loan.” Since its inception in 2011, Lendio has facilitated over $1 billion in ﬁnancing to more than 22,000 small businesses across the country. Its network of lenders oﬀers 12 diﬀerent types of ﬁnancing including business lines of credit, short term loans, business acquisition loans, commercial mortgages, and equipment ﬁnancing. Applying for a loan is fast and simple with Lendio’s streamlined online application process. Completing the application takes about 15 minutes; there’s no fee or obligation, and it won’t impact an applicant’s credit score. Plus, personal funding managers are available to discuss funding needs and help ensure that applicants have collected the right documents and forms to complete the application. Then the company’s proprietary algorithm matches applicants to the best loans; and again, personal funding managers are available to walk applicants through each option and help choose the perfect one. Funding is also fast. While there is no guarantee that an applicant will be approved for a loan, once approved, access to capital can be available in as little as 24 hours. “This alliance marks another milestone in MRA’s commitment to providing the programs and services retailers need to start, build, and grow their business,” adds Hallan. “MRA members who are part of our Merchant Processing Program can take advantage of this new program.” The pilot program is underway. For more information, see www.lendio.com/mra. MRA members who are not yet part of the Merchant Processing Program should contact MRA’s Harmony Clouse at (800) 366-3699 or email@example.com for more information and a no-cost quote.
Recreational/Medical Marijuana and the Workplace: An Explanation of Employers’ Rights Michigan’s legalization of both recreational and medical marijuana does not limit an employer’s right to establish and enforce drug policies. Marijuana is now legal for recreational use in Michigan under the Michigan Regulation and Taxation of Marijuana Act (MRTMA), which became eﬀective December 6, 2018. The use of medical marijuana has been legal in Michigan since 2008 when the state enacted the Michigan Medical Marijuana Act (MMMA). Employers often express concerns over their ability to maintain safe worksites and the legal risks created by marijuana in the workplace. This article will help employers assess these legal risks and clarify employers’ rights with regards to employees who use medical marijuana. Law does not Cancel Employer’s Policy for Drug-free Workplace The Michigan Regulation and Taxation of Marijuana Act does not restrict a private employer’s right to maintain and enforce a zerotolerance drug policy. The new law speciﬁcally states that it “does not require an employer to permit or accommodate conduct otherwise allowed by this act in any workplace or on the employer’s property.” In addition, the act “does not prohibit an employer from disciplining an employee for violation of a workplace drug policy or for working while under the inﬂuence of marijuana.” The act also does not prevent an employer from refusing to hire or to discharge, discipline, or take other adverse employment action against a person with respect to hire, tenure, terms, conditions, or privileges of employment because of that person’s violation of a workplace drug policy or because that person was working while under the inﬂuence of marijuana. 4
Michigan Food News February 2019
Michigan Grocers Fund Yields High Returns
32% Average Return of Premium; $424,000 Back to Members The Michigan Grocers Fund once again rewards its members for outstanding performance, giving back its highest proﬁt return to date. As a member-owned, self-insured workers’ compensation program, the Fund has become the largest workers’ compensation provider for the Michigan grocery industry, representing 58 companies with over 117 locations. “From substantial proﬁt returns to aggressive claims handling, the Michigan Grocers Fund is an extremely cost-eﬀective workers’ compensation option,” says Fund Administrator Tim Hanna. Great News: Fund members will receive a $424,000 credit for good performance on their 2019 renewal. This amount of surplus comes from a number of policy years and includes premium not used to pay claims and investment income. This brings the total returned since 2014 to over $620,000 and represents a 32% average return of premium. Fund members receive stable yet competitive upfront pricing and continue to outperform the insurance marketplace with lower net premium costs every year. This competitive pricing, along with the Fund’s selective approach to underwriting new members, is designed to save members money on the total cost of workers’ compensation over the long term. The Fund takes the responsibility for the costs associated with claims and workplace safety very seriously. Reducing the costs associated with workers’ compensation claims means there’s more proﬁt to return to members. The Fund’s Board of Trustees, elected by the members, governs the operation of the Fund and provides authorization on claims settlements of size. In addition, the claims adjusters have lower caseloads compared to many other workers’ compensation carriers; this allows them more time to proactively manage the claim and reduce the overall costs associated with loss-time injuries. “The Fund’s safety record continues to have low losses in recent years,” Hanna adds. “This excellent performance leads to premium returns back to the members and is attributed to each member’s continued commitment to maintain a safe work environment.” The Fund oﬀers its members numerous safety resources and loss control programs that are speciﬁc to the grocery industry. Some of the training focuses on creating a safety culture in the workplace by working with owners/supervisors on proper claims handling, accident investigation, and return-to-work programs, and also by making every employee accountable for safety on the job. The Fund works with loss control specialists who provide sound guidance and cost-saving solutions on safety and loss prevention. For most members, saving money is the primary reason they insure with the Michigan Grocers Fund. “It has proven to dramatically reduce the overall costs of their workers’ compensation insurance each year,” Hanna reports. “Members can further reduce their costs with the help of the Fund’s loss control resources available in preventing claims and reducing the frequency and severity should claims occur.” The Fund retains an average of 98% of its members year after year. Fund members are Michigan-based grocery business owners who are focused on safety and devoted to speciﬁc risk management strategies. Many sectors of the grocery industry are eligible to participate in the Fund. Generally, participants are supermarkets and/or grocery stores whose sales volume is primarily based on selling a general line of food and beverages such as canned and frozen foods; dairy products; a variety of beverages including alcohol; fresh fruits and vegetables; or fresh and prepared meats, ﬁsh, and poultry. The Michigan Grocers Fund is sold and serviced by a carefully selected statewide network of independent insurance professionals with grocery industry experience. For more information, contact the Fund Administrator, RPS Regency, at (800) 686-6640 or visit www.migrocersfund.org.
“Congratulations to Michigan Grocers fund members for an excellent job on keeping their premium costs low and employees safe,” says Fund Administrator Tim Hanna. “If you’re not currently a member, you’re missing out on the many benefits the Fund has to offer.” Michigan Grocers Fund Board of Trustees Chair Christy Kuhnke, Tom’s Food Markets Kim Kennedy, Polly’s Country Markets Curt De Vries, Harding’s Markets-West Dave Duthler, AMRA Enery Rich Cole, Leppink’s Food Centers Your Online HR Department Michigan Grocers Fund members get free access to HR360, an online Human Resources library that provides comprehensive, easy-to-navigate and understand human resources and benefits news and guidelines.
Whether you need a form, a poster, or the newest information on health care or state employment laws, HR360 delivers so you can stay compliant. HR360 also provides a great range of online tools including a job description developer and salary benchmarking tool. HR360’s teams of attorneys, HR specialists, editors, and advisors have over 10 years’ experience developing and maintaining the site’s award-winning content, guidelines, and forms. Interactive guides written in plain English, not legalese, provide step-by-step details on how to comply with a broad range of laws — from COBRA and FMLA to Michigan labor and termination laws. Whether you have five or 500 employees, HR360 can help.
Likewise, the MMMA speciﬁcally provides that “nothing in th[e] act shall be construed to require ... [a]n employer to accommodate the ingestion of marijuana in any workplace or any employee working while under the inﬂuence of marijuana.” The MMMA places further limitations on medical marijuana, including prohibiting people from performing tasks under the use of marijuana when doing so would constitute negligence or professional malpractice. Additional limitations include prohibitions against smoking marijuana on any form of public transportation, in any public place, or operating all manner of motor vehicles while under the inﬂuence of marijuana. Employer Drug Testing Guidelines Employers have the right to: 1. Test for illegal drugs as a precondition to employment. 2. Test for illegal drugs or alcohol based on a reasonable suspicion that an employee is working under the inﬂuence. 3. Test for drugs, randomly, if such tests are job-related and consistent with a business necessity. 4. Enforce disciplinary policies including termination evenhandedly for positive drug tests. Federal Case Law Demonstrates Employers’ Ability to Drug Test Casias v Wal-Mart Stores, Inc, 695 F.3d 428 (6th Cir. 2012), provides a helpful demonstration of a Michigan employer’s ability to enforce a zero-tolerance drug policy under the MMMA’s employer protections. The plaintiﬀ, a Wal-Mart employee, was prescribed medical marijuana — and carried a valid medical marijuana card — for treatment of sinus cancer and an inoperable brain tumor. The plaintiﬀ was injured at work, and a post-injury drug test returned positive for marijuana. The plaintiﬀ was terminated for violating his employer’s drug policy and sued, arguing that he was wrongfully terminated because the MMMA protects patients from disciplinary action in a private employment setting when the patient is legally using marijuana. Interpreting the MMMA, the court conﬁrmed that the MMMA does not impose restrictions on private employers. continued on page 6 February 2019 Michigan Food News 5
Michigan Will Issue March and April Food Assistance Benefits Early Grocery Retailers Be Prepared: The Michigan Department of Health and Human Services (MDHHS) will issue March and April food assistance beneﬁts early to reduce the gap between beneﬁts payments that resulted from the partial federal government shutdown. Food assistance recipients can expect to receive beneﬁts on March 3, 4, or 5. April beneﬁts will be issued from April 3-12, and May payments will be issued as regularly scheduled MDHHS made changes to the schedule so that families do not have to go more than 45 days without receiving food assistance. The department issued February beneﬁts early beginning on January 17 at the direction of the federal government, which said there were questions about whether the funds would be available to issue in February because of the government shutdown that has since ended. In Michigan, food assistance beneﬁts are usually issued to clients according to a numeric schedule over a 21-day period throughout the month. About 1.2 million Michiganders receive food assistance through the federal Supplemental Nutrition Assistance Program administered by MDHHS. “MDHHS wants to make sure that families and individuals can put food on their tables,” says Terrence Beurer, MDHHS deputy director of Field Operations Administration. “We were concerned about families having to go 45 to 60 days or more without beneﬁts as a result of the early issuance of February beneﬁts. Gradually returning to the regular schedule cushions the impact of the federal government shutdown.” Retailers: In case employees are asked, be sure they know that people who receive food assistance can check their beneﬁts balance via the phone number or website address on the back of their Bridge Card or by accessing their account at michigan.gov/mibridges.
Recreational/Medical Marijuana and the Workplace, continued from page 5 Practical Considerations and Best Practices for Drug Testing Even with an employer’s ability to administer a robust drug testing policy, workers with prescriptions for medical marijuana will still be on the job, which can raise liability concerns. In addressing these concerns, the importance of maintaining a strong substance abuse policy cannot be overstated. Employers with consistently applied, zero-tolerance substance abuse policies will be able to assert a willful misconduct defense in a workers’ compensation case and will be better equipped to address other potential legal issues. In administering these policies, employers should be sure to: 6. Maintain and document a chain of custody for all samples. 1. Provide employees with a written substance abuse policy when hired. 7. Maintain conﬁdentiality. 2. Develop guidelines to help supervisors identify signs of impairment. 8. Educate supervisors and employees on your company’s policy. 3. Only test employees based on current observations. 9. Consistently enforce company policy. 4. Obtain a second opinion when a supervisor suspects impairment. 10. Keep thorough records. 5. Test as soon as possible after relieving an employee from duty due to suspected impairment. Medical Marijuana Remains a Non-Reimbursable Treatment Under the Workers’ Disability Compensation Act From a workers’ compensation insurance perspective, medical marijuana remains a non-reimbursable treatment under Michigan’s Workers’ Disability Compensation Act. Whether medical marijuana eventually becomes a reimbursable treatment will depend on medical evidence. Currently, the Oﬃcial Disability Guidelines, American College of Occupational and Environment Medicine Guidelines, and state medical treatment guidelines fail to list marijuana as a viable treatment option. This is because there are no quality controlled clinical data with cannabinoids, which is partially the result of marijuana’s Schedule I classiﬁcation under the Controlled Substances Act (CSA). 6
Michigan Food News February 2019
William Hallan to Lead MRA Starting August 27
With the upcoming retirement of longtime Michigan Retailer Association executive James P. Hallan from the President and CEO position, the Board of Directors appointed William Hallan to take the reins of the Association. “Because MRA has evolved into a complex organization, the Board of Directors identiﬁed a successor who could ensure a seamless transition and lead our multi-faceted Association,” says Board Chair Becky Beauchine Kulka. Bill Hallan joined MRA as vice president and general counsel in 2011. He expanded his responsibilities to include oversight of the Association’s legislative advocacy program in February 2012 and overall operations in September 2013. He now also holds the titles of executive vice president, chief operating oﬃcer, and general counsel. “The board has chosen wisely,” Beauchine Kulka says. “Bill will be fantastic as our new President and CEO. He’ll bring his ideas to the table but also carry on the traditions established by his father.” Bill is a graduate of Denison University and a magna cum laude graduate of the University of Toledo College of Law, where he served as Articles Editor on the Law Review. He was a litigator with the Dykema Gossett law ﬁrm before joining MRA. Named a rising leader by the Michigan Society of Association Executives, he was twice appointed by Gov. Rick Snyder to the state Organized Retail Crime Commission, after playing a key role in helping to pass the Organized Retail Crime Act. “I’m excited to build on MRA’s success,” Bill says. “We’ve had record-breaking years for our credit-card processing and workers’ compensation programs, and we’ve made a splash with our Buy Nearby program educating consumers on the importance of keeping their money in the Mitten. I want to keep that momentum going.” He adds, “Our organization became even stronger when Michigan Grocers Association became a division of MRA in 2018, and I look forward to continuing to serve all our members in my new role.” “Michigan Retailers will be well-served by Bill’s leadership and management skills,” says his father, Jim. “It’s been an honor to work with him over the past eight years and see him advance his career and earn the trust of the board of directors. This will be an easy transition for the employees and members. As you would expect, I’m very proud of his accomplishments.” Bill and his wife, Michelle, live in Okemos with their three children, Olivia, Zachary, and Theodore.
Bill Hallan and former MDARD Director Gordon Wenk at last year’s Legislative Reception. Be sure to mark your calendar for this year’s legislative event on April 23.
“Our organization became even stronger when Michigan Grocers Association became a division of MRA in 2018, and I look forward to continuing to serve all our members in my new role.” —Bill Hallan
Governor Names New Department of Agriculture and Rural Development Director
Governor Gretchen Whitmer appointed Gary McDowell as Director of the Michigan Department of Agriculture and Rural Development. He replaces Gordon Wenk. Previously, McDowell was a Democratic member of the Michigan House of Representatives, representing Emmet, Mackinac, Chippewa, and parts of Cheboygan counties from 2005 to January 1, 2011. He also ran for Congress in 2012. McDowell was born and raised on a farm in Rudyard. The oldest of 10 children, he and his brothers own and operate a family business, McDowell Brothers Farm and McDowell Hay Incorporated, and he brokers hay sales from the eastern Upper Peninsula to markets around the nation. Prior to serving in the legislature, McDowell was a member of the Chippewa County Board of Commissioners for 22 years. He was also a UPS delivery driver for 30 years and a volunteer ﬁreﬁghter/emergency medical technician for 18 years. McDowell attended Lake Superior State University. He and his wife, Carrie, have three daughters.
Employer Rights to Test for Medical Marijuana are Intertwined with the Controlled Substances Act If marijuana’s classiﬁcation under the CSA were to be downgraded from Schedule I, without corresponding amendments to the Americans with Disabilities Act (ADA), employees with medical marijuana prescriptions would be aﬀorded much greater protections from drug testing. The CSA classiﬁcation is vital to the operation of the ADA. The ADA relies on this classiﬁcation to deﬁne “illegal” drugs as well as for determining what is a “medical examination.” If marijuana were no longer a Schedule I drug, then it would likely not be an “illegal” drug for someone with a valid prescription under the ADA. And if medical marijuana is not an “illegal” drug under the ADA, testing for marijuana likely would become a “medical examination” under the statute. And if testing for marijuana is a “medical examination” under the ADA, only drug tests for job-related inquiries would be proper, rather than the broader level of testing that employers have today. Employers Can Enforce Robust Drug Testing Policies The bottom line in all this is that employers can enforce robust drug testing policies. In fact, employers with strong drug testing policies are better able to protect themselves from liability issues and ensure maintenance of a safe workplace. The Michigan Grocers Fund can assist members in developing and implementing an eﬀective drug screening program and manage their workplace exposure. For more information, contact RPS Regency at (800) 686-6640. Hanba & Lazar, one of Michigan’s leading insurance and employment defense law firms, contributed information to this article.
Marihuana or Marijuana?
The state of Michigan uses the more antiquated spelling of marihuana, with an “h.” This stems from the Marihuana Tax Act of 1937. Michigan adopted its statutory definition of marijuana in the Public Health Code using the then-current federal spelling, “marihuana.” This past December the Michigan Department of Licensing and Regulatory Affairs, which houses the Bureau of Marijuana Regulation, announced it would begin using the common spelling of marijuana, except in legal documents and references to statute. An act of the Michigan Legislature would be required to change the spelling of “marihuana” in the Michigan statutes.
Bill Introduced to Add Warning Labels to Marijuana Products
Legislation recently introduced as HB 4126-4127 would require health warning labels on products containing marijuana that are sold in Michigan. The warning labels would be required on both medical and recreational marijuana products. February 2019 Michigan Food News 7
What’s New at AWG? President and CEO David Smith Provides an Update
Associated Wholesale Grocer’s (AWG) past three years have been both challenging and very rewarding. Despite a major member switching to self-supply, our cooperative membership has grown substantially, related sales to member stores have increased over 8%, and we’ve achieved successive years of record patronage paid to our members. Falling on the heels of a major expansion year, AWG’s focus for 2018 was on our four strategic pillars for success: 1. Accelerating proﬁtable member growth; 2. Building, training and retaining high performing teammates; 3. Strengthening our core support and services; and 4. Leveraging technology and organizational infrastructure to enable long-term, sustainable member success. We’ve achieved positive results on these objectives. Our 2018 full-year service level reached a historic high, our employee turnover improved 25%, our quality and freshness performance improved, supplier partners supported us to reduce the cost of goods to our members another $10 million incrementally, cooperative sales have grown, and we anticipate that 2018 patronage objectives will be met or exceeded. Overall, a good year.
We have new members, excellent growth in several areas, and signiﬁcant member store expansion primarily in areas served by our Great Lakes, Nashville, Springﬁeld, and Gulf Coast divisions. We are blessed to serve some of the country’s best independent retailers, who continue to lead their areas with market share growth and smart expansion. Serving their needs and supporting their growth makes us a better cooperative. As a member-owned wholesaler, we actively listen to our all-retailer board of directors, our members’ direct feedback, suggestions from our strategic planning counsel, and our annual feedback survey. We align those priorities with our mission to provide member-retailers with all the tools, products, and services they need to compete favorably in all markets served. This includes top quality supermarket merchandise and support services, all at the lowest possible cost. We made some key leadership changes for 2019 to better align with our members’ needs and priorities. (Editor’s note: For a detailed look at these changes, see the January issue of the Michigan Food News.) AWG has a comprehensive menu of products, programs, and services all geared to help our member-retailers compete in a highly competitive marketplace. The aggregation and totality of our many programs allows our retailers be successful. —David Smith
Hey Food Processors & Distributors, The Campbell Group has you covered! • Authorized Michigan Grocers Fund Agency • Excess Premiums Returned to Members • $1,490,000 Returned to Members in 2018 • Over $5.1 Million returned since 2007 • We have Over 25 years Experience in Workers’ Compensation Self-Insurance Want to learn more? Mark Castillo, CIC
Shopper Engagement Platform Drives Sales Smith says that AWG developed a number of robust programs to help members compete in the digital arena and omnichannel environment. This month the company notes signiﬁcant growth of its Shopper Engagement Platform (SEP). A ﬁrst-to-market in-house loyalty and data program, SEP enables independent retailers to use data, digital coupons, and rewards to grow sales. SEP is the evolution of traditional loyalty programs into a program that works for all types of consumers and retailers. More than 300 AWG retailers use the program in diﬀerent ways, with multiple go-to-market strategies. The program allows AWG retailers to oﬀer a carded or non-carded program. Retailers use points programs, gas programs, and short-term promotions to drive customer loyalty and sales. Recent statistics from retailers using SEP show a nearly $14 diﬀerence in average basket size for customers using a card or rewards program. Some retailers have chosen to use a traditional card-based program, while others are using a virtual card. This lets retailers serve customers no matter how they wish to engage with loyalty programs. Recent growth has come from AWG-speciﬁc digital content. AWG’s category management team has worked with vendors to secure digital oﬀers and coupons outside of the nationally aggregated coupons to give AWG retailers a competitive advantage.
The new legislative session is underway. Here’s an overview of bills that would impact grocers. Alcohol multi-licenses: Legislation introduced as Senate Bill 82 would allow an entity to hold both on and oﬀ premises licenses simultaneously for liquor, beer and wine. Next steps: Senate Regulatory Reform Committee. MRA Position: Support. Clerk age to sell alcohol: House Bill 4019 would allow a 17-year old to sell or serve alcohol. Current law only allows individuals over age 18 to sell or serve alcoholic beverages. Next steps: House Regulatory Reform Committee. MRA Position: Support. Cigar tax cap: SB 58 reintroduces legislation from last term that Gov. Snyder vetoed in December. The legislation would eliminate the current Oct. 31, 2021, sunset capping cigar taxes at no more than 50 cents per individual cigar. Next steps: Senate Finance Committee. MRA Position: Support. E-cigarette sales to minors: Several bills banning sales of e-cigarettes and vapor products to individuals under the age of 18 were introduced as HB 4017, HB 4039, and HB 4164. HB 4017 also includes a requirement for online or remote sales to verify age using an independent, third-party age veriﬁcation service. HB 4164 increases the penalties for sales to minors or tobacco or vapor products from $50 per violation to $100 for a ﬁrst oﬀense, $500 for a second oﬀense, and $2,500 for a third or subsequent oﬀense. HB 4039 increases the penalties for sales to minors or tobacco or vapor products from $50 per violation to $1,000-2,500 for a ﬁrst oﬀense, $2,500-$5,000 for a second oﬀense occurring within two years after the ﬁrst violation. Next steps: House Regulatory Reform Committee. MRA Position: Monitoring. Pregnancy and alcohol warning posting requirements: HB 4112 is a reintroduction of a bill from last term that would require retailers selling alcohol to post a warning of the potential problems of drinking alcohol during pregnancy. The bill was introduced to raise awareness of fetal alcohol syndrome and would add the warning to an existing poster. Next steps: House Regulatory Reform Committee. MRA Position: Support. Tobacco 21: Legislation prohibiting the sale of tobacco products or paraphernalia to individuals under the age of 21 was introduced as HB 4039. Next steps: House Regulatory Reform Committee. MRA Position: Monitoring.
Industry Golf Outing is Not to be Missed
June 20, 2019 Brookshire Inn & Golf Club, Williamston
The golf outing returns to the Brookshire Inn and Golf Club in Williamston, about 20 minutes east of Lansing. Last year, golfers had nothing but praise for the course and for the level of personal service provided by the golf club, so this year should prove to be another exceptional event. From a great mix of retailers and suppliers to a beautiful course made even better with fresh-grilled burgers, hotdogs, and brats at the turn and a ﬁrst-rate awards dinner with barbecue ribs and chicken, salad, corn on the cob, and more — last year’s event set a high bar for the ﬁrst-ever combined Michigan Grocers/Michigan Retailers outing. “We expect this year’s outing to be even better,” says MRA Senior VP Tom Tuggle. “Grocers and suppliers should really make an eﬀort to be part of the event. And, all MRA members are invited, so it provides a great opportunity to meet new retailers.” Sponsorship opportunities are available. For more information, contact MRA’s Nora Jones at firstname.lastname@example.org.
SpartanNash’s News Includes New Honor, Initiative, and Market Named among Top 101 Best and Brightest Companies
MRA Member SpartanNash has been named among the Top 101 Best and Brightest Companies to Work For in the Nation, according to the National Association for Business Resources. To be named Best and Brightest, organizations are assessed on communication, work-life balance, employee education, diversity, recognition, and retention — with winners selected based on their eﬀorts to improve employee relations, use innovation to motivate employees, implement creative compensation programs, and more. SpartanNash oﬀers a robust Total Rewards program, with beneﬁts for eligible associates including medical, dental, life, vacation, 401(k) with company match, employee assistance services, and a wellness program. The company also oﬀers associate discounts at its more than 155 owned and operated retail stores, as well as discounts with vendors and tuition reimbursement. Associate learning and development is also a priority at SpartanNash, with training and development courses tailored to each associate’s business segment and career aspirations. SpartanNash also oﬀers employee resource groups for its female and veteran associates, as well as companywide volunteering and sustainability programs. Embarking on a Clean Ingredient Initiative SpartanNash and its private brands — including Our Family and Open Acres — have embarked on a Clean Ingredient Initiative, focusing on providing cleaner products to customers by reducing synthetic colors, MSG and other key ingredients. The company realizes that consumer preferences are changing, as customers look for healthier food options, clean labels, and “free from” formats when shopping at their local grocery store or putting food on the table.
The Clean Ingredient Initiative’s purpose is to not only provide products that cater to an evolving consumer, but also to educate the consumer in a market where information and product options are numerous and overwhelming. Overall, SpartanNash’s Clean Ingredient Initiative is focused on transparency and simplicity, aligning with consumers’ interest in investing in products that support: • Sustainable eﬀorts, such as sustainable sourcing, reduced packaging, food safety, traceability, and social responsibility. • Ingredients that ﬁt their overall lifestyle goals. This may mean honing in on a speciﬁc macro nutrient or focusing on overall simple ingredients. • Certiﬁed products such as Organic or Non-GMO. Opening New Market by Forest Hills Foods SpartanNash, alongside Ada Township oﬃcials and local developers, unveiled plans to open the Ada Market by Forest Hills Foods in downtown Ada. The 13,000-square-foot space was vacated by Kingma’s Market in January 2019. SpartanNash, owner of Forest Hills Foods, plans to begin remodeling the space immediately with a tentative opening date of mid-April. SpartanNash has been working with Jeﬀ Vandenberg, whose parents started Forest Hills Foods, as part of the transformation team. The Ada Market will oﬀer store guests fresh and healthy grab-and-go meal solutions, household staples, a wide selection of craft beers, wine, and spirits, and much more in easy-to-navigate aisles and market stands. It will also be home to a Starbuck’s coﬀee outlet. In addition, the market’s innovative design will showcase a wide variety of local and organic produce, handcrafted meats and cheeses, fresh ﬁsh, a café with full salad and soup bar, fresh ﬂowers, artisan bakery items, and health and beauty care products. February 2019 Michigan Food News 9
Members Receive FMI Gold Plate Recognition
The Food Marketing Institute’s Gold Plate Awards recognize retailers, suppliers, and community collaborators who have creatively executed a National Family Meals Month campaign. The goal of the program is to encourage shoppers to share one more family meal together each week using items from the grocery store. Gold Plate Honorable Mention: Martin’s Super Markets, with 21 stores in Southwest Michigan and Northern Indiana, for their campaign, “The Flavorful Four.” Martin’s enlisted the help of four “Superhero Foods” — Captain Carrot, Extraordinary Eggplant, Peppy Pepper, and Brilliant Broccoli — to equip shoppers with the resources necessary to execute more healthful family meals together. Gold Plate Supplier Award: Kellogg Company for their “Family Meals for Healthier, More Successful, Safer Kids!” campaign. Through partnerships with a variety of WIC stakeholders, the company spread messages about the beneﬁts of family meals, the state of family meals in the U.S., and ways to use WIC foods to make aﬀordable, delicious meals that bond families. The campaign reached over 13,000 WIC participants, and 700 Michigan WIC staﬀ members were educated on the beneﬁts of family meals. More than 200 companies have joined the National Family Meals Month movement since its inception four year ago. In fact, participation jumped dramatically in 2018 with: 20% increase in retailer participation; 40% increase in supplier participation; and 37% increase in community collaborators. In 2017, the Michigan Retailers Association lobbied to pass a House Resolution declaring September as Family Meals Month; and in 2018, at MRA’s request, then-Governor Snyder declared September to be “National Family Meals Month.”
Visa, Mastercard Plan to Increase Fees
Card companies are set to raise existing transaction and processing fees this April, reports the National Grocers Association. Visa claims that its forthcoming adjustments to its interchange and other network fees are a result of market conditions, and that the fees impacted have not been adjusted in three years. Mastercard declined to comment on a proposed fee increase. Discover is also preparing to increase its interchange and other network fees, but also declined to comment. In addition, NGA reports that returned merchandise purchased using Mastercard debit cards will, in some cases, become more expensive for stores. In some transactions, merchants won’t be reimbursed for the interchange fee that was paid on the initial transaction. NGA is working with a coalition to ﬁght fee increases while also working to increase competition and card security in the payment ecosystem. 10 Michigan Food News February 2019
Kroger Introduces Kroger Pay and Kroger REWARDS Debit Card
MRA Member Kroger is rolling out Kroger Pay, a mobile payment solution that securely combines a customer’s payment and loyalty card information to create a faster checkout experience. Kroger Pay is available for iOS and Android devices. After a customer enters their custom PIN or biometrics, the app provides a single-use QR code to scan at the terminal to communicate payment and loyalty card information, which includes digital coupons and personalized oﬀers. Kroger is also launching a Kroger REWARDS debit card, a payment option that connects directly to a customer’s checking account. The Kroger REWARDS debit card oﬀers beneﬁts to customers, including bonus fuel points and Our Brands discounts, and the rewards double when the card is used through Kroger Pay.
Kroger Offering $1 Million to Innovators for Solutions to Prevent Food Waste
Kroger is oﬀering up to $1 million in grants for ideas that will help achieve its Zero Hunger | Zero Waste commitment to end hunger and eliminate waste across the company by 2025. Applicants must submit letters of intent through March 4, 2019, to receive a chance to be selected as ﬁnalists and provide full applications for grant consideration. Kroger will award grants for emerging technologies and solutions focused on the prevention, recovery, or recycling of food waste. The idea or project should bring something new to the work that is already being done to reduce food waste. Kroger encourages social enterprises, beneﬁt corporations, for-proﬁt companies, public-private partnerships, and non-proﬁt organizations to apply. Individuals, government agencies, international organizations, and researchers are not eligible to apply. Kroger will award grants ranging from $25,000 to $250,000 per project, prioritizing emerging technologies and ideas focused on food waste prevention. What type of applicants are most likely to be successful? Kroger is looking for organizations whose missions are intrinsically tied to Kroger’s Zero Hunger | Zero Waste social impact plan. This includes innovators needing support for early-stage concepts as well as scalable projects and technologies that advance a range of food waste prevention, recovery, and recycling solutions. For more information, visit innovationfund.kroger.com. Questions? email them to KrogerFoundation@Kroger.com.
Study Provides Insights on How to Win Online Grocery Shoppers
New research from Bain & Company and Google found that online grocery shopping is not yet a consistently more convenient experience than in-store shopping in the consumer’s mind. Among online grocery shoppers who say they have shopped online for groceries just once in the past 12 months, only 42% report that the online experience saved them time. According to the research, while consumers think researching and list building are easier online, the browsing and shopping phase of the online journey can be frustrating. “Online grocery retailers haven’t yet convinced customers that grocery shopping online can be a better experience,” says Bain’s Stephen Caine. “Traditional grocers have decades of experience optimizing their physical stores to align with how shoppers think — training them to navigate store shelves to easily ﬁnd what they are looking for, making it easy for them to make trade-oﬀs between products, and providing inspiration when they want to try something new. Online grocery shopping has not yet found a way to digitally replicate these cues simply and intuitively.” Local Grocers Have Home-ﬁeld Advantage: When it comes to building share online, traditional grocers have an unexpectedly powerful advantage, the Bain-Google research found. Consumers who had not used an online grocery service in the past year were asked which service they would select if they had to give it a try. Almost all (96%) said they would look ﬁrst to a traditional brick-and-mortar retailer for home delivery, and 85% said they would select a store they already visit. This home-store bias makes sense, since grocery shoppers have already made well-informed decisions about which retailers they trust. Unseating these habits is diﬃcult. Only 17% of consumers surveyed say they have tried a new retailer in their area within the last three months, and only 25% said they are likely to try a new retailer for a routine grocery trip. “Winning a ﬁrst trial is so important because there is a general consumer ‘stickiness’ when it comes to online grocery: 75% of online grocery shoppers say they are still using the ﬁrst online grocer they tried,” says Bain’s Michelle Paratore. “Knowing that existing consumers are likely to try their online oﬀering ﬁrst, omnichannel retailers are well-positioned to keep these shoppers for continued visits and purchases as long as they deliver an experience that is convenient and meets shoppers’ needs.” Invest to Make Digital an Edge: The research found that the two features grocery shoppers value most from an online grocery retailer are: Providing a simple way to build a shopping list, and Having ways to compare prices. This contrasts with more advanced and expensive technology such as having a website that makes personalized recommendations or runs substitution algorithms. These features matter less to consumers.
Popular Straight Back Bonus Promotion Returns to Daily 4 Game By Brian O. Neill, Michigan Lottery Commissioner The popular Straight Back Bonus promotion is returning to the Daily 4 game in March and will give players a chance to win more cash with no additional cost. The Straight Back Bonus automatically is applied to all Daily 4 straight bets so retailer staﬀ members don’t have to take any extra steps to serve players. Straight Back Bonus will run for a limited time in March. The Straight Back Bonus promotion doubles the chances to win for all straight bet wagers. This promotion is a favorite among Lottery players and is designed to attract players by oﬀering them more chances to win. Beginning March 1, Daily 4 Straight-bet players whose numbers match the drawn numbers in reverse order – “straight back” – will win a $1,000 prize. For example, if a Daily 4 player picks 1-2-3-4 and the numbers drawn are 4-3-2-1, the player wins $1,000! Boxed bets, 1-Oﬀ, and 2-Way bets aren’t eligible for the bonus prize, and Wheel-Bet winners will be paid only the Straight prize. Players will be paid only for the largest prize won on a ticket. This exciting promotion gives players more chances to win prizes in one of our most popular games, without adding any cost to their wagers. We expect Straight Back Bonus to generate player excitement and help boost sales and store traﬃc for retailers.
New Michigan Lottery Instant Games Oﬀer Players Chances to Win up to $4 Million Michigan Lottery players will have more chances to win big prizes — up to $4 million — with the launch of three new instant games this month. Diamonds and Gold: $2 ticket, $50,000 top prizes, more than $7 million in total prizes. Full of 500s: $5 ticket, $500,000 top prizes, more than 14,000 $500 prizes available, more than $30 million in total prizes. Royal Millions: $30 ticket, $4 million top prizes, more than $140 million in total prizes. New Michigan Lottery Retailer Website Retailers are encouraged to visit the all-new website that has been developed to bring you Lottery-related news and important retailer information: retailers.michiganlottery.com. Income Tax Information Retailer sales and commissions statements were mailed at the end of January. Duplicate commission statements can be requested by calling (517) 373-6001. February 2019 Michigan Food News 11
;IŨVITVSYHXSSƉIVXLI3YV*EQMP] FVERHXSMRHITIRHIRXVIXEMPIVW -XŨWEFVERH]SYVGYWXSQIVWGERXVYWX WE GUARANTEE IT!
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Our Family® anchors a broad portfolio of private brand items currently provided to retailers like you.
Meat, deli, bakery, seafood, and ready to heat selections
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Natural and organic selections
Visit SpartanNash.com for more information or call: Jim Gohsman 616-878-8088 Roger Delemeester 989-245-0337
Health and beauty products for the whole family
A full line of quality baby care
Affordable pet care and toys
The February 2019 issue of Michigan Food News, the official publication of Michigan Grocers, a division of the Michigan Retailers Associatio...
Published on Feb 19, 2019
The February 2019 issue of Michigan Food News, the official publication of Michigan Grocers, a division of the Michigan Retailers Associatio...