Square watermelons and finding a better way

My wife Sally sent me this chain email that she received from someone else.The anonymous author offers a produce related life lesson, so here it is, just as I read it this morning:



You don't have room to waste. Watermelons, big and round, wasted a lot of space. Most people would simply tell the grocery stores that watermelons grow round and there is nothing that can be done about it. That is how I would assume the vast majority of people would respond. But some Japanese farmers took a different approach. If the supermarkets wanted a square watermelon, they asked themselves, "How can we provide one?" It wasn't long before they invented the square watermelon.

The solution to the problem of round watermelons wasn't nearly as difficult to solve for those who didn't assume the problem was impossible to begin with and simply asked how it could be done. It turns out that all you need to do is place them into a square box when they are growing and the watermelon will take on the shape of the box.

This made the grocery stores happy and had the added benefit that it was much easier and cost effective to ship the watermelons. Consumers also loved them because they took less space in their refrigerators which are much smaller than those in the US meaning that the growers could charge a premium price for them.

What does this have do with anything besides square watermelons? There are a few lessons that can you can take away from this story which help you in all parts of your life. Here are a few of them:

Don't Assume: The major problem was that most people had always seen round watermelons so they automatically assumed that square watermelons were impossible before even thinking about the question. Things that you have been doing a certain way your entire life have taken on the aura of the round watermelon and you likely don't even take the time to consider if there is another way to do it.

Be creative: When faced with a problem, be creative in looking for a solution. This often requires thinking outside the box. Most people who viewed this question likely thought they were being asked how they could genetically alter water melons to grow square which would be a much more difficult process to accomplish. By looking at the question from an alternative perspective, however, the solution was quite simple.

Look for a better way: The square watermelon question was simply seeking a better and more convenient way to do something. The stores had flagged a problem they were having and asked if a solution was possible. It's impossible to find a better way if you are never asking the question in the first place.

Impossibilities often aren't: If you begin with the notion that something is impossible, then it obviously will be for you. If, on the other hand, you decide to see if something is possible or not, you will find out through trial and error.

Supermarket secrets - Part 1

This series is being talked about in the discussion group, and I thought I would post this installment of the British import.

APEAM lawsuit vs. CAC

A lawyer connected with the case has told me APEAM, the avocado exporter group based in the Mexican state of Michoacan, has filed a complaint today against the California Avocado Commission in the US District Court for the Eastern District of California (Sacramento). The complaint alleges trade defamation, interference with contractual relations, interference with prospective economic advantage, negligence and unfair competition. According to the lawyer, the gist of the complaint is that CAC made numerous public defamatory statements about Mexican avocados which contributed to the severe drop in demand during 2007 and to some extent continuing into the future.

Developing....

More on Bill

We here at The Packer have received several responses from industry veterans who enjoyed seeing the recent Q and A with Bill Coon, retired publishing director of The Packer. Industry leaders like Ed Odron, Rick Bella, Chuck Curl, David Marguleas and Ron Orr have checked in with kind words about Bill.

One letter from Ron Orr, director of business development for Graves Menu Maker Foods, Jefferson City, Mo., said it well.

"I know I speak for so many in stating that the fresh produce industry at large is appreciatively better off and further ahead, because of the commitment Bill Coon made to it."

If any other industry friend wants to connect with Bill, shoot me an email (tkarst@thepacker.com) and I'll give you his contact info.

Chat - David Mitchell

I just posted a brief "chat" interview with David Mitchell, senior writer for The Packer. David brings a lot of journalism skills with him, including extensive work as a sports writer - something I have to say I envy. I managed to get a dig in at his Kansas Jayhawks, but he was above the fray and ignored my cheap shot. As if a K-State fan has room to talk....

11:03 AM me: Great - here we go - David Mitchell, senior writer for The Packer, where is your "hometown"?

5 minutes

11:09 AM david.edward.mitchell: I grew up in DeSoto, Kan., but my parents moved back to Hutchinson, Kan. -- their hometown -- while I was in college. I worked for the daily newspaper there for about five years when I was in my 20s. It was a nice set up. I was a mile from my parents, two miles from work and not far from my grandparents' house. I was a sportswriter back then, and I was minutes from the community college and the local high school. In an odd twist, my wife and I live in Shawnee, but we're in the DeSoto school district.

11:10 AM me: What do you think prompted your interest in journalism?

11:13 AM david.edward.mitchell: English was one of my better subjects in high school, and my sophomore English teacher -- who also was the journalism teacher -- encouraged me to take the newspaper class. So I guess it's her fault. I worked on the school paper during my junior and senior years and then studied journalism at the University of Kansas.

11:14 AM me: Well - you went into sports journalism - something I never did but always was fascinated with. What are the highs and lows of covering sports?

6 minutes

11:21 AM david.edward.mitchell: It was a fun job for a young, single guy. I got to cover two college bowl games, five or six NCAA Tournaments -- including two Final Fours -- a U.S. Open, the NBA Draft and some other interesting events. I've covered games in at least 20 states and have been to some places fun places like Hawaii, Vegas and New Orleans. The drawback is that sports writing, like a lot of journalism jobs, doesn't pay very well unless you're with a really big publication. The hours and travel are a real killer, too. The job I have now is a lot better, in terms of hours and travel, considering I have a wife and daughter. I can't even tell you how many birthdays, weddings, funerals, etc. I missed when I was covering sports.

11:22 AM me: At least now you don't have to write a story about KU losing in the tournament every year - ouch

11:23 AM david.edward.mitchell: Did I mention the two Final Fours? I'm not sure what to expect out of this year's Jayhawks. They have a nice looking record, but they seem to be having some trouble on the road of late. The loss at Okie State was disturbing. The Pokes aren't that good.

11:24 AM me: I'm sorry - I

11:25 AM I should say I don't have room to talk, being a KSU fan - they may not make it in this year at the rate they are going.... Leaving the sports world, what have been some highlights of produce journalism so far - any surprises?

11:28 AM david.edward.mitchell: This is the fourth newspaper I've worked at, and I have to say the working environment here is a lot better than in daily newspapers. It's a more postive experience. I think that's true of the industry in general. There are a lot of really friendly, helpful people like Roger Pepperl, Karin Gardner, Bryan Silbermann ... I could make you a very long list.

11:30 AM me: David, it has been good to have this brief chat. I could quiz you some more about the f/v industry advisory committee meeting that you covered recently but I fear I have already use enough of your time. Thanks for your help and we'll do it again sometime...

11:31 AM david.edward.mitchell: No problem. Thanks, Tom.

Beware the shoe salesmen

One more presentation from the USDA Agricultural Outlook that you may want to review is this one, which addresses the speculative positions that hedge funds have taken in commodity markets. Amid the record price run ups of various agricultural commodities, one wonders when the bubble will burst and what impact that might have on the farm economy.

Here is a link from an AgWeb blog that talks about the speculative presence in the market:

“Old school” commodity brokers from the early 1970’s tell me it used to be “easy” to call a top in the commodity markets. The top came when the “shoe salesmen” of the world walked into the branch and opened an account. Today things are a little more complex, as the “shoe salesmen” of the world have a tremendous number of investment vehicles at their disposal (like ETF’s and hedge funds) and they can pile into long commodities without even knowing what they own. With Wall Street talking up commodities (and specifically agriculture) on a daily basis, I believe the volume of money that has poured into the commodity world in recent weeks could be the modern day equivalent of “shoe salesmen” opening a commodity account. Because this money has been flowing in, traders have stopped focusing on signs of domestic demand rationing. Just this week, Smithfield Foods announced a 4% to 5% cut in their sow herd.


TK: At least there is no commodity futures trading for apples or grapes, but I see a bear market meltdown at some point for soft commodities like grain and oilseeds, made more dramatic by the speculative positions in the market by hedge funds.

Onion pickle

Tesco observer

Luis of the Fresh Produce Industry Discussion Group has been in Tesco Fresh & Easy stores on more than one occasion and submitted several posts to the discussion board on his observations. This post and continuing thread is his latest offering and I reprint some of it in this space:

Many readers probably know from other sources that Fresh-n-Easy started to discount perishables (i.e. prepared foods, meats and FV's) a while ago. This is done with a wireless hand-held unit and a portable sticky label printer. Some quick observations: It began with some sort of calibration procedure, starting at 75% of full price and being re-labelled to 50% and then a very deep 25% discount over a one day period (three labels on top of each other). Then, after a few days of that, the discounts started to take place over a period of around two days before item expiration, starting again at around 75% and stopping at around 50%. You see employees re- labeling items all the time and the greater time window seems to have improved the velocity of the items. Items are most discounted at expiration but seemed to be in fairly good condition. Kind of a balance between inefficiency to the retailer and of margin of safety for the consumer. Gives the store a bit of an auction feel. We'll see what that does to the image but is one heck of an experiment.


Luis later added:

To follow up, Tesco is also modifying assortment and display as well. May be they are starting to figure out they are selling to a bunch of cowboys (kidding).
Half of the original prepared food cooler in one of the stores is now dedicated to chilled wine. A few end isle displays midway through the store feature "loss leaders" (what an oxymoron) such as beer and paper products at attractive prices. Same with Oreo cookies, 7-up, Doritos and so on, at the front entrance with the items changing weekly. Still no widespread advertisement. Not sure the wider community knew about deals like the dozen roses $9.99 around Valentines. A fascinating thing is that the stores are still somewhat of a tabula rasa (blank slate) with very little inventory and could be "morphed" very quickly. Still too much food going to the food bank but Tesco is showing flexibility.


TK: Also note here news of a Piper Jaffray study on the Fresh & Easy concept. From the news story about the report, citing Mike Dennis of PJ:

But Piper's Mike Dennis warned: 'The Fresh & Easy concept is not right and they need to quickly find out what the issues are and reset the concept.' Dennis said it could cost Tesco £400m to exit the US - a dramatic move the supermarket insists it is not contemplating. Dennis claims the 50 Fresh & Easy stores opened so far are averaging sales of only $170,000 (£86,500) a week. He thinks Tesco was aiming for closer to $200,000 initially, rising to $270,000 later.'The overall indication seems to be negative,' he said. 'This begs the questions of how bad it could be for Tesco's Fresh & Easy stores across California, Arizona, Nevada and what it would mean to Tesco's long-term growth rates and international strategy in the US.