Baskin Robbins and Mitt Romney Connection??

It's been a while since I posted, just lazy I suppose. I wanted to share an article about Baskin Robbins plant closure. Is it true Baskin Robbins and Mitt Romney want us all fat? LOL..... read on


Baskin-Robbins and the Walmartization of Ice Cream
July 20th, 2012 Armine Yalnizyan

It’s been an unusually hot summer, and soaring temperatures have boosted sales of that quintessential summer food, ice cream. But Baskin-Robbins has decided to shut its production facility in Peterborough, Ont., and lay off 80 workers because of…wait for it… increased demand!

From the department of “wait, what?”, here’s the scoop behind this brain-freeze-inducing decision.

Baskin-Robbins, home of 31 flavours (one for each day of the month), brought in $1.8-billion in sales from its 6,777 outlets around the world last year. Same-store sales rose by an impressive 9.4 per cent in the first quarter 2012, and that’s before the heat wave.

Though business is up, the company says expanding production is not part of the game plan. Peterborough is the last place in North America where Baskin-Robbins makes what it sells, and those 80 CAW-organized workers supply a third of the 4,200 outlets outside of the U.S., including 113 Canadian stores.

That production is now moving to third-party suppliers. Canadians’ demand will be supplied by Scotsburn Dairy in Truro, N.S. — for now. Like Peterborough, it’s also a union shop (CAW). But most of what Peterborough produced will now be made in El-Paso, Texas, a right-to-work state with no minimum wage. Only 5.3 per cent of workers are union members in that state.

Does that make Baskin-Robbins the Caterpillar of Peterborough? Not so fast.

The world’s biggest chain of ice-cream stores already operates in 110 nations, and believes future expansion of global domination can best be achieves by focusing on retailing and franchising. They are getting out of manufacturing.

Getting out of manufacturing is one way to drive down costs, by shifting labour-cost decisions to third-party suppliers.

Baskin-Robbins’ plan goes further: drive down costs by extending its presence in emerging markets, where disposable income is increasing; but, importantly, that’s where new suppliers are emerging too.

Call it the Walmartization of ice cream. When you’re big enough globally, you don’t have to make things to change the way things are made. The size of the contracts you’re waving around changes the game. The retailer, not the producer, becomes king of the deal. And the lowest price becomes the law.

Suppliers swallow ridiculously low per unit prices because the bottom line of that contract is huge. Then they find a way to shave their own costs. So Baskin-Robbins lowers its costs by shifting the incentive to find savings onto parties outside the company. Shift costs, increase profits. That’s the formula these days.

And here’s another part of the formula: Baskin-Robbin’s parent company is Dunkin’ Brands, which is owned by Bain Capital – Mitt Romney’s company before he became Presidential hopeful for the Republicans. These firms, and Romney, have been lobbying against supply management, angling for lower dairy prices to help us all get fatter on pizza and ice cream, one crazy-cheap mouthful at a time.

Lower dairy prices are indeed on the menu of free trade deals like the one now being negotiated with Europe and upcoming talks with the Pacific nations, which will most likely see an end to supply management of the dairy industry in Canada. But there’s still cheaper milk products to be found in other nations. And that’s the point of this drive for global dominance in ice cream. Market-spanning giants like Baskin-Robbins, relentlessly driving down input costs, give a whole new meaning to free trade. But remember the other trade: the flip side of low prices is low wages. Someone’s paying the price somewhere.

This blog originally appeared on the Globe and Mail’s online business feature, Economy Lab.

The Chicken or The Egg Conumdrum

In thinking about the food trends in Canada, I wonder if people eat healthier or make choices based on what's available or do their demands dictate what restaurants produce? This harkens back to the chicken and the egg conumdrum, and I still haven't figured that one out yet.....Whatever your stance, here are some interesting stats about what food consumption trends are like at retaurants these days from fastcasual.com ....


According to the latest research from Mintel, more than 60 percent of restaurant-goers think nutritional information should be posted on menus, and two in five (44%) think federal or local governments should facilitate such actions.

"Menu transparency will allow consumers to have control over their food decisions with a complete understanding of what they’re eating," said Eric Giandelone, director of foodservice research at Mintel. "However, getting people to eat healthier requires more than just posting calories or adding healthy options to the menu…the food also has to taste good."

When going out for dinner, nearly 60 percent of survey respondents said they want something that tastes great and 23 percent claim to want to eat a healthy meal. Only 14 percent of diners said they are never interested in ordering a healthy restaurant meal. This insight shows that restaurant patrons are attracted to healthful meals, as long as they’re full of flavor.

Nearly half of survey respondents report eating healthier in restaurants in the past year and people have different methods for doing so. Reducing fat (67%) leads the way in strategies for adopting healthier eating habits at restaurants, followed by eating more fruits and vegetables (52%). Meanwhile, 49 percent of patrons are cutting calories by simply ordering less food.

"From a restaurant’s perspective, there is a concern that healthy menu items may not sell, but there is also a danger to having a calorie-laden menu when the calorie count law starts taking effect," Giandelone said. "There may be some initial consumer shock at the calorie counts and chains may have to start listing lower-calorie options or smaller portion sizes to help diffuse this unpleasant surprise."

When Will Hotel Business Go UP in Canada?

Just when we started seeing some positive changes in the food services and retail side of the hospitality industry in Canada, I came across this article on the dropped hotel rates for our top 5 cities. While not encouraging, still noteworthy information for hotel managers.....

Strengthening Canadian Dollar Drives Hotel Rate Drops and Great Deals

SAN FRANCISCO, May 12 /PRNewswire, a leading discount travel site, today announced the results of the May 2010 Hotwire[R] Canadian Hotel Rate Report, which features the top five cities in Canada where hotel rates have dropped the most. When combined with Hotwire's already discounted prices, the Hotel Rate Report helps guide customers to the destinations that will maximize their travel dollars. Edmonton tops this month's rate report with an 11 percent drop, and after a six-month absence, Vancouver makes a welcome return with a 3 percent drop.

Hotel prices across Canada continue to fall as many popular destinations are still seeing declines in leisure travel that traditionally fills up rooms this time of year. This trend is being driven by the strength of the Canadian dollar against both the U.S. dollar and Euro. Travelers appear to be choosing destinations where they can get more native currency in exchange for their money, causing hoteliers in cities like Halifax and Vancouver to drop prices to compensate.

In addition to the exchange rate effects, cities like Edmonton and Ottawa are not seeing a return in business travelers, which is causing hotels to slash rates even further in those areas. So for travelers looking to stay closer to home this summer, they are bound to find a destination that suits their budget and taste, whether it is scenic Niagara Falls, history-rich Halifax or the country's capital, Ottawa.

When compared to the same time last year, the top five hotel price reductions for May 2010 include:

Example of a Current Hotwire Deal, CAD$/Night

Hotel Market: Edmonton, AL
Price Drop: 11%
Rank:3-star
$96

Hotel Market: Halifax, NS
Price Drop:9%
Rank:3-star
$76

Hotel Market: Ottawa, ON
Price Drop:8%
Rank:3-star
$90

Hotel Market: Niagara Falls, ON
Price Drop:5%
Rank: 3-star
$97

Hotel Market: Vancouver, BC
Price Drop: 3%
Rank: 3-star
$92

"Leisure destinations across Canada are offering some great deals this month on Hotwire," said Clem Bason, President of the Hotwire Group. "As long as the Canadian dollar stays strong against international currencies, travelers should continue to see low hotel prices throughout the summer."