Food has always played an out- sized role in American poli- tics. We watch with amusement as candidates vie for the hearts and minds of voters by gorging
on everything from apple pie at local diners to corn dogs at county fairs in an effort
to convince the electorate that they are just
However, with the culmination of two
excruciating years of campaigning for the
country’s highest office, we have to get a
little bit serious and ask what impact the
new administration might have on the food
and retail industries at large.
It all boils down to this—we do not know.
Will the populist movement be swallowed
up by partisan politics? Will economic
progress be stifled by the status quo? All
interesting questions. But
there are real issues at
play—global and domestic, regulatory and economic—that could shape
spending behavior and
industry policies for some
time to come.
Generally, retailers take
a nonpartisan approach to
politics—at least the ones
that want to stay in the
good graces of whichever
party happens to occupy the Oval Office
or the corridors of Congress and the state
house at any given time. As Shakespeare
said: ”Discretion is the better part of valor.”
Consider the National Retail Federation’s
RetailPAC, which contributed about
$385,000 to Congressional races this
year, supporting 113 House and Senate
candidates. Initial results show that more
than 90 percent of those supported won,
the association said.
There were reportedly 150 state ballot
initiatives this year that could affect the
grocery industry. As such, step one is to
cement close relationships with those in
both parties in order to educate them on
the industry’s priorities and concerns. At
the federal and state levels, most of these
confabs will be conducted by trade associations. That is probably the way it should be
given that they wield the power and influence of the many.
Yet, the attentions of local office holders, who can be invaluable allies, are up for
grabs. They often need to be schooled on
the contributions that business makes to
the local economy and building personal
relationships with them is key.
We will have to wait a while before we
can get a handle on what actions President-elect Donald Trump might take on the
big issues like GMOs, tax reform, the farm
bill, healthcare compliance, labor policies,
immigration, trade agreements, cyberse-curity and rebuilding a transportation infrastructure that would put millions of people
to work and eliminate what has been called
a “bottleneck” in the retail supply chain.
Nothing happens that quickly in
Washington, nor are solutions as simple
as they seem during the heat of campaign
rhetoric. For example, Trump’s comments
on deregulating the FDA which would
impact implementation of the Food Safety
Modernization Act (FSMA)… not going to
I do believe that everyone has to dial
down the rhetoric in favor of economic
logic if issues facing the retail industry and
its brand partners are to be solved and for
sales to continue growing.
At this writing, the stock market is moving steadily upward and that is good news.
But consumer confidence is a bit shaky.
Uncertainty is not good for the consumer
psyche and there is plenty of that to go
around. This already showed up in restaurant sales, which—with the exception of
fast food—slowed this year, leading some
analysts to express concern about a potential recession. However, most believe that
any concern about an economic downturn
is at least six months away.
A joint study by Princeton University
and the University of Chicago Business
School found no correlation between the
elections and consumer spending. On the
other hand, it does not seem to energize
consumer spending the way retailers and
brand marketers would like.
Without political and economic clarity
consumers tend to focus on stretching their
paychecks and reducing indulgence purchases. This is good news for discounters
like Aldi, Lidl, dollar stores and conventional
stores like Walmart Neighborhood Markets
and independents that keep prices down
by offering a few less bells and whistles.
Not so much for retailers that are going
overboard on expanding convenience
foods, gourmet products or so-called
artisan products that tend toward higher
prices. Consumers will still be looking for a
better shopping and eating experience. But
how much they are willing to pay for it will
be a source of anxiety. It may not be as sexy,
but better to err on the side of caution.
We are a nation in transition and in the
end it is all about consumer sentiment. That
is what should be closely monitored.
WAITING ON WASHINGTON
It is time to dial down the political rhetoric in favor of economic logic regarding issues facing the retail industry.
By Len Lewis
Len Lewis is a regular Grocery
Headquarters columnist and
veteran industry journalist.