Remember the fortune cookie: “Your eyes believe what they see; your
ears believe others.” We think anyone could have seen this crisis in
the supermarket business coming. Thirty years ago, if you went to a
multifamily barbecue, the host bought the meat at a butcher’s shop.
Ten years ago, the host bought the meat, drinks, and paper goods
at the supermarket. For the last fi ve years, the host has bought the
meat, drinks, paper goods, lawn furniture, potted plants, outdoor
speakers, and barbecue itself at Costco or Wal-Mart.
What goes great with a sport utility vehicle and a giant stainless
steel freezer? A huge cargo of dry goods and frozen meats—it’s all
part of the super-sizing of America. Our huge middle class does not
have the cash-fl ow worries of 30 years ago; they are better able to realize
economies of scale by shopping “club” style and buying in bulk.
Of course, few top-fl oor Manhattan restaurants host multifamily
barbecues, so quite a few stockbrokers missed this trend until it was
too big to miss.
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