Healthy Choices for Shoppers, All Change in UK Health & Beauty, and Autonomous Delivery Robots | GrocerTalk

Hello, and welcome to episode nine of Grocer Talk.

I'm Ben Miller.

And I'm Chris Walton.

And today's episode is brought to you with the help and support of Instacart Enterprise, Portager, Viewsion, and Sifter.

Welcome back, Chris Walton.

Thank you, Ben.

It's great to be here again.

Two weeks in a row, unplanned.

I'm excited.

I feel like such a.

Such.

It's such an honor to be with you two weeks in a row.

It's an honor to have you back.

And I think it's also marks the end of your time on the road, does it not?

Oh, my God, yes, Ben.

Four retail conferences in four weeks.

Vegas twice in 10 days.

Not good for anybody.

I'm glad to be back in Minneapolis and.

And glad to be home.

And it's.

It's been.

It's been a welcome respite, Ben.

Yes, it has.

Very good, very good, very well.

It's good to have you back in your home studio.

And look, Chris, this is.

This is episode nine of Gross at All.

Wow.

Really?

Nine it already.

Nine it already.

And I look two things.

So firstly, I just wanted to take the opportunity to thank everybody who's been involved in the last nine weeks.

So, look, thanks to our partners and sponsors.

Thanks particularly to everyone that's listened in and everyone who's given us feedback, who's been in touch.

It's been fantastic to hear from you and hear the conversations we're having is resonating.

So, like, number one, vote of thanks to everybody.

Number two, Chris.

We're going to do things a little bit differently today, aren't we?

Oh, okay.

Yeah, I guess so.

You're.

You're.

You're.

You're the captain of this ship.

You're the captain of this ninth voyage, Ben.

So, yes.

Tell me, Captain, what are we going to do today?

Well, look, we decided because you're back for the second week running, it was a perfect opportunity to stick with a number of things that are exactly the same.

So what we're going to do, we're going to unpick the global grocery news of the week.

We're going to give it the same focus, we're going to give the same insight.

What we're going to do, though, is just change the production a little bit so it might just sound and feel a little bit different.

So I think, think of this like a live a B test.

Yeah.

So we can compare this week to last week.

And I'd love to know, listeners, what you think, whether you preferred Chris and I in this style.

Or.

Or should we just go straight back to normal?

So we're testing and learning, Chris.

That's what we're doing this week.

Wow.

I've never been AB tested before, Ben.

I hope it's as good for you as it is for me.

Maybe I need a cigarette at the end of this one.

I don't know, man.

Yeah.

Wow.

A personal AB test.

All right, let's do it.

All right, let's do it.

Well, look, this week we're gonna have three parts.

In part two, we're gonna talk all about how to help shoppers make healthy choices.

Part three, we're gonna dive into the very latest in autonomous delivery robotics.

But we're going to start with a significant potential reshaping of the health and beauty market in the uk with implications that stretch far beyond the UK borders.

Yeah.

All right, Ben.

So to do that, I've got two stories which I'm going to give you you to give your thoughts on and to let the audience in on what we're going to discuss today.

So two stories.

Number one, Ben, the Westin family has acquired Boots.

And the second one, we also cannot forget that MNS is also partnering with Sephora because those two stories are closer than they appear in the rear view mirror.

Here's the background on each.

Whittington Investments Limited, which is out of Canada and is the holding company of the Canadian Weston family, which coincidentally is also the ultimate parent owner of Loblaw and Shoppers Drug Mart, two very big Canadian retailers.

Well, they're going to own 50% with Fairfax Financial holdings holding the other 50%.

But Whittington will have operational control.

They're purchasing it from the PE firm, the famed PE firm Sycamore Partners, which seems to own a lot of things in retail, and the Pesina family for $8.9 billion.

And the deal is expected to close in Q1 of 2027.

Some of the debt is expected to be levered against the new Boots business.

So that's the watch out.

Because of decades of underinvestment in Boots, which Ben, I'm going to want to get your thoughts on now before I get to Sephora and M and S, however, what's your perspective on boots as someone native to the uk, how does it fit into the whole health and beauty landscape from where you sit across the Atlantic?

Yeah, great question, Chris.

And what I really wanted to get into this topic because Boots is the clear number one in health and beauty retailer in the uk.

So depending on what flavor and look, you can cut health and beauty a number of different ways, depending on where it starts and where it stops, in terms of what you include in the total market and what you don't.

But it's somewhere in the region of 15 to 20% of market share.

So it's a dominant market leader.

Number two is Tesco.

So the grocers come straight in at number two in UK Health and beauty.

So you've got Boots as the standout leader and then you've got Tesco.

And Tesco's got about 9% of the market.

Boots has got.

Again, it has over 1800 stores across.

So there is a Boots, Chris, on almost every UK high street.

So Main street, the center of every town, city or shopping district has a boot.

Now from there there's like a really long tail.

So as Watson has got a couple of brands, they've got Superdrug and Savers.

The department stores, like the John Lewis Partnership, have got a little bit of business, but you're Talking kind of 2, 3%.

What you have, if you stand back and you look at UK health and beauty, is a big bit of the market with Boots, a big bit of the market with the supermarket and then a load of specialists.

What it, what it actually doesn't have is, is a, is a premium player, is a premium option of scale outside the department stores and an online options.

Got it.

Okay, so that, that helps me.

Okay, so that sets a table for me on why you pick this story.

Because health and beauty in the UK is basically synonymous with grocery.

That's what you're saying, Ben?

Yeah, very much so.

Very much.

Can't have one discussion without the other.

Okay, so that, that's, that's great.

And so Boots.

So I mentioned it before too.

So Boots has been kind of underfunded in the landscape too, is.

Has it not, in terms of the investment that basically Walgreens, since it's acquired, since it acquired, it has been putting towards it.

Yeah, that's right.

Boots has passed between multiple owners since it was taken off the UK stock market in 2006.

So it was merged with Alliance Healthcare.

That business was owned by kkr.

It was rolled into the wider Alliance Boots, Walgreen business and then split out again.

You know, Singapore Partners took it out in, in 2025.

So you've had a history of change of ownerships.

And throughout that history, Chris, we, we talk about a lot of leverage buyout.

So there's a lot of debt has been put into that business.

Now it look, Boots is a sizable retail chain, so it's about 10 billion US so 7 and a half billion UK to really big.

It's really big.

It's also, it's about as British as tea and the Queen.

Chris.

It is, it is, it is that it is a household name for everybody in the uk.

So everybody in the uk, no matter who they are, shops of Boots has been to Boots, knows where the local boots are.

The majority of pharmacies that are on UK high streets, main streets are, are run by Boots and then a number of competitors.

We'll come on to some of the challenges because they are that every man, every person proposition, which we know is not probably a terribly winning retail proposition right now.

But they have this market presence and this brand reputation in the UK, but for the past 20 years there's been an ongoing and which is now a legacy of underinvestment in, in those physical stores.

So 1800 stores.

One of the biggest challenges of the boots and when you think about what the Westerns are buying, is a real variety in the quality of the portfolio.

So they've got some very good units, some flagships in city centers, but they have a lot of stores that haven't had much investment.

Now if I go into my local store, which is a 15 minute walk from me, I find paint flaking, I find strange adjacencies, I find there's three different floorings.

If you kind of in retail, you know how important it is to get your flooring right.

And it's a great sign that people aren't spending money in their shops when you can walk around the store and see three different generations.

And that's kind of the typical Boots experience.

So I mean, one of the things that I'm excited about, about this news is the boot is desperate for investment, you know, and I think when we come on to think about that Sephora.

Story,.

We know how much beauty is changing and what it takes to be able to sell beauty.

At the moment.

Boots have developed a, a specific beauty format.

Chris only got two stores in the whole of the UK of that footage.

So 1800 plus stores, they've got two that are specialist beauty stores.

They're way behind the eight ball on that.

Right, right, right.

Okay, so, so if I hear you, I hear what you're saying.

So you're saying like, so this actually sounds like the ideal acquirer for Boots.

You know, you've got, oh, a, a family owned operation which has a history in grocery, which as you said, is very aligned to this category in the uk and they also understand the Drug business as well.

So that seems like a good acquirer.

And they're also buying what sounds like is kind of a distressed asset in a lot of ways too in terms of it's been underfunded.

There's probably a lot of low hanging fruit for, for an operator that knows what they're doing to come in and, and right.

The ship, so to speak.

Now you could ask the question of, you know, why has it not been able to write it right.

The ship itself over the past few years.

But you know, as we've talked about on this show, a lot of times, private equity can sometimes work, sometimes can't when it comes to, you know, being able to accomplish what's required.

So this seems like the ideal acquirer.

Ben, would you, would you agree with that at this point in time?

Yeah, I am more optimistic about this owner from Boost and I have through from a couple of iterations.

I think, look, I think distressed asset is pushing it.

They are still the market leader and they're holding that, that share.

I think when I look at Boots, I am excited about the opportunity for a business that can do better if it has some support from its owner.

And I think one of the things that is in its favor is they just in the process of bringing in a new CEO.

So literally starting at the moment, gentleman called Alex Baldock, who formerly ran Curries, which is the biggest consumer electronics business in the uk he's done a fantastic job with that business that he's leaving that business in a much stronger position.

So kind of a good leader, a good retailer and some owners that hopefully will be prepared to.

I just hope the Westerns appreciate the fact that this is not a quick turnaround, this is not a quick feat they're going to have to spend.

And I think the length of time that I'm aware they've been talking about making this acquisition and the fact that they were being able to bring the price down again from what was initially being offered makes me think that they know that they need to invest some time, effort and capital to really get boots, boots flying.

Yeah, right.

That's a great point too about the, the new CEO too.

And, and particularly the other point I mentioned too is that, you know, he's from the UK because as all of us Americans sometimes like to think, Canada is not the UK either.

And so the Canadians that are buying this country, buying this operation are going to have to come in and figure out how to run it from a UK perspective, which it sounds like, you know, like you said, it's as.

As ubiquitous as tea and crumpets, I think, is what you said.

So, like that.

That's an important factor.

All right, Ben, so I want to talk now about.

I want to talk about the Sephora and M and S angle here too, because that's.

Boots is an important backdrop to discuss the Sephora and M s partnership because of.

Because of the situation that Boots finds itself in.

It could or could not be ripe ground for the taking if MNS and Sephora do what they want to do and get this thing off the ground like gangbusters.

So.

So just to give everyone background on that, so Sephora is partnering with M and S to launch Sephora at M and S in store and online in the spring of 2027.

And the partnership is going to feature curated brands and specialist advice in a hundred stores.

Because Ben mentioned before, Sephora has a very, very, very tiny presence in the UK at this point in time.

Ben, I want to ask you about this partnership, but before I do, give us a little bit more on the history of Sephora in the uk as much as you can.

Yeah, no, of course.

And you know, this partnership shouldn't exist because the opportunity shouldn't, on paper, be there.

Boots should have closed that down, but it.

Right, doesn't, because of all the things we've just been talking about, there is an opportunity.

Look, look, Sephora tried to come into the UK at about 2000.

They only opened six stores.

It was a time that the global support business was doing well.

There was bigger priorities.

Particularly that was when it really, really ramping up its US business.

It never got behind the uk.

It never scaled.

The stores only lasted about four or five years.

It didn't make an impact.

They closed, they withdrew.

What's really interesting, in 2021, they came back and Sephora bought an online, a pure play health and beauty retailer in the UK called Feel Unique.

So from that Feel Unique, they rebranded, they got the digital storefront, but crucially, they got the mating list.

So in 2022, rebranded to Sephora and then just kept building that name and that brand recognition.

Opened their first physical store in 2023.

It's like a huge launch, Chris.

It's a super popular queues throughout the shopping centers, you know, throughout the malls that it went into.

And that was fundamentally different.

You know, at the time, the UKMD of Sephora said that 50 of the potential customers that they surveyed already knew the Sephora brand before they'd launched into the uk.

Because, you know, when you think about how global beauty content on TikTok is talk to any teenager in the UK.

They all, they all know Sephora because they're seeing it, they're seeing it through the content.

Does that, does that brand awareness?

So look, they're back in the uk.

The relaunch has gone really well.

They're now up to 17 standalone stores in those three years.

So they're investing in that physical space and they're putting it into kind of major city centers and major malls as they grow.

So that, that sort of created the, the foundation for this completely next step that M and S might take them to.

Yeah, the, the other part that I think is interesting about it too is like going back to the boot story.

Like you said, there's basically $10 billion of volume share up for grabs in this market.

And you've said how you've told me as the, as the curious onlooker here that the grocery angle here is very important too.

And M and S is now kind of an MNS and support together and now taking kind of this hybrid approach.

I want you to talk a little bit about that too because I think it's, you've got an interesting perspective on that as well.

Taking this hybrid approach of putting Sephora into their stores via shop and shop when Ms. Has been making a very good push into grocery as well, which allows it to create kind of this new cauldron of innovation in terms of what the next generation beauty experience in the UK can look like regardless of whether boots can actually right itself or not.

Because as you've said, that's also kind of a dowdy experience.

You know, it's been around forever.

And is that still the experience that consumers want?

Even if they get it turning and copying and whatnot?

Is the, are they still at risk of losing share to this new model that potentially comes into play via MNS and Sephora?

That's, that's, I think the last, last question I have for you, Ben.

Yeah, and I think that, I think I've said this to you before.

I think the, the turnaround of Fortune performance and particularly brand perception of Marks and Spencers is one like one of the retail turnaround case studies.

So for it is counterpoint to the department stories Dead conversation.

The number one that is a business that is a.

It.

It again it's as British as boots and tea.

You know it.

It's on every British high street.

It's so well known.

But you know, under Stuart Matu and his leadership team they have turned around the perceptions of that business.

You know, the, the M and S brand is really on the up in the uk.

It's incredibly highly thought of.

The stores are looking great.

Look, there's a number of things going for it.

They've sort out the retail standards so the stores are looking good.

The food business is exceptional.

So this is one of the, one of the big differences between a UK or a European department store in the US department stores is that many UK department stores also have your food halls as they're known.

But it's basically super.

It's.

It's a supermarket within the.

So that drives the footfall and the Ms. Food business is, is about as well run as any chain grocery.

You will go into anywhere in the world at the moment and, and, and I genuinely, genuinely will stand by that that drives footfall.

The second thing is they are in fantastic locations.

You know when, when back in my old, you know, when I was working in location planning for, for grocers, if you looked at footfall data in the uk, where is the busiest point in any city center you would usually be where the M and S is located.

They've got the incred and they've extended that to.

To somebody else anchor units.

They've got in.

In the most da miles as well.

So they've got fantastic locations that the company is on a bounce.

So it's driving footfall.

And then one of the things I think is super interesting Chris is they've talked about putting it into 100 stores, this Sephora partnership.

Right, really quick sidebar.

UK geography.

UK you have, you've got one mega city which is London and London's got a population of over 8 million.

The next biggest city is Birmingham and Birmingham's got a population just over 1 million.

So you drop dramatically.

Then you go to places that people will know, usually from the football clubs like Leeds and Liverpool and Glasgow and Edinburgh.

They've only got populations of about half a million.

And then you suddenly drop to actually a lot of places with a population of around 100 to 200,000 and you probably got 70 odd of those for a hundred stores.

You can get nationwide coverage into every urban area of scale in the UK and your boots has tried to be on every shopping precinct in every town down to kind of 40, 30,000 people.

So for an Ms. With just 100 concessions can get pretty much nationwide coverage and that's really compelling I find incredibly compelling for them.

So net net, you like this, you like this partnership.

You given the backdrop of boots and everything that's going on there, you think they're share for the taking You're.

You're all in on this one.

You think one plus one equals three on this one, huh, Ben?

Yeah, I really do.

I guess the one thing that I have in the back of my mind, and this is where I'd love to get your perspective on, Chris, is, you know, there's a.

There's a really big warning sign over this and that warning sign doesn't read here be dragons, Chris.

It simply says coals.

So I guess, ah, what I want to know is like, is there, is there any transferable learning?

Watch out on knowledge from what's happened between, between support and Coles in the us?

No, I don't think so.

If anything, I think actually this gives credence to the fact that it probably is going to work over there because, you know, for the most part, Sephora has been like, basically the.

What's.

The.

What's the word I'm looking for?

The.

The what.

What's.

What is it when you lead something against a fence that's falling and collapsing and you're trying to hold it up?

It's been.

I can't think of the word for that.

It's like the, you know, like it's, it's whatever's holding up the fence and, you know, it's, it's.

It's literally, it's literally.

I mean, that's what.

Sephora has been to Kohl's.

Kohl's has got its own issues and that's, that's neither here nor there.

Kohl's.

Kohl's, to use a British parlance, could not be more chalk and cheese from Marks and Spencer than anything else in the world.

Like, they're just that different.

If I'm going to translate for all the Americans listening, a support beam, it's.

It.

I mean, it's basically buying a support beam for Kohl's.

That's what I was trying to say.

And so, yeah, so I don't think.

I don't think anyone should be concerned about that at all.

I don't think anyone should be drawing comparisons with that.

If anything, it just tells Sephora how to run a shopping shop.

Well, and don't forget, they were doing it with J.C. penney's for years and years before they went into Kohl's too.

So they've been doing this for a while, so they know how to do it now.

They just got to take it overseas and adapt it to the right model itself.

In terms of how the UK shopper wants to interact with the brand, which I think is still that's probably the biggest open question to me, Ben, is like, how does this sit inside the Marks and Spencer floor pad?

How do the sales associates work it?

How do the sales associates connect with the rest of the store?

So it doesn't feel like a one off shop and shop, but they can actually, you know, be briefed on everything that's happening in the store.

How do they feel like one cohesive experience.

Those are the questions that are going to matter operationally.

Yeah, I couldn't agree more.

And I think that's.

Yeah, that is really good to know and it doesn't dampen my enthusiasm for this partnership at all.

So, look, we've talked a little bit, a couple of bits of merchant acquisition, particularly the huge news about Boots.

There's been a few.

A couple of other M and A stories that have been flying around this week.

I just want to touch on before we.

Before we take a short break.

Firstly, from a UK perspective, there's been a story that's done around that.

Sainsbury's and Morrisons, So that's the UK's number two grocer and kind of Morrison's about number six at the moment.

There was some merger talks.

Sainsbury's, the much bigger party, they've walked away.

They initiated and then they walked away.

Pulling back.

We've talked a little bit about PE ownership.

Morrisons has been in pe ownership since 2021.

They are looking for an exit.

I think what you read through this is the Morrisons is in play, which I think everybody knew it was.

So this story isn't going to go away.

It's what happens next that we'll be keeping an eye on.

So is this like the dating analogy, Ben?

Like one of them is playing hard to get and they just want to, you know, like, is that how this is going?

Is that where.

Is that what this is going to be?

Eventually they're going to consummate this relationship.

Yeah.

And the problem is Sainsbury's has got quite close to going down the aisle recently with another partner with Asda, and that all that was public and that all collapsed.

So I think the current CEO Sainsbury's would probably be a little bit more cautious than his predecessor, who infamously, Chris, at the end of a BBC News interview about the merger, he thought the microphones had been turned off and was caught singing the show tune When we're in the Money live on a hot mic.

Oh, my God.

I did not know that.

Wow.

That's crazy.

Wow.

All right, well, so for me you know, the story that I want to just make sure everyone's aware of too, because I think it's really funny that it actually broke in a lot of ways and it's been denied numerous times since it broke.

But for those in the US particularly too like Starbucks was reportedly looking at acquiring Chipotle, which was surfaced through the Financial Times, if I'm not mistaken.

Right, Ben.

And, and for those that are probably very much in the know, Starbucks current CEO Brian Nickel used to run Chipotle.

Um, so you can see potentially what some of the rationale is there.

But the market caps are, you know, pretty sizably different.

Starbucks 105 billion.

Chipotle 40 billion.

It would make it one of the largest restaurant mergers of all time.

But like I said, Starbucks came out flatly denying the rumors.

And all I can say, Ben, I'm guessing you agree with me on this.

All I can say is thank fricking God.

Like I just don't understand what burritos and selling coffee have to do with each other honestly, other than like back office scale.

But I don't, I don't think that's a reason for a merger.

I don't.

But this would not be the first time that a story gets leaked so the parties can get a handle on what the potential market response might be.

And I did, I'm not for one minute suggesting that this is what happened here, but I did, I did note one analyst note that this, describe this as Brian Nicholl potentially jumping the shark.

So on that basis it probably is no surprise that they're denying it.

And I think that's the right.

And look, one of the one that I'm keeping an eye on is, is Majestic.

Majestic Wines is a, it's another PE owned business, but it's one, it's a specialist wine and spirits retailer.

It's got about half a billion dollars in annual revenue.

It's a good business that's been trading solidly.

Why I raised it, it is because one of the bidders is reported to be Tesco.

And Tesco has recently been selling businesses that we've touched on previously in Grocer talk.

So an acquisition is interesting.

I think the most interesting thing for them is probably the synergies between Majestics kind of wholesale division and Tesco's wholesale business.

Booker.

I think that's where the value will not there will be but I think that's one to keep an eye on because together significant market share in terms of one spirit in the uk.

In the uk.

Right, Chris, on that Note.

I think it's time to take a breather and take a quick break.

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Learn more@siftasolutions.com okay Chris, in this section I want us to discuss how grocers can help shoppers make healthy choices in their food shopping.

And to kick us off, let's hear first from Kevin Billings from our title sponsor Sifter Solution, who joins us for five insightful minutes on the very latest on SNAP waivers in the U.S. kevin, listeners will become increasingly familiar with the Sifter name pro through your sponsorship of grocertalk.

So can you start by just sharing a little bit about how you support grocers with their personalization?

Thanks for having me Ben.

Really excited about our sponsorship with Grocer Talk.

Yeah, so a little bit of history if you don't know much about Sifter.

We are a Food is medicine food intelligence technology solution.

We've been around for five plus years now, but we've got a really deep grocery retail background.

Our founders Andrew and Thomas Parkinson along with Judy Sebold, our third founder.

Andrew and Thomas are the founders of Peapod.

So the first online grocery store back in the day.

So have been innovators forever and ever.

But after they sold it to Iold Delhai's, they've always had a desire to make healthy eating easy for everyone.

So that was the kind of brainchild behind Sifter.

Create a technology that would help retailers do that.

So currently we're engaging with retailers to help them with better personalization any food is medicine strategies that they have and so we've been helping them for the last four or five years and doing all of those things.

Okay Kevin, let's talk about SNAP waivers because they've been a really hot topic in our industry recently.

So scene setting for anyone outside the US SNAP is the US Supplemental Nutrition Assistance Program.

It's a federal government initiative that provides food purchasing assistance to low income households.

Think of them as modern day food stamps.

So Kevin, can you describe for us what are the so called SNAP waivers and what's the latest on their state level implementation?

A year and A half or so ago, there was a movement from states to ask for waivers from the USDA to not allow SNAP subsidies to be spent on foods and beverages that we know are causing chronic disease.

So think about sodas and candies, high fructose corn syrup as the first ingredient items.

And over the last year or so, there are now 23 states that have active waivers.

Some of them have been put on delay because of the USDA's desire to maybe have some open comment periods just to make sure that they're aligning on doing the right things.

But at the end of the day, we feel like even those delays are going to be diluted soon and most states will have a waiver.

But philosophically, the goal behind the waivers are to try to not have SNAP subsidies paid for things that we know are causing chronic disease.

So what do you see, Kevin, from your position as the potential impact for both grocers and CPGs of the waivers and what the retailers need to make sure they're doing to maintain their SNAP license?

I mean, the USDA said, hey, if you're not compliant, you might lose your SNAP license.

That's not a good thing.

For many retailers, up to 30 to 40% of their revenue is coming from SNAP dollars.

So they definitely don't want that to happen.

So it's a big thing.

And of course CPGs are impacted because if they happen to have products that are ineligible now, then they're obviously losing revenue.

So a lot of revenue at play here.

But interestingly enough, what we're hearing from retailers is as much as they were concerned about this movement at first, some retailers are telling us that because their margins are so low on some of their direct store delivery items that include the soda and candy, that now that Sifter is working with them to serve up alternative products that are eligible in these SNAP affected categories, their margins are actually higher on those products, so less of a revenue strain for them at this point.

But all in all, you know, the retailers have asked for two things.

One, accurate restricted product lists to integrate into their POS so that they're in compliance, but also tools for their shoppers for nutrition education, better guidance, and opportunities for their shoppers to scan products in store to determine eligibility well before they get to checkout.

So I really want to get into a practical example of this.

And we've been talking about SIFTA having recently announced a contract with the state of Arkansas for a SNAP waiver compliance service.

So can you tell me more about that and the impact that it's having on both retailers and Snap shoppers in the state.

Earlier this year, the governor, Governor Huckabee Sanders, made a strategic decision and a conscious choice to pay for services that retailers of Arkansas could take advantage of, but also develop a Snap app for all of the Arkansas Snap shoppers to use and store to scan products for eligibility.

So we worked hard to win that contract and that's what we've created for the state, a data exchange for retailers to submit their assortment for us to do our analysis.

And we're delivering the accurate, restricted product list back to them based on their assortment.

And then the Arkansas Snap companion app is really being highly adopted by Snap shoppers across the state so that they can scan products to determine eligibility well before where they get to check out.

This is part of a large, healthy initiative for the state of Arkansas, but it's working really well.

And our hope is that other states will adopt this same model in order to be able to serve the Snap shoppers of their state well along with the retailers of their state really well.

So, Kevin, just describe to us how the SIFTA solution which you designed to help shoppers make kind of active, healthy lifestyle choices.

How does it help retailers and CPG brands navigate this SNAP landscape?

Because of our food is medicine background and because of the way that we built our, our, our technology, our APIs, our processes, methodologies and algorithms around, you know, truly understanding the ingredients and nutritional makeup of all food and bever in the market, it set us up well for this.

Now we'll say the, the complications around the SNAP waivers is that every state is different.

So, you know, some states are very straightforward.

It's like, hey, no more soda, no more candy.

Some are way more granular.

Arkansas is an example.

A juice that is less than 50% real juice is ineligible for Snap.

But if it's more than 50% real juice, it's eligible.

So, you know, some states are digging in a little bit deeper on their definition of a restriction.

So Sifter's in a unique position because again, we understand the nutritional makeup of all food and beverage products to be able to align the restrictions through our analysis to be able to accurately determine what UPCs are eligible or not.

So, you know, we feel that, you know, states should have the ability to make those determinations on their own, but we also feel that Sifter is the perfect partner to help them make sure that they're implementing accurately because of our unique abilities, as I defined just a few months ago.

Great.

So look, Kevin, if people want to hear more, if they Want to discuss this further.

How can they contact you?

Kevin.billingsiftersolutions.com or you can go to our website siftersolutions.com and track down to our SNAP page with more detail.

Appreciate you joining us.

Thank you.

Kevin thank you so much.

Chris I'd love to hear your thoughts.

What's kind of your reflection, what stood out from you in the conversation we just had with Kevin?

First of all, I love that conversation.

You know, to me, if I step back from the conversation and I look at it, I look at what's happening in the grocery industry broadly from a 30,000 foot view, for lack of a better way to put it, I just think there's so much changing at the product level, like the small P product level too.

BEN I'd say within grocery.

So like we talked about all the tech changes, but at the product level there's, the changes are just barraging the industry.

Barraging is the term I would use.

So like first you've got, you've got SNAP waiver changes which Kevin talked about.

You've got the GLP1 impacts as well.

You've got the protein movement in general too, outside of GLP1.

So you know, we always hear, we always hear data, data, data.

Well, that conversation proves that out, Ben because if, if you don't know how your product portfolio stacks up from an ingredients perspective, particularly with all of those changes, the confluence of all these changes happening at a product level, happening at one time, you're going to be left flying blind.

There's no doubt about it in my mind.

And the other point I take away, BEN and this is important too, because you know, the grocery business is retail and it's CPG for the most part, you know, and then the technology companies support both of those.

But this is not just a retailer issue.

What I'm talking about, the changes at a product level, it's also a CPG issue because the businesses are at risk, particularly if the SNAP laws continue to change and they continue to change on the trajectory that they're going to change and they're going to change state by state.

You could have a lot of business that you're used to doing at risk here if you're not careful and not in front of this.

That's what my takeaway is.

BEN yeah, I couldn't agree more with that.

And I think I thought Kevin's perspective was really helpful because some of the conversation about SNAP waivers is strongly suggesting that it's going to go away.

And actually, Chris, I thought Kevin put a very compelling argument that actually it's not going to go away.

Things might not be exactly as they're currently proposed, but the direction of travel is really clear and compliance within that 40% of sales.

As Kevin reminded us, for some retailers going through, you know, Snap products, that compliance issue is absolutely critical.

So no, I think it's, I'm really pleased that Kevin joined us because I think it's such an important topic that we should keep abreast of.

Yeah.

And even, even the fact of like, if you think it's going to go away, that's like burying your head in the sand like an ostrich too.

Ben.

Because thinking it's going away means you're like kind of ignoring the zeitgeist of just what's happening, which is like people are starting to get the punchline to the joke that we need to eat more healthy food.

So if your business is, is devoted to these types of products now, wake up because in 10 or 20 years, that's not going to be the way it is regardless.

Most likely.

Yeah.

So linked to this.

Chris, one story that really caught my eye this week and you know something that I've been keeping a close watch on is an activation from, from Giant, from the giant company.

So God bless US supermarkets where there's three or four different giants.

So this is giant company which is one of our whole Delez USA's banner.

And this is the giant company from Carlisle, Pennsylvania.

So they've got about 193 stores across Pennsylvania and neighboring neighboring states.

They are starting to run tours, kind of one hour guided tours across six of their stores to help people understand the products that they have on their shelves that will help them when they're on a GLP1 diet.

They're going to talk them through strategies for choosing foods that are rich in protein, that are high in fiber and are nutrient dense.

And I think it's really interesting they're also doing a whole series of online classes so hosted by their dietitians of pharmacists, really to help guide people who use GLP1s to make those choices, to support, support healthy eating and also to deal with the side effects of being on the drugs.

And I mean, as a kind of interesting little side note, Giant is also offering loyalty points to people who sign up and join the online classes, which I thought was quite an interesting, interesting connection that we come back to.

So, I mean, Chris, I'd love to get your reflection on this.

We've seen a number of retailers trying to think about how to connect elements of their business, you know, their pharmacy, their dietitians and their in store.

This taking people on tours feels a very manual approach and it's a very small trial.

But as a principal, do you like it?

I think if you put a gun in my head and say, no, I don't, I don't love it, I don't think it, I don't think it scales.

I think, you know, it's a little, it's a, it's a little bit incongruous to me in Congress.

To me too, in terms of like staffing grocery stores is hard.

You're now going to put money towards this, which is taking away money from somewhere else.

I think there's a lot of factors too in terms of psychology, of do I want to be on one of these tours, walking through my local grocery store, letting people know I'm on GLP1s.

And so I just think about everything that you talked about with Kevin too, really in terms of if you get a hold of your item level data, you can scale that same effort so much, so much more readily through digital activations than you can through this type of activation.

So that's why I'd say, like I would be leading with that versus this.

This might give you some trial and experimentation.

You might learn some things.

But, but overall I think you've got to have your, your, your compass pointed in the right direction and that.

And that's, that's, that's where I would go.

So I don't generally like these types of things.

I've.

People that follow my regular show probably know that.

But I'm.

Do you agree with me, Ben, or not?

Yeah, I think that's where I'm coming from as well.

And I think the.

One of the stats that was dropped in part this conversation is that, you know, there's now 11% of US adults who are on GLP1s and it's up from 3% just two years ago.

So we've seen significant growth.

And I.

Look, Chris, I read another bit of research recently that talked about how when people are on GLP1, they're discovering that the impact on food consumption and purchasing is actually focused really on that individual.

So they're still feeding the rest of their family kind of the same that they used to, particularly if they've got children feeding the children the same.

So there is something very personal about this journey.

So I get a community support element to it.

Being in a group walking around the store very visibly, I feel less comfortable with as, as a as an idea.

But looking, look, it might, it might work for some.

I've seen if Publix put a brochure out that's a bit flat.

I think the one that excites me a bit more is what Hyvee did.

Hyvee, where they were able to utilize, having the, all the dietitians they already have in store to have a dietitian led online program that helped people through it is a really big change to the diet.

So having that support and what that really nicely did was bring together the significant healthcare business that Hy Vee owns and the grocery business.

And I think that's the value to unlock.

And Hyvee is part of this nourishing change movement as these are whole delays.

So I expect as businesses they're probably talking to each other and there's got to be something that's more scalable than walking around.

Yeah.

I mean, at the end of the day I just think this is like a tailor made use case for generative AI too.

And people are very acclimated to doing that now.

So I would just get that capability lit up on your site to help people filter out their dietary needs if they're on GLP1s, given their preferences that they can put into a generative search engine.

That's what I would be doing.

Ben,.

You mentioned lighting up a site.

What about lighting up the store, Chris?

Because one of the conversations that we've been tracking for the last couple of weeks is, you know, different use cases of ESL technology and shop to light.

And it was something that, you know, when we were talking to Kevin, before we record that five insightful minutes, he said, well, what about getting your GLP1 relevant products or even SNAP compliant products to light up in an aisle whilst you're shopping, controlled by an, by an app.

Do you think if that's a sort of idea that you could get behind?

I think so.

I mean, I've gone back and forth on this one.

I think so.

Because like, if, if, like if I, if I walk through the flow, like, okay, I'm on GLP1s, I need help finding my assortment.

I'm engaged in the mobile app.

So all this is working together and then I can identify those items that I've now put on my grocery shopping list and I want them to point me in the direction of where I can find them in the store because possibly many of them are new, I've never shopped for them before.

I don't know where they potentially all are or I Want to save time in, you know, locating them, then?

Yeah, I think so.

And the great benefit of that is you've got an engaged shopper on the mobile app and the capability is there to light up the shelf anyway, so it doesn't really cost you anything additional.

Again, provided that your item data is correct and you can point people in the right direction.

That's the.

The ultimate, you know, hook here that you have to be able to do.

But if you can do all that, it's an added benefit at a very low cost to your shopper.

And the big question for me is just how many shoppers are going to want to do that?

But seems like a worthwhile experiment if it keeps people engaged in your mobile applications.

Yeah, really interesting.

And look, before we move on, Chris, this is.

I just want to touch on a developing story that's been live for the last 24 hours.

Yeah, because we've just been talking about ARO delays and we've touched on ESLs and some of their operating systems as we're recording.

It's so over the uk, it's late afternoon on Tuesday and it's kind of morning over with you guys.

In the us, there is an ongoing cyber attack.

The Ahold delays, their banners, their websites are down at the moment.

It appears potentially to be linked by a more widespread cyber attack of grocery retailers in France where they're operating, and particularly the refrigeration systems were targeted.

So, look, you know, Chris, I think one of the things we wanted to achieve with Grow To Talk is that we provided a bit of analysis and depth.

So, you know, if this is an ongoing story is one we're going to come back to.

I think there's a couple of things I would say.

I've had a couple of conversations with retailers who've been the other side of cyber attacks, and it's horrific when you're in the trenches on that.

So just like, the best of luck to everybody that's involved and I think for anybody that isn't, just make sure your firmware is up to date on your hardware.

That's kind of one practical thing that we think we can do.

But, Chris, have you got any other kind of thoughts before we move on on that one?

No, I just read that story right before I got on that.

Yeah, the refrigeration units have been, like, turned up to super high temperatures so that it's, you know, melting all the frozen and refrigerated food, which sounds.

Sounds horrible on so many levels.

One, because it means people can't eat what they want to eat and then two, I can't imagine the stores and what the cleanup of that is going to look like.

And as a former store manager, my heart just goes out to anyone that's going to have to deal with that because it's terrible.

Yeah, agree, agree.

Right, we're going to change tack quite dramatically.

We're going to discuss delivery robots.

But before we do that, it's just grab another quick break.

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Okay, Chris, section three, home straight.

Third area that I really want to pick up and get and pick your brains on is around autonomous delivery.

Now, we've talked quite a lot about drones on this show over the last couple of months.

What we haven't really talked about is other autonomous routes, particularly pavement or sidewalk robots.

And there's been a couple of stories this week that has really made me want to kind of focus on this, actually both of them for the UK.

So the first one is DoorDash.

So through its European subsidiary, Deliveroo is taking its pavement sidewalk delivery robots to five UK cities.

So delivery is expected to begin in the London area, in the city of London, the Canary Wharf in the next couple of weeks, with four other UK cities following soon.

And these are areas where local councils have allowed robot deliveries.

Milton Keynes, Leeds, Stockton upon Tees and Nottingham.

So that's with Coco Robotics.

Also this week, just eight have talked about expanding their robot delivery.

And I think this is interesting because they are taking robots into a new area and partnering with Morrisons.

So Justy Takeaway works with Starship technologies that I'm sure many people are already familiar with.

They're scaling their operation and they've started trial in Camborne Town in Cambridgeshire.

And this is the first location where just they didn't already have a grocery delivery, a delivery opportunity.

So it's.

So they're using it to go into new areas.

And look, I guess what I'd really like to kind of take your perspective on, Chris, it's a couple of things.

So we've talked about drones a lot.

What do you think is driving this current wave of experimentation and trial with pavement robots?

What, what do you see as the business case for this one?

I Mean, I think the business case for pavement robots and drones is, you know, pretty similar from the folks I've talked to over the years.

You know, it really comes down to two things.

One, you want to defray the last mile costs of the delivery, right.

Is that such a significant portion of what we're talking about here?

And then the other point too, that I don't think it's talked about enough is the quality of the food actually being delivered because the operators don't want the food sitting in the trunk of someone's car or the boot and of someone's car for 40 minutes while they're out delivering other orders.

Like that's a real issue in terms of the quality, you know, of what's ultimately delivered to the customer.

So those are the two things that I think are driving it.

And that's why you're seeing the QSR or the restaurant industry move the fastest towards this.

Particularly when you're talking about sidewalk robots too, Ben.

Yeah, and I think that whole idea of why is it the restaurants that are driving this rather retail is really, really interesting.

And I think a couple of thoughts I found on that one is one is distance.

So I read the stat that the median food delivery journey is, especially in the US is about two and a half miles.

So that's the sort of distance that plays into a relatively slow moving sidewalk robot versus for example, a drone which has got a much bigger, much bigger scale.

And it's also one where you, those short distances are more expensive if you use kind of a, a motorbike courier or a cycle courier or, or a car.

So delivery from restaurant really nicely plays into that.

Not only that, Chris, you've got density in terms of restaurant.

You know, where restaurants are found is usually 10.

There can be easy 10, 15 different options the people can choose from.

So you're kind of spreading that density of pickup spots to then be able to kind of frequently short deliveries.

And I think that might play into why it's the restaurant delivery companies, they're taking a bit of a lead on this one.

If you were, if so, if you were a betting man, Chris, would you put your money on robots or drones or both being kind of core parts of an operator's last mile solutions?

Well, this is a really good question and because you know, on the whole, as much as I've talked about drones and what Walmart's doing and, and, and been lauding it, I don't love either one that much as an idea overall.

And the reason I don't love them is because they deliver one to one versus one to many.

And so there's, there's no technology in the scale itself.

Ben that's how I'd put it.

You have to bring scale to the equation somehow.

Which is why I potentially like drones for Walmart because Walmart has the space and the strip mall locations to feed a drone, quote, unquote, drone hub.

You know, without that element, it gets really hard for me to see how either drones or sidewalk robots work because an individual restaurant, one, they can't own and operate their own drones.

Like, you know, like how many drones are they going to be able to have in their store running deliveries?

Like, it's just not possible.

And two, even if it has Doordash or someone else or any of these robotic companies that you name Starship or whatever the heck Coco or Wing or whatever, even if they have someone else try to do it, you still have to get the orders to the drone or the sidewalk robot efficiently as well.

And so that's still a big matzo ball that's hanging out there.

So I don't know if we get to the point where delivery robots, you know, particularly probably more so delivery robots than drones are more like a public good, akin to, you know, the vision of a Waymo or robotic taxis that are just out there running through the marketplace at any time and you just hail them to come to your restaurant.

Then maybe I see this working, but I think it's a long way off.

And to think it's anything more than a long way off outside of like the Walmart initiative.

I think you're kind of, I think you're personally diluting yourself a little bit.

That's how, that's how I consolidated my thoughts on this topic of bone of drones for bones, drones versus delivery robots.

Ben that's, that's how I'm, that's how I'm piecing everything together in my head right now.

I, I, I still don't think I'd be touching this if I was my average retailer or my average restaurant delivery option that I'm sorting through, you know,.

And I think if you were going to take a look at it, you, you would go to Finland.

So that's the market where the reason this one go to Finland.

So S group or the biggest grocers in Finland, they've been working with Starship Technologies for a number of years now.

They say that 10 now Chris, of their ecom deliveries are with pavement robots.

They have two to 300 stores running a service.

They may, they've made Over a million and a half deliveries.

So that's the kind of the case study to have a look at.

Okay.

If I'm going to really think about this, what do I want to see?

I think, you know, we've got a lot of US Listeners.

There's a number of things.

There's a lot of things, Chris, that are different between Finland and the U.S. but one of the big things that the sidewalk robots need, they need continuous pavement and pedestrian infrastructure.

They also need a pretty high residential density as well as store densities over short distances.

That's not most of suburban US So I think there, I think there is far more limited geographies where it's going to work in, in the States.

But I think, yeah, S. Markham, Finland is where you need to head if you really want to see what a scaled version of this looks like.

Yeah, I'd love to see that Starship, if you're listening, let's go to Finland.

Let's go check it out.

That you and I road trip to Finland.

Love to see that.

Actually love to eat my words too.

If you can explain to me and I can better understand what the dynamics are that have to be true for this to take off in the US or even in the uk.

Yeah, I mean, that's absolutely right.

Okay, Chris, so we get a wrap.

But before we do that, I just want to kind of check in on an.

And finally, is there anything else in the world of grocery that you have been tracking this week that we haven't talked about?

Oh man, the thing that I'm really interested in is I've talked a lot with you personally and even on this show about the rise of marketplaces and which marketplace is going to steal the most share in the decade ahead.

Would you bet on TikTok?

Would you bet on Amazon?

Would you bet on Doordash?

And so with all of them going towards agentic commerce, again, going back to what we talked about before too, in terms of agentic commerce being tailor made for a lot of the grocery experiences that people want and desire.

I think it's going to be interesting to see who ultimately gains the lion's share of people's interest and time as they're trying to make those decisions and going through that funnel process in their head.

So I'm interested in talking about TikTok shop this week on our show on the Fast Five and how they're activating agentic commerce and even talking about whether or not that plays in negotiating the long term.

Really interesting.

Really interesting.

Well, in which case you should keep on your radar.

And something that I'm keeping an eye on is the significant growth that Kaufland is investing in Europe in its marketplace.

So Kaufland, which is the large format supermarket hypermarket operation from the Svarts groups, that's Lidl's parent company, they are really going hard on their marketplace at the moment.

So they launched in the Netherlands just about a month ago.

The Netherlands, as well as Amazon, they've got ball.com which is our whole Dalesa's marketplace, which is a very, very good business.

So that's, that's aggressive.

Just this week, they've launched a marketplace in Spain.

So they're scaling into a significant European marketplace of scale.

So that's.

Yeah.

So for your marketplaces, Chris, that's one I'd recommend from a European side for you, kind of keep an eye on.

Wow.

Great, Great tip, Ben.

Thank you.

There you go.

Right, look, let's wrap this up.

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