Retail Brew // Morning Brew // Update

Hey, hey. Liquid Death yesterday released its latest marketing stunt—a Hot Fudge Sundae-flavored sparkling water in collaboration with Van Leeuwen, its first co-branded flavor collab. In addition to TikTok Shop, they’re available for purchase at Van Leeuwen scoop shops, satisfying the consumer urge to wash down their ice cream with, uh, water that tastes like ice cream.

In today’s edition:

—Andrew Adam Newman, Alex Vuocolo, Erin Cabrey

SUPPLY CHAIN

Straight from the source

Shutter2u/Getty Images

In late 2022, Mississippi-based manufacturer United Furniture Industries abruptly shuttered, terminating 2,700 jobs and leaving a sizable hole in the market for budget-friendly furniture.

For American Freight, a chain of warehouse stores selling discount furniture, mattresses, and open-box appliances, the sudden loss of a major supplier marked a turning point. No longer would it rely exclusively on domestic middlemen to bring in its products. Going forward, it would source from a much wider pool of suppliers, including from outside the United States.

“We knew that they were sourcing a lot of those goods overseas,” Alissa Ahlman, chief merchandising officer in the home furnishing division at Franchise Group, the parent company of American Freight, told Retail Brew. “And so we kind of embarked on this, ‘Well if they can do it, we can do it.’”

These efforts culminated last month with the announcement that American Freight had expanded into new international sourcing territories with the goal of expanding its assortment of affordable offerings, and that Vietnam and Malaysia were the focus.

The move places American Freight alongside a number of US retailers, including Amazon and Walmart, and fellow discounters, such as Big Lots, which are increasing their imports from Southeast Asian countries, as higher costs and geopolitical tensions make China a less attractive exporter.

But setting up shop on the other side of the world is no easy task. Ahlman said the expansion required the company to rapidly stand up a sourcing division and develop partnerships with a mix of local sourcing agents and manufacturers.

Straight to the source: The process started with American Freight getting its boots on the ground, Ahlman said, with company executives “traveling a couple times a year to see the factories with our own two eyes, to meet the people, to touch and feel the product, to make alterations on the spot.”

Keep reading here.—AV

FROM THE CREW

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E-COMMERCE

Many unhappy returns

Francis Scialabba

Of all the challenges that retailers face, none has them reaching for the Tums so much as returns misbehavior by their customers, according to a new survey from Loop, a returns, exchanges, and reverse logistics platform.

Asked to select among trends that “have the most significant impact on your company today,” 53% of US respondents chose returns fraud, followed by returns policy abuse (42%) and high operational costs (36%).

Loop defines fraud as behaviors like lying about products not arriving or purchasing with a stolen credit card, then getting the refund applied to another card. Among behaviors it defines as returns abuse are wardrobing—ordering something intending to wear it, then returning it—and claiming items are defective when they’re not, in the hope of getting a refund or discount. Loop surveyed 600 retail professionals in June in the US, the UK, and Australia.

One shop stopping: Retailers walk a tightrope when it comes to returns misdeeds, trying to treat their customers like they’re always right at the same time they’re policing them.

Keep reading here.—AAN

COMMUNITY

Coworking with Annie Streit

Annie Streit

On Wednesdays, we ~~wear pink~~ spotlight Retail Brew’s readers. Want to be featured in an upcoming edition? Click here to introduce yourself.

Annie Streit’s food and beverage industry résumé includes General Mills and Hershey-owned Amplify Snack Brands. Now, she’s chief commercial officer at frozen food company Daily Harvest.

How would you describe your job to someone who doesn’t work in retail? I help do everything possible to deliver sustainably sourced, convenient, and nourishing food built on organic fruits and vegetables to Americans’ kitchen tables. Were you walking down the aisle at Target, Kroger, or Wegmans and spotted our smoothies on the shelf? My team did that. Were our Harvest Bowls recommended to you while browsing on Amazon, Instacart, or Google Shopping? Did you fall in love with us and subscribe online? My team did that, too.

What’s your favorite project you’ve worked on? Bringing Daily Harvest into retail after years of building the brand in DTC was pretty incredible! There are so many little things that I took for granted as a “given” in my prior CPG roles like UPCs on packages, retail-specific nutrition facts labels, or frozen logistics plumbing. The launch of this beloved brand into retail was such a powerful opportunity to apply all of my previous learning and work with an incredible cross-functional team to deliver on all of the unique grocery distribution requirements.

Which emerging retail trend are you most excited about right now, and why? The “real food” trend happening in retail is giving a lot of hope right now! Customers are demanding quality choices in all price ranges for products with clean ingredient lists consisting largely of items that grow in nature. As I’ve learned more about the food system in the US, my own eating habits have really shifted to materially decrease my highly processed food intake.

Keep reading here.—EC

SWAPPING SKUS

Today’s top retail reads.

Dining in: A deep dive into the restaurant industry résumé of Starbucks’s new CEO Brian Niccol. (the New York Times)

In the bag: Lands’ End has entered the war of the bags against L.L. Bean’s customizable Boat and Tote. (Marketing Brew)

Make your mark: Primark debuted its first US brand campaign entitled “That’s So Primark,” as the Irish retailer continues its push stateside. (WWD)

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