Express Checkout #110

Hello hello!

We recently had the absolute pleasure of interviewing PJ Oleksak, the powerhouse CEO of Nuts.com, and we learned a ton about what it takes to come into a decades-old company and steer it toward a successful future. For any business looking to modernize while respecting your roots…this Checkout Chat is for you.

News From the Week

Well, no sh*t Sherlock. This week, Walgreens’ CEO Tim Wentworth made a statement that “locking up merchandise to prevent shoplifting negatively impacts sales.” It isn't exactly groundbreaking news…but it’s good that major retailers are finally acknowledging what customers have been screaming about for months: locking up everything from Cheetos to Advil is bad for business.

Walgreens, like many other retailers, has been grappling with a significant increase in "shrink"—inventory losses due to theft and other factors. The National Retail Federation's data shows retail shrink as a $100 billion problem—which led to an overcorrection that's now coming back to bite retailers in the butt.

Wentworth didn't mince words when he said, "When you lock things up... you don't sell as many of them. We've kind of proven that pretty conclusively”. It’s cut and dry—and the numbers don’t lie:

• 27% of shoppers will switch retailers or abandon purchases when faced with locked items

• 61% of shoppers noticed an increase in locked-up products over the past year

• 62% typically wait for assistance, while 9% order online from the same retailer

So, how are retailers backtracking? With some haphazard fixes…like:

1. AI-Powered Surveillance: Major retailers like Walmart, Target, Lowe's, Kroger, etc. are investing in AI systems that can detect suspicious behavior in real-time

2. Smart Locks: CVS and Walmart are testing allowing customers to unlock locked display cases using their smartphones

3. Body Cameras: TJX has implemented body cameras for some employees,

4. RFID and Smart Tags: Lowe's implemented "Project Unlock" which uses RFID chips to make stolen power tools inoperable. Home Depot implemented similar point-of-sale activation tech.

Facing the double-edged sword of the threat of shoplifting and reduced sales when items are locked, retailers are being forced to get creative.

CPG & Consumer Goods

• Someone’s in trouble. The FTC sued PepsiCo for apparently engaging in illegal price discrimination by providing a large retail customer with unfair pricing advantages, thereby inflating prices for competing retailers. The lawsuit alleges that Pepsi's practices violate the Robinson-Patman Act.

• A blast from the past. Speaking of PepsiCo, their former soda brand, Slice, is making a comeback after being discontinued in 2010.

  • Now owned by Suja Life, the revitalized Slice is now a pre, pro, and postbiotic (whatever that is) functional drink….because of course it is.

  • The new flavors include Grapefruit Spritz, Lemon Lime, Orange, and Strawberry, with more to come later this year.

• Athletic Brewing better watch its back. Tom Holland’s NA beer, Bero is on an absolute tear! They just launched on Amazon, and as of writing this, they’re #1 in the NA beer category!

• A plant-based comeback story. Aloha, the plant-based protein bar brand, is re-entering Target stores after being dropped seven years ago. Aloha's renewed partnership with Target reflects a strategic focus on better-for-you and wellness-focused products.

  • Some context: Aloha has had a tumultuous journey since its inception in 2013. By 2017, the company had burned through millions in venture capital and was on the brink of failure.

  • The turning point came when Brad Charron joined as CEO in late 2017, becoming what he calls the company's re-founder. He restructured the team from 70 employees to fewer than 10, closed the office, and completely overhauled the product line.

  • Between 2020 and 2023, Aloha achieved nearly 500% growth and has expanded to over 14,000 points of distribution—culminating in a $68 million investment.

  • Now? Aloha’s on track to reach $100M in sales.

• 1 MILLION brownies. Elavi is launching its high-protein, low-sugar brownies in all 82 Costco locations in the Southeast, following two successful product runs.

• Let the sauce flow. Sauz, the viral Gen Z-founded sauce brand, is launching in Whole Foods Markets and Sprouts locations nationwide, introducing two exclusive (and really delicious-sounding) flavors: Miso Garlic Marinara and Brown Butter Alfredo.

  • There are a surprising amount of fast-growing and delicious tomato sauce brands—Monte's Fine Foods, Yo Mama's Foods, Matriark Foods, Hoboken Farms, Ciao Pappy—that have been experiencing significant retail growth and fandom. Rao’s better look out.

• The end of Chubby. Chubby Snacks, a frozen sandwich maker, is shutting down after four years due to financial and legal difficulties—including a lawsuit with the champion of the space, Uncrustables (who’s nearing $1 billion in sales).

  • This is not the first time Smuckers has gone after a small brand making crustless sandwiches: In 2022 they issued a warning against Gallant Tiger for their take on a crustless PB&J.

eCommerce

• Embracing our AI overlords. Ebay, Instacart, DoorDash, and Uber are all participating in the research preview of OpenAI's new AI agent tool, Operator, which performs various online tasks autonomously. AKA, browsing the web for you as a human would.

Retail

• Dollar General hops on the private-label train. The discount behemoth is expanding its private-label offerings, introducing over 100 new products across various categories.

  • And they’re not alone: In 2024, private-label sales reached a record $271 billion, reflecting a 3.9% increase from 2023.

• I gotta make my way to a Buc-ee’s. This is insane. A 74,000 sq.-ft, $47 million Buc-ee’s is set to begin construction soon. The San Marcos, Texas travel center is part of Buc-ee's ambitious expansion plan.

Funding news

• SKKY Partners re-emerges. 111SKIN announced a minority investment from SKKY Partners—the consumer-focused private equity firm co-founded by Jay Sammons and Kim Kardashian. Founded by by world-renowned plastic and reconstructive surgeon Dr. Yannis Alexandrides in 2012, 111SKIN is known for clinically inspired skincare products.

• Buzzing for mocktails:

  • Hiyo secured $20 million in funding. The drink features adaptogens and nootropics.

  • New Orleans musician Trombone Shorty partnered with and invested in the local beverage brand Mockly, a premium canned mocktail company.

• Beauty incubator raises. Gloss Ventures raised $15 million in Series A funding to support its beauty brands, including Sacheu Beauty and Glossmetics.

• And that’s on the power of creators... ShopMy, a creator marketing platform, raised $77.5 million in Series B funding led by Bessemer Venture Partners and Bain Capital Ventures.

  • The investment will help the company expand its team and reach new verticals while enhancing its performance-driven marketing approach, which has generated over $352 million in brand sales.

  • Check out my ShopMy page here: shopmy.us/nate 😉

• Is “beanless” the future of coffee? Atomo Coffee’s $7.8M Series B raise—taking it to nearly $60M in funding to date—seems to suggest it. Watch out for this 50:50 beanless coffee blend.

• Candy brand buys protein brand. Ferrero Group acquired Power Crunch, a leading protein snack company, to enhance its portfolio in the better-for-you snack category.

  • This acquisition follows Ferrero's recent expansions in the U.S. market, opening their first-ever chocolate factory in the US this past May. Other notable acquisitions include Nonni's bakery and Wells (the owner of Blue Bunny Ice Cream).

• The ecomm tech stack expands. Rokt, an eCommerce company focused on real-time relevance, closed a new investment round at $335 million, raising its valuation to $3.5 billion. The investment was backed by firms such as Tiger Global Management and Square Peg.

• Another win for clinical skincare. American Exchange Group acquired Urban Skin Rx, a clinical skincare brand focused on diverse skin tones.

• Bad year to be a rum brand? Diageo offloaded Venezuelan rum brand Cacique to French spirits group La Martiniquaise-Bardinet, marking its second rum disposal in recent months.

Weekly Pickups

You know what boy math is? It’s putting kale sprinkles on your pizza. Edggies Veggies is one of the funnest new brands I’ve come across lately. I love the simplicity and innovative nature of the product. Plus more greens in your diet is good.

See ya next week!

Nate + Jenna :)

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