Tuesday, September 30, 2008

Watch John McCain Try To Escape His Shadow


Thursday, September 25, 2008

U.S. Ambassador Wood's Reception For SACC-USA

Ambassador Michael Wood gives a welcome toast.

Ambassador Michael Wood and Viveka Wahlstedt,
chairman of SACC-USA.

Gunilla Girardo, president, SACC-USA and
Nils-Eric Svensson, a promoter of Region Skåne in
southern Sweden.

Viveka Wahlstedt presents my book "Swedish-
American Currents" as a farewell gift to the ambassador.

The ambassadoren, who has worked as
a publisher, browses my book about Currents.

The U.S. Ambassador with my book about Currents.

The Swedish-American Chambers of Commerce (SACC-USA) held its annual Entrepreneurial Days conference in Sweden on September 15 and 16 at Hotel Clarion Sign in Stockholm. The night before, the U.S. Ambassador Michael Wood held a VIP-reception at his residens. 

SACC-USA managed to convene a successful conference and matchmaking event with many interesting discussion panels, despite the implosion of the financial markets and turmoil on Wall Street. It was maybe not exactly business as usual, but how often is business actually as usual? At the Edays conference the spirits were high, and the focus on how to create more business opportunities in the U.S. and in Sweden.

Michael Wood's Sunday night reception was in a way a farewell party for the ambassador as he will have been replaced by a new ambassador the next time SACC-USA gathers in Sweden. Michael Wood is a man of great charm and intelligence and he has managed to become one of the most popular U.S. Ambassadors to Sweden ever despite the fact that he represents one of the most impopular U.S. presidents ever, who also happens to be an old friend of the ambassador.
The explanation for this feat is that he is a genuin and totally unpretentious guy, who has focused his effort on connecting Sweden and the U.S. in a field that fits our time perfect: alternative energy. In his speach at Edays, he said that president George W. Bush had given him that task.

In his toast he lauded SACC-USA and SACC-USA's chairman Viveka Wahlstedt lauded the ambassador in her thank you toast. Then she presented the ambassador with my just released book "Swedish-American Currents" to have as a memory of Sweden and SACC-USA when he returns to his homeland.  

Hans Sandberg

Friday, September 12, 2008

How the Supermarket Won Italy’s Hearts and Minds

A floating vegetable store in Venice.     Photo: Hans Sandberg

Trying to find a supermarket in Rome? Good luck, and while you’re searching, stop in at one of the ancient city’s many botteghas, macellerias or salumerias to pick up something to eat and drink. Old ways live on in Italy, especially in the south, which is one reason that it took so long for the supermarket to catch on.

When the first Italian supermarket opened in Milan in 1957, it came at the prodding of Nelson Rockefeller, the American capitalist philanthropist who in 1959 became mayor of New York City and in 1976 vice president to Gerald Ford. He had sponsored similar projects in Latin America that he now introduced to Milan, a stronghold for the Italian Communist Party. The idea was that “it’s hard to be a Communist with a full belly.”

“Italy had lived through two world wars, fascism, poverty, and lacked even the most important goods,” explains Emanuela Scarpellini, associate professor at the University of Milan, and an expert on the history of the Italian Supermarket. What it didn’t lack was stores, mostly small family-run stores. In 1951, there were 951,382 stores and small businesses catering to the public in Italy. 801,837 of them had only one or two employees, 198 had more than 100, while only one had more than 500. (All according to Emanuela Scarpellini’s study “Shopping American-Style: The Arrival of the Supermarket in Postwar Italy”, published in Enterprise & Society, Vol. 5 No. 4, 2004.) And with so many small shopkeepers there was a strong political base for resistance to modernization.

Emanuela Scarpellini, professor at University of
Milan.    Photo courtesy of Emanuela Scarpellini.

The old family-owned store had its charm, and usually excellent food from local producers, but the food was costly and the supply limited. Italy’s grocery sector was “a backward sector, even compared to other European countries”, says Emanuela Scarpellini. “The same was true for the department stores. We only have two national chains in the 1950’s, La Rinascente and Standa.”

A cheese vendor in Rome.                     Photo: Hans Sandberg

Besides, the country’s infrastructure was badly damaged, making it hard to build the necessary logistic and distribution networks. “The depression, the wars and the damages delayed the creation of a national market,” she says.

The American supermarket was not the only alternative to the traditional grocer. Italy already had a very large cooperative movement, which had built buyers coops and agricultural coops. Some of the largest supermarket chains in the country emerged from the cooperative movement, and are today quite common, especially in the north. The Coop group, which consists of nine regional companies, is Italy’s largest supermarket chain, with total sales of 13 billion dollars (Riccardo Lotti, Peter Mensing, and Davide Valenti in “A Cooperative Solution”, published in Strategy + Business July 17, 2006)

But the little guy didn’t go away. “The local mom-' n'-pop stores continue to play an essential role,” wrote Dana Biasetti, an expert at the U.S. Embassy in Rome in an overview published in AgExporter in October 2002.

“Italians were accustomed to small shops, and friendly relations with the shopkeeper,” says Emanuela Scarpellini. “It was part of the social tissue of everyday life. You knew the shopkeeper and he knew you. But by the end of the 1950’s, we had this idea of modernity coming from the United States. America was coming to Italy, and the supermarket was part of that. Much of this was of course an imagined America, brought on by Hollywood movies, media icons and things like that.” America was at the time seen by many as a liberator, a beacon of political freedom, modernity and material wealth.

“With the supermarket, America not only brought in a new type of technical organization, but a symbol for the end of poverty,” says Emanuela Scarpellini.

“The supermarkets had a more efficient organization, self-service, good logistics and a different relation with the producers. They could buy big quantities, and sell at a low price. It was a revolution,” she says.

“We had new and foreign brands coming in, like Coca Cola. Self-service was also very important, because for the first time, customers could touch the goods without the mediation of the shopkeeper. This changed your relation to the goods,” she says.

When growth took off in post-war Italy, people’s income went up giving them money to spend. And the supermarkets and department stores could reach them in new ways through television and TV-advertising. Small stores couldn’t afford that, and were not able to respond to the demand for new categories such as frozen food. “They simply did not have freezers and refrigerators,” she says.

A small supermarket in Montesarchio in southern Italy.
                                                           Photo: Hans Sandberg

Once the supermarkets had established their viability, they were sold to Italian investors, who built new stores and chains. Still, it took a long time for them to become popular. In the 1970’s, supermarkets had less than five percent of food retail sales, according to Emanuela Scarpellini.

“You would find supermarkets mostly in the big cities in the north, in Milan and Turin, and then in Rome and Venice. We must also take into account the fierce opposition by the small shopkeepers and their politicians, who fought this development.”

“Italy was a very decentralized culture, where the butcher and the baker was part of the local infrastructure. And local licensing laws tried to preserve this structure.”

“Political parties such as the Christian Democrats were very weary and worried about the new supermarkets, and feared that their voters would be hurt. They saw it as a question of defending the social fabric, and not only about economics. It was a social and political issue. So we heard a lot about monopolistic capitalism in the 1960’s and 1970’s.”

The relatively underdeveloped domestic Italian retail sector made it easier for French and German food retail giants such as Carrefours and Lidl to set up large new shopping centers and hypermarkets. “After the 1970’s, with the liberalization and globalization, we saw more of the international companies in Italy,” she says, adding “they became important players in 1980’s and 1990’s, especially in the north.”

A new Carrefour "hypermarket" north of Neaples.
                                                                Photo: Hans Sandberg

The international chains increased the pressure on Italy’s food manufacturers as they drove up the imports, as well as forced change and more emphasis on logistics, efficient production and production for export.

“The industry saw that this was the future, that they had to change, and compete on quality, and even price. This was an important adaptation for the Italian food industry.”

One could think that small shops would benefit from the new logistics systems or using the Internet, but the big chains have their own organizations, according to Emanuela Scarpellini. There are local or regional chains for small independent stores, but their way of competing is to “find a particular producer that can give them a special product. They try to differentiate, so that they can offer something unique,” says Emanuela Scarpellini.

“We now have the slow food movement, and many Italian producers have focused on high quality food. The food industry is becoming more important, like the fashion industry. They also contribute to selling the image of Italy.“

The modern supermarket was a response to social change, and caused its own changes.

“It brought men into the supermarket,“ says Emanuela Scarpellini. “Shopping was previously only made by women, but now men entered and took part in this activity.”

One reason for this was that women usually did not drive, and the car was essential as many supermarkets were located outside the city. The supermarkets also had an impact on women’s role in society, both as it provided new jobs for women and helped workingwomen, who could not spend as much time as before on daily shopping.

Today both the supermarket and the mom & pop store co-exist in Italy.

“Today, the supermarkets have more than 50 or 60 percent of sales. They are dominating the market, but the numbers are still lower than for other European countries. There is still an important place for small shops in Italy.”

Half a century has passed since has passed since Italy got its first supermarket. At that time, it filled a need that was deep and sometimes desperate, but still faced resistance on many levels. It won the hearts and minds of the Italians by providing a wide variety of goods at relatively low prices. Back in the 1950’s, one customer was so happy about it that she told Roland Hood, one of the supermarket pioneers, “I have written to my sister in New York and told her to vote for Mr. Rockefeller if he ever runs for Governor again.” Another said “I’m sure God has sent you Americans to do this wonderful thing for us in Italy.” Yet another was overheard saying, “just remember this next time you vote, they don’t have any of these in Russia.” (Emanuela Scarpellini, 2004, p 662)

Whether it saved the country from another revolution is, as most things are in Italy, open for debate.

Hans Sandberg

Monday, September 8, 2008

Republican Dishonesty And A Couple of Cool Clips

The Democratic Convention was great and brimming with hope, while the Republican Convention - once Gustav's (or God's for those of you who are believers...) rage subsided enough to let it start - was a display of deep dishonesty.

There was a moment when I felt that John McCain was playing the foreign policy card so that he could get some elbow room versus the religious right, but now we know that that wasn't the case. McCain does what he does for his own sake. He uses people to get where he wants to get. He doesn't hesitate to lie and cheat, but still claims that we have to believe him because he got shot down over Vietnam. But character is not something that is cut in stone, and especially not an opportunistic character such as McCain's. Republicans often try to make people believe that character is what sets them apart compared to the wishy-washy flip-flopping liberals. But it is a charade intending to hide the fact that the Republican message of "small government" and "tax cuts" would hurt most people. If they focused on the message they wouldn't have a chance, so they focus on the "war hero" instead, and the nobody from nowhere with perfect fundamentalist credentials. 

For an uplifting take on Republican hypocrisy, watch this wonderful piece on the Daily Show!

Thursday, September 4, 2008

Swedish-American Business Book

I just published a book about the Swedish-American business world on the Print-On-Demand website Lulu.com.  

Click here to see the book on Lulu.com!

Hans Sandberg