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Dollar General, Nielsen strengthen strategic partnership

BY DSN STAFF

Dollar General and Nielsen are looking to take their professional relationship to the next level. The retailer announced that together, both companies will broaden the application of Nielsen’s insights and solutions, to better support Dollar General’s strategic initiatives and in-market activation.

“We highly value our relationship with Nielsen and the work we do together to help Dollar General customers save time and money, every day,” Jason Reiser, chief merchandising officer at Dollar General, said. “Through data-driven decisions, our work with Nielsen has allowed us to stay laser-focused on our business goals, turn information into action and fuel our success in today’s complex retail environment.”

Throughout the past 14 years, the Goodlettsville, Tenn.-based retailer has looked to Nielsen as a trusted partner to support its merchandising and marketing initiatives, which have driven the company’s growth in the marketplace, the company said.

“We are proud of our long-standing partnership and look forward to expanding our relationship to support Dollar General’s continued growth and evolution.” Jeanne Danubio, EVP of retail for lead markets at Nielsen, said.

This expansion of services strengthens Nielsen’s position as the analytics authority for dollar channel retail outlets as it currently covers metrics for 90% of the total U.S. dollar channel market, the company said.

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Trump budget’s ‘Blue Apron-style’ SNAP proposal raises industry eyebrows

BY David Salazar

A small section of the White House’s proposed budget for fiscal year 2019 could have big implications for recipients of the Supplemental Nutrition Assistance Program and food retailers. As part of President Donald Trump’s proposed changes to the Dept. of Agriculture — which include a 16% decrease in its budget from the 2017 enacted level — is a plan to send food benefits directly to beneficiaries’ homes that White House director of the Office of Management and Budget Mick Mulvaney compared to Blue Apron.

The effort, which the USDA has officially dubbed America’s Harvest Box would impact roughly 81% of SNAP households, or 16.4 million households that receive $90 or more per month in SNAP benefits. The USDA projects that the box will make up roughly half a household’s SNAP benefits, with the remainder delivered via Electronic Benefit Transfer card.

The USDA’s fact sheet, published by Agri-Pulse, notes that this effort has the potential to save $129.2 billion between FY2019 and FY2028. In a press briefing on Monday, Mulvaney highlighted the savings to the government from the program.

“It lowers the cost to us because we can buy prices at wholesale, whereas they have to buy it at retail,” Mulvaney said. “It also makes sure that they’re getting nutritious food. So we’re pretty excited about that. That’s a tremendous cost savings.”

CNBC reported that SNAP purchases drive 7.5% of overall supermarket sales, according to Customer Growth Partners. The Food Marketing Institute’s chief public policy officer Jennifer Hatcher on Monday noted that the proposal “makes major changes, but not changes that SNAP-authorized food retailers see as positive or even efficient.”

“FMI and our members have worked with the House and Senate Agriculture Committees and the USDA over several decades to achieve a national system, utilizing existing commercial infrastructure and technology to achieve the greatest efficiency, availability and lowest cost,” Hatcher said. “As we understand the proposal in the President’s budget to create a USDA commodity foods box of staples, each of these achievements would be lost.”

Hatcher also noted that while the savings from “Perhaps this proposal would save money in one account, but based on our decades of experience in the program, it would increase costs in other areas that would negate any savings.”

Indeed, one of the most potentially costly questions — that of fulfillment — is an open question for the program. “States will be given substantial flexibility to distribute these food benefits to participants. States can distribute these boxes through existing infrastructure, partnerships, and/or directly to residences through commercial and/or retail delivery services,” the USDA fact sheet said.

Hatcher said, “As the private partners with the government ensuring efficient redemption of SNAP benefits, retailers are looking to the administration to reduce red tape and regulations, not increase them with proposals such as this one.”

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Walgreens, AmerisourceBergen in acquisition talks: reports

BY DSN STAFF

Updated Feb. 13, 1:03 p.m.

Walgreens Boots Alliance reportedly is interested in a potential acquisition of AmerisourceBergen. Representatives of WBA CEO Stefano Pessina reached out recently to AmerisourceBergen CEO Steve Collis’ representative about acquiring the roughly three-quarters of the distributor that WBA doesn’t already own, according to the Wall Street Journal, which cited people familiar with the matter.

According to the WSJ report, the companies are in early talks to combine, though sources reportedly stressed the uncertainty as to whether there would be a deal. As a result of the report, AmerisourceBergen shares increased roughly 12% after market close. In response to Drug Store News inquiries, Walgreens declined to comment on the news, and AmerisourceBergen said the company’s corporate policy is not to discuss rumors or speculation about possible mergers or acquisitions.

News of the potential combination of the companies — which recently added three years to their 10-year distribution partnership through which Walgreens Boots Alliance gained a roughly 25% stake in Valley Forge, Pa.-based AmerisourceBergen — comes as CVS Health is in the midst of its $69 billion acquisition of health insurer Aetna. Both moves come as Amazon continues to make overtures in the healthcare space — forming an insurance company with Berkshire Hathaway and JPMorgan Chase for the three companies’ employees and steadily acquiring pharmacy wholesale licenses in various states.

Walgreens’ market cap was $67.8 billion and AmerisourceBergen’s was $19.6 billion as of Feb. 12, according to Nasdaq.

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