ReportWire

Tag: Food Retailing

  • Instacart reportedly puts off its long-anticipated IPO

    Instacart reportedly puts off its long-anticipated IPO

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    Grocery-delivery company Instacart Inc. is delaying its long-awaited initial public offering because of poor market conditions, according to news reports Thursday.

    The New York Times first reported Thursday that the San Francisco-based company has halted its IPO plans, and is awaiting more favorable conditions. Later Thursday night, the Wall Street Journal confirmed the report, citing a memo from Instagram CEO Fidji Simo saying an IPO will be “highly unlikely” this year.

    The IPO market has been severely curtailed this year following a record-setting 2021, as the stock market has slid amid high inflation and recession fears. As of September, the number of U.S. IPOs was down 79% year over year, with total proceeds down 95%, according to Renaissance data.

    According to the Times, Instacart had intended to start the IPO process this week by releasing some financial information, but decided not to, for now, due to market volatility.

    The Journal reported that the IPO had received positive feedback from potential investors, but executives came away with the message that the market will not support a tech IPO at this time.

    “Our business has never been stronger,” Instacart said in a statement Thursday. “In Q3, our revenue grew more than 40% year-over-year, and our net income and adjusted EBITDA more than doubled from Q2. We remain focused on building for the long term, and we are excited about the opportunity ahead.” 

    Instacart confidentially filed for its IPO in May. The company has been one of the more anticipated potential IPOs for years. In July, Instacart cut its estimated valuation for the second time in four months, to $15 billion, nearly 40% less than its previous valuation of $24 billion.

    Last month, the Wall Street Journal reported Instacart didn’t plan on raising much capital in its IPO, instead having most of its listing come from the sale of employees’ shares — a move that could greatly benefit current employees.

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  • Consumers pay 14.1% more on average for pumpkin-spice products

    Consumers pay 14.1% more on average for pumpkin-spice products

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    We may be paying a price for our pumpkin-spice cravings.

    A new study from the MagnifyMoney.com website has found that retailers routinely charge more for pumpkin-spice items than for the standard versions of those same products — in fact, a lot more. On average, the pumpkin-spice “tax,” as MagnifyMoney.com dubs it, is 14.1%.

    That’s a significant increase from 2020, which was the last time MagnifyMoney looked at the pumpkin-spice pricing differential. At that time, the “tax” was 8.8%.

    “I think companies are finding it’s a great way to capitalize on a seasonal trend,” said Ismat Mangla, executive editor of MagnifyMoney.com. “As long as consumers are willing to pay for it, they can take advantage of it.” MagnifyMoney.com, which is owned by LendingTree, offers information on how to manage and grow your money.

    Craig Agranoff, a Florida-based marketing expert, put it this way: “It’s Retailing 101.”

    Some retailers really push the pumpkin-spice upcharge to the upper limits, the 2022 study noted. A case in point: Trader Joe’s, the supermarket chain beloved for its low prices, charges 161.1% more for its Pumpkin Spiced Teeny Tiny Pretzels than for its Honey Wheat Pretzel Sticks. The retailer also charges 49.9% more for its Pumpkin Spice Hummus than for its Mediterranean Style Hummus.

    And what about Starbucks
    SBUX,
    -1.60%    ,
    the coffee chain that made pumpkin spice a household favorite? The study found that it levies an 18.3% “tax” on its ever-popular Pumpkin Spice Latte (or PSL), with a standard 16-ounce latte running $5.45 and the PSL costing $6.45.

    Trader Joe’s and Starbucks didn’t respond to a MarketWatch request for comment.

    Agranoff said consumers are probably willing to pay more for pumpkin-spice products without complaining because the products are not considered essentials. By contrast, consumers tend to be very sensitive when it comes to price increases on items they need to buy on a regular basis, such as milk or gasoline.

    Still, not every retailer is asking consumers to shell out more for pumpkin-spice products. Target
    TGT,
    -1.28%
    charged less for several items versus the standard ones, the MagnifyMoney.com study found. One example: A bag of Pepperidge Farm Milano pumpkin-spice cookies was 14.3% cheaper than the traditional Milano cookies at Target.

    Regardless of whether the price is higher or lower, Mangla of MagnifyMoney.com isn’t one to buy these products. “Personally, I’m over pumpkin spice,” she said.

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  • Kroger and Albertsons Say Their Merger Will Cut Prices. Their Shares Are Tumbling.

    Kroger and Albertsons Say Their Merger Will Cut Prices. Their Shares Are Tumbling.

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    With inflation still an untamed threat, Friday’s announced merger of the grocers


    Kroger


    and


    Albertsons


    will spur debate about whether the consolidation will raise food prices, or lower them.

    The Biden administration’s antitrust regulators are scrutinizing mergers more closely than did predecessors, and an old argument against combinations is that they lead to price-gouging.

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