August 7, 2017

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It's Coming... October 4!

In the ever changing world of retail, retailers and their partners have a new place to find support, ideas, training, education and innovation to help their businesses not only survive, but thrive.

The Minnesota Retailers Association is pleased to announce Retail Rally--coming to the retail community October 4 in partnership with the University of St. Thomas.

Watch your inbox for more details in the coming weeks!
Local Update   
Minneapolis Committee Re-Passes Single Use Plastic Bag Ordinance; 5 Cent Fee Headed To The Full Council  

Today the Minneapolis Health, Environment and Community Engagement Committee took up and passed to the full City Council a 5 cent fee on consumer bags given out at retail. The potential ordinance was taken up as a result of a new state law that disrupted Minneapolis' original bag ban ordinance as local governments are now prohibited from banning single use plastic bags.

In response to the state action, Minneapolis City Council member Cam Gordon made some changes to his original plastic bag ban and related fee. Now retailers must charge consumers a 5 cent fee for all point of sale bags used by a consumer, with exceptions for low income individuals.

The City Council is expected to take up the ordinance next week, with a strong likelihood of passage.

Federal Update  
Minnesota Retailers Played Big Role In Thwarting Border Tax

From the Star Tribune, Jim Spencer, August 7, 2017

"In a memorable bout of political muscle-flexing, the nation's retail industry "took a $5 trillion tax hike [over 10 years] and defeated it with a few million dollars worth of advocacy expenditures," said David French, vice president of government relations for the National Retail Federation (NRF), which spent $7.3 million lobbying in the first six months of 2017, more than it did in all of 2016.

Some Republicans touted the border adjustment tax as a buy-American initiative and a revenue replacement plan that would allow them to cut the U.S. corporate tax rate from 35 percent to 15 or 20 percent. Because Target imports a "large portion" of its merchandise and because the majority of the electronics Best Buy sells are made abroad, both companies faced potentially ruinous hits to their bottom lines or equally ugly price increases to their customers under the plan.

Time and again, Games by James President Glenn McKee described to elected officials the impact of the border adjustment tax:

McKee does not import, but his game suppliers do. The tax "was either going to put my suppliers out of business or they would pass the 20 percent cost increase on to me," McKee said. "A 20 percent price increase was more than my wholesale profit. So I was either going out of business or passing the cost along to my customers."

Day after day, almost from the beginning of the year, the message was clear: The border adjustment tax would raise consumer prices and kill retail jobs. The secret to beating Congress and the White House was finding the resources necessary for relentless messaging that framed the argument early and often and signaled an unwillingness to compromise. The retail industry never wavered."

How Mobile Is Changing Back To School 

From the Retail Dive, Cara Salpini, July 31, 2017

"Back-to-school shopping isn't just a trip to the local mall anymore. The methods by which parents and their kids find back-to-school deals are changing, making mobile a key component to any successful shopping event.

Aside from mobile's obvious use as a marketing and purchase platform, shoppers' relationship to mobile during back-to-school is shifting, down to the device's inclusion as a must-have item. "Though consumers will continue to make purchases on their mobile device, there becomes a point in time where every child needs (wants) a phone. Thus, purchasing a mobile phone will also become a part of the back to school shopping experience," Rich Kahn, CEO and co-founder of eZanga, told Retail Dive in an email.

And as Gen Z prepares to head to college, back-to-school shopping is trending toward young millennial parents and Gen Z students, making mobile and social media increasingly important.

According to the NRF's annual back-to-school survey, 43% of consumers plan to use their smartphones during back-to-school shopping - a 10% increase from five years ago.

Various studies have predicted even larger amounts of mobile engagement. One, by tech-based ad firm the Rubicon Project found that mobile will be used heavily amongst parents, with 60% of parents planning to use mobile devices for their start-of-year shopping and 30% planning to do at least a quarter of their back-to-school shopping on mobile."

Local Update 
Minneapolis Approves Menthol, Mint & Wintergreen Tobacco Sales Ban      

From MPR News, August 4, 2017

"The Minneapolis City Council has voted to restrict the sale of menthol cigarettes in the city to tobacco shops and off-sale liquor stores.

The city said in a Friday statement that the new regulations on menthol, mint and wintergreen tobacco products will take effect in August 2018. The city says the restrictions will cut the products' availability from 318 outlets to 23 tobacco shops and 24 liquor stores.

The city says the changes are meant to prevent nicotine addiction, tobacco use by youth and the harms of using tobacco. Council Member Cam Gordon says officials believe that making it harder to get menthol tobacco will prevent some people from getting addicted.

The sale of other flavored tobacco products has been restricted to tobacco shops since last year."

The menthol sales ban becomes effective August, 2018. 

Border Adjustment Tax  
How One Retailer's Voice Made A Difference In Washington, DC: Games By James' Glenn McKee & BAT 

Most small retailers don't have a moment to spare. And neither did Glenn McKee when he got the call about going to Washington, DC to talk with Minnesota's elected officials about the proposed border adjustment tax a month and a half ago. 

But McKee, owner of several Games by James and Air Traffic stores, decided to take a few days away from running his business to tell his real life story about how the proposed high import tax would negatively impact his suppliers and ultimately his customers. 

McKee's efforts and those of many other retailers produced important results last week when an influential group of legislators announced that the border adjustment tax had been dropped from the federal budget plan.

Following an initial visit to DC in June, McKee made a second trip a week later, and a third just two weeks ago to deliver the message that the border adjustment tax threatens to damage retailers of all sizes with noticeable impacts on communities across Minnesota.

"If you don't think one or two or three or 10 conversations can make a difference, try telling that to Glenn McKee" said Minnesota Retailers Association president Bruce Nustad. "The pressure to pass the border adjustment tax was tremendous, but voices like Glenn's made a made a huge difference in this conversation. We are so grateful to Glenn and others."

"In the beginning I questioned how my voice as a retailer in Minnesota could impact on this conversation", said McKee in reaction to the announcement. "But it turns out delivering the straight story and helping those that are elected to represent us understand this issue had a deep impact. I feel like I made a difference."    

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