Stew Leonard Jr., Stew Leonard's President & CEO Talks Consumer Affordability Crunch | Bloomberg...

Added: 2026-05-25

[00:00:02]Bloomberg Audio Studios, podcasts, radio, news. We're thinking about Memorial Day. We're thinking about what goes into a Memorial Day picnic and celebration. This is happening as global food prices climb to their highest level in more than three years as the Iran war disrupted supply chains. You know, we kind of kicked it off talking with Stuart and Mike, uh, Michael McKe, of course, about inflation concerns, and that, uh, includes, uh, food. So, we've got a great voice to get into all of this. Let's head to Stu Leonards in Norwalk, Connecticut to the president and CEO of Stu Leonard. Stu Leonard's Jun Stu Leonard Jr. joins us. Stu, happy summer. Uh, I I just want to start off with um the question, is it is it a happy summer at this point? What are sales telling you? What are customers telling you?

[00:00:45]>> Well, first of all, hi Carol and Tim.

[00:00:47]How you doing? Uh, first of all, the thing that would make me happier if you didn't talk about all the rain and everything that's supposed to happen this morning, you know, that that doesn't help our sales. We want everybody to go out and barbecue and cook cheeseburgers out in their backyard, you know. Um, no, but I would say right now sales are brisk, customers are buying, but they're also complaining. Okay, they're complaining about the prices of food right now. Um, and not only just food, but I think their overall uh uh uh, you know, expenses in their normal lives. Like as an example, the other morning I got a phone call from our farmer, tomato farmer in Florida. He said, "You know, I got some bad news." He said, "You know, we had a big freeze down here. I had to replant my crop. Tomato prices are going to be up and it's going to cost me $2,000 more to send a tractor trailer truck from Florida up to the New York area to your stores." And then I come down here in the store and I'm talking to a customer that just said, "Hey, I just went and filled up my Suburban and that cost me $50 more and my energy cost at home, insurance, everything." So, I'm stuck in the middle a little bit. Um, you know, on one hand, I got to negotiate with this farmer, which I did, and we're going to split the the cost, but I can't raise prices. So, you know, our prices at stews compared to last Memorial Day are probably up about 3%.

[00:02:16]They'd only be up like 1% if it wasn't for me, you know. And and you asked me about some props earlier, but you know, here's one of our great >> Oh, yeah. This is what uh you know, if you could put this on the grill this weekend, you know, for Memorial Day, it's a it's a crowdleaser.

[00:02:36]>> But Stew Yeah, it would be. But that's going to set you back. I mean, you're talking about a very expensive cut of meat there. And you mentioned cheeseburgers earlier. Mike McKe talking to us a little earlier and he said, you know, at some places they're charging you just for walking by the meat department. That's how expensive it's gotten.

[00:02:51]>> Yeah. Uh but you know, one thing people are doing is they're they're switching from their protein. Like, you know, that's obviously the most expensive thing you can buy is a big ribeye steak, but then you can also go down to just getting some uh plain hamburgers. So, we notice people switching a little bit.

[00:03:08]They're going to chicken. That's only in the four to5 a pound range right now.

[00:03:14]Um, they're going to pork. I've even been doing that. Instead of having a steak, get get a nice pork chop.

[00:03:20]>> And And it's like 10 bucks a pound less.

[00:03:22]>> How much How much is that tomahawk that you held up per pound?

[00:03:25]>> Oh gosh. I bet you this will be about $70. Okay. Get this. But hey, if you went to a restaurant and you ever ordered something like this, you'd be paying 150 or at least double or or more for that thing. So, >> how many people can how many people can eat that chop? Like I >> How much would I eat?

[00:03:44]>> I know my husband be like, "That's mine." But I'm just saying two or three people could probably chop into that, right?

[00:03:50]>> Oh, yeah. For sure. You know, it really depends. I mean, who's a big meat eater?

[00:03:55]You know, your husband probably would love to devour. I got a son-in-law who loves meat all the time, and he he could make a big dent in that thing. So, you know, but but you know, it's it you know, right now you're you're seeing people really just trying to save money.

[00:04:12]But you know what the thing with meat right now is? We're at a 50year low in herd price uh sizes in America. We just had some of our ranchers back from the Midwest and they're really just saying there's just less cattle. And why is that? because, you know, it cost them a lot of money to feed them >> because of the droughts and everything that happened in the Midwest and there's not as much, you know, grass out in the fields for for the cattle to eat. They got to import the corn and the soy and alalfa for for the cattle to eat. So, >> Sue, that was that was that was a problem I feel like last year, too.

[00:04:48]Like, we've been talking about the herd >> um situation for a while. Is that as you talk to the ranchers, any of that going to get better or easier or No, >> it's it's getting better now, but it takes two years to really grow a little cal from like 3400 lb when they're born all the way up to maybe 1,600 lb when they're, you know, harvested. So, um uh you know, it takes a takes time, but you're seeing it build right now. It is it is growing. And that's why I'm optimistic about a couple things. One of them is I do think meat prices are going to be coming down in the future. You know, even our ranchers and everything agree with that. And the second thing I really think fuel prices are going to come down once we get things straightened out in the Middle East, which can't be forever. I mean, it's got to be resolved at some point. So, I think we're going to see some softening on these inflation numbers as far as food goes >> in the future. But you know what? Here here's what's really interesting, Carol.

[00:05:50]Um I think you have to break up this inflation into supply and demand and actual cost. Like from our standpoint, like I'll give you an example. You can go buy this watermelon right here. This, by the way, watermelons are great right now. They're really sweet. So here's here's a watermelon. You can go buy that. It's about six bucks or seven bucks at the store. Or you can do this.

[00:06:13]We can have somebody cut these up. the labor for me to have a a a nice lady or guy back there cutting these up.

[00:06:21]>> It It's for us nearly $25 an hour right now without benefits.

[00:06:26]>> And that's never going down.

[00:06:28]>> That's never going down. And so there's a couple things that are not going to go down. Labor is not going to go down.

[00:06:34]That's >> yeah, >> that's inflationary right now. But but I think the supply and demand of food, like for instance, I always laughed when I would read about people saying about egg prices. eggs had nothing to do with inflation, right? Um that had no government policy or anything. That just had to do with the aven flu.

[00:06:53]>> So supply and demand is a is built in.

[00:06:56]And if you look, we just had some fires out in Semi Valley, as I mentioned, the cold snap down in Florida, right?

[00:07:03]>> The droughts out, these affect food price.

[00:07:05]>> Well, we got to run. Always love checking in with you, Stu. Happy Memorial Day. We're going to keep our fingers crossed you don't get rain.

[00:07:13]Um Stu Leonard Jr. of course, president and CEO of Stu Leonard's. Um enjoyed talking with him. We talked with his uh daughter Blake uh who runs their uh spirits and wines business uh a little bit earlier.