Discover more from The 21 Hats Morning Report
Frustrated with online job portals, some businesses are going back to old school hiring techniques.
Here are today’s highlights:
A judge tells Glassdoor to identify anonymous reviewers.
A new DoorDash service lets diners order their meals through the app while seated in a restaurant.
Even as sales slide, home prices hit a record high.
Small business owners march on Capitol Hill.
Both employers and employees express growing frustration with online job portals: “The walk-in strategy that landed your first job bagging groceries or scooping ice cream just might help secure your next one. Taped-up invitations to ‘apply within’—rendered obsolete by digital HR portals and impractical during the pandemic—are reappearing on office doors and storefronts for white-collar and skilled trade jobs from Reno, Nev., to Cincinnati to Hyannis, Mass. business groups say.”
“‘Are you awesome? Because we’re NOW HIRING,’ read a sign this month on the door of the Classic Arcade Pinball Museum in Chattanooga, Tenn., which was in need of an assistant manager. ‘Apply inside!’”
“Owner Dave Alverson told me the role isn’t complicated and pays a modest wage but requires strong interpersonal skills—and he’d grown frustrated with online application systems that couldn’t vet people’s ability to make conversation and create a welcoming atmosphere.”
“He hung a sign to solicit walk-ins, interviewed several promising candidates, and last week filled the position with someone he thinks will connect with customers.” READ MORE
A judge ordered Glassdoor to disclose the identities of anonymous reviewers: “People read the employer-review site Glassdoor to get the scoop on what it’s really like to work at a given company. But Glassdoor is only as useful as its ability to preserve the anonymity of the current and former employees who share their impressions. A new California court ruling offers a reminder that this anonymity—whether on Glassdoor or other sites—can’t always be guaranteed. Magistrate judge Alex Tse of the US District Court in the Northern District of California has ordered Glassdoor to disclose the identities of people who left anonymous negative reviews about working at the New Zealand toy company Zuru. Zuru subpoenaed that information because the company, co-founded by siblings Mat, Nick, and Anna Mowbray, plans to file defamation lawsuits in New Zealand against the people who left the reviews.”
“One review refers to ‘toxic culture, hostile leadership, erratic strategy & extremely high turnover.’ Another review, which (accurately) predicted that company leadership ‘will try [to] identify me,’ describes that leadership as exploitative and ‘incompetent.’ Yet another calls the company a ‘[b]urn out factory.’”
“Collectively, they make Zuru ‘sound like a horrible place to work,’ judge Tse writes in the court order issued July 11.” READ MORE
FOOD & BEVERAGE
Food delivery companies are having a tough time: “After surging growth during the pandemic, they are now facing their slowest growth in years while confronting high inflation and a potential economic downturn. With their shares tumbling and expansion cooling, DoorDash and Uber Eats have been offering new ads and deals to attract customers, tweaking their apps to trigger more spending and moving beyond food to give people more reasons to return. They are also trying to keep restaurants from ratcheting up delivery prices while offering them new services.”
“Last month, DoorDash launched new features—including letting customers write reviews of restaurants and rate dishes—to try to tempt people to use the app more.”
“DoorDash is diversifying by extending new services to restaurants. In March, it purchased a startup whose order-and-pay software lets customers order food from their mobile phones while seated at restaurants.”
“DoorDash said the service would take the burden off understaffed eateries by helping them better manage staff. In February, it began lending money to restaurants based on their sales on the app.” READ MORE
Home prices hit a record high as sales continued to slide: “Slower activity in the housing market, halting a torrid stretch of sales induced by the pandemic, is another sign of a slowing economy, economists said, adding to risks of a recession. The median sales price of an existing home climbed to $416,000 in June, the National Association of Realtors said Wednesday, up 13.4 percent on the year and the highest since records began in 1999. At the same time, sales of previously owned homes fell for a fifth straight month, dropping 5.4 percent in June to an annualized rate of 5.12 million, NAR said. That was lower than the number of sales recorded in all of 2019, before the Covid-19 pandemic became widespread in the U.S.”
“The housing market has frozen as participants adjust to the increase in mortgage rates, said Mark Zandi, chief economist at Moody’s Analytics.”
“‘Buyers can’t figure out what is the right price,’ he said. ‘Sellers are very reluctant to give up’ on the price they expected to sell for a few months ago, he said.” READ MORE
Small business owners marched on Capitol Hill: “Thousands of small-business owners descended on Capitol Hill this week in a bid for congressional support as they brace for a looming recession that threatens to wipe out numerous mom-and-pop stores. Small business owners, who employ nearly half of all U.S. workers, say they’re being hammered by inflation, hiring difficulties, supply chain snags, child care shortages and limited access to capital. Weathering the storm will get much harder if a recession dents consumer demand for their goods and services.”
“‘I’m concerned about the upcoming recession, and I’m concerned about the lagging results that have been able to happen for the small-business world,’ said Jill Bommarito, owner of Detroit-area gluten-free bakery Ethel’s Baking Co. ‘I think we’ve got a lot more coming at us, and we’re going to need the support.’”
“Supply-chain troubles have forced Bommarito to carry double the usual inventory of raw materials, eating up the bakery’s cash reserves, and she said that she’s already maxed out her lines of credit with banks. Those issues, coupled with rising costs, forced Bommarito to carry out large price hikes.”
“The business owners are pushing lawmakers to reauthorize and modernize the SBA and enact tax credits and other incentives to help small businesses offer benefits, retain workers and access capital.” READ MORE
The tech downturn is slowing early stage funding: “The slowdown in venture-capital funding has spread to early-stage startups, with that part of the market suffering one of the biggest investment drops in more than a decade. In the second quarter, venture capitalists invested around $16 billion in U.S. early-stage deals—known as Series A and B rounds—a 22 percent decrease from the year-earlier period, according to PitchBook Data. That marked the biggest quarterly year-over-year decline in early-stage funding since at least 2010, with the exception of a drop in the second quarter of 2020, when investors pulled back briefly amid the onset of the global pandemic.”
“The change is shifting more power in Silicon Valley back to investors. For years, a deluge of cheap money kept valuations soaring, and venture firms said they spent less time on research and vetting the companies to court founders and not miss out on deals.”
“The pandemic accelerated many of these trends, as demand for software services increased to accommodate businesses moving online and interest rates stood at historic lows.” READ MORE
THE 21 HATS PODCAST
Employees Still Have the Leverage: This week, Jay Goltz, Liz Picarazzi, and William Vanderbloemen discuss how their businesses are holding up and whether they’ve gotten past the labor shortage (short answer: No). The conversation veers into a discussion of how to finance growth and what to do when your bank is unresponsive (find another one!). And then Liz explains her intense distaste for dealing with lawyers, accountants, and insurance agents and how she’s trying to cope with it. “Believe me,” responds Jay, “I haven't paid enough attention to certain things that I should have, and it's cost me. But yeah, we can't every day just do the inspiring, cool, fun, oh-my-God, we-had-a-big-sale, look-at-the-problem-I-solved thing. It’s all part of the package.”
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If you see a story that business owners should know about, hit reply and send me the link. If you got something out of this email, you can click the heart symbol, you can click the comment icon below, and you can share it with a friend. Thanks for reading, everyone. — Loren