Let’s Shoot for Labor Day

Today’s highlights: Companies are pushing back return-to-office dates. Golfers are teeing up in record numbers. And ghost kitchens are lowering startup costs and improving data analysis.

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THE COVID ECONOMY

Those return-to-the-office dates are getting pushed back again: “From Silicon Valley to Tennessee to Pennsylvania, high hopes that a rapid vaccine rollout in early 2021 would send millions of workers back into offices by spring have been scuttled. Many companies are pushing workplace return dates to September—and beyond—or refusing to commit to specific dates, telling employees it will be a wait-and-see remote-work year. The delays span industries. Qurate Retail,the parent company of brands such as Ballard Designs, QVC and HSN, recently shifted its planned May return to offices in the Philadelphia area, Atlanta and other cities until September at the earliest.”

  • “TechnologyAdvice, a marketing firm in Nashville, initially told employees to plan on Feb. 1 as their return date. The company then pushed the date back to August.”

  • “Now, TA has decided it will begin a hybrid in-office schedule in the fall of 2021, letting workers choose whether to work remotely or come in, the company says.”

  • “Nearly a year of makeshift work at home has weighed on employees, leaders say. While many companies say productivity is up, executives worry that creativity is suffering and say that burnout is on the rise.” READ MORE

BUSINESS MODELS

By lowering startup costs and improving data analysis, ghost kitchens are becoming the future of restaurants: “The basic logic of ghost restaurant brands is that they take much of the risk out of a generally very risky undertaking. According to a handful of industry estimates, the median cost of opening a restaurant runs anywhere from roughly $450 to $525 per square foot. But by focusing on simple specialty concepts like burgers or omelettes, avoiding highly coveted real estate, and sharing kitchen space, equipment, resources, and square footage, the barrier to entry in a notoriously difficult industry drops considerably. Some of the bigger ghost kitchen outfits like Kitchen United and food service vendors like U.S. Foods claim that a new digital kitchen can be opened in an urban center for $50,000, roughly 5 percent of the average cost of a regular restaurant.”

  • “Alp Franko is the CEO and founder of the Local Culinary, a Miami-based company led by restaurant veterans that franchises more than 50 ready-made digital restaurants with menus, recipes, branding, and hardware included.

  • “For a would-be entrepreneur, a business decision can be made on the basis of demographic data rather than a passion for, say, sushi burritos.

  • “‘We do an analysis on your zip code, and from your location we can see whether you might have more pizza, more vegan, or more Chinese food customers,’ Franko said. ‘And depending on the location, we adapt.’” READ MORE

Are rooftop farms the future of the food supply chain? “The world’s biggest commercial rooftop greenhouse sits atop a former Sears warehouse in a semi-industrial northwestern quarter of Montreal. Early every morning, staff pick fresh vegetables, then bring them downstairs, where they get packed into heavy-duty plastic totes along with the rest of the day’s grocery orders. Tablets loaded with custom pick-and-pack software tell them where to put what: This basket has lettuce, tomatoes, and cucumbers, plus some chicken, eggs, and milk. The next one has eggplant, cashew Parmesan, tomato sauce, fresh pasta, and vegan ground round crumble. Whatever Lufa doesn’t grow in its four greenhouses comes from local farms and producers, mostly from within 100 miles.”

  • “It’s stunning to think Lufa was founded by two people who’d never even grown a tomato before, let alone sold one.”

  • “‘We said, Instead of learning how the food world works, let’s just come up with what we feel the food world should be,’ says Mohamed Hage, 39, who cofounded Lufa with Lauren Rathmell in 2009.”

  • “To them, it looked like this: rooftop greenhouses that bring agriculture into cities. No pesticides, herbicides, or fungicides. Composting their green waste. Selling direct-to-consumer the same day the food is harvested.” READ MORE

PROFILE

For Molly Moon Neitzel and her Seattle ice cream chain, the pandemic has been a rollercoaster: “In November, the pandemic worsened and stricter shutdown orders were imposed. Sales at Neitzel’s shops dropped again, and her new wholesale business didn’t meet her expectations. Her desperation mounted. December felt like a repeat of the worst months of the spring all over again. Weighing on her was a $750,000 hole in her 2021 budget. ‘I couldn’t sleep again,’ Neitzel says. ‘I was starting to lose my hair again. I was really, really, really, really worried.’”

  • “The relief bill, enacted at the end of December, transformed Neitzel’s outlook (and her sleep) because it reopened the Paycheck Protection Program and expanded employee retention tax credits, among other provisions.”

  • “As soon as the program opened, she applied for a $1.1 million PPP loan through her community lender, Washington Trust Bank, which made Neitzel’s first PPP loan last year.”

  • “She awaits the SBA’s approval of the new funding and estimates the tax credit could be worth a couple of hundred thousand dollars, in addition to PPP.” READ MORE

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HUMAN RESOURCES

Offering big bonuses, pharmacies have gone on a desperate hiring spree: “Phones are ringing with plentiful job opportunities. Prospective employers are dangling five-figure signing bonuses. Businesses are hounding universities for potential recruits. The job market is booming — at least if you’re a pharmacist. The vaccination drive in the United States is entering a new phase this week, with the start of a federal program that will send more doses of Covid-19 vaccines into drugstores and grocery store pharmacies. In preparation, pharmacy chains are in the middle of a hiring spree, competing to quickly recruit pharmacists and support staff to inoculate customers.” READ MORE

OPPORTUNITIES

Golfers are teeing up in record numbers: “This time of year, many golfers swap rounds on the course for rounds on the couch, unless they’re heading to Florida or Arizona. But 2021 looks different: Thanks to milder temperatures in January and Americans’ persistent desire to get outside amid the continuing pandemic, golf courses around the country have been experiencing an unexpected boon. They’re also adapting to this hardier breed of duffers, offering a warmer-than-usual welcome via heated golf carts, shorter courses and expanded whiskey menus.”

  • “Silvies Valley Ranch, a golf and spa resort in [Oregon] opted to stay open through winter for only the second time and is offering a ‘cool golf’ option ($45 per person).”

  • “Guests use high-loft clubs, whose higher launch angle makes them easier to hit, and neon-green tennis balls, more readily spotted in the snow, so players can move briskly around a five-hole course.”

  • “Winter bookings at the Ranch are up more than 200 percent from last year.” READ MORE

BUSINESS TRAVEL

Delta’s bet on blocking the middle seat is not paying off (so far): “Delta announced on Monday that it was extending its middle-seat block for one more month, to the end of April. Delta, the last U.S. airline to block all middle seats in coach, will consider further extensions based on Covid-19 transmission and vaccination rates. So far, Delta thinks it’s earning goodwill and confidence with customers, particularly business travelers, who aren’t traveling now but will come back. Some who’ve flown during the pandemic have been willing to pay Delta more for more space onboard. Most have been price-sensitive leisure travelers willing to sit shoulder-to-shoulder for cheap fares—on airlines not blocking middle seats.”

  • “The bottom line for Delta during the pandemic has been bigger losses than rival airlines selling all their seats.”

  • “‘This is really about playing the long game and making sure that we are positioning this brand for greater success coming out of the pandemic,’ says Bill Lentsch, Delta’s chief customer experience officer.” READ MORE

SOCIAL MEDIA

Facebook, which has a history of cloning competitors or buying startups like Instagram, is reportedly working on a Clubhouse knockoff: “Clubhouse, a social networking app, has gained buzz for letting people gather in audio chat rooms to talk about various topics. Mark Zuckerberg, Facebook’s chief executive, has been interested in audio communication forms, said the people with knowledge of the matter, and he appeared in the Clubhouse app on Sunday to chat about augmented and virtual reality. Facebook executives have ordered employees to create a similar product, said the people, who were not authorized to speak publicly.”

  • “Instagram in 2016 copied one of the marquee features of rival Snapchat, Stories, which allow users to share ephemeral videos and photos.”

  • “Last year, Instagram debuted Reels, a TikTok-like video product. When the teleconferencing service Zoom became popular last year, Facebook quickly created Rooms, a group video chat service.”

  • “And this year, Facebook has been working on a competing product to Substack, the popular newsletter service.” READ MORE

FASHION

Some women are moving from fast fashion to forever fashion (and paying more for it): “The Covid era has significantly altered the way some women shop—rendering trendy fashion out and timeless clothing in. In its Spring 2021 press presentation last November, retail site Net-a-Porter reported that, based on its sales data, customers were drifting away from faddish seasonal pieces and toward luxury classics, like eternally chic Saint Laurent blazers and sleek-but-relaxed pants from the Row. Key factors: All the time we’re spending at home (there’s no point trying to impress a cat with zeitgeisty trendiness) and a heightened awareness of how ‘in one season, out the next’ clothing creates waste.” READ MORE

THE 21 HATS PODCAST

Episode 48: I Want Clean Hands: This week, Paul Downs, Jay Goltz, and Dana White give quick PPP updates—and then dive into a discussion of what a $15-an-hour federal minimum wage would mean for smaller businesses. Will it put businesses out of business? “I'm listening to you, Jay,” Dana tells us, “and I'm thinking about the coffee shop owners I know who have to close.” To which Jay responds, “They say they have to close, but did they try raising their prices 5 percent first?” We also tackle a listener-submitted question about the best way to avoid unemployment claims, which can require forceful management. “There's no way around it,” Paul tells us. “You gotta be hard at some moments, as a boss. You just have to be.”

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