Pecans and Kitsch

The teal blue roofs of Stuckey’s road stops once rivaled the Golden Arches. Times changed, but Stephanie Stuckey, granddaughter of the founder, is trying to breathe new life into the legacy brand.

THE 21 HATS CONVERSATION

Meet Stephanie Stuckey: Join us Tuesday at 3 ET, and Stephanie, who has spent most of her career as a litigator and a legislator, will tell us about the business her grandfather founded during the Depression, how it grew to 370 stores nationwide, why the family sold it, why it fell into decline, and why she bought it back.

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OPPORTUNITIES

A cottage industry of small companies looks to revive abandoned brands -- even controversial ones like Aunt Jemima, Uncle Ben’s, and Eskimo Pie: “‘Trademark abandonment is a new kind of industry. It’s a new kind of gold rush,’ says Jeff Kaplan, whose company Retrobrands filed applications for all three marks. His operation acquires trademarks for brands that companies have let lapse—Chipwich and Victrola are part of his portfolio—and either licenses the names or manufactures the revamped products himself. But giving a second life to brands rooted in racist stereotypes—ones that big companies have deemed too problematic to maintain—is a vastly different proposition from reviving those that capitalize on innocent nostalgia.”

  • “Kaplan feels that brands like Aunt Jemima have been sufficiently updated and still have big markets, which include Black customers who he says agree that the brands are no longer derogatory.”

  • “The business of reviving abandoned brands relies on trademark law’s use-it-or-lose-it structure.”

  • “An owner of a trademark must actively use the name in order to maintain it.” READ MORE

A Michigan entrepreneur, Terence Jackson Jr., has built a mobile bowling alley in a trailer: “The trailer includes two 25-foot lanes, an automatic ball return, automatic pin-resetters and even digital scorekeepers. It is, however, not 100-percent regulation bowling. To better accommodate the space, the balls here weigh about 3 to 4 pounds (as opposed to up to 16 pounds for typical bowling), are about the size of a grapefruit and don't have any holes.”

  • “He designed and outfitted the trailer himself at the beginning of the pandemic in March. He says it cost him about $300,000.”

  • “Rentals start at $500 for two hours and cap off at five hours for $1,000 for 10 to 15 people.”

  • “Jackson says typically the bowling alley is booked 20 to 30 times a week, and he brings in at least $10,000 in sales.” READ MORE

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GOVERNMENT SUPPORT

Congress is considering another round of PPP loans: “A bipartisan proposal for a broader, $908 billion coronavirus-aid bill includes $300 billion for the Small Business Administration and a restart of the PPP, which closed in August. The plan would limit loans to businesses that have 300 or fewer employees and can demonstrate that they sustained a 30-percent revenue loss in any quarter of 2020. Such requirements would mark a departure from the program’s first iteration, which was launched in April and provided $525 billion in forgivable loans for firms to cover payroll and some overhead costs.” READ MORE

FINANCE

This has been a surprisingly good year for small banks: “When the coronavirus closed businesses in Baltimore and its suburbs in the spring, Kevin Benson feared the worst for the small lender he runs—widespread defaults, anemic loan growth. Instead, Rosedale Federal Savings and Loan surpassed $1 billion in assets in May, years ahead of schedule, aided by a government-backed lending boom. The vast majority of its borrowers—consumers and businesses—are in good standing. ‘We’re all pretty surprised by the resiliency,’ said Mr. Benson, chief executive at Rosedale Federal. ‘It’s not time for a victory lap yet, but we’re cautiously optimistic.’”

  • “Stimulus and unemployment checks boosted deposits and kept borrowers from falling behind on their loans.”

  • “The Paycheck Protection Program—the government’s small-business bailout—brought them new customers and kept old ones afloat.” READ MORE

MANUFACTURING

Steelmakers are straining to keep up with resurgent orders from manufacturers:  “Steelmakers idled about one-third of domestic production capacity for flat-rolled steel this spring when their customers canceled orders and closed plants to slow the spread of the new coronavirus. Since many factories reopened a month or two later, steel demand for cars, appliances and machinery has rebounded, thanks in part to rising purchases from homebound consumers. The benchmark price for hot-rolled sheet steel has doubled since early August to a two-year high of $900 a ton, according to S&P Global Platts.”

  • “Steel distributors said soaring prices and the reduced availability of steel have touched off panic-buying by some manufacturers.” READ MORE

THE COVID ECONOMY

A Covid pass app could help businesses reopen: “In the coming weeks, major airlines including United, JetBlue and Lufthansa plan to introduce a health passport app, called CommonPass, that aims to verify passengers’ virus test results — and soon, vaccinations. The app will then issue confirmation codes enabling passengers to board certain international flights. It is just the start of a push for digital Covid-19 credentials that could soon be embraced by employers, schools, summer camps and entertainment venues.”

  • “The advent of electronic vaccination credentials could have a profound effect on efforts to control the coronavirus and restore the economy.”

  • “Clear, a security company that uses biometric technology to confirm people’s identities at airports and elsewhere, is already operating a Covid app.” READ MORE

The return of college students this fall seems to have had a deadly impact on college towns: “In late August and early September, as college students returned to campus and some institutions put into place rigorous testing programs, the number of reported infections surged. Yet because serious illness and death are rare among young coronavirus patients, it was unclear at the time whether the growth of infections on campus would translate into a major health crisis. But since the end of August, deaths from the coronavirus have doubled in counties with a large college population, compared with a 58 percent increase in the rest of the nation. Few of the victims were college students, but rather older people and others living and working in the community.”

  • “Before students from the University of North Dakota returned for a mix of in-person and online classes in August, the county was averaging about six new cases a day per 100,000 people, officials said.”

  • “After students returned, new cases rose to an average of 94 cases per 100,000 people, and in November, they grew still more: 253 new cases a day per 100,000.” READ MORE

A wave of evictions is expected to hit in January: “That month is when the Centers for Disease Control and Prevention’s ban on evictions is set to expire. The moratorium protects tenants who have missed monthly rent payments from being thrown out of their homes if they declare financial hardship. The CDC ordered the halt on evictions under the Public Health Service Act, which allows the federal government to enact regulations that help stop the spread of infectious diseases. Between 2.4 million and 5 million American households are at risk of eviction in January alone, and millions more will be vulnerable in the months after, according to estimates from the investment bank and financial-advisory firm Stout Risius Ross.”

  • “Housing-industry executives said they expect the CDC eviction ban to be extended.”

  • “Many landlords said they believe they are more likely to recover some rent by working with tenants than by evicting them.” READ MORE

IN CASE YOU MISSED IT

How much do you tell your spouse? On Saturday, I posed a question that I know every entrepreneur has thought about but that I’ve rarely, if ever, seen discussed: How much or how little do entrepreneurs tell their spouses about the stress of running a business? We received many thoughtful comments, including this one: “As long as I'm clear with her on where we are, she knows what she needs to do. However, if I tell her about the uncertainties that we face when running a business, the pending litigations, the late receivables, the contracts that didn't come through, etc., she would lose her mind with worry. To sum it up, no, I do not discuss business issues with her. It works better that way for us.” 

  • It’s not too late if you’d like to read what others have written or LEAVE A COMMENT

TAXES

The world’s two richest men are getting Opportunity Zone tax breaks: “Jeff Bezos and Elon Musk had competed for nearly a decade to develop engines and rockets through their privately owned space companies when the perk came their way in 2018. Their companies' sites were included among the thousands of tracts across the U.S. designated as Qualified Opportunity Zones, part of President Donald Trump’s plan to use tax breaks to attract investments and jobs to distressed neighborhoods. At the time, Musk’s Space Exploration Technologies Corp. was building a launch operation along the Texas-Mexico border. Bezos’s Blue Origin had struck a deal to build a $200 million rocket engine plant in an Alabama research park. The companies had already committed to job creation and secured local tax breaks.” READ MORE

THE 21 HATS PODCAST

Episode 42: The Great Covid Churn: Paul Downs, William Vanderbloemen, and Laura Zander talk about William’s prediction that 2021 will be a year of employee turnover. His theory, which he says he’s already seeing in practice, is that pent-up forces that were blocked by the pandemic this year will be unleashed in 2021—especially as vaccines arrive and the economy improves. His advice: make sure your best people feel appreciated. Or, as he puts it: “Better to keep a good employee —even if it costs you more than you think it should—than to have to call me.” Plus: we discuss whether, when the time comes, businesses should require employees to get vaccinated.

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