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Thank God It’s Thursday
As Americans reorder their lives in the wake of the pandemic, Thursday is becoming the new Friday.
Here are today’s highlights:
Amazon promises to stop booting merchants out of its marketplace for no reason.
Supply-chain issues continue to fade, and retail shelves are full.
The retail labor shortage continues—in part because warehouse jobs pay more.
As business starts continue to rise, Doola offers founders a “business in a box.”
At bars and restaurants, Thursdays are taking on new meaning: “As Americans redesign their lives for the contours of a ‘post-pandemic’ existence, Thursday is enjoying a renaissance. The once unremarkable day that historically predated the weekend has recently taken on a newfound importance, say bar and restaurant operators around Greater Boston. It’s busier than before COVID — sometimes so much so that owners have to hike up inventory or bring on extra staff to keep pace with the crowds. Data from Open Table shows that reservations through the service were up 30 percent the last Thursday in October, compared to the same day in 2019.”
“The hybrid workweek is at least partly responsible for the trend. But newly formed fluctuations in priorities and social habits are playing a role, too.”
“Some theorized that the pandemic highlighted the need for greater work-life balance. Friendship, after all, shouldn’t be reserved for two nights a week, said Mario LaPosta of Da LaPosta, an Italian restaurant in Newtonville.”
“Sean Olson of Salt + Stone said his Assembly Row restaurant fills up with employees from MassGeneral Brigham or the Puma headquarters coming for $1 oysters from 4 to 6 p.m. on Thursdays.”
“Afterward, formal work dinners overtake the space. One recent Thursday, Salt + Stone had six reservations for company get-togethers on the books, for anywhere from eight to 15 people. Compared to pre-pandemic, his Thursday sales are up 50 percent.” READ MORE
Amazon says it will stop booting merchants out of its marketplace without cause: “Amazon.com Inc. says it will stop summarily suspending online sellers, a peace offering to small- and medium-size businesses that have long complained of being booted off the site arbitrarily. Under a new initiative, called ‘Account Health Assurance,’ Amazon staff will work with merchants one-on-one to resolve any issues without resorting to suspensions, the company said. The program went live in the US and Canada on Wednesday and will later expand to other countries.”
“Some 2 million merchants are responsible for more than half of the goods Amazon sells. But for years, these sellers have lived with the fear that they could be abruptly suspended, sometimes after being falsely accused by a shopper or competitor of selling counterfeit products.”
“Many appealed their suspensions but found themselves passed from one Amazon team to another with no resolution. Meanwhile, their web stores were shuttered, with merchandise piling up unsold.”
“In 2020, Bloomberg chronicled the experience of a Los Angeles clothing retailer who was kicked off the site for allegedly selling fakes, which he denied. Amazon declined his appeal and destroyed what he said was $1.5 million of inventory.” READ MORE
Heading into the holidays, retailers are fully stocked: “Easing supply-chain pressures mean American consumers can look forward to their first normal holiday season in three years, industry executives and analysts say. They project full store shelves—and even deals—as retailers work through gluts in product categories from toys to furniture. ‘The script has been flipped,’ said Steve Pasierb, president of manufacturing group The Toy Association. ‘From a supply-chain standpoint, it’s the opposite of last year.’”
“Executives and analysts credit several factors: increased capacity throughout the supply chain, slackening demand driven by spending shifts from goods to services and higher interest rates, and a ‘new normal’ for supply-chain management that emphasizes earlier delivery lead times and heftier inventories.”
“Companies from big-box chains to makers of apparel and luxury goods to smaller and specialty retailers say they expect to be well stocked for the holidays.”
“‘I can deliver stuff to you today,’ said Michael Abt, co-president of Abt Electronics, a Chicago-area retailer of appliances, electronics and furniture. ‘It really is business back to normal.’” READ MORE
The retail labor shortage continues: “According to September data from integrated workforce management platform Magnit, retail associate pay is up 22 percent since 2018. In addition, with consumers’ return to physical stores, demand for hiring retail workers is outpacing demand to hire warehouse workers for the first time since 2019. Competition is especially high for attracting and retaining staff for retail mall brands, with many upping the perks to attract both seasonal holiday workers and long-term staff.”
“‘The labor shortage isn’t going away for another few years. We just don’t have as many people entering the workforce as we do leaving it,’ said Raleen Gagnon, VP and GM of total talent intelligence at Magnit.”
“While the high unemployment compensation during the pandemic has often been cited as the main reason driving the retail worker shortage, Gagnon said several longer-term trends are at play, including competition from warehouses and shifting priorities among younger workers.”
“Warehouse jobs are posing competition to retailers for workers, said Gagnon. According to Magnit, warehouse pay is 25-45 percent higher than retail pay nationally.”
“Amazon pays its workers a minimum of $15 an hour and recently announced pay increases to take the average pay of front-line workers to $19 an hour. Amazon has, however, been slowing the expansion of its warehouse openings.” READ MORE
The new office status symbol is a big water bottle: “The $50 Stanley Quencher boasts a double-walled design that puts an end to melting ice and frequent refills. Its real achievement might be solving a less technical problem: how to show off in today’s casual, hybrid workplace. Put the Jimmy Choo shoes and Armani suits back in the closet. The new on-the-job status symbol is a tumbler only slightly smaller than hockey’s Stanley Cup and nearly as valuable to some. Sometimes going for two to three times its retail price on the secondary market, this desktop trophy allows its owner to flaunt a combination of trendiness, disposable income, and presumably, bladder control.”
“Stanley, a century-old brand that you might associate with Grandpa’s camping gear, reports the waiting list for its 40-ounce drinking vessel peaked at 150,000 customers earlier this year after millennial women with large social-media followings helped repopularize it.”
“Sales this year are up 275 percent, compared with last year, the company says, a figure that doesn’t count resales on websites like Poshmark.”
“Quencher fans say they love its ability to keep drinks hot or cold and that it fits in a car cupholder, despite its mondo size, thanks to a tapered bottom.” READ MORE
Thanksgiving dinner will cost more this year: “American families will spend about 14 percent more this year on their holiday dinner thanks to higher prices of turkey, flour, eggs and other staples, according to data from Information Resources Inc. Increasing costs of ingredients, production and transportation—coupled with extreme weather and avian influenza outbreaks across the U.S. that affected millions of birds—could add up to what IRI projects to be the most pricey Thanksgiving meal in recent memory.”
“Wholesale prices for turkey have increased about 30 percent from a year ago, said Neil Stern, chief executive of supermarket operator Good Food Holdings, as the bird flu has kept turkey supplies tight and driven up prices. Avian influenza has killed more than 49 million birds in the U.S. this year, according to the Centers for Disease Control and Prevention.”
“Heavy rain and intense heat have pushed up the prices of fruit and vegetables this year. This means holiday side dishes will be more costly, too.” READ MORE
Luxury homes are selling for deep discounts: “Aspirational prices for luxury homes around the country are falling back to Earth, as the seemingly unstoppable real-estate frenzy of the last 18 months begins to dissipate. Real-estate agents said buyers spooked by economic uncertainty are suddenly hesitant to overpay and some are sitting on the sidelines waiting to see how things shake out. Having lost the upper hand, some sellers eager to move properties are slashing prices and selling for deep discounts.”
“A year ago, the luxury real-estate market was like ‘this huge party with champagne and caviar and everyone was thinking it was never going to end,’ said Bess Freedman, chief executive of Brown Harris Stevens, a luxury brokerage. ‘Now, it’s like the lights have been turned on. It’s a different environment.’”
“Among all listings above $10 million between August and October 2022, there was a 28.77 percent increase in price reductions of at least 20 percent compared with the same period in 2021.” READ MORE
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Applications to start new businesses are still growing: “Despite the slowing economy, applications to form new businesses in the U.S. grew by 1.2 percent in October, compared to the previous month. Part of what drives new business formations in sectors is when there are lots of new ideas and new options for growth, said Aaron Terrazas, the chief economist at Glassdoor, a jobs board site. However, ‘not all businesses are born equal,’ he said. ‘Some new businesses are born of opportunity, some new businesses are born of desperation.’”
“He pointed out that there was a small boom in business formations during the depth of the Great Recession, as many people who lost their jobs were starting personal fitness training or personal career coaching businesses.”
“During the pandemic, business applications surged, with a September 2021 study finding that most were concentrated in the e-commerce boom, as well as gig workers setting up LLCs to protect themselves from personal liability.” READ MORE
A New York City startup helps founders around the world start businesses in the U.S.: “Doola is building what he said customers call ‘business in a box,’ which has turned into a one-stop solution for compliantly forming a company, including more education on how to start a company, a new banking offering and a soon-to-come credit product. Much of that is to help the U.S. Census’ project of over 5 million new business applications made in 2021, [co-founder Arjun] Mahadevan said.”
“Thousands of companies from over 130 countries have launched with Doola, which has helped the company increase its revenue growth by seven times year to date, Mahadevan told TechCrunch.” READ MORE
THE 21 HATS PODCAST
For Richer, For Poorer: This week, Liz Picarazzi, Hans Schrei, and Laura Zander talk about something they have in common: They all own and run their business with a partner who also happens to be a spouse. Which suggests some interesting questions: Is someone in charge? How do they divvy up responsibilities? What do they talk about? What do they fight about? Do they fight in front of the employees? How do they make decisions? Who does the dishes? Do they ever wish they were not in business with their spouse? Do they know what would happen to the business if they were to divorce?
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Thanks for reading, everyone. — Loren