The Hiring Process Has Changed
If your business isn’t paying attention, you could lose out on good candidates or even get in legal trouble.
Good morning!
Reminder: I recently posted my plan to turn 21 Hats into a sustainable business. You can READ MORE HERE, but the upshot is I’m asking readers to sign up as either a Paid Subscriber or as a Founding Member.
Here are today’s highlights:
Amazon is pushing live-streaming but it’s not cheap.
Tech salaries have actually fallen in New York and San Francisco (and risen elsewhere).
Case study: how to take over a family business without alienating your family.
Plus: how one startup turned threats from Hershey and Kellogg’s into a marketing opportunity.
FINANCE
Ami Kassar warns that it’s important to pay attention to the fine print in an EIDL loan. Among other things, you need to know:
“The SBA is allowed to inspect, make copies of, and audit any books, records, and papers relating to your financial or business conditions.”
“No later than three months after the end of each fiscal year, you have to provide the SBA with your financial statements.”
“You must obtain and itemize receipts (paid receipts, paid invoices, or canceled checks) and contracts for all loan funds spent and keep these receipts for three years from the date of the final disbursement.”
“You need written approval from the SBA before you make any distributions to any owner, partner, or employee.” READ MORE
HUMAN RESOURCES
The pandemic has changed the job interview process, Gene Marks says, and businesses need to pay attention: “Now, more than ever, personal questions are a no-no. Asking about a candidate’s family or even activities outside of the office can be potentially discriminatory. Our job as the interviewer is to determine if an applicant has the skills to do the advertised job. What they do off-hours is none of our business. ‘Employers should avoid questions that may create stereotypes or even something that might be seen as qualifying people around something that is protected under the law,’ said Teri Hartwell-Easter, who runs T.H. Easter Consulting, a human resources firm with offices in Delaware.”
“‘For example, you shouldn’t ask, What are you going to do with your children if you get this job?’ which is usually a question that’s directed toward women but not men. A prospective employee’s family status should never be a factor.”
“Although Pennsylvania does not prohibit employers from asking about a candidate’s salary history, the practice is prohibited [in many states and jurisdictions]. Doing so can bias an employer into offering a salary based on the past which can be unfair if the salary was below market rates due to the worker’s age, gender, or other factors.”
“Newer technology can also make the interview process easier. Many of the major payroll service providers like Paychex and ADP provide talent management systems for organizing the interview process.” READ MORE
Tech salaries have actually fallen in New York and San Francisco: “San Francisco still offers the highest average pay for tech workers in the country, but the rate has slipped 0.3 percent from last year to an annual salary of $165,000, according to a report from Hired, a marketplace for tech jobs. In the U.S. overall, industry salaries are down by 1.1 percent, with the average compensation now at $152,000. Cities like New York, Atlanta and Dallas also registered decreases. Meanwhile, salaries rose by 4.6 percent to $158,000 in Seattle, home to Amazon.com, and by 5 percent in Austin, Texas, which has attracted companies like Facebook and Google, and will soon welcome Tesla’s headquarters.”
“In San Diego, a major remote-work destination, salaries jumped 9.1 percent to $144,000, the largest increase in the country.”
“About eight in 10 tech workers are still working fully remotely, and a vast majority would like to stay this way, which has contributed to the big-city exodus, according to the survey.” READ MORE
SUCCESSION
Karla Trotman talks about how she took over the family business without alienating her family: “Once the decision of succession was confirmed, we started holding regular family meetings to talk about company direction, challenges, and very important matters like individual credit and assets. People underestimate that. They think your family can just hand you the company, regardless of your personal finances. You can gift shares in certain amounts every year, but depending on the value of the company, it could take forever to transfer all the shares. Then I brought in a professional from a financial-management company to verify that everyone’s wishes were even feasible and to guide the process from a non-emotional standpoint.”
“This person interviewed all of us and gave my brothers and I a StrengthsFinder test to assess our individual levels of interest and preparedness before sharing their recommendations with my parents.”
“This is honestly the friendliest way to go about it: having open conversations within the family to make sure everyone is on the same page and then lean on a third party to make an agreement that communicates your wishes properly. It keeps all the awkwardness out of the family.”
“The reality is, none of your friends are going to understand what you’re going through, so it’s important to have access to a group of other business leaders for support. I joined a CEO coaching group as I was going through this, and they were my cheerleaders through it all.” READ MORE
MARKETING
Amazon is allowing brands that live-stream to collect some data about their customers: “The e-commerce giant is pushing its QVC-like shopping platform Amazon Live as a way for brands like The Honest Co. and electronics charger brand Anker to collect shoppers' email addresses, which have become increasingly valuable to advertisers as third-party cookies go away. People watching a livestream can click on a large button to follow a brand on Amazon. Brands can then use a tool from Amazon to target their followers with specific offers. For example, a makeup brand can send people who watched an Amazon Live video an email message about a new product launching. Nancy McLaughlin, senior director of search and enterprise at Tinuiti, said that the Follow button ‘moves Amazon from a transaction website to a brand-building website.’”
“Still, advertisers want sales data. Email data helps brands grow softer metrics like awareness and sentiment but Podean's Johnson said that Amazon Live videos lack data about if people bought something during the livestream.”
“‘Amazon Live is a good way to get followers and build brand equity,’ he said. ‘There's a lot of benefits of the livestream but anecdotally, the sales are hard to justify the price point.’”
“Amazon is making such a big bet on live-streaming that it's raising ad prices for holiday ad packages created for Amazon-produced videos to $85,000, up considerably from its usual price of $35,000 ...” READ MORE
A chocolate startup, after threats from Hershey and Kellogg’s, redesigned its packaging in 21 days—and documented the process on Instagram: “Their solution was to push up a major redesign of Mid-Day Square's packaging. Instead of a March launch, the three co-founders oversaw the creation of a new label in 21 days to fend off the complaint from RXBar. They documented the process in a recent episode of their Instagram series. The sprint involved several quick choices. At one point, the team nearly moved forward with a design that overlaid the Mid-Day Squares name on a photo of the bar, only to realize it looked like packaging from a brand called Unreal.”
“It also reached a deal with Hershey: Mid-Day Squares changed Peanut Butta's color to a specific lighter shade of orange that the candy giant said was different enough from the one Reese's uses.”
“In an interview with Insider, the three founders said there was more than money on the line. ‘Forget about all the dollars,’ Jake Karls told Insider. ‘The energy suck that this would have taken us, being a hyper-growing business, would have killed us." READ MORE
FROM OUR SPONSOR: BE FOUND ONLINE
Steve Krull’s Marketing Minute: How would you spend $10,000 a month on B2B marketing? “Even if you have more than $10,000 a month to spend, what follows may very well apply to your situation as well. Regardless, as a business owner, you want those dollars to be invested and not just spent. The trick with $10,000 per month is that you know it probably won’t allow you to do everything you want to do—and certainly not everything you could do. You also know that at the end of every quarter and at the end of the financial year, your marketing spend is going to be analyzed to the very last cent, and you’ll have to demonstrate what results that spend brought.”
“Spend 90 to 120 days really focusing on your site. This is where you’ll be driving leads, prospects, and customers, so you need to make sure it works properly when they get there.”
“Once you’ve got your website up where you want it, I would suggest leveraging some of that content you’re creating for your website by building out some small LinkedIn campaigns.” READ MORE
LOGISTICS
The next supply-chain crunch will involve food: “In Denver, public-school children are facing shortages of milk. In Chicago, a local market is running short of canned goods and boxed items. But there’s plenty of food. There just isn’t always enough processing and transportation capacity to meet rising demand as the economy revs up. More than a year and a half after the coronavirus pandemic upended daily life, the supply of basic goods at U.S. grocery stores and restaurants is once again falling victim to intermittent shortages and delays.”
“‘I never imagined that we’d be here in October 2021 talking about supply-chain problems, but it’s a reality,’ said Vivek Sankaran, chief executive officer of Albertsons Cos., who echoed the laments of other retailers. ‘Any given day, you’re going to have something missing in our stores, and it’s across categories.’”
“‘People are hoarding,” said [Saffron Road] CEO and founder Adnan Durrani. “What I think you’ll see over the next six months, all prices will go higher.’” READ MORE
To fix the supply chain, we need 80,000 truck drivers: “That's a 30 percent increase from before the pandemic, when the industry already faced a labor shortage of 61,500 drivers. ‘That's a pretty big spike,’ [CEO of the American Trucking Associations Chris] Spear added. Many drivers are retiring, dropping out of the industry. Increased consumer demand, prompting a need for more drivers, also plays a big role in the shortfall.”
“Truck drivers move 71 percent of the US economy's goods, but represent just 4 percent of the vehicles on the roads, said Spear.”
“If nothing is done, the latest figures put the industry on track for a shortage of 160,000 drivers by 2030, and the need for 1,000,000 new drivers over the next ten years, according to the American Trucking Associations.” READ MORE
ECOMMERCE
The pandemic boom for Instacart and other food-delivery services has slowed: “Even so, some consumers aren’t going back, Chief Executive Officer Fidji Simo said Tuesday at The Wall Street Journal’s Tech Live conference. Online grocery sales currently make up about 10 percent of grocery sales, and San Francisco-based Instacart expects that number to reach 30 percent over the next several years, she said. Research firm Cowen Inc. anticipates online grocery sales will reach 20 percent of total grocery sales by 2025, up from 5 percent in 2019. ‘It has changed consumer habits forever,’ Ms. Simo said of the pandemic.”
“Instacart has appealed to supermarkets by offering a quick way to provide grocery-delivery services without spending time or money building their own system. Some supermarkets have said they aren’t making money through Instacart because they pay a commission on each order, and others worry that they are sharing valuable data on what customers buy.”
“The industry is becoming more competitive, with DoorDash and other companies seeking to grab consumer spending.” READ MORE
OBITUARY
David Finn, co-founder of Ruder Finn, one of the most successful corporate PR firms to emerge after World War II: “By 1967, Ruder Finn had grown into the world’s largest PR agency at the time. ‘I would put him among the top five on the Mount Rushmore of modern public relations, along with Harold Burson, Daniel Edelman, Al Golin and Gershon Kekst,” Larry Weber, the founder and former chief executive of Weber Shandwick, one of the world’s largest PR firms, said in an interview for this obituary this year. Mr. Finn was at the forefront of a wave of former G.I.s entering the public relations field after World War II. He and a childhood friend, Bill Ruder, started the firm in 1948 and got their first big break when they were introduced to an up-and-coming young crooner and former barber named Perry Como.”
“Mr. Finn caused an internal uproar at his firm when, in the 1980s, he promoted three of his children into management roles at the firm. Complaining of nepotism, three senior managers and 11 others left to join a rival firm, taking with them Ruder Finn’s biggest accounts.”
“But Mr. Finn, who had declined numerous offers to be acquired by other firms, defended the move, saying he wanted to ensure that the agency would remain independent and under family control. Within three years, revenues reached a new high.” READ MORE
THE 21 HATS PODCAST
Holy Crap! This Is All My Dreams Come True: This week, in episode 81, we have a celebration. As many of you will recall, when we started this podcast, Karen Clark Cole was coming off months of failed negotiations with a potential investor in Blink, the business she co-founded. Those months she spent trying to land the investor took a toll on both Blink and on Karen, who subsequently took a mental health sabbatical. But, as she tells Jay Goltz and William Vanderbloemen, she came back, refocused, and has just sold Blink for $94 million in cash. As you might imagine, we had some questions for Karen, including: Will she stay? How many employees knew what was going on? Was there a bidding war? Is there an earn out? What was it like to wake up one morning knowing that she had taken all of her financial risk off the table? And is she ready to report to a boss?
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