What If Amazon Charged for Returns?
Last year, $761 billion in merchandise was returned to retailers, more than the U.S. spent on defense. There is a way to solve this problem.
Here are today’s highlights:
Gen Z says it’s willing to trade a pay cut for a career path.
The wedding industry can’t keep up with its boom.
Startup platforms are helping home chefs sell food they make in their own kitchens.
Here’s something employees are bringing back to the office: profanity.
Suppose Amazon decided to charge for returns? “A National Retail Federation survey found a record $761 billion of merchandise was returned to retailers in 2021. That amount surpasses what the U.S. spent on national defense in 2021, which was $741 billion. Amazon wouldn’t share its overall returns numbers, but in 2021, the National Retail Federation estimates 16.6 percent of all merchandise sold during the holiday season was returned, up more than 56 percent from the year before. For online purchases, the average rate of return was even higher, at nearly 21 percent, up from 18 percent in 2020. With $469 billion of net sales revenue last year, Amazon’s returns numbers are likely staggering.”
“An often-cited 2018 survey of 1,300 online shoppers found 96 percent would come back to a retailer if they had a good returns experience, and 69 percent were deterred from buying if they knew they’d have to pay for return shipping.”
“But reverse logistics experts say the best way to reduce waste, and cut the expense of returns, is to prevent them from happening in the first place and then to create disincentives for returning goods.”
“‘The industry at large would bow down to Amazon in a heartbeat if Amazon were to start to charge for returns because it would give them air cover to do the same.’” READ MORE
For younger employees, training can be as important as pay or flexibility: “In fact, some workers would be willing to take pay cuts for certain jobs that allow them career mobility. That's according to LinkedIn's most recent Workplace Confidence Survey, which polled about 5,000 workers in March. The survey shows that 40 percent of Gen Z employees would be most willing to take a pay cut of up to 5 percent of their current salary for a role that offered them a better chance of career growth--compared to 26 percent of the overall workforce.”
“The younger generation also prioritizes ‘enjoyable work,’ notes the survey, which concludes that 38 percent of Gen Z respondents would be willing to make less money for a job they found pleasurable.”
“Millennials feel even more strongly inclined in this regard, with 40 percent saying they'd take a pay cut for a more enjoyable job.”
“What's least important to Gen Z employees is flexibility and the ability to work remote.” READ MORE
The pandemic has helped blue-collar workers move to “new-collar” jobs that involve tech skills and better pay: “More than a tenth of Americans in low-paying roles in warehouses, manufacturing, hospitality, and other hourly positions made such a switch during the past two years, according to new research from Oliver Wyman, a management consulting firm that surveyed 80,000 workers world-wide between August 2020 and March 2022. Many of the new jobs are in software and information technology, as well as tech-related roles in logistics, finance and healthcare. New data from the Current Population Survey and LinkedIn also suggest the pandemic has helped catapult more workers into more upwardly mobile careers.”
“As many as 32 million Americans lack a four-year college degree but have the skills or experience to parlay into higher-income jobs, according to a 2022 study by Opportunity@Work, a nonprofit social venture whose mission is to help more people without a college diploma onto higher-earning career paths.”
“The key is spending the time and dollars on training, and spotting the potential in applicants who lack traditional criteria.”
“‘That’s a huge opportunity for a lot of employers right now, precisely because there are so many companies sleeping on it,’ said Byron Auguste, CEO and co-founder of Opportunity@Work.” READ MORE
The wedding industry can’t keep up: “After two years of a pandemic-imposed drought, the wedding industry is booming again. But that sudden burst of celebratory demand is colliding with supply chain backlogs, labor shortages and inflation, resulting in higher prices for brides and grooms across the country. Consumers are ready to spend big again, even if the rest of the economy hasn’t caught up. Wedding vendors are reporting a flood of new inquiries for spring and summer weddings, as couples — some of whom have been unexpectedly engaged for three years — rush to make their way down the aisle before another wave of coronavirus infections thwarts their plans.”
“In all, Americans are expected to host 2.5 million weddings this year, up about 30 percent from last year and the most in nearly four decades, according to the Wedding Report, a national trade group.”
“‘It’s all harder to get, sold out, back-ordered and more expensive,’ said [Susan] Cordogan, who owns Big City Bride in Chicago. ‘For two years, our hands were tied. Now it’s the great wedding boom, but our industry is still catching its breath.’”
“To keep up, wedding singers are booking three ceremonies a day. Venues are scheduling receptions every day of the week, including Mondays. And attorneys are working overtime to hammer out prenuptial agreements.” READ MORE
Are 1,818 Airbnbs too many for Joshua Tree? “Demand for short-term rentals surged by 54 percent between 2019 and 2021, making Joshua Tree one of the top two fastest-growing markets in California and one of the top 25 fastest-growing markets in the United States, according to data from AirDNA, a company that collects and analyzes data from Airbnb and Vrbo. Joshua Tree and the nearby town of Yucca Valley issued 958 permits in 2021, more than nine times as many as they did in 2019, according to San Bernardino County and Yucca Valley data. As of March, there were 2,043 listings in Joshua Tree and Yucca Valley on Airbnb and Vrbo, more than twice as many as four years ago, according to AirDNA (1,818 are on Airbnb, though some are cross-listed).”
“Over the past two years, the price of the average home rose more in Joshua Tree and nearby Landers and Twentynine Palms than in any other part of California, according to an analysis by The San Francisco Chronicle.”
“Desert lovers have long been renovating cabins and setting up glamping facilities for visitors. The pandemic has supersized that pattern, fueling a sort of gold rush through which investors from Los Angeles, New York, China and elsewhere are rushing in, not just to renovate properties, but to buy land to build homes explicitly for Airbnb and Vrbo.”
“One Realtor who works in Joshua Tree said that plots are now selling for quadruple 2019 prices.” READ MORE
THE GIG ECONOMY
Woodspoon and Shef are vying to be the Uber of home cooking: “Start-ups like WoodSpoon and Shef have emerged, pushing what has been an underground industry of selling food to friends and family into the mainstream through apps. They are aiming to reach those who have developed meal fatigue during the pandemic, weary of trying to find a new, inventive way to cook a chicken or hitting redial for their favorite takeout joint. Most of these apps say they expect the chefs to follow all state and local laws or risk removal from the platform.”
“The companies paint themselves as part of the new gig economy, a way for the people making the food to earn a little or a lot of money, working whatever days and hours best fit their schedules.”
“From her kitchen in the Lower East Side of Manhattan, María Bído uses WoodSpoon to sell classic Puerto Rican dishes like mofongo, bacalaitos and sancocho, using recipes she learned from her grandmother.”
“‘What we’re seeing is a burnout of cooking,’ said Melanie Bartelme, a global food analyst at Mintel, a market research firm that found last spring that one-third of consumers said they were “sick of cooking” for themselves or their families.”
“‘We are ahead of the regulators, but as long as I keep my customers safe and everything is healthy, there are no issues,’ [said Oren Saar, founder and CEO of WoodSpoon]. ‘We believe our home kitchens are safer than any restaurants.’” READ MORE
The father of New York City’s Little Tokyo calls it quits: Tadao Yoshida, known as Tony, the mystery mogul of the East Village, has built a food-and-drink empire that few of his generation can rival. It all started in the early 1970s with the humble vegetarian-friendly joint Dojo and has expanded to include, most recently, the sprawling Japan Village food court in Industry City, Brooklyn. Mr. Yoshida helped teach New York that it couldn’t live without an authentic izakaya (something like a Japanese pub). And the cocktail revival of the aughts can be traced directly to Angel’s Share.”
“He also may very well be the man responsible for that ubiquitous ginger-carrot salad dressing found at every Japanese restaurant across America.”
“‘He basically invented our Little Tokyo in the East Village,’ Mr. Somoza said. ‘That’s how that became a concentration of Japanese stores. Think about that. Who gets to create and shape a neighborhood in Manhattan?’”
“Now Mr. Yoshida’s Little Tokyo is gone. After nearly 30 years occupying the strip of low-slung buildings near Third Avenue, he has left or is leaving all the spaces, after negotiations failed with Cooper Union, which leases the buildings from their owners and had subleased them to Mr. Yoshida for decades.” READ MORE
As many as 3,000 of Britain’s 10,000 fish-and-chip shops are expected to close: “When it opened in 2020, business was booming at Chunks, a store serving dozens of portions each day of Britain’s best known takeout meal: battered and deep-fried cod with fries, or chips as they are known here. But even before the war in Ukraine further pushed up the shop’s bills for energy, fish and cooking oil, inflation had already forced the owners, Sayward and Michael Lewis, to raise their prices twice. Now, with another spike in prices driving away customers, Chunks is on the brink of failing.”
“Ukraine and Russia are large producers of sunflower oil, used by many fish-and-chips shops, and that is running out. And even potatoes are destined to become more expensive, as rising gas prices push up the cost of fertilizer.
“‘My industry is directly affected by the Ukraine issue because all our four main ingredients are directly affected, and we use a lot of them,’ said Andrew Crook, the president of the National Federation of Fish Friers, referring to fish, oil, flour (for batter) and potatoes.”
“‘There’s a bit of theater in a fish-and-chip shop, it’s bit like being behind a bar,’ Mr. Crook said.’“I’ve got customers that just come in for the banter and, for some of the older people, we might be the only people they speak to all day.’ He added, ‘It’s something special, it’s part of the culture of the nation.’” READ MORE
BACK TO THE OFFICE
Is it okay to swear in the office now? “There are infinite reasons to want to utter profanity these days: The cost of everything is rising, the pandemic is lingering into year three, the link to that videoconference you can’t miss doesn’t work. During months at home, we got comfortable and said what we wanted—even when it was a four-letter word. Some of us are bringing that authenticity, fresh perspective and casualness back to the office.”
“‘Business formality is on the way out,’ says Nick Mazing, Sentieo’s director of research. Back in 2020, he noticed a lot of sober language in transcripts, and talk of gratitude. Now, many appear to be saying f—it.” READ MORE
THE 21 HATS PODCAST
Do You Take Money Off The Table? This week, Shawn Busse, Paul Downs, and Jay Goltz discuss their philosophies about taking money out of the business. Of course, you can’t take money off the table unless there’s money on the table. Paul tells us that he once calculated his average earnings for his first 22 years in business and they came to about $11 an hour. But he now expects to make more money in the next five years than he did in the previous 35. We also talk about content marketing, direct mail, and trade shows. Plus: Was the Paycheck Protection Program, despite the billions of dollars in fraud, a success?
You can subscribe to the 21 Hats Podcast wherever you get podcasts.
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