business news in context, analysis with attitude

Published on: December 14, 2020

KC tells of an encounter he had with a supermarket checkout person that was not just one of the best ever, but that illustrated a fundamental truth about retailing.

Published on: December 14, 2020

The University of Michigan on Friday released it latest index of consumer sentiment, saying that it "climbed to 81.4 in the two weeks ended Dec. 9, from 76.9 in November," the Wall Street Journal reports.  The number was higher than the decline to 75.5 expected by economists.

The increase seems to be a reflection of how many people expect "the economic conditions to improve when the country begins to exit from the coronavirus pandemic."

"Most of the early December gain was due to a more favorable long-term outlook for the economy, while year-ahead prospects for the economy as well as personal finances remained unchanged," said Richard Curtin, the survey’s chief economist.

The release of the consumer confidence index comes as "coronavirus cases surged and some states placed new restrictions on activity," but also as hopes are raised as the country starts to see distribution of the first of several vaccines.

Published on: December 14, 2020

Random and illustrative stories about the global pandemic and how businesses and various business sectors are trying to recover from it, with brief, occasional, italicized and sometimes gratuitous commentary…

•  The numbers vary somewhat depending on the source, but according to Worldometer, the site that MNB has been citing since the beginning of the pandemic, the United States now has suffered more than 300,00 deaths related to the coronavirus.

The exact numbers in the US are these:  16,737,267 total cases … 306,359 deaths … and 9,724,439 reported recoveries.

Globally, there have been 72,724,234 total coronavirus cases … 1,620,624 fatalities … and 50,941,022 reported recoveries.

•  As the daily coronavirus death rate in the US seems to hover at the 3,000 level - higher, as the director of the Centers for Disease Control and Prevention (CDC), Dr. Robert Redfield, has pointed out, than the death toll on 9-11 or at Pearl Harbor - the good news is that the vaccine developed by Pfizer-BioNTech and approved late Friday by the US Food and Drug Administration (FDA) has begun to ship.

The Washington Post reports that "the first vials of the coronavirus vaccine were shipped Sunday, paving the way for inoculations to begin across the country this week.

"Nearly 3 million doses of the Pfizer-BioNTech vaccine are expected to arrive at 145 facilities Monday, marking the beginning of a huge logistical effort to stop the rampant spread of the virus … The vaccine will arrive at nearly 500 additional sites on Tuesday and Wednesday."

Questions still remain, however, about how effectively the states - responsible for distribution and administration of the vaccine - will be able to get the vaccine into people's arms.

•  The Washington Post writes that "the new coronavirus vaccine appears to be stunningly effective — blocking serious illness entirely in randomized trials — and it has passed strict safety reviews and won emergency authorization from regulators in the United States and several other countries so far. But news bulletins in the past week provided a reminder that this remains a revolutionary pharmaceutical agent that will be scrutinized in the months ahead as shots go into arms.

"Among the unknowns: To what extent does the vaccine prevent infection vs. simply preventing clinical illness?

"Can a vaccinated person who becomes infected, but not sick, transmit the virus to someone else? That’s a pivotal factor in forecasting how rapidly the pandemic will be quashed once there is widespread distribution of vaccines."

While there are concerns about people with severe allergies taking this particular vaccine, the Post quotes Dr. Anthony S. Fauci, director of the National Institute of Allergy and Infectious Diseases, as saying, "I don’t think that the allergic reactions are even close to being a showstopper for the Pfizer vaccine."

The Post quotes Fauci as saying that "the criteria for participation in the random trials excluded people with a history of severe allergic reactions, and it is not surprising that, as the vaccine reached the general population, such rare allergic responses emerged. He said officials will continue to monitor the safety of the vaccines long after they have received emergency authorization."

•  The New York Times reports that "an independent committee of experts advising the Centers for Disease Control and Prevention on Saturday afternoon voted to recommend the Pfizer coronavirus vaccine for people 16 and older. That endorsement, which now awaits only final approval by Dr. Robert Redfield, the director of the C.D.C., is a key signal to hospitals and doctors that they should proceed to inoculate patients … The advisory committee, which typically meets three times a year to review amendments to routine schedules for child, adolescent and adult vaccines, has been engaged in numerous marathon-length sessions this fall to discuss a plethora of knotty issues surrounding the introduction of the novel vaccine, which is in limited supply, during a pandemic.

"In meetings on Friday and Saturday, the panel’s heated discussions centered mainly on three areas: whether to recommend the vaccine for patients 16 and 17 years old, for pregnant and lactating women and for patients who have had an anaphylactic reaction to other vaccines."

•  The Wall Street Journal writes that "another Covid-19 vaccine, from Moderna Inc., could add to the supply of doses this month if it is authorized, which could happen later in the week. Both vaccines are given in two doses, three or four weeks apart.

"As the initial supply is limited, the first doses are being reserved for doctors, nurses and other front-line health workers who may be exposed to the coronavirus while caring for infected patients.

"Residents of nursing homes and other long-term care facilities also are expected to get early doses, because they are more vulnerable to severe Covid-19 disease and death.

"Eventually, as supplies increase, more priority groups such as essential workers and the elderly will be vaccinated.  Federal officials expect about 100 million Americans will get immunized against Covid-19 by February or March. The general public could be inoculated in the spring or summer."

•  Also from the Wall Street Journal:

"The effort to vaccinate the nation relies on chemists, factory workers, truck drivers, pilots, data scientists, bureaucrats, pharmacists and health-care workers. It requires ultracold freezers, dry ice, needles, masks and swabs converging simultaneously at thousands of locations across the country.

"To work, every one of the many and complicated links of the chain has to hold.

In the trucks that headed to airports and distribution hubs, specially designed containers equipped with sensors monitored location, temperature, light exposure and unusual jolting. Inside, dry ice sandwiched thousands of doses of BNT162b2, the scientific name of the Covid-19 vaccine … Despite dry runs and contingency planning, a lot can go wrong. Refrigeration problems could ruin doses, and logistical snafus could delay shipments. If hospitals botch the challenge of scheduling a continuous stream of people to get the shots, defrosting doses might go bad. And the pandemic itself could sideline some of the armies of workers involved in the effort."

Hy-Vee announced that is "pharmacists and technicians who take part in the company’s rapid antigen COVID-19 testing will be offered an additional bonus for participating in the public health program. Full-time pharmacists who administer the tests will receive a $500 bonus and part-time pharmacists and technicians who administer the test will receive a $250 bonus. This is in addition to the $23.3 million in frontline employee appreciation bonuses that the company has paid out to all retail employees to date as well as the company’s upcoming 10% employee bonus on all hours worked during this year’s holiday season – Dec. 21, 2020, through Jan. 10, 2021."

•  The Los Angeles Times reports that "Foster Farms, one of the West Coast’s largest producers of poultry, is facing scrutiny for new clusters of coronavirus infections at its facilities in California’s Central Valley, which follow a deadly, months-long outbreak this year.

"California-based Foster Farms reported that at least 193 people at its Cherry Avenue plant in Fresno tested positive for the coronavirus over a recent two-week period, along with 12 people at another Fresno plant. And a union official said at least 37 workers at the company’s Livingston complex in Merced County have tested positive since Nov. 30.

"About 1,000 people work at the Cherry Avenue facility, meaning that about 20% of that plant’s workers tested positive, the company said. The plant was closed last weekend for deep cleaning and reopened this week."

•  The New York Times reports that "the entry ticket to the nation’s reopening is set to come largely in the form of a digital health credential.

"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. They could prompt more employers and college campuses to reopen. They may also give some consumers peace of mind, developers say, by creating an easy way for movie theaters, cruise ships and sports arenas to admit only those with documented coronavirus vaccinations."

However, the Times writes, "the digital passes also raise the specter of a society split into health pass haves and have-nots, particularly if venues begin requiring the apps as entry tickets. The apps could make it difficult for people with limited access to vaccines or online verification tools to work or visit popular destinations.

"Civil liberties experts also warn that the technology could create an invasive system of social control, akin to the heightened surveillance that China adopted during the pandemic - only instead of federal or state governments, private actors like employers and restaurants would determine who can and cannot access services."

•  The New York Times writes that "Indoor dining will once again be barred in New York City restaurants starting on Monday, Gov. Andrew M. Cuomo said on Friday, in a significant reversal of the city’s reopening that comes as officials try to halt the escalation of a second wave of the coronavirus and avoid a broader shutdown.

"The decision, which Mr. Cuomo earlier this week suggested was all but certain, is a crushing blow to the city’s restaurant industry, a vital economic pillar that has been struggling all year in the face of pandemic restrictions and a national recession."

One of the more high-profile victims of the shutdown: the 21 Club, which said it has "indefinitely" ceased operations (it has been open since 1930, starting as a speakeasy) with no plans to reopen - though the owners said they were "exploring long-term options."

•  The New York Times reports that Google is now saying that it will not reopen its offices to employees until September 2021;  like many companies, Google removed to remote working as the pandemic gained momentum earlier this year.

However, the Times also says that Google is testing a number of different scenarios going forward, including employees working in the office three days a week that would be deemed "collaboration days," while working from home the other two days.

“We are testing a hypothesis that a flexible work model will lead to greater productivity, collaboration, and well-being,” , Sundar Pichai, CEO of Google’s parent company, Alphabet, said in an internal email.  “No company at our scale has ever created a fully hybrid work force model - though a few are starting to test it - so it will be interesting to try.”

The Times goes on:  "After such a long period of remote work, companies are wrestling with how best to transition workers back into offices.

"Last month, ViacomCBS told employees that it expects most of its employees to divide their time between working at home and in its offices. In doing so, the company said a hybrid model would allow more flexibility for employees, while reducing its real estate needs and keeping costs down.

"Reed Hastings, Netflix’s chief executive, has said that he has not seen 'any positives' from working at home and that not being able to get together to discuss ideas in person is a 'pure negative.' However, he said he expected the five-day workweek would become four days in the office and one day remote after the pandemic."

Published on: December 14, 2020

Both the Washington Post and the New York Times have run negative - in some ways, blistering - reviews of Amazon's new Halo fitness-tracking device, moving into territory currently occupied by Apple and Fitbit, among others.

The Times review, which you can read here, focuses on the lack of context and accuracy.

The Post review says that "the Halo collects the most intimate information we’ve seen from a consumer health gadget — and makes the absolute least use of it … the Halo pushes into uncharted territory by also collecting new, unabashedly invasive kinds of personal information — including body photos and voice recordings — and then feeding it into Amazon’s software for analysis."

Published on: December 14, 2020

With brief, occasional, italicized and sometimes gratuitous commentary…

•  The Dallas Morning News reports that Albertsons-owned Tom Thumb "plans to permanently lay off 97 drivers in the Dallas-Fort Worth area and shift to third-party delivery services as its online grocery business continues to grow."

The company said "the job cuts are coming around the end of February. Between 10 and 17 employees per store will be laid off at Tom Thumbs in Arlington, Dallas, Coppell, Fort Worth, Garland, Grand Prairie and Plano.  Those stores are hubs for online orders for delivery from tomthumb.com and albertsons.com. Store employees will continue to shop and pack orders for delivery. Curbside orders are also processed by Tom Thumb and Albertsons employees at stores selected by customers."

There may be short-term savings here, but the long-term impact is that Tom Thumb is outsourcing its reputation and responsibility for an important part of the customer experience.  That's problematic, I think.

•  From the Minneapolis/St. Paul Business Journal:

"Best Buy Co. Inc. is beefing up its delivery options with just a few weeks left in the holiday shopping season.

"The Richfield-based retailer has for years used its stores as de facto warehouses for its e-commerce business; it's one of the ways Best Buy has held its ground against rivals like Amazon.com Inc. Now it's taking the idea one step further, using store employees to make actual deliveries, in addition to the company's current partnerships with Instacart, Shipt and Roadie.

"Best Buy employees in almost all of its stores will deliver online orders directly to customers within their own communities. The orders will be delivered until 10:30 p.m. every day. Shoppers don't need to select this specific option during checkout, just their preferred time of delivery … Best Buy said through a spokesperson that the company is providing vehicles for the employees to complete the deliveries."

Published on: December 14, 2020

•  Costco said last week that its Q1 revenue grew to $43.2 billion in the quarter, from $37 billion a year earlier … digital sales grew 86 percent … profit rose to $1.17 billion, up from $844 million in the same period last year …. and same-store sales were up 17.1 percent.

•  The Wall Street Journal reports on how the meal kit business - seemingly in the throes of dissolution a year ago because of lack of consumer interest - has rebounded.  But, the story cautions, "When the Covid-19 vaccine rollout gradually allows normal life to resume, speedier dinner options like ready meals could eat into their growth."

Meal kit company HelloFresh, which has seen an enormous increase in sales and stock price, "will try to protect its business by expanding into different meals such as lunch and new products. It recently bought Factor75, a business that will generate $100 million this year from freshly prepared meals."

The Journal notes that it already is happening:  "Sales of fresh dinners that can be heated in the microwave already grew faster than meal kits in the U.S. this year—by more than 100% compared with 60%, respectively."

•  USA Today reports that "Target has extended its store hours in the days leading up to Christmas.  Most stores will open at 7 a.m. and close at midnight starting this week … While hours have been extended, Target has reduced its special hours for senior shoppers age 65 and older, pregnant women and those defined by the Centers for Disease Control and Prevention as vulnerable or at-risk at most locations from two days a week to one.

"Most stores now dedicate the first hour on Tuesdays for these shoppers who are considered at greater risk by the CDC. Stores have had two senior hours per week since March."

•  From Bloomberg:

"A U.S. cookie shortage could leave Santa’s plate bare.

"Campbell Soup Co., the maker of Pepperidge Farm cookies, warned it’s working through 'supply constraints' in its cookie division, which makes familiar packaged varieties like Milano and Chessmen.

"A combination of labor shortages due to Covid-19 and elevated demand as people stay home are driving the cookie-sector 'challenge,' Campbell’s Chief Executive Officer Mark Clouse said on an earnings call Wednesday."

Published on: December 14, 2020

•   John le Carré, one of the most accomplished novelists of the late 20th century and early 21st century, using the spy novel as a way to probe notions of morality, betrayal, ethical ambiguity and patriotism, has passed way.  He was 89, and had been suffering from pneumonia.

The novelist, whose real name was David Cornwell, was areal-life spy when he wrote the novel "The Spy Who Came In From The Cold,": which allowed him to leave the service.  Among his other books:  “The Looking Glass War” … A Small Town in Germany” … The Russia House” … “The Little Drummer Girl” … "Smiley's People" … Tinker, Tailor, Soldier, Spy" … and "“A Constant Gardener."

•  Charley Pride, a former semipro baseball pitcher and smelter turned country music singer, who became the first major African American star in the genre with more than 50 Top 10 hits on the country charts, has passed away of  complications related to Covid-19.  He was 86.

Published on: December 14, 2020

…will return.

Published on: December 14, 2020

•  In Major League Baseball, ESPN reports that after more than a century playing as the Cleveland Indians, the team will drop the nickname, "becoming the latest professional sports franchise to shed its Native American imagery amid accusations that its use is racist … The organization is expected to announce the change this week, sources said, continuing a years-long process in which it abandoned its Chief Wahoo logo and committed to exploring a new nickname, as well."

The story says that "Cleveland has not settled on a new nickname, and it's unclear whether the team will be dropping the nickname immediately or will transition to a new moniker following the 2021 season."

•  In Week 14 of National Football League action…

Houston Texans 7, Chicago Bears 36

Dallas Cowboys 30, Cincinnati Bengals 7

Kansas City Chiefs 33, Miami Dolphins 27

Arizona Cardinals 26, NY Giants 7

Minnesota Vikings 14, Tampa Bay Buccaneers 26

Denver Broncos 32, Carolina Panthers 27

Tennessee Titans 31, Jacksonville Jaguars 10

Indianapolis Cots 44, Las Vegas Raiders 27

NY Jets 3, Seattle Seahawks 40

Green Bay Packers 31, Detroit Lions 24

New Orleans Saints 21, Philadelphia Eagles 24

Atlanta Falcons 17, LA Chargers 20

Washington 23, San Francisco 49ers 15

Pittsburgh Steelers 15, Buffalo Bills 26