business news in context, analysis with attitude

Published on: July 21, 2021

 The journalist Michael Kinsley once said that "a gaffe is when a politician tells the truth – some obvious truth he isn't supposed to say."  Well, having returned from a brief foray into space yesterday, Jeff Bezos said something that KC thinks may come back to haunt him.

Published on: July 21, 2021

by Kevin Coupe

After his space flight yesterday, Amazon founder-chairman Jeff Bezos announced a more down-to-earth investment - a $100 million donation to José Andrés, the chef and co-founder of World Central Kitchen, a nonprofit that helps feed and support people in disaster-stricken areas around the world.

"I'm really grateful for this award, and the incredible support from Jeff and the entire Bezos family," Andrés said in a statement. "World Central Kitchen was born from the simple idea that food has the power to create a better world. A plate of food is a plate of hope. It's the fastest way to rebuild lives and communities."

Good for Bezos on this one.  The instinct and the optics are right.

Speaking of optics…

Bezos got a lot of attention yesterday for the cowboy hat that he wore before and after the flight of the Blue Origin New Shepard rocket.

Now, in fairness, Bezos is from New Mexico … so at some level, he is entitled.

But in watching him, I found myself thinking back to another cowboy hat-clad person who rode a rocket, albeit under somewhat different circumstances:

Published on: July 21, 2021

More bad news for big tech companies facing potential antitrust actions by legislators and regulators.

Axios reports that antitrust veteran Jonathan Kanter has been nominated by the Biden administration "to lead the Department of Justice's antitrust section as it pursues a raft of cases against tech giants."

According to the story, "The nomination completes a trifecta of wins for Democrats who want to see the standards for holding tech companies accountable for monopolistic behavior broaden beyond the traditional "consumer harm" measure.  The White House has already placed two other tech critics, Tim Wu and Lina Khan, in key positions, with Wu serving in the White House as President Biden's special assistant and Khan in charge of the Federal Trade Commission."

Axios notes that Kanter's paste activism could create problems for his nomination when it goes to the US Senate, and, if he is confirmed, is likely to result in calls by big tech companies for him to recuse himself from major cases.

Published on: July 21, 2021

ABC News writes about how "thirty-nine states and the District of Columbia had special provisions in place during the pandemic that allowed restaurants and bars to deliver alcohol orders to their customers," and now, as the country reopens, "all but 11 of those states have kept their alcohol to-go rules in place following the end of their governors' emergency orders. Economic and political experts say those states that are on the fence should consider following suit if they want to ensure a stronger post-pandemic future for their restaurants."

According to the story, "Although most states have relaxed their limits on indoor capacity for businesses, restaurants and bars are still relying on takeout customers to improve their revenues … Restaurants still haven't regained 1.5 million jobs lost before the pandemic, a 12% loss, according to the National Restaurant Association.

Nearly two-fifths of restaurant owners said they still can not afford rent, according to statistics from the association."

Published on: July 21, 2021

Variety reports that "Netflix, coming off a pandemic-fueled bumper crop of subscribers in 2020, added just 1.5 million customers worldwide for the second quarter of 2021 — a significant slowdown from its previous torrid pace of growth."

While the number was higher than had been predicted by Netflix, analysts noted that the company had set a very low bar for growth.

In fact, "during Q2, Netflix lost subscribers in its key U.S./Canada region, posting a net loss of 430,000 paid streaming customers in the region."

As a response to the slow down, Variety writes, Netflix "officially unveiled its plans to enter the video game market, eyeing it as a new category that will help it attract and retain customers. Netflix said games would be included as part of the monthly subscription price of its core service."

Published on: July 21, 2021

•  CNet reports that "Uber is expanding its grocery delivery services to more than 400 cities across the country, the ride-sharing company said Monday. Areas in San Francisco, New York City and Washington D.C. can now order on-demand or scheduled grocery deliveries from Uber.

"The announcement comes as Uber partners with 1,200 Albertsons-owned stores, like Safeway, Jewel-Osco, ACME, Tom Thumb and Randalls. With the expansion, Uber says, all grocery orders over $30 will get free delivery for Uber Pass and Eat Pass customers.

"Uber started offering grocery delivery to 100 areas in the country in 2020. Since then, the company has offered grocery delivery to areas of Miami, New York, Houston, Dallas, Phoenix and Washington D.C. Uber plans to steadily expand the service into other cities throughout the year."

Published on: July 21, 2021

With brief, occasional, italicized and sometimes gratuitous commentary…

•  The Save Mart Companies stores – Save Mart, Lucky California and FoodMaxx -- announced that they "have teamed up with Fandango to offer movie fans the opportunity to watch summer blockbusters inside a local theater or stream movies from the comfort of their home.

"Now through August 10, shoppers at Save Mart, Lucky California and FoodMaxx will receive a free Fandango Movie Reward for every $25.00 spent on specially marked items in a single transaction. Shoppers may use the reward to get a ticket to visit a local theater or use the reward to stream any movie on VUDU.  Fandango Buy Me tags are featured on participating items throughout the store including popular brands like Frito Lay, Pepsi, Nature’s Own, and much more. Rewards are redeemable up to a thirteen-dollar value."

The smart move was adding the streaming component, because there still are a lot of us reluctant to go back to movie theaters.

•  Health and wellness retailer GNC said that it has entered into a partnership with meal delivery service RealEats, including a strategic investment into the delivery company.

According to the announcement, "GNC will offer RealEats’ exclusive meal bundles through GNC.com beginning later this year. The bundles will include options for consumers with dietary preferences, such as meat-free or lower calorie offerings. Through GNC’s digital and store footprint, the partnership will expand RealEats’ geographical reach, increasing the delivery service throughout the US and furthering the company’s goal to improve the health and lives of everyone, by making real food accessible."

Published on: July 21, 2021

•  Kroger announced yesterday that Rob Quast, the company's director of insurance and claims, has been promoted to Head of Investor Relations.

Published on: July 21, 2021

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…

•  In the US, we've now had a total of 35,081,719 Covid-19 coronavirus cases, resulting in 625,363 deaths, and 29,435,171 reported recoveries.

Globally, there have been 192,329,727 coronavirus cases, with 4,135,069 resultant fatalities, and 175,004,410 reported recoveries.  (Source.)

•  The Centers for Disease Control and Prevention (CDC) says that 68.3 percent of the population age 18 and older has received at least one dose of vaccine, with 59.6 percent being fully vaccinated.

•  From the Wall Street Journal this morning:

"Life expectancy in the U.S. fell by 1.5 years in 2020, the biggest decline since at least World War II, as the Covid-19 pandemic killed hundreds of thousands and exacerbated crises in drug overdoses, homicides and some chronic diseases.

"Provisional data released Wednesday by the Centers for Disease Control and Prevention showed that American life expectancy dropped to 77.3 years in 2020, roughly the same level as in 2003, erasing years of hard-won gains in the nation’s public health. It was the largest single-year decline recorded since 1943."

The Journal writes that "life expectancy won’t recover to pre-pandemic levels in 2021," according to population-health experts, "and could decline again if a new Covid-19 variant emerges that vaccines don’t protect against, some said. The highly transmissible Delta variant of the virus has pushed cases, hospitalizations and deaths up again recently, particularly in parts of the country where vaccination rates are low."

•  The Wall Street Journal reports that "the Delta variant accounts for 83% of analyzed Covid-19 cases in the U.S, according to genetic sequences from positive tests submitted to the Centers for Disease Control and Prevention, the agency’s director said … The Delta variant’s prevalence in sequenced samples had risen from 50% of cases for the week of July 3, CDC director Rochelle Walensky said Tuesday in testimony before the Senate Committee on Health, Education, Labor and Pensions."

Walensky told the committee that the best defense against the Delta variant and all other forms of the coronavirus is vaccination, and noted that "nearly two-thirds of counties in the U.S. have less than 40% vaccination coverage."

•  CNN reports that "Amazon said it will end its on-site Covid-19 testing for US warehouse workers this month as it continues to peel back some pandemic-related safety measures inside its facilities.

"The company notified workers that it will cease offering on-site testing after July 30, according to a notification Amazon shared with workers in its employee app, called A to Z, viewed by CNN Business. The company cited that Covid-19 testing and vaccines are now widely available."

According to the piece, "The change comes as workers continue to receive notifications from the company about confirmed cases of the virus inside facilities, and amid the growing spread of the Delta variant. Amazon said it could resume its employee testing program at any point if needed. In February, the company said its newly built Covid-19 testing lab in Kentucky had processed more than 1 million tests for frontline employees from more than 700 testing sites."

Published on: July 21, 2021

Yesterday we took note of a Boston Globe story about how "Maine Governor Janet Mills this week signed the nation’s first extended producer responsibility (EPR) law, effectively holding the corporations accountable for the packaging waste they create. Now, nearly a dozen states, including Massachusetts, are on track to follow Maine’s lead."

MNB reader Bob McGehee wrote:

In the mid-90’s Florida enacted the Advance Disposal Fee (ADF).  It was a cost added to various products depending on their current level of  recycling.  Aluminum cans and newspapers were initially exempt as they were already above the Florida determined recycling percentage goal.  Plastic, cardboard and various other material had a fee (aka tax) added at the wholesale level for each sale unit.  I.E., a six pack of juice boxes had $0.06 added to its cost.  Retail pricing was increased to account for the cost. 

Initially, it was a real nightmare to even get an accurate list from the state of Florida for all products.  Also, it was determined that many items had to be exempted because of the nature of their packaging.  I.E., a can of nuts has a plastic lid, cardboard container and a aluminum lid.  You can imagine the gyrations that generated.

Systems had to be edited to create a field to load the ADF, retailers had to post signage alerting consumers to the new increased cost plus many other costly activities.   Wholesalers were compensated about $10 per month to manage reports, revenue submission, audit practices, etc. That money was spent on the first round of conference calls.  LOL.

After about 2 years, it was abandoned due to less than projected revenue, consumer complaints and general lack of behavior change.  It fell into the pile of ‘that’s a good idea, let’s do it, what could possibly go wrong’ endeavors.  I’ll be watching to see if Maine’s experience has a different outcome. 

Another MNB reader responded:

Shifting the responsibility to the manufacturer again.  The states will still have to figure out what to do with the waste.  That doesn’t change.  The only difference is they don’t pay for it anymore.  So I wonder if Maines taxes will go down???  That would be wicked good.

On another subject, from MNB reader Steven Ritchey:

Rudeness in stores isn't new.

I started working as a bag boy in Tom Thumb in Fall of 1976, you can do the math as to how long ago that was and how old I am now.  A year or two later I was a checker.  Early one Saturday morning a woman was loudly berating me because we were out of something that was on sale.  I tried to explain to her that our DC was out and we'd been cut on our last order and I would happily issue her a rain check for it.

She was having none of it, and she was letting me know using language that would make a sailor blush.  My Store Manager happened to walk by, heard her outburst and came over to see if he could help.  He ended up telling her that his employees were not there to be treated rudely by people like her and she needed to stay out of his store until she could behave herself.

Later, I helped a woman take her groceries to her car and all the way there she complained to me that she had just moved her from New York, and she had the accent to prove it.  I was in the Dallas area in Texas, grew up there and have the accent to prove it.  She capped off her litany of complaints as I put her groceries in her car with, "And I hate this southern, Texas accent, and you are the worst I've ever heard."

I just looked at her and smile then said, "Well Ma'am, at least I don't talk like some damned arrogant yankee."

I turned to go back in the store and I heard her calling me.  Expecting an outburst I turned to face her and she said, "Thank you for putting me in my place, I deserved that."  She become one of my best customers for the next few years.

Responding to a conversation from yesterday, one MNB reader wrote:

Regarding the vaccine “scam”.  Have a friend that got the vaccine.  Their spouse called it a scam and wouldn’t go within 10 miles of it.  The spouse is now recovering, thankfully, from the virus, was hospitalized and is still not up to speed.  So call it what you want, but vaccines work and apparently are working on the variants.  No evidence to the contrary and I see it as a real scare tactic.  Even though I lean right, I say get the vaccine so your voice can continue to be heard.

In my commentary yesterday, I expressed a certain exasperation with people who are complaining about new mask mandates.  I suggested they think of it this way - if a street had a pothole, and the authorities felt it was necessary to block off the street temporarily, it would make sense to die so until the street could be repaired.  After all, public safety is important.

But one MNB reader wasn't buying:

Instead of blocking off the street, why not drive around the pothole?  You still get to where you’re going but are careful how you do it knowing there is an impediment.

Sometimes you don't see the pothole until it is too late.  Sometimes the pothole is too big to drive around.  And sometimes people find any reason not to accept the fact that sometimes, in the public interest, we have to accept certain inconveniences.

Published on: July 21, 2021

The Milwaukee Bucks last night defeated the Phoenix Suns 105-98 in game six of the National Basketball Association finals, earning the franchise its first NBA championship in a half-century.