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Thursday, December 3, 2020
THE NEW “TikTok Treats” menu on Postmates in Los Angeles wins no plaudits for gastronomy. It appeals to carb-loving teens: cloud bread and pancake cereal. But the tie-up with the popular short-video app is another sign that food-delivery firms are coming of age. Among teens and millennials, ordering food online is as ingrained a habit as booking an Airbnb, bingeing on Netflix or hailing an Uber. Just how hooked consumers are thanks to the pandemic is clear from financial documents filed on November 13th by DoorDash, America’s biggest food-delivery company, ahead of its listing on the New York Stock Exchange next month. From January to September it booked orders worth $16bn, up by 198% year on year, earning revenues of $1.9bn. It ferries grub from 390,000 American restaurants. The majority of America’s 700,000 or so eateries now distribute via a delivery app, notes Lauren Silberman of Credit Suisse, a bank. The pandemic turbocharged a pre-existing trend for convenience food, as more women work and everybody is short of time. In doing so, it has also rehabilitated one of Silicon Valley’s most derided business models. Restaurants entered the digital realm two decades ago when Takeaway.com
A New York University professor sued fellow faculty members for libel this week after they complained to administrators about his encouraging students to question whether masks actually prevent COVID-19 from spreading. Mark Crispin Miller — a media professor at NYU’s Steinhardt School known for his contrarian views — says his fellow faculty sent the school’s dean a letter filled with a “pack of lies” about his position on mask use and his treatment of students. Miller says the Oct. 21 missive prompted the school to open a review of his behavior that could lead to disciplinary action against him — and now he wants the other professors to pay up for their allegedly false claims. His lawsuit, filed Monday in Manhattan Supreme Court, demands $750,000 in damages from 19 of the teachers, whom he accused of harming his “career and professional standing.” In the meantime, an online petition Miller launched to defend his “academic freedom” has garnered nearly 18,000 signatures, including several high-profile names such as investigative journalist Seymour Hersh, Chinese civil-rights activist Chen Guangcheng, and controversial anti-vaccine advocate Robert F. Kennedy Jr. The dustup began in September when a student in Miller’s undergraduate class on propaganda called for him
Impulse purchases — gum, mints and snack bars tossed into a shopping basket as one snakes through the supermarket checkout line — are falling as more people get groceries delivered or pick them up curbside. US sales of mints are down 30 percent year-on-year at stores tracked by market researcher Nielsen in the 11 weeks ending on May 16, while sales of gum are down 28 percent. The pandemic has prompted many people to switch to online grocery shopping rather than visiting stores, where snacks and other so-called “impulse purchases” are placed strategically near checkout lines. “Sales in our gum and mint category have also been significantly impacted by social distancing protocols,” Hershey, maker of Ice Breakers mints, said in a filing on Wednesday. Mondelez International last month forecast “material declines” in its gum business, which includes Trident and Stride, in the second quarter, describing that category as “the most impulse in nature.” Gum, which is mostly consumed when people go out, is often bought in convenience stores, many of which are closed, it added. Consumers are not, however, abandoning oral care amid social distancing measures. Toothpaste and mouth wash sales are up 12 percent and 13 percent, respectively, for the 11-week period, according to Nielsen. In general, packaged food makers, including Nestle, Kraft Heinz and General Mills have seen a huge boost since the pandemic forced the closure of restaurants, bars and hotels, leading people to eat more at home. The shaky economy in the US could be another factor in the decline in sales of the “to-go” snack items, because they’re not seen by consumers as necessities, according to Amy Goldsmith, a food marketing consultant in Los Angeles. “With the economy, snacking is probably going to take a hit, if it hasn’t already,” she said. “If you’re not on-the-go, you can make yourself a sandwich or have leftovers from last night, so you’re not wasting.” Performance nutrition bars, which many companies pitch as healthy snacks, are down 19 percent in the 11 weeks ending on May 16, according to Nielsen. Cereal and granola bars, sometimes marketed to replace breakfast, fared better, up 3 percent. Daniel Lubetzky, founder and executive chairman of KIND Snacks, said there remained a lot of uncertainty. “It’s very difficult to plan,” he told Reuters. “People aren’t working out — they’re not on the go as much,” Jon Nudi, General Mills’ head of North America retail, told Reuters on Wednesday, noting that diet-focused bars with low calories or sugar were particularly affected. General Mills, owner of Nature Valley and Larabar snack bars, is the biggest player in a global snack bar market worth $16.7 billion at retail, according to market researcher Euromonitor International. “People, at least for the time-being, have put off dieting … to embrace more indulgent things,” Nudi said, noting his company’s Betty Crocker dessert mixes saw sales jump more than 100 percent in the early days of the pandemic. Nudi said snack bar sales should improve as lockdown rules ease, and noted that recessions usually cause people to seek out value brands, where most of its bars play. Share this:
The feds slapped ex-Wells Fargo chief John Stumpf and the bank’s former community banking head Carrie Tolstedt with fresh civil charges and fines over their roles in the fraud scandal that rocked the bank in 2016. The Securities and Exchange Commission said Friday that Stumpf and Tolstedt intentionally misled investors about Wells’ community bank as they inflated the unit’s financial performance while also creating millions of fraudulent and unauthorized accounts. The 66-year-old Stumpf — who left Wells in October 2016 at the height of outrage over the fake accounts, and who famously weathered a grilling from Sen. Elizabeth Warren — has already agreed to pay a $2.5 million fine but will avoid admitting any wrongdoing to the SEC, according to a filing. In January, Stumpf was barred from the banking industry and fined $17.5 million by a banking regulator. Tolstedt, who was allowed to “retire” in July 2016 as her unit was revealed to be at the center of Wells Fargo’s crisis, is in significantly more trouble. She has been charged with fraud for certifying that “cross-selling” was on the up and up in 2015 and 2016, despite having been told that was not the case. The SEC is seeking
Macy’s comparable sales plummeted more than 20 percent in the last three months amid a surge in coronavirus cases that could hamstring the holiday season, the retailer said Thursday. The department store giant expects sales to remain about that far below 2019’s levels for the second half of the year even though they’ve recovered since the virus forced its stores to close in the spring. Macy’s executives say they’re keeping a close eye on the record-setting spike in COVID-19 cases that’s sweeping the nation ahead of Black Friday and the rest of the holiday shopping season. The US has reported more than 100,000 new infections a day for about two weeks straight, leading to renewed lockdown measures in some states. “COVID is surging again across the country, and that continues to impede our recovery and international tourism and urban areas,” Adrian Mitchell, Macy’s chief financial officer, said on a Thursday conference call with investors. But Macy’s bosses said they’re optimistic about posting strong holiday results after finishing the third quarter with better sales than they expected a few months ago. To do that, the company has made its holiday sales events longer and put a greater emphasis on online shopping
Bitcoin’s month long rally is showing no sign of letting up, with the price of the digital token topping $15,000 for the first time since January 2018. The cryptocurrency saw its value increase 9 percent Thursday, and is up more than $1,700 since the eve of the presidential election on Monday. The value of one bitcoin is up more than 30 percent since early October. Fueling the rally has been volatility resulting from the election — which as of Thursday evening was still too close to call. Investors also hope that the finite limit on bitcoin — the currency’s network has a hard cap of 21 million coins — will help its value increase as governments around the world plan future stimulus for their covid-pummeled economies. The world’s best-known cryptocurrency has seen its price climb in recent weeks after PayPal announced that it would allow its customers to buy and sell bitcoin on its platform. JPMorgan analysts last month also said that the value of bitcoin could “double or triple” as it increasingly becomes a more attractive “alternative” currency to gold. The news bolstered long-standing expectations that bitcoin and its rivals could become a more viable form of payment, a goal that
The huge regional trade deal Australia signed along with 14 other nations over the weekend is broadly positive for Australian business but it will require skill to manage its effect on the role of China in our region. The deal known as the Regional Comprehensive Economic Partnership or RCEP brings together 15 nations including the ASEAN countries, Australia, NZ, Japan and South Korea. Combined, they represent about a third of global economic output, which has prompted some to call it an Asian version of the European Union. That is an exaggeration. The price of bringing such a diverse group together has been accepting a fairly weak deal, which leaves in place many barriers to trade. The deal will not, for instance, reduce agricultural tariffs, a key sector where Australia wants to increase market access. There are only incremental improvements in other areas, such as trade in services. The main advance under the deal will be clearer “rules of origin”, which decide where a product is made and hence whether it qualifies for preferential tariffs. Goods using components from other RCEP countries will be easier to count as locally made. Advertisement
Listen in as IG Markets analyst Kyle Rodda joins Markets Live editor Alex Druce to discuss eight-month highs on the ASX 200, what stocks are likely to benefit from positive vaccine news, the picture painted by October employment data and whether the looming OPEC+ meeting might extend production cuts. You can find past episodes of the weekly podcast, which is produced in conjunction with IG, here. Each episode goes for about 10 minutes and is also available through Spotify and Google Podcasts. Markets reporter for the SMH and The Age Most Viewed in Business
Welcome to our grand opening — and yes, we will probably be shutting down soon. A handful of New York City restaurateurs recently have been opening new eateries, even as some admit they will likely close within days or weeks as state officials impose fresh pandemic restrictions. A few, meanwhile, claim they’ve found the secret sauce — negotiating favorable rents that they say will keep them alive during the pandemic and beyond. Last Wednesday, Gray Hawk Grill, whose executive chef, Anthony DiCocco , has cooked for celebs including Jennifer Lopez, Sir Elton John and Mary J. Blige, opened its doors at 1556 Second Ave. on the Upper East Side. The American-style venue, whose go-to items will include baked clams, butternut squash soup and filet mignon, is the culmination of a 25-year dream for veteran restaurant manager Steve Millan. “I wasn’t going to walk away from something that I’ve dreamt of doing for so many years,” Millan told Side Dish. The pandemic caught Gray Hawk Grill by surprise. Millan signed the lease a week before the March lockdown. Then came the construction build, which took longer than planned because of the outbreak. “We thought 25 percent indoor-seating capacity would lead to
Apple has temporarily cut off business with a Taiwanese supplier after finding it asked student employees to work late nights or overtime hours in violation of the iPhone maker’s policies. Taipei-based manufacturer Pegatron falsified paperwork to cover up how it misclassified the student workers in China, who were also sometimes allowed to do work that wasn’t related to their majors, Apple said Monday. “The individuals at Pegatron responsible for the violations went to extraordinary lengths to evade our oversight mechanisms,” Apple said in a statement, adding that its investigations didn’t uncover any evidence of forced or underage labor. The American tech titan said it won’t give Pegatron any new business until the supplier completes “all of the corrective actions required,” but didn’t provide details about the terms of the probation. In a separate statement, Pegatron said the student workers at its Shanghai and Kunshan campuses who weren’t following local rules and regulations have been pulled off production lines and given “proper compensation.” Apple also said Pegatron has fired the executive who had direct oversight of the work-study program. Pegatron is one of several suppliers Apple depends on to produce its signature devices such as the iPhone, according to Bloomberg News.
The pandemic hasn’t derailed holiday shopping this year — at least not yet. Retail sales are on track to grow by as much as 5.2 percent to $767 billion during November and December as many consumers enter the holiday season with fatter savings accounts and less debt, according to a forecast by the National Retail Federation.  “We’ve seen consumers very engaged, looking for an opportunity to celebrate and they have moved into real consumption mode,” NRF chief executive Matthew Shay said during a Monday media briefing. At the same time, the trade group cautioned that sales could rise just 3.6 percent or less — compared with a 4 percent increase in 2019 — because of the economic uncertainty surrounding surging numbers of COVID-19 cases across the country, which could result in states and cities shutting down their local economies as they did earlier this year. “It’s hard to quantify such uncertainty,” NRF chief economist Jack Kleinhenz said during the call. The economist said the shopping forecast assumes that unemployment will remain around the October level of 6.9 percent, adding, “a lot will depend on the labor force participation rate and those receiving benefits.” Sales were up by 10.6 percent in
Shares of News Corp. surged 10 percent on Friday after the publishing giant said it swung to profit with better-than-expected quarterly results. The parent of the New York Post and the Wall Street Journal posted a fiscal first-quarter profit of 8 cents a share on an adjusted basis, up from 4 cents a share this time last year, after posting a loss in the previous quarter due to the pandemic. Revenue came in at $2.1 billion, down 10 percent year-over-year. But some of the decline was attributed to a loss of income from News American Marketing, the coupon publishing unit that was sold at the end of March for $235 million. The adjusted revenue decline was 3 percent. The results follow a difficult period for media companies generally, which saw spending plunge due to the pandemic, and beat the Zacks’ consensus estimate for earnings of 4 cents a share on sales of $1.9 billion. News Corp. reported total segment EBIDTA of $268 million, up 21 percent over last year. The growth was spurred by strong sales from its Dow Jones, digital real estate and book publishing units. “News Corp has started the fiscal year strongly, with higher revenue in many