The Weekly: Edition #53 - July 10th, 2020
Bottlenecks
The task of growing a business can be defined as finding and eliminating bottlenecks to allow for greater capacity and throughput. Your business will only operate as fast as your narrowest bottleneck allows. The pandemic, with its resulting shifts in customer behavior and constantly changing requirements on businesses, are exposing bottlenecks many of us didn’t know were there. As the world moves online, customer expectations grow around instantaneous service, further compounding the issue. Now more than ever, it is critical that we root out the bottlenecks in our organizations and open them or eliminate them altogether in order to meet the demands of this new reality.
Supply Chains - There are vendors who deliver, and there are vendors who don't. Covid-19 has exposed how optimizing for the lowest costs can increase the risk around timely delivery. Going forward, we believe companies who ensure that their supply chain is uninterrupted will win business when competitors falter in their ability to deliver. Is your supply chain experiencing interruptions and how does this compare with what your competitors are experiencing?
Operations - The fundamental purpose of technology is to give the end user leverage over their time to accomplish more with less (time or money or both). When change is necessary, we often lose this leverage as we spend inordinate amounts of time coaxing our systems to follow new process. Does your technology stack give you more flexibility to meet changing demands, or is it locking you in to processes that are no longer relevant or hold back your ability to respond to shifts in the landscape?
Talent – In times of uncertainty, team agility becomes critical. Your team not only needs to be willing to turn on a dime when necessary, but ideally are thinking creatively about tactics to address emergent challenges. Often this is not the case as disruption causes many to retreat to routines that are familiar. Tough times can cause true leaders to emerge, so be on the lookout for those who are willing to tackle new problems and encourage them to lead. If you have the capacity to do so, many industries have a richer talent pool than they’ve seen in years from which to hire. Now is a great time to encourage your current team out of their safe places and to support new leaders.
Finance – Many of the great success stories of today were born during the financial crisis of 2008. Slack, Uber, Pinterest, and Square came through hard work and great product to be sure, but none would have been possible without access to capital. Do your current financial partners enable or hamper your growth? Have you revisited how you’re handling accounts receivable and cash management? Do you current investments and capital projects still make sense in this landscape?
As we begin the climb out of the economic crater that is Covid-19, addressing consumer demand efficiently will be a large part of what defines the winners and losers in the coming years. Consumers and businesses alike have experienced delays, bad customer service, or no service at all due to various bottlenecks in business operations. The winning companies will be able to adapt to customer needs by asking and addressing these questions.
How will the world change after COVID-19? (Hawk Equity)
+ This is one of the best crowd-sourced lists we've come across that shows how people think the world will change after COVID-19.
American Airlines will no longer limit capacity on flights (Paste Magazine)
+ "Currently American books its planes to about 85% of their total capacity. About half of the middle seats of the main cabin are sold for flights right now, and presumably those are filled by parties who are traveling together and thus already regularly exposed to each other. As of next week, though, American’s going to stop doing that. There will be no caps on how many seats can be sold for any flight. They will notify passengers in advance if a flight is full, and give them the option of switching to a less crowded flight, if one is available, but otherwise it’s back to the glory days of packing as many people into that metal tube as possible."
Our ghost kitchen future (The New Yorker)
+ "The ghost kitchen is an increasingly crowded space. In addition to Reef, there are Zuul and Kitchen United in the United States, Deliveroo in London and Paris, and Panda Selected in China. CloudKitchens, the new venture run by Travis Kalanick’s City Storage Systems, buys real estate, brings in kitchen facilities, and leases them to chefs and small-business owners, most of whom do not have other brick-and-mortar spaces. Ojalvo cites his own experience in the restaurant industry (as a partner, he worked on the expansion of Sushi Samba, a Peruvian, Japanese, and Brazilian fusion-restaurant chain with locations in Las Vegas and Amsterdam) to note that opening a brick-and-mortar restaurant is high-risk and expensive, whereas ghost kitchens are lower-risk, offering a more affordable way for entrepreneurs to enter the business."
US online grocery shopping hits a record $7.2B in June (TechCrunch)
+ "Despite the slow reopening of the U.S. economy over the past several weeks, online grocery shopping is continuing to reach ever-higher numbers as Americans seem to be in no rush to return to the store. According to new research released today by Brick Meets Click and Mercatus, U.S. online grocery sales hit a record $7.2 billion in June, up 9% over May, as 45.6 million households turned to online grocery pickup and delivery services for a larger portion of their grocery needs."
There’s a worldwide shortage of roller skates (Vogue)
+ "Steilen, a.k.a. Estro Jen (her skate name), founded Moxi in 2008 with a mission to create beautiful made-in-America rollers that had the same retro appeal as Farrah Fawcett’s. The Moxis come in every color of the rainbow with wheels that hold up outdoors. At $299 a pair, they’re not cheap, but Steilen has seen her business double each year since opening. In the last six months, her staff has grown sevenfold to keep up with demand, from five to 35 people, all skaters who had lost jobs in the pandemic. “We’re seeing last year’s annual sales in one month,” she says. Executives at C7 skates, Impala Rollerskates, and Sk8 Fanatics all agreed that the demand right now is truly unprecedented."
How coronavirus and millennials killed the non-digital gym (VentureBeat)
+ "The fitness industry is in the midst of a digital transformation. Fitness, like just about every industry from transportation to leisure, has witnessed the emergence of digital as a force for change, and brick and mortar gyms are having a tough time keeping pace. Entire companies have been successfully launched to capitalize on the rise in digital fitness as evidenced by the popularity of companies such as MIRROR Home Fitness, Peloton, FiiT, and SWEAT. These are just a few fitness providers that have leveraged digital technology to engage audiences that are looking for customized fitness experiences that meet their individual schedules and routines."
Who is the mystery shopper leaving behind thousands of online shopping carts? (Wall Street Journal)
+ "When The Wall Street Journal contacted Google in June, a spokesman at the internet giant, after a few days of digging, provided an update: The mystery shopper is a bot of its own creation. The purpose: making sure the all-in price for the product, including tax and shipping, matches the listing on its Google Shopping platform or in advertisements. It wasn’t to cause angst to merchants due to thousands of abandoned carts."
Ability to work from home: evidence from two surveys and implications for the labor market in the COVID-19 pandemic (Bureau of Labor Statistics)
+ "A recent article by Erik Brynjolfsson et al. estimates that 31 percent of workers who were employed in early March had switched to working at home by the first week of April. Even when stay-at-home orders are relaxed, many workers may continue working at home until the pandemic is fully contained."
The coming child care crisis (Axios)
+ "Most working families need care for at least 40 hours a week, and schools were providing that," says Adrienne Schweer, a fellow at the Bipartisan Policy Center, a Washington think tank. "If that's gone, there's nothing to fill the void." Care for children under five is also in crisis, she says. The Center for America Progress projects that the pandemic will put up to 50% of day care centers out of business, erasing some 4.5 million slots for young kids."
Do you have what it takes to be a master auctioneer? (Texas Monthly)
+ "We sold a horse. We sold Yeti coolers. We sold wireless meat thermometers, Craftsman shop vacs, trailer tires, and vintage saddles. When stomachs were growling, we sold popcorn snacks. A rum cake, made by one woman’s ninety-year-old Hawaiian grandmother, sold for hundreds of dollars. A three-speed 1921 Emerson fan and a football signed by former Oklahoma Sooners coach Bob Stoops each went for much less. In desperate times, we sold whatever we saw nearby: eyeglass frames, an American flag, a Texas flag, folding tables, a lectern—even the very microphone we held."
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