Tag Archives: recession

Food Truck Entrepreneurs

If you live in New York or another major city, chances are you’ve encountered food trucks–those mobile eateries that serve everything from plain bagels and coffee to tacos to Chinese dumplings. According to Inc.com, these restaurants on wheels have been experiencing a resurgence lately, which has given rise to even more gourmet and exotic offerings. Perhaps it’s due to the recession–foodies still want their daily dose of deliciousness, but they want it quicker and they want it cheaper. Or perhaps it’s just because food from a truck is tasty–why, I’m not sure. But it is.

For those of you interested in getting into the food truck business, a word of caution: While most people will be delighted that they only have to walk ten feet from their office door or apartment building to get lunch, not everyone will be thrilled. In the past, some real estate management companies, especially on Wall Street, have complained about the presence of food trucks outside of their properties saying they offend the aesthetic of their block. In fact, just this summer, the management company in charge of the Portfolio office building on Hudson Street in Manhattan, complained that the Wafels and Dinges truck that had started to park outside every Tuesday looked “unprofessional.” The owners of the truck, who serve waffles and other desserts (“dinges” is the word for “things” in German), were reportedly asked to leave the area, but within a couple of days, they were back, and have been a Tuesday staple every since.

Another possible reason for the success of food carts in recent months is the rise of Twitter, which allows food truck owners and patrons to Tweet whenever the truck moves to a new place. That way, fans can know their favorite truck’s whereabouts whenever they get a hankering for waffles or, in the case of one San Francisco-based food truck, creme brulee. Twitter+food trucks=the perfect combination for a hungry world on the go.

Inc.–Start-Up Trends: Food Trucks

Share this Post:

Lehman Brothers–a Retrospective

In honor of the one-year anniversary of the collapse of Lehman Brothers, the former vice chairman of the firm, Barbara Byrne, recounted the experience of living through the final days of the 164-year-old firm in a recent interview with Fortune. Commenting on the consequences of the Lehman bankruptcy, Byrne said:

I think that allowing the failure of a major systemic and important institution actually created massive systemic risk. Many people would argue there was a lot of risk in the system, which there was already, but do you pop a balloon or do you let air out of a balloon?

Some may disagree with Byrne and think the government did the right thing by allowing the firm to fail, but regardless, it’s apparent that Lehman’s collapse caused a major panic through the market that shook investor confidence and exacerbated the pain of the recession. Several articles and a few books have been published since the event in an attempt to examine what went wrong (Portfolio will publish a book on the history of Lehman next year), but it may be years before we fully understand the why and how of Lehman’s failure, not to mention the impact it had on the economy at large.

We do know that Lehman’s bankruptcy was not only stunning in the way it was carried out but also in the fact that Lehman Brothers was one of the oldest and most respected firms on Wall Street. Founded in 1844 by Henry Lehman, a Jewish immigrant from Bavaria, Lehman Brothers would go on to finance some of the most important endeavors in American history–from radio to retail, automobiles to airplanes–thus distinguishing itself as a smart, innovative investment firm. This storied history may have gotten a little lost, however, in the milieu of bad investments and shaky business practices of the last couple of decades during which Lehman got caught up in the make-a-dollar-now-worry-about-it-later mentality. In hindsight, it’s easy to point fingers (at CEO Dick Fuld, capitalism, Wall Street, greedy bankers, government regulation), but, as we’ve learned, the blame game only gets you so far after the fact.

Fortune: Lehman’s Last Weekend

Share this Post:

Retailers Need Converts Not New Customers

During this downturn, Wal-mart and other bargain-hunter satisfying retailers have profited while others have struggled. While high-end retailers are seeing their numbers plummet, Wal-mart is experiencing significant growth. The question is whether this growth is sustainable. When the bad times are over will Wal-mart and other retailers like them be able to keep the new customers driven to their stores by the recession?

Of course, there are those who will be so scarred by the memory of this downturn that they will stick with cheaper retailers even when the American economy is booming, much like some of our grandparents who lived through the Depression still roll pennies and re-use scrap paper. But in the end, unless bargain retailers can make a lasting impression on them now, most Americans will return to their Abercombie and J.Crew spending habits as soon as the economy recovers

A current article in BusinessWeek takes a close look at what Wal-Mart is doing to make sure these customers stick around. In this same article Ryan Mathew’s of Black Monk Consulting, which works with retail clients, says “If the recession ended tomorrow, they would lose a lot of [customers]. But the longer the recession goes, the smarter Wal-Mart will be about holding on to those customers.”

http://www.businessweek.com/magazine/content/09_24/b4135000941856_page_2.htmkeep-calm-and-carry-on-shopping3

 

 

Share this Post:

Don’t Save So Hard, You’ll Hurt Yourself!

I’ve noticed that there’s a strange inverse relationship between the size of my apartment and the price of my new television. My charming husband won my consent for the decadent purchase with the reasoning that a cheaper TV would take up too much space in our small living room. We actually had to spend more money to own a less intrusive set. Well, I suppose that’s true. But it’s also true that—particularly in these uncertain times—we could have socked that money away or invested it in a more responsible way.
 
But this New York Times article has made me feel a lot better about the sleek rectangle that looks down on me from my living room wall. Shame be gone! Apparently there’s scientific evidence that those who suffer from financial hyperopia—farsightedness—look back with sadness on the fun they weren’t able to have because they just couldn’t separate themselves from the dough.

Splurging on a vacation or a pair of shoes or a plasma television can produce an immediate case of buyer’s remorse, but that feeling isn’t permanent, according to Ran Kivetz of Columbia University and Anat Keinan of Harvard. In one study, these consumer psychologists asked college students how they felt about the balance of work and play on their winter breaks.

Immediately after the break, the students’ chief regrets were over not doing enough studying, working and saving money. But when they contemplated their winter break a year afterward, they were more likely to regret not having enough fun, not traveling and not spending money. And when alumni returned for their 40th reunion, they had even stronger regrets about too much work and not enough play on their collegiate breaks.

“People feel guilty about hedonism right afterwards, but as time passes the guilt dissipates,” said Dr. Kivetz, a professor of marketing at the Columbia Business School. “At some point there’s a reversal, and what builds up is this wistful feeling of missing out on life’s pleasures.”

So retailers everywhere now have a new enticement in their bag of trick this season. Go ahead and take that vacation or buy that new TV. It’ll cure your saver’s remorse!

New York Times: Oversaving, A Burden for Our Times

Share this Post:

Wanted: Talented People

In the wake of the current recession, many businesses have rushed  to cut employees as a way to quickly and drastically cut costs. But, as George Anders notes in The New York Times, certain savvy companies in the entertainment, venture capital, and medical research fields are actually using these tough times as an opportunity to recruit talent to help them stay ahead of the curve while their competitors struggle to stay alive.

And Anders is not the first to espouse the idea that people are the lifeblood of an organization, rather than disposable cogs in the wheel. Portfolio author and Fortune Senior Editor at Large Geoff Colvin wrote an article in January about how to manage your business in a recession, which suggested the same thing. It might be counter intuitive, but maybe that’s why it’s such a good idea.

The New York Times: The Secrets of the Talent Scouts

Fortune: How to Manage Your Business in a Recession

Share this Post:

Layoffs, layoffs, and more layoffs

This was another lovely headline to wake up to:  ADP index shows private-sector jobs fell by 697,000 in Feb.

I hope America’s senior managers will read Geoff Colvin’s forthcoming book, THE UPSIDE OF THE DOWNTURN, and learn the danger of rushing into mass layoffs as a first resort. There are smarter ways to cut costs that won’t leave companies quite so devastated when the recession eventually ends.

In the meantime, while we wait for Geoff’s book in late June, everyone in business ought to read his brilliant January article in Fortune:

How to Manage Your Business in a Recession

Share this Post: