Headlines of the Week

Inflation surged 6.8% in November, even more than expected, to fastest rate since 1982

Inflation accelerated at its fastest pace since 1982 in November, the Labor Department said, putting pressure on the economic recovery and raising the stakes for the Federal Reserve.  The consumer price index, which measures the cost of a wide-ranging basket of goods and services, rose 0.8% for the month, good for a 6.8% pace on a year over year basis and the fastest rate since June 1982.  Excluding food and energy prices, so-called core CPI was up 0.5% for the month and 4.9% from a year ago, which itself was the sharpest pickup since mid-1991.

 

Jack in the Box to buy Del Taco for $575 million

Jack in the Box said on Monday it would acquire fellow quick-service chain Del Taco for $12.51 per share, or around $575 million. The move by the two chains, both based in San Diego, will give the brands greater economies of scale and reinforce their strategies for growth, the companies said in a statement, adding that 2,200-unit Jack in the Box and 600-unit Del Taco have “complementary cultures, guest profiles, operating models and market opportunities.” Del Taco is the nation’s second largest chain in the growing Mexican food segment, after Taco Bell. This is not Jack in the Box’s first foray into owning Mexican restaurants. It owned fast-casual concept Qdoba Mexican Eats for 15 years before its sale in 2018.

 

 

Apparel & Footwear

Nike will stop selling sneakers at DSW, one of the largest U.S. shoe chains

Nike is cementing its direct-to-consumer strategy by cutting ties with DSW, one of the largest shoe store chains in America. As of 2022, customers will not be able to buy Nike apparel or sneakers at the retail location — or a number of others — as Nike continues to cut down the number of third-party merchants it sells through. In addition to DSW, stores like Zappos, Dillard’s, Urban Outfitters, and Shoe Show will no longer carry Nike products in the new year.  The business move — which has been reflected by Adidas, Under Armour, and Crocs — comes as brands try to maintain more control over their images, distribution, and pricing. Selling only through their own retailers also allows companies to maximize profits and exclusivity, a factor becoming increasingly important as the Omicron variant of COVID threatens shortages and sales once again.

Bedrock Manufacturing Co. Announces New CEO

Bedrock Manufacturing Co., parent of Shinola and Filson, has named Awenate Cobbina its new chief executive officer, effective Jan. 1, 2022. The role marks an expansion in leadership for Cobbina at the company, where he serves as a board member and runs investing and philanthropic activities for Bedrock Group LP. Cobbina, 41, will drive overall day-to-day business, as well as develop new opportunities. He succeeds Shannon Washburn, who joined in 2019. Immediately prior to joining Bedrock Group LP, the leading investor in BMC, Cobbina led operations as a member of the Biden-Harris transition’s executive leadership team.

Torrid braces for rising costs and ongoing pandemic uncertainty after mixed Q3

Benefiting from apparel demand but dogged by supply chain issues, Torrid on Wednesday reported a mixed Q3. Net sales rose 13% year over year and 19% versus 2019 to $306.2 million, and gross profit expanded to 40.9%, from 35.4% last year and 38.3% in 2019. But the plus-size apparel retailer swung to red with a $58.9 million net loss, from last year’s $4.3 million net income, largely due to an IPO-related tax bump in the quarter.  Comp sales rose 14% year over year and 18% from 2019, according to a company press release. Comps include both e-commerce and stores, and the Q3 increase was Torrid’s 37th positive showing in the last 39 quarters, CEO Liz Muñoz said.

Rent the Runway CEO says it is changing how it buys apparel from brands to boost its profits

Rent the Runway is still losing money. Its shares fell around 12% in trading Thursday, touching an all-time low of $9.81, in the wake of the fashion rental platform’s first financial report as a public company. In its fiscal third quarter, Rent the Runway reported a wider net loss compared with a year earlier and an active subscriber count that has yet to return to pre-Covid levels. About half of its expenses were one-time items associated with its recent public debut. But Chief Executive Officer Jenn Hyman hopes to sell investors on her strategy to win over women’s wardrobes while turning a profit — eventually. During a call with analysts Wednesday evening, Hyman explained that the company has multiple ways that it can acquire inventory from designers, and some of those channels are more profitable than others.

Stitch Fix Beats on Revenue, but Shares Dive on Down Forecast

One thing became clear during Stitch Fix’s earnings call on Tuesday: For the fashion e-commerce and data-driven fashion styling service, its direct-buy feature has become a lifesaver for the business — and maybe a bit of an albatross. For its first fiscal quarter of 2022, which ended in October, Stitch Fix revenue sailed over analysts’ projections of $571 million to $581 million, for ​​19 percent year-over-year growth. Adjusted earnings of $38 million brought Stitch Fix a gross margin of 47 percent, marking its highest ever. But that wasn’t enough to buoy the stock. When the company’s revenue forecast for the fiscal year fell short of analysts’ expectations, shares fell 17 percent in after-hours trading.

 

Athletic & Sporting Goods

CCM Hockey To Merge With Jackson Ultima And Atom

Sport Maska Inc., the Montreal-based owner of the CCM Hockey brand, announced the acquisition of Tournament Sports Marketing, Inc., the owner of the Jackson Ultima and Atom brands.   Headquartered in Cambridge, Ontario, Tournament Sports Marketing makes figure skating boots, blades and skates through its Jackson Ultima brand. Tournament Sports Marketing also makes roller and in-line skates through its Atom Skates brand. Sport Maska also owns Step Steel.

 

Bridgestone sells tennis ball company

Another company within Bridgestone Corporation’s Diversified Products business will soon have a new owner. Bridgestone Sport Co., Ltd. (BSP) is selling all its stock in Bridgestone Tecnifibre Co., Ltd. (BSTF), a Thailand-based manufacturer and seller of tennis balls, to Japanese sport equipment company Yonex Co., Ltd. BSP withdrew from the tennis goods business at the end of 2020.

Aqua-Leisure Recreation Continues Year of Growth With Acquisition of Airhead Sports Group

Aqua-Leisure Recreation, LLC, a pioneer in water sport leisure product development and aquatic goods and the #1 brand in pool hammocks and lounges, announced the acquisition of Denver, Colorado-based Airhead Sports Group. With the acquisition of Airhead, the #1 brand in the marine towable watersports and winter leisure activity product categories, Aqua-Leisure becomes the premier market leader within the aquatics consumer products industry.  Founded in 1991, Airhead Sports Group manufactures market-leading outdoor, marine, watersports and winter leisure products under the brand names Airhead, Sportsstuff and Yukon Charlie’s. Airhead products are distributed across 60+ countries through six core channels.  This is the first add-on acquisition for Aqua-Leisure since Blackford Capital acquired the company in January 2021.

Cosmetics & Pharmacy

Walgreens reportedly considering sale of U.K.-based Boots pharmacy

According to a report, Walgreens is putting advisors in place, including Goldman Sachs, to explore options for Boots. Walgreens Boots Alliance may be thinking of letting Boots go.  Walgreens acquired the U.K.-based pharmacy chain in a two-step process that began in 2012, with a 45% equity ownership in Alliance Boots. It completed the process in 2014, acquiring the remainder of the company to form Walgreens Boots Alliance. According to the report, Walgreens CEO Roz Brewer, who took the reins of the company in March, is focused on sharpening Walgreens’ focus on U.S. health care.   Some industry experts say that Boots has lost its distinctive character under U.S. ownership, and that its stores and services have suffered from a lack of investment, the report said.

Nestlé Trims L’Oréal Stake With $10 Billion Sale

Nestlé SA said on Tuesday it would cut its stake in L’Oréal to about 20 percent by selling shares worth €8.9 billion ($10 billion) back to the French cosmetics brand, moving to reduce the weight of the beauty giant on its books for the first time in seven years. The Nescafe maker’s holding in the beauty giant has been the subject of intense scrutiny over the years, and the Swiss company has maintained its interest was both financial and strategic, even when activist investor Third Point urged disposal in mid 2017. Since then, L’Oréal shares have more than doubled. Seeking to reduce the weight of its L’Oréal holding while maintaining a level above 20 percent, allowing it to consolidate the investment on accounts, Nestlé approached L’Oréal two months ago, kicking off a flurry of negotiations that involved chairmen of both companies, according to a source with knowledge of negotiations. Following the deal, Nestlé said it would own 20.1 percent of L’Oréal, down from 23.3 percent previously. L’Oréal, meanwhile, would buy back shares representing 4 percent of its capital and cancel them at the latest on Aug. 29.

 

P&G to Acquire Hair Care and Lifestyle Brand, Ouai

Procter & Gamble will acquire Ouai, a hair care and lifestyle brand. Company Founder Jen Atkins will remain with the company as chief creative officer. Colin Walsh will continue as chief executive officer. A purchase price was not disclosed. Since its inception in 2016, Ouai has expanded beyond hair care into candles, body care, fragrances and supplements. Like many other brands born in the past five years, Ouai relies on its loyal customers for input on product development. The brand has more than 4.2 million followers on Instagram and connects with them via surveys. Ouai reportedly has sales of $50 million this year and sales could top $80 million in 2022, according to sources.

Discounters & Department Stores

Nordstrom leverages pack and hold inventory to mitigate supply chain risk

Nordstrom is increasing its use of pack and hold inventory “by a factor of two times to three times” at its Rack subsidiary as it expects macro supply chain disruptions to persist into 2022, CEO Erik Nordstrom said on the company’s Q3 earnings call. Through this approach, Nordstrom Rack will buy larger quantities of relevant items when available and hold a portion of it for deployment “in periods with high demand, tight supply or system constraints,” Nordstrom said. The retailer expects its inventory levels to remain elevated through the end of the fiscal year as it invests in pack and hold at Rack and ships products earlier to meet holiday demand. CFO Anne Bramman said the company will also pull volume forward for spring products in the next two quarters.

Belk, Afterpay partner on buy now, pay later service

Amid the buy now, pay later boom in the U.S., Belk Has introduced Afterpay’s buy now, pay later payment service online and in stores, the financial tech company announced on Tuesday. So far, the retailer has seen a 50% increase in average order values for customers using the service. The majority of Belk’s Afterpay users are millennials and Gen Z shoppers. The service is launching amid the holiday season and allows customers to “pay for their gifts responsibly in four interest-free installments,” according to the release.

Hedge fund pushes Kohl’s to consider e-commerce spinoff

Expressing disappointment and impatience with what they called Kohl’s underperforming stock, hedge fund Engine Capital, which owns 1% of Kohl’s shares, on Monday urged the department store to “publicly commit to conducting a full review of strategic alternatives.” In a letter to the Kohl’s board also made public, Engine Capital partners Arnaud Ajdler and Brad Favreau outlined what they called “two viable paths” — splitting off its e-commerce and legacy store operations into two companies, or selling itself. “The Kohl’s board and management team continuously examine all opportunities for maximizing shareholder value,” Kohl’s said in an emailed statement.

 

Walmart to build a high-tech fulfillment center in Tennessee

Joining other retailers in adding more distribution centers, Walmart on Tuesday announced it’s opening a 925,000-square-foot automated fulfillment center in the fall of 2022 in Lebanon, Tennessee, to streamline its supply chain and e-commerce operations. The fulfillment center — marking the retailer’s first in the state — will use AI software, robots and human associates to ship orders to customers. It will house millions of items that will be sent directly to customers as early as the next day, according to a company press release. The facility will use robots to find items within its storage system and bring them to employees for packing before shipping to customers. The company is hiring for a range of full-time jobs within the fulfillment center, including general manager, human resource manager and maintenance manager, per the announcement.

 

 

Emerging Consumer Companies

The Center, a Los Angeles-based multi-brand beauty platform, raises $15 million

The Center, a beauty multi-brand platform announced that it has received a $15 million minority investment from Prelude Growth Partners. The Center, founded in 2019 by beauty industry veteran Ben Bennett, focuses on building and growing beauty and wellness brands. The Center develops and supports the growth of leaders and up-and-comers in the space including their in-house brands Naturium, MAKE Beauty, and Phlur.

Media content company, The Desire Company, raises $14 million

The Desire Company, a Chicago-based media and content platform where experts and professionals across a range of industries — from fitness and wellness to entertainment and culinary — can offer their personal advice concerning particular consumer products, announced that it raised its Series A. The $8 million round was co-led by Valor Equity Partners and Cleveland Avenue. The company’s platform features product reviews, how-to videos and classes as well as articles by professionals looking to share their knowledge.

Jolie launches showerhead filter beauty brand

The founder of footwear brand Greats, Ryan Babenzien, is back with Jolie, a showerhead filter beauty brand designed to filter 85% of chlorine and heavy metals such as lead, arsenic, mercury and chromium out of water for three months based on average shower use. The compounds are commonly found in water in the United States, according to Babenzien, who says they have negative impacts on skin and hair, including contributing to eczema and dandruff. At the core of Jolie’s product is a proprietary combination of two types of filtration mechanisms: KDF-55, a copper-zinc alloy that removes chlorine and heavy metals at high pressure and temperature, and calcium sulfite focusing specifically on chlorine removal. Jolie’s showerhead was tested by three independent testing facilities. Babenzien asserts it has the most effective filter on the market.

 

 

Food & Beverage

Chicken-free egg maker, The Every Company, raises $175 million

The Every Company closed an oversubscribed $175 million Series C funding round, bringing the animal-free egg protein company’s lifetime funding to $233 million. The round was co-led by new investor McWin Food Ecosystem Fund and existing investor Rage Capital. Other investors in this round include Temasek, Grosvenor’s Wheatsheaf Group, TO Ventures and Prosus Ventures.  The Every Company plans to use the funds to scale production, commercialize a strong pipeline of animal-free protein products and expand into new applications. The company also plans to expand its portfolio by producing more proteins naturally found in the egg.

McCain invests $55M in plant-based frozen brand Strong Roots

McCain Foods invested $55 million in Irish frozen plant-based food company Strong Roots, with the global potato giant taking a minority stake in the business.  Through this partnership, Strong Roots will use McCain’s global network to grow and increase distribution. McCain gains a healthy and on-trend brand to increase its reach in better-for-you and plant-based categories. Strong Roots, which will continue to be run independently, will gain foodservice exposure through McCain’s existing partnerships. This is the latest partnership between McCain and smaller companies in the plant-based space. McCain also has invested in plant-based chicken maker Simulate and Canadian indoor vertical farming company GoodLeaf.

Kids Drinks Brand good2grow Acquired by Wind Point Partners

Atlanta-based kids drink brand good2grow was acquired by Chicago-based private equity firm Wind Point Partners, which purchased the brand from its owner Kainos Capital. Terms of the deal were not disclosed.  Founded in 1997, good2grow produces clean label, RTD juices, fortified waters and flavored milks and has now emerged as one of the fastest growing brands in the kids drink space. In addition to its better-for-you positioning, the company has driven growth through its collectible bottle tops, featuring cartoon characters from Disney, Hasbro and Nickelodeon, to name only a few of the brand’s licensing partners.

Kraft to acquire Just Spices

The Kraft Heinz Co. is acquiring an 85% stake in Just Spices GmbH, Dusseldorf, Germany.   The remaining 15% ownership stake in Just Spices will be retained by its three founders who will remain with the company once the acquisition is complete. Terms of the acquisition were not disclosed.  Just Spices is a manufacturer of spices, spice blends, salad dressings and meal kits. Approximately 70% of the company’s sales are direct-to-consumer. Just Spices, which was founded in 2014, has annual sales of approximately $68 million.

 

 

Grocery & Restaurants

Aramark signs collaboration deal with Starr Restaurants

Aramark has entered into a “strategic collaboration” with Starr Restaurant Organization, one of the largest multi-concept and independent restaurant groups in the country with concepts like Buddakan, Barclay Prime, Upland and The Clocktower. The collaboration between the two companies, both based in Philadelphia, includes an exclusive licensing agreement that will allow Aramark to operate designated Starr concepts and brands within its various markets while providing Starr, which is currently concentrated along the East Coast, with national visibility. Aramark also takes a minority ownership position in Starr as part of the agreement. In addition to the licensing agreement and minority ownership components, the deal also calls for joint business development opportunities and creative and operational knowledge exchanges among culinary teams and senior leadership of the two companies. With clients in markets as diverse as higher education, corporate dining, sports/recreation, convention centers and cultural attractions, Aramark presents a broad area of expansion for Starr into not only new geographic territories but venues beyond its current commercial restaurant focus. Meanwhile, Aramark gains access to a premium restaurant concept developer and operator led by Starr—a James Beard Award winning restaurateur who founded the company in 1995 and currently serves as its CEO—and to its culinary expertise.

Retail concept Krispy Krunchy Chicken gets a growth investment

The private-equity firm Main Post Partners has made a strategic growth investment in Krispy Krunchy Chicken, a New Orleans-based concept that serves freshly made chicken inside convenience stores and other retail locations. Terms of the deal were not disclosed. But Krispy Krunchy has more than 2,600 retail locations in 48 states. The deal connects the company with an investment firm with considerable experience in the multiunit foodservice business. Main Post has invested in giant franchisee Flynn Restaurant Group in the past, as well as the sandwich chain Jimmy John’s. Krispy Krunchy was founded in 1989 by Neal Onebane, a convenience-store operator in Lafayette, La. The company provides a quick-service-style offering in a flexible format. Its menu features Cajun fried chicken and an assortment of sides.

Home & Road

RH ups fiscal outlook after ‘record results’ in Q3

Luxury home furnishings retailer RH reported that its financial results represented “the strongest two-year growth” in the industry. For the quarter ended Oct. 31, net revenues increased 19% to $1.006 billion compared with $844 million in the same quarter a year ago, and up 49% vs. Q3 2019. Net income jumped 297% to $184 million vs. $46 million in Q3 2020, and GAAP diluted earnings per share rose to $5.88 from $1.64 in 2020. “Our performance demonstrates both the desirability of our exclusive products and our ability to overcome the compounding supply chain challenges that led us to delay the launch of RH Contemporary, the opening of our first RH Guesthouse and several Galleries, and the mailing of our Fall Source Books until Spring of 2022,” said CEO Gary Friedman in a statement that accompanied the earnings report. Through the first nine months of 2021, RH reported net revenues of $2.856 billion, up 40.28% from $2.036 billion in 2020. Net income climbed 282.42% to $541.5 million, up from $141.6 million this time last year, and GAAP diluted earnings per share at $17.19 vs. $5.37 through nine months in 2020, an increase of 220.11%. With the strong figures in hand thus far this year, Friedman said RH is upping its financial guidance.

Conn’s sees significant retail sales, e-commerce increases in Q3

Specialty retailer of home furnishings and electronics Conn’s Inc. saw retail sales accelerate during the third quarter ended Oct. 31. Total revenues for the period reached $405.5 million, up 21.3% year over year, and Q3 net income rose nearly 146% to $18.2 million, up from last year’s $7.4 million. “Retail sales momentum accelerated during the third quarter as same store sales increased 20.6% over the prior fiscal year period and were up 9.7% on a two-year basis,” said Chandra Holt, CEO. Same store sales, combined with the contribution of new stores, drove a 28.8% increase in total retail sales for the quarter, compared with the same period in fiscal 2021. E-commerce sales increased 294.8% to a quarterly record of $19.2 million.

Leon’s Furniture set to commence substantial issuer bid

Leon’s Furniture Limited has announced its intention to commence a substantial issuer bid, in which the company will offer to purchase up to $200 million in value of its outstanding common shares for cash. As of Nov. 16, there were 76,793,896 common shares issued and outstanding. The offer would be for 10.4% to 10.7% of outstanding common shares if the purchase price falls between the minimum of $24.30 and the maximum of $25.05 under the offer. The offer will proceed as a “modified Dutch auction,” which provides holders of common shares two methods of tendering to the offer. The purchase price to be paid by the company for each validly deposited common share will be based on the number of common shares validly deposited pursuant to auction tenders and purchase price tenders, and the prices specified by shareholders making auction tenders. The purchase price will be the lowest price which enables the Company to purchase the maximum number of common shares not exceeding an aggregate of $200 million in value. The offer will commence on Nov. 25 and expire at 5 p.m. (Eastern time) on Dec. 30, unless withdrawn or extended.

Man Wah Holdings to acquire 55% of Superb Creations

Man Wah Holding Ltd. has entered into a purchase agreement with Superb Creations Ltd. acquiring 55% of its shares with a controlling interest in the company. The purchase agreement is at HK$209 million, subject to adjustments that could result in an increase that will be capped at HK$275 million. Superb Creations is primarily engaged in the furniture export business with operations in the United States and Australia. In addition to American-style upholstery, Superb Creations offers European high-end sofa designs. The company has factories in China, Thailand and Vietnam. Man Wah Holdings has entered into this purchase agreement because of the synergies between both companies and the tremendous growth potential. Following completion of the acquisition, Man Wah plans to increase the production capacity of Superb Creations Limited by expanding its factories.

Wayfair to add brick-and-mortar retail locations

Home furnishings retailer Wayfair plans to open three new retail locations for its AllModern and Joss & Main brands in 2022. AllModern will open its first store at MarketStreet in Lynnfield, Mass., followed by a second location at Legacy Place in Dedham, Mass. Both open-air retail destinations are owned and managed by WS Development. Joss & Main will open in the new lifestyle space at Burlington Mall, a Simon mall in Burlington, Mass. These locations will be the first in a series of openings as Wayfair plans to launch additional stores representing all five of its brands in optimal formats, sizes and geographies over the next two years.

Jewelry & Luxury

Luxury Brands Are Already Making Millions in the Metaverse

The waiting list for a Birkin bag can stretch years, but for some, the only purse they want is one they’ll never get their hands on. The Dematerialised, a British startup that co-founder Karinna Nobbs calls “the digital department store of your dreams,” sells nothing but virtual luxuries; it’s a marketplace for clothing and accessories that will only ever exist online. The first piece it brought out, on Dec. 12, 2020, was a silver sweater selling for €121 ($137). Like all of her products since, the whole run—1,212 digital renderings—sold within three hours. Nobbs has also worked with the Fabricant, a Dutch virtual couture house where users create exclusive apparel for their digital avatars on social platforms including VRChat, a 3D digital world that soared in popularity during the pandemic. The Fabricant collaboration scored the priciest sale at her store so far: €9,000 for a single garment—or, more precisely, nongarment.

Despite Risks, Watch Brands Are Fixated on China

For Swiss watchmakers preoccupied with growth — and let’s be honest, that is virtually all of them — China is the relationship they cannot live without. “It’s going to be the growth market with the biggest opportunities in years to come,” said Jean-Philippe Bertschy, a luxury goods analyst at Vontobel, a private banking and investment management group based in Zurich. “We can talk about the U.S. and Asian markets, but in terms of volume and size, of course it will be China for the foreseeable future.” By all accounts, the scenario that Mr. Bertschy described is already here. After besting the United States and Hong Kong to become Switzerland’s No. 1 export market for watches in 2020, China is neck and neck with the booming U.S. market to retain that position for at least another year.

 

Office & Leisure

Main Street Announces New Portfolio Investment

Main Street Capital Corporation is pleased to announce that it recently completed a new portfolio investment to facilitate the recapitalization of Valley Veterinary Clinic, LLC d/b/a Valley Vet Supply, a leading omnichannel retailer of animal health products and supplies. Main Street, along with several co-investors, partnered with the Company’s existing owners and management team to facilitate the transaction, with Main Street funding $42.2 million in a combination of first lien, senior secured term debt and a direct equity investment. Main Street and one of its co-investors also provided Valley Vet Supply with a revolving line of credit to support the Company’s future growth initiatives and working capital needs. Founded in 1985 by veterinarians and headquartered in Marysville, Kansas, Valley Vet Supply provides customers with the very best animal health solutions.

GameStop adds inventory, execs, tech offices and millions in losses

GameStop’s sales in the third quarter rose more than 29% year over year to $1.3 billion, according to a release. The retailer attributed some of that growth to new and expanded relationships with brands, including with Samsung, LG, Razer and Vizio. Inventory levels were up by nearly a third, to $1.1 billion, to “focus on front-loading investments in inventory to meet increased customer demand and mitigate supply chain issues,” the company said. Operating loss also grew by more than 60%. As it aims for a technology-focused transformation, GameStop added offices in two major tech hubs, Seattle and Boston, during the quarter. GameStop CEO Matt Furlong said this week that the retailer is prioritizing long-term growth over short-term margins.

 

Joann’s earnings dip highlights the slowing of the crafting sales boom

Crafting retailer Joann’s third-quarter revenue was down 14% year-over-year, as the pandemic crafting boom wanes. For the second quarter in a row, Joann reported a year-over-year decline in revenue, though an 8% increase on a two-year stack. Monthly foot traffic to the retailer’s stores was down 15% on average across the quarter year-over-year, though once again up on average on a two-year stack, according to foot traffic analytics firm Placer.AI. Over the past year, Joann leadership has been investing in store refreshes and e-commerce additions like buy online, pickup in-store in order to continue to court the eight million new customers who shopped at the retailer during the pandemic. However, Joann’s recent performance highlights that, after a banner 2020, crafting and sewing interest is slowing down.

 

Technology & Internet

Amazon Web Services outage causes issues at Disney+, Netflix, Coinbase

Amazon’s cloud computing unit on Tuesday was hit with an outage that took down some websites and services. Among the services that reported issues as a result of the outage were Disney’s streaming subscription service, Disney+, Netflix, Slack, Ticketmaster, stock trading app Robinhood, and Coinbase, the largest cryptocurrency exchange in the U.S. The outage also brought down critical tools used inside Amazon. Warehouse and delivery workers, along with drivers for Amazon’s Flex service, reported on Reddit that they couldn’t access the Flex app or the AtoZ app, making it impossible to scan packages or access delivery routes. Amazon sellers also reported they were unable to access Seller Central, an internal website used to manage customer orders. The outage is hitting Amazon’s retail operations at a particularly inconvenient time. The company is in the middle of “peak season,” when holiday shoppers place a flurry of orders and the e-commerce giant is under immense pressure to make sure their packages arrive on time.

 

Boxed makes public market debut

Online bulk-products retailer Boxed.com premiered as a public company last week after closing a merger with special purpose acquisition company (SPAC) Seven Oaks Acquisition Corp. Also on Thursday, New York-based Boxed announced a partnership to integrate its e-commerce grocery platform with a range of solutions from online technology and services giant Google. Boxed Inc. is led by current Boxed co-founder and Chief Executive Officer Chieh Huang as CEO, with Seven Oaks Chairman and CEO Gary Matthews serving as chairman. As part of its plan to go public, Boxed aims to monetize its end-to-end e-commerce platform via a software-as-a-service offering. The business combination enables Boxed to raise about $198 million in gross cash proceeds from a combination of Seven Oaks’ cash in trust of approximately $78 million, as well as a $120 million fully committed private placement financing, New York-based Seven Oaks reported. In the transaction, no secondary shares were sold by existing Boxed shareholders. When the merger was announced, the companies said Boxed’s equity holders will own about 62% of the company after the deal was finalized.

 

Finance & Economy

U.S. household wealth gain in Q3 smallest of pandemic era

U.S. household wealth rose to a record $144.7 trillion at the end of the third quarter, a report from the Federal Reserve showed, though the $2.4 trillion gain over the period was the smallest since the rebound from the coronavirus pandemic began.  Real estate values added around $1.4 trillion to overall wealth, according to the U.S. central bank’s latest quarterly report on household, business and government financial accounts. The value of equities held by households and nonprofits fell by $300 billion.  The slower growth in U.S. household wealth suggests the boost from an unprecedented period of easy monetary policy and a fiscal firehose of aid initiated by former President Donald Trump and extended under President Joe Biden has begun to ease.

Americans’ pandemic-era ‘excess savings’ dwindle

Infusions of government cash that warded off an economic calamity have left millions of households with bigger bank balances than before the pandemic — savings that have driven a torrent of consumer spending, helped pay off debts and, at times, reduced the urgency of job hunts.  But many low-income Americans find their savings dwindling or even depleted. And for them, the economic recovery is looking less buoyant.  Over the past 18 months or so, experts have been closely tracking the multitrillion-dollar increase in what economists call “excess savings,” generally defined as the amount by which people’s cash reserves during the COVID-19 crisis exceeded what they would have normally saved.