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    Published on: June 24, 2020

    A chance encounter at Stew Leonard's teaches KC a lesson about how muscle memory isn't always a good thing ...and why it is critical not to always do things the way we've always done them.

    Published on: June 24, 2020

    Amazon yesterday announced the creation of  The Climate Pledge Fund, which it said is designed "to support the development of sustainable technologies and services that will enable Amazon and other companies to meet The Climate Pledge -  a commitment to be net zero carbon by 2040. This dedicated venture investment program - with an initial $2 billion in funding - will back visionary companies whose products and services will facilitate the transition to a zero carbon economy."

    The announcement, ironically, came as Amazon said that its 2019 greenhouse gas emissions were up 15 percent from the previous year.

    The Seattle Times writes that Amazon says that "its emissions per dollar of gross merchandise sales — a measure of emissions intensity that Amazon says it uses to benchmark its climate performance, but which others say obscures the more important rise in absolute emissions — actually decreased 5% from 2018."

    The Times also notes that "that emissions intensity metric includes greenhouse gases stemming from Amazon’s activities in moving goods to customers, and from the manufacture of its own products. Amazon doesn’t count the emissions from manufacturing of products by other companies, even though it counts sales of those products in calculating its emissions per dollar. The company declined to disclose its gross merchandise sales."

    The Fund announcement says that the goal is to "invest in companies in multiple industries, including transportation and logistics, energy generation, storage and utilization, manufacturing and materials, circular economy, and food and agriculture. Over time, Amazon will also look for opportunities to involve other Climate Pledge signatories in this venture investment program."

    KC's View:

    To me, this story reflects a reality of Amazon's current situation that goes beyond the issue of climate change.

    If tomorrow, Amazon sees an opportunity that would help it disrupt a business segment with positive implications for its long-term dominance, but that opportunity would not be good for the planet's health, would it do that thing anyway and worry about the climate stuff later?

    If Amazon sees an opportunity to improve efficiency in its warehouses, but it will mean working its employees a little harder and maybe a little less compassionately, would it make that change and then worry about the employees later?

    Amazon is so big and its moves so impactful on the environment and the culture that inevitably there will be times when there will negative repercussions from its actions … and times when Amazon may not always be the best corporate citizen.  And so, it will have to make choices, and those choices will not always be popular.  (Or right.)

    But … doing things like the Climate Change Fund isn't just about positive publicity or assuaging the corporate conscience.  Billions of dollars can generate real change and new technologies with long-term implications.  And so, let's not diminish the importance of such a commitment.

    Published on: June 24, 2020

    The New York Times has a story about how, even as many companies declare bankruptcy (sometimes because of the pandemic, sometimes because of issues that had nothing to do with the coronavirus), their boards are finding enough money to pay millions of dollars in bonuses to senior executives.

    "The payments, which are made just before a bankruptcy filing, appear to be legal and have been made by several companies," the Times writes.

    One example:  "J.C. Penney, which is closing 154 stores, paid its chief executive, Jill Soltau, $4.5 million."

    The Times  writes that "in normal times, a large portion of executive compensation is paid out in stock-based awards that top officers earn over time. But the stock of a bankrupt company is most likely going to be wiped out or be worth little once a company resolves its bankruptcy or, in extreme cases, sells off its assets and goes out of business.

    "As a result, boards have quickly changed how top officers are paid, giving them cash bonuses instead of stock-based awards. But paying cash up front can be a windfall for chief executives when the livelihood of employees is under threat."

    KC's View:

    The Times notes that "Ms. Soltau of J.C. Penney got a $4.5 million cash bonus before the retailer declared bankruptcy, much lower than the $8.2 million at which her 2019 incentive-based awards were initially valued."

    Which is probably cold comfort to all the people being laid off by the company as stores are being closed.

    This is the kind of thing that just makes me nuts.  It reflects a leadership mindset that is exactly the opposite of the Marines' "Officers Eat Last" mantra.

    Published on: June 24, 2020

    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 United States, as of this morning there are 2,424,493 confirmed cases of the Covid-19 coronavirus, with 123,476 deaths and 1,020,412 reported recoveries.

    Globally, there have been 9,377,126 coronavirus cases, with 480,220 fatalities and 5,064,843 reported recoveries.

    •  CNN reports on Congressional testimony yesterday by Dr. Anthony Fauci, director of the National Institute of Allergy and Infectious Diseases, in which he warned that "we're now seeing a disturbing surge of infections."

    Fauci said that "Fauci, who has consistently expressed concern at the wave of aggressive economic openings championed by the President, warned that the next couple of weeks "are going to be critical in our ability to address those surges that we're seeing in Florida, in Texas, in Arizona, and in other states. They're not the only ones that are having a difficulty."

    CNN  reports that "fully half of US states are now seeing rising cases of the disease with the situation especially acute in Texas, Florida and Arizona, which embraced aggressive reopening programs … Increasing cases of the virus, which do not represent the 'second wave' medical experts have long feared but more a broadening of the first wave that crashed onto coastal cities and urban areas, are beginning to frame up a daunting question for state and national political leaders: will the situation get so bad that a return to more restrictive and even stay at home measures will need to be considered?"

    •  From the New York Times coverage of the Congressional hearing:

    “'The virus is not going to disappear,' said Dr. Fauci, the nation’s top infectious disease expert, who testified that the virus was not yet under control in the United States.

    "His testimony came as more than half of the country was seeing an uptick in cases, with officials in some states slowing their return-to-work plans or even imposing new restrictions. Dr. Fauci and three other leaders of the government’s coronavirus response who testified on Tuesday cast a cloud over the sunny accounts offered by the president as he has portrayed the United States as a nation bouncing back from the brink.

    “'I am very cautious and I don’t — still don’t sleep well at night,' said Adm. Brett P. Giroir, the assistant secretary for public health, 'because we have a long way to go.'

    •  The Puget Sound Business Journal reports that Washington State health officials "mandated on Tuesday that people wear face masks in public as the economy slowly reopens and Covid-19 cases rise. The order goes into effect Friday.

    "Gov. Jay Inslee said during an afternoon press conference that businesses must require all customers to wear masks when the order takes effect. Failing to do so could result in sanctions, including the loss of business licenses, Inslee said."

    Inslee also said that "the order would likely remain in place until there is a Covid-19 vaccine or cure."

    The story notes that Costco CEO W. Craig Jelinek "said his company supports the order and already requires its customers and employees to wear masks.

    "Early in the pandemic, he said, Costco, an essential business that remained open throughout the spring lockdown, saved its supply of masks for medical workers, donating approximately 50,000 of them to hospitals. But, he said, the company found its employees were getting infected with Covid-19 … Positive Covid-19 tests among employees dropped once masks were required, he said."

    •  The Wall Street Journal reports that "the two most populous states in the country, California and Texas, each reported more than 5,000 new infections, breaking previous daily records they had set."

    This are not the kinds of records that anyone should want to break.

    From the Journal story:

    "Arizona also reported record cases Tuesday. The 3,591 new Covid-19 cases bring the state’s total to more than 58,000, according to data from the Department of Health Services.

    "The state became one of the country’s largest coronavirus hot spots weeks after Republican Gov. Doug Ducey lifted Arizona’s stay-at-home orders. Last week Mr. Ducey reversed course to allow local governments to mandate use of face masks in public to slow the spread of the virus.

    "New York has reached its lowest percentage of positive Covid-19 test results since March, but health officials are closely monitoring hot spots where higher rates of infection persist, including some lower-income neighborhoods in New York City. The city moved this week into phase two of its reopening plan, allowing workers to return to offices and outdoor dining to resume … In neighboring New Jersey, Democratic Gov. Phil Murphy said Tuesday that amusement and water parks in the hard-hit state would be allowed to open at 50% capacity. Staff and guests will be required to wear face coverings. Playgrounds in the state are also set to open July 2."

    •  CNBC  reports that as the European Union talks about the degree to which it should open its borders to international travelers as it looks to reopen its economies in the wake of pandemic-related shutdowns, one of the possibilities is that visitors from the United States could be banned.

    At issue is the coronavirus infection rate in countries from which travelers originate, and the US may not make the cut, depending on how the lines are drawn.  Brazil and Russia also would be on the banned list.

    According to the story, "there have been more than 9 million confirmed cases of Covid-19 worldwide. The U.S., Brazil and Russia are currently the top three nations with the most cases. As of Monday, the U.S.’s seven-day average of daily new cases had increased more than 30% compared with a week ago, according to a CNBC analysis of Johns Hopkins University data."

    •  The Houston Chronicle reports that Harris County there - which includes the city of Houston, is the most populous county in nTexas and the third most populous county in the US - has mandated that "businesses require clients to wear masks … Harris County Judge Lina Hidalgo issued the order June 19, after a surge in COVID-19 cases resulted in eight straight days of record hospitalizations in the county. The order officially expires June 30, though it will likely be extended."

    Kroger said that it would avoid turning customers away by making "disposable and reusable masks available for purchase at our front end."

    •  From Bloomberg:

    "During the coronavirus pandemic, people are drinking less. (Yes, you read that correctly.)

    "While the masses are buying more booze from grocers and liquor stores to drink at home, that hasn’t been enough to fill the gaping hole created by declines in shipments to restaurants, bars and sporting venues that were closed to slow the virus. Global alcohol consumption isn’t expected to return to pre-Covid-19 levels until 2024, and the U.S. recovery will take even longer, according to researcher IWSR said."

    Bloomberg writes that "this is especially troubling for brands in the U.S., where even before Covid-19 a growing number of Americans, led by 20-somethings, increasingly strived to be healthier. They aren’t giving up all the indulgences of older generations, but many want to feel better about doing so. It’s a dynamic that helped turn lower-calorie hard seltzers, like White Claw, into household names and made non-alcoholic beer much more than an option for recovering alcoholics."

    •  From the Washington Post:

    "The fallout from Novak Djokovic’s safety-flouting Adria Tour exhibitions worsened Tuesday, when the world’s top-ranked tennis player disclosed he has become the fourth participant to test positive for the novel coronavirus.

    "Djokovic, 33, organized the Adria Tour to give himself and fellow pros a chance to compete after being idle since March, when the men’s and women’s pro tours were suspended.

    "But it has proved calamitous, resulting in at least six other positive tests: fellow players Grigor Dimitrov, Borna Coric and Viktor Troicki; Djokovic’s wife, Jelena; Djokovic’s fitness coach; and Dimitrov’s coach.

    "The exhibitions were staged without following basic health and safety protocols to guard against transmission of the highly contagious virus."

    Stories like this one only reinforce to me the degree of difficulty in bringing back sports … much as it would be good for the national mood, it'll be a short-lived relief if players start dropping like flies.

    Published on: June 24, 2020

    A compendium of stories, with occasional and italicized commentary, that focus on the racial and social justice issues that are confronting businesses around the country…

    •  CNN reports that Walmart no longer will display the state flag of Mississippi at its stores there "because of a debate over changing the design of the flag."

    The current design includes the battle flag of the Confederate States of America.  Walmart actually banned the sale of the Confederate flag in its stores five years ago.

    CNN writes that "the decision comes amid a renewed effort nationwide to remove memorials to the Confederacy as the nation grapples with the intertwined legacies of institutionalized racism and police brutality. NASCAR banned the Confederate flag at races, and the US Navy and Marines have also moved to ban the Confederate flag from public display."

    The story notes that "several public universities, including the University of Mississippi and Mississippi State University, previously stopped flying the controversial state flag. And last week, the city of Gulfport, Mississippi, said it would do the same in a resolution which acknowledged the flag is for many 'a painful reminder of past days of transgressions in this State and has also been used by some as an image of hatred, divisiveness, and violence'."

    USA Today reports that "on Tuesday, the Mississippi Baptist Convention called for the state to change its flag, with its executive director calling it 'a relic of racism and a symbol of hatred'."

    I know I'm just a Connecticut Yankee, so my ability to understand this issue is limited.  But I've never understood the allegiance that some folks - people who, I think, would consider themselves to be patriots in that "proud to be an American" sort of way - feel toward a flag that represents anti-USA behavior and the legalized enslavement of an entire race.  I'm not talking about erasing history, but does one ordinarily celebrate a subversive movement that was aimed at wrecking the country?

    The good news is that more and more institutions are recognizing this problem, and are acting to deal with it. When Walmart - which can be fairly described as a pretty conservative company, I think - comes to the same conclusions, then this is no longer a fringe attitude.  It is mainstream … and reflective of the national reckoning we seem to be going through.

    •  The Wall Street Journal reports that Unilever "is facing fresh backlash against a skin-lightening cream that is one of its better-selling products, as scrutiny mounts for brands that some say feed into racist ideas and imagery.

    "Fair & Lovely, Unilever’s largest personal-care brand in India, has long been a target for critics who say it promotes the suggestion that light skin is more attractive than dark. The company has for years defended the brand, which generates more than $560 million in annual sales, saying it is a safe alternative to dangerous bleaching products."

    The new backlash is an outgrowth of heightened national awareness of race-related issues, which "has picked up pace with the Black Lives Matter protests that have been fueled by the killing of George Floyd in police custody in Minneapolis last month, among other events."

    The Journal writes that "Johnson & Johnson recently said it would stop selling similar skin-lightening products under its Clean & Clear and Neutrogena brands. PepsiCo Inc. has said it is retiring the Aunt Jemima brand of syrups, pancake mixes and other products, while Mars Inc. is changing the name of its Uncle Ben’s rice."

    This may be a big seller, but the current climate may make it impossible for Unilever to continue selling an item that is seen as suggesting that lighter skin is more attractive than dark skin.  The world is changing, and there is a lot of consciousness raising going on … positions that just a few months ago seemed safe now may be untenable.

    •  The national focus on racial issues, the New York Times writes, has led to heightened sales for books about race and racism in America, and growing popularity for black-owned bookstores.

    One such store, Semicolon Books in Chicago, saw sales go from 3,000 books a week to 50,000 books a week.

    "All that demand, however, is becoming a challenge for some black-owned bookstores around the United States, as they attempt to manage the deluge of orders, a handful of titles that are out of stock, and occasionally, customers angered by the delays," the Times writes, adding, "The concentration of interest among just a few titles can create long wait times, with some books on back order for weeks — and while most customers are understanding, store owners say, there are those who demand refunds or cancel their orders."

    However, the story notes, "This surge in demand could not come at a better time for bookstores, which saw business down a catastrophic 65 percent in April over the same period the year ago, according to figures from the Census Bureau."

    •  The New York Times has a story about a debate taking place at Amazon, where some employees and contractors "are arguing that Amazon, one of the nation’s largest employers, needs to do much more to address racial inequality within its own walls. The calls for change — including diversifying its top ranks and addressing racism in its warehouses — have generated an unusual degree of turmoil inside the tech giant."

    The Times writes that "Amazon stands out because it has a large percentage of black employees — more than a quarter of its 500,000-person domestic work force, most of them in hourly jobs at its sprawling logistics operations, where they earn far less than their corporate counterparts. That percentage is slightly higher than among Walmart’s employees in the United States, and far higher than at other big tech companies. At Facebook, for example, less than 4 percent of its work force is black."

    And while founder-CEO Jeff Bezos has been outspoken about confronting systemic racism, some suggest that he needs to do more to deal with the issue internally.

    You can read the story here.

    Published on: June 24, 2020

    Amazon this morning announced that "it has established a new Counterfeit Crimes Unit, dedicated to bringing counterfeiters that violate the law and Amazon’s policies by listing counterfeit products in its store to justice. Amazon’s Counterfeit Crimes Unit is a global, multi-disciplinary team composed of former federal prosecutors, experienced investigators, and data analysts, and will join Amazon’s extensive work to drive counterfeit to zero."

    The company said that the Counterfeit Crimes Unit "will investigate cases where a bad actor has attempted to evade Amazon’s systems and listed a counterfeit in violation of Amazon’s policies. The Counterfeit Crimes Unit will mine Amazon’s data, cull information from external resources such as payment service providers and open source intelligence, and leverage on-the-ground assets to connect the dots between targets. The Counterfeit Crimes Unit enables Amazon to more effectively pursue civil litigation against bad actors, work with brands in joint or independent investigations, and aid law enforcement officials worldwide in criminal actions against counterfeiters."

    KC's View:

    We had CSINCIS.  Now, we'll have CCU: Seattle … I see an Amazon Prime Video series sometime in the future, featuring David Caruso as an intrepid investigator hunting down counterfeit products from all over the world.   (I'd cast Stanley Tucci as Jeff Bezos.)

    The theme, of course, will be from The Who:

    We're not gonna take it

    We're not gonna take it

    We're not gonna take it

    We're not gonna take it

    We're not gonna take it

    Never did and never will

    We're not gonna take it

    Gonna break it, gonna shake it

    Let's forget it better still.

    Published on: June 24, 2020

    •  Amazon and Maryland's Prince George's County yesterday announced "that Amazon is funding computer science education and teacher professional development for 132 elementary schools in the district, impacting more than 49,000 students from underserved and underrepresented communities. Amazon is working with BootUp, a nonprofit professional development provider specializing in elementary school education, to bring computer science to each school as part of its Amazon Future Engineer program. Due to the uncertainty surrounding the upcoming school year, BootUp has modified its professional development to work in a virtual setting."

    •  The Verge reports that "Amazon could be planning to bolster its Prime Video service, which is mostly known for its on-demand video offerings, with live TV … Details are light about what the new live TV services might entail, though the efforts appear to be in their early stages."

    The speculation is based on job listings that appear to be for people who could help Amazon produce more live TV.

    The story notes that "this wouldn’t be Amazon’s first foray into live programming. Amazon has offered NFL Thursday Night Football games on Prime Video and Twitch for a few years, and the two companies will continue their partnership thanks to an extension signed in April. And Amazon announced just last week that it would start streaming Premier League soccer on Twitch starting June 29th. But these recent job listings … suggest that Amazon is looking to take its live TV ambitions much further by offering some kind of 24/7 service."

    Published on: June 24, 2020

    With brief, occasional, italicized and sometimes gratuitous commentary…

    •  Bloomberg reports that "GNC Holdings Inc. filed for bankruptcy protection with the aim of selling itself and closing stores after its latest effort to manage its debt load unraveled amid the coronavirus pandemic.

    "The health and wellness company’s Chapter 11 petition filed in U.S. Bankruptcy Court in Delaware allows the retailer to keep operating while it pursues a dual-track process to restructure its balance sheet in a standalone plan or complete a sale, according to a statement."

    The story notes that any turnaround "will be complicated by the retail industry’s temporary shutdown of stores to help stop the spread of Covid-19. That has been partially offset by the company’s e-commerce operations, whose sales increased 25% in the first quarter."

    •  From USA Today:

    "J.C. Penney has revealed the locations of another 13 stores it will close permanently in Chapter 11 bankruptcy, including seven in Michigan.

    "The department store chain expects to begin liquidation sales at the stores on July 3 after a federal judge signs off.

    "The latest round of store closings comes in addition to 136 stores that have already begun going-out-of-business sales. Those locations were the first ones revealed as part of a broader plan to close 242 locations permanently," as the retailer deals with bankruptcy and works to craft a turnaround plan.

    •  From the New York Times:

    "A Missouri appeals court on Tuesday ordered Johnson & Johnson and a subsidiary to pay $2.1 billion in damages to women who blamed their ovarian cancers on the company’s talcum products, including its iconic baby powder.

    "The decision slashed by more than half a record award of $4.69 billion in compensatory and punitive damages to the women, which was made in July 2018.

    Johnson & Johnson still faces thousands of lawsuits from consumers who claim its talcum products were contaminated with asbestos that caused cancer. The company announced last month that it would stop selling baby powder made from talc in North America, though it would continue to market the product elsewhere in the world.

    "A spokeswoman said Johnson & Johnson would seek further review of the ruling by the Supreme Court of Missouri and defended its talcum products as safe."

    •  FMI-The Food Industry Association the, International Franchise Association, the National Association of Convenience Stores, the National Automatic Merchandising Association, the National Grocers Association, the Retail Industry Leaders Association, and the Society of Independent Gasoline Marketers of America have come together to ask Jerome Powell, Chairman of the Federal Reserve System, and Secretary of the Treasury Steve Mnuchin to address the national coin shortage.

    In a letter, they write, "We were alarmed to hear that the system for distributing coins throughout the country is at the breaking point. The Federal Reserve’s announcement on June 11th that it will have to ration the distribution of coins across the country came as a shock. Some of our member businesses are being told that they cannot get coins from their banks at all. This threatens the functioning of our member businesses and, by extension, the needs of their customers."

    The associations are calling for three actions:  "1) the Federal Reserve could distribute more coins from its inventory to ensure that economic activity is not disrupted; 2) the U.S. Mint could increase coin production to meet these needs; and 3) distribution of coins could be prioritized for consumer businesses in the essential critical infrastructure workforce that most need coins to complete cash transactions with individual Americans."

    Published on: June 24, 2020

    •  MarketWatch reports that Koninklijke Ahold Delhaize NV "has appointed Peter Agnefjall as its new chairman effective Jan. 1, 2021, following Jan Hommen.  Mr. Hommen is scheduled to retire on Dec. 31 this year."

    The story says that "Mr. Agnefjall has been a member of Ahold Delhaize's supervisory board since April 2019 and previously served as president and chief executive at furniture giant IKEA International AS."

    Published on: June 24, 2020

    I went on a FaceTime rant yesterday about people (I used a rather more descriptive word) who are threatening public health officials who are just trying to keep us safe by creating rules and regulations to get us through the pandemic.  (You can see it below.)

    This prompted a bunch of email.

    One MNB reader wrote:

    KC, thank you, thank you, thank you! Public servants are working hard trying to do their best to serve the people of their city, county, state or country. In many cases they are not paid as well if they worked in the private sector. The Washington Post did an article on the EMS workers in New York City their starting pay is $35,000 and top off at $48,000, not very good pay for New York City. At some point we have to start to recognize we need to pay people who are invisible to us on a daily basis but do incredible work for us and keep our society going.


    From another reader:

    Good for you Kevin for calling out these people! 

    And from another: 

    KC, I shared your FaceTime post today. I almost always enjoy your message and thoughts but  It’s the first time I’ve shared them. It is a message that needs to be seen by people far outside of your normal fan group and I was very happy to see your anger and passion on the subject. Thank you for sharing your thoughts in just the way you did.

    MNB reader Chris Grathwohl wrote:

    Couldn’t agree more.  It is sad that people believe that anyone with a different opinion or idea is so wrong that they must threaten and debase them.

    In my own state of Ohio, the highest ranking health official, who steered the state to a flattened curve with her aggressive approach to covid, stepped down under public pressure.

    Many decided that she was too conservative, that businesses should have been opened sooner or never closed at all.  Fact is, she probably saved lives, may of some of the very people who forced her out.

    The current state of America, where there are two ways -  “my way and wrong way” - scares me.

    And from another reader:

    Kevin – I couldn’t agree more with your “outrage” against the “assholes” concerning the actions taken against public health officials that have caused these people to resign, retire or quit their jobs. I get absolutely livid when I hear people complain that their “rights” are being violated when someone mandates that masks be worn or social distancing should take place to protect the well being of our general population. Arrogant, selfish fools need to understand that unless we pull together and make some sacrifices that Covid 19 will continue to wreck havoc across our  great country. You were

    “spot on” with your comments. Lets hope that your message is heard and that everyone understands that some sacrifice is required by all to defeat this terrible disease.

    And one more:

    Well said.

    I am stunned by the people who grumble about their rights and scoff at the recommendations of our health departments and healthcare workers. 

    Everyone's entitled to their opinion, but when it's life and death, your opinion should be based on something. We pay a lot of money collectively and individually to have access to science-based, fact-based healthcare in this country, but for some reason the response to this particular problem is up to everyone's opinion, but the opinion is not based on any information. The Covid-doubters I know (a flight attendant, an engineer, and a DPW worker) would never drive across a bridge whose design was altered based on the opinions of doctors and public health officials. But the three think their own input should override the solutions painstakingly built by the healthcare and public health community.

    By the way, you could have inserted, "The needs of the many outweigh the needs of the few, or the one."

    It would've been logical to do so.

    Here's the original commentary:

    Published on: June 24, 2020

    I'm happy to announce that on Friday, at 7 pm EDT / 4 pm PDT, we're going to do it again … an MNB Virtual Happy Hour.

    The folks at GMDC have once again agreed to sponsor and host it.  Hopefully, you can put it on your calendar … choose a libation for Happy Hour … and then prop up your laptop or warm up your computer on Friday, June 26, for a conversation and a drink.  (You don't have to let me know you're coming, but it would be nice to know.)

    To join us, click here.