- THE WEEK’S OVERVIEW – CORPORATE
Things that might have been missed in the press of events:
- SUVs boom; Minivans fade in popularity – Purchases of minivans began declining during the 2009 recession, then rebounded slightly in the last few years, but fell 13% over the past two years and another 16% through June of this year (ref WSJ). About 38% of the minivans sold last year went to fleet buyers such as rental car companies. SUVs are favored currently because they can seat seven or more people and buyers prefer their styling to that of the minivan. Sales increased 20% in the first half of the year.
- Ford Motor Company is beginning to reverse steep losses overseas and reported a $1.7 billion operating profit for the second quarter, forecasting a continued improvement in profitability this year.
- Millions of first-time internet customers, from the Ivory Coast to India and Indonesia, are connecting to the web on a new device that costs only $25 (ref. WSJ). These “smart feature” hybrid phones use inexpensive mobile data, provide basic apps and internet access in addition to texting and calling abilities. Approximately 3.4 billion people still do not have internet access and companies like Reliance Jio Infocomm intend to try to fill those gaps.
- UPS has noted a surge in their overnight shipping services as internet sellers are using overnight shipping to meet customer expectations of quicker arrival of parcels at their homes. UPS posted a 30% quarterly surge in the service.
- U.S. grocery stores are beginning to carry wide varieties of products as their “store brands” – from cheese, cookies, crackers and other snacks to packaged coffee, the stores are having these products made under their labels – a process that is currently causing a pinch for the customary food makers. Name-brand sales have dropped from 3-5% while store-brands have increased 5-23%, depending upon the item.
- Amazon is insisting that those companies selling on their site re-do their packaging to streamline it, reducing wasted shipping space. In some instances, companies have reduced packaging volume by 34% and the amount of wasted space by over 80%. Amazon has given a deadline for companies to comply; otherwise, they will no longer be selling on the site.