New York: Food is the New Fashion

News,

foodWe reported in last week’s post that the fashion industry in New York is suffering due to unseasonably high temperatures, rendering winter clothing less attractive. So what – if anything – is replacing this? What are consumers spending their money on in the Big Apple now?

It seems food is becoming the next best thing, or, at least, it’s trying to be. Food entrepreneurs in Queens are trying to get their organic recipes to become household names. At the Organic Food Incubator (and other such places), gluten free bread, hot sauces, and various tonics are being created and bought to cafeteria’s like those at Facebook’s HQ, located just south of Manhattan.

Indeed, one might even go so far as to say that “food is as hot as tech right now,” which were the words that came from the mouth of Organic Food Incubator’s founder, Richard Madonna. He developed this institute to help food entrepreneurs get their start in the business.

Last year, it was documented in NYC that there was a total of 1,078 food manufacturing companies employing 16,356 workers. This was an increase from figures in 2008 in which there were 940 companies and 14,284 workers.

Unseasonal Highs in Weather Impact Shopping Sales

Fashion, , ,

fashionSince winter seems not to have arrived at its set time, department stores such as Macys and Nordstroms are feeling the burn. When they normally have shoppers lining up to try on their insulated boots and thermal coats, now the stores are empty. In the first half of December for example, Planalytics found that sales of women’s boots dropped by a staggering 24 percent in New York.

Because truthfully, who wants to be trying on winter attire in 65 degree heat?

Indeed, as CEO at The Gap, Art Peck pointed out, “October was the warmest October ever.” And he should know as The Gap reported a 3 percent decline in net sales in the third quarter.

However, this phenomenon has not spread to other consumer shopping patterns. At the start of the holiday shopping season in November, it was said that there was “enough momentum in the economy for the Federal Reserve to raise interest rates next week for the first time in nearly a decade.”

According to a US economist at Capital Economics, Steve Murphy, “it dismisses any concerns of a potential slump in household spending after some weakness in the last few months. Not that there is much doubt any more, but this supports the case for a rate hike by the Fed next week.” Even though there was a drop in consumer spending in September and October, now things are looking up, partly due to improved income prospects.

In addition to this, attitudes of consumers to buying major household items, “were the strongest since 2005,” although automobile purchasing-attitude did not follow suit.

These figures indicate that the Fed will raise its benchmark form near zero, something that hasn’t occurred since June 2006.

10th Annual M&A Advisor Turnaround Award Winners

News, , , ,

In recent news, M&A Advisor announced the winners of the 10th Annual M&A Advisor Turnaround Awards in the categories of Restructuring of the Year, Transaction of the Year, Refinancing of the Year, Sector Deal of the Year, Firm of the Year, Turnaround Product/Service of the Year and Professional of the Year. The nominations, representing over 200 participating companies, were judged by an independent panel of industry experts.

Canaccord Genuity, where Geoff Richards is the Head of US Debt Finance & Restructuring, was selected as the winner in two categories. They won the Distressed M&A Deal of the Year ($50 million to $100 million) and Healthcare and Life Sciences Deal of the Year. Both awards were in recognition of their work on behalf of PhotoMedex Inc.

The awards will be presented at the Awards Gala on Thursday, January 28th, 2016 at the Colony Hotel in Palm Beach, Florida. As David Fergusson, the co-CEO and President of the M&A Advisor said, “The award winners represent the best of the distressed investing and reorganization industry in 2015 and earned these honors by standing out in a group of very impressive candidates.”

How will New York Fare in 2016?

Economy, ,

new yorkAs we begin our closure of 2015, we might want to ask, what does the housing market forecast look like for 2016? One argument is that the housing market will encounter substantial growth, with total sales for the year expected to hit 6 million – the highest in the last 10 years. According to Realtor.com overall growth will stagnate to 3 percent compared with 2015. The main reason for this is said to be elevating mortgage rates and diminished affordability. This could be somewhat offset however, with a 12% escalation in new home stars.

Other good news for those living in New York is the way the state fared on the transit scores. There was an increase of 2.9% from 81.2% in 2014 to 84.1%. As Walk Score noted, having a Transit Score in the 70 to 89 range means transit is excellent.

In terms of the job situation in New York, while December 2015 is encountering a hike, this may not translate into employment growth for 2016. According to Janet Yellen, chair of the Fed, the economy has been improving in recent weeks. She said: “On balance, both economic and financial information received since our October meeting has been consistent with our expectations of continued improvement in the labor market.” Still movements by the Fed will be with caution in 2016 since “there is a lot of uncertainty about what comes next.”

New York Shopping: Go Online

News, ,

online-shoppingIt seems that shopping online is the way to go these days. At least in New York, over the most recent holiday period.

No longer are people killing themselves and each other to line up for Macy’s and Target on Black Friday. There is no need for one to leave their Thanksgiving dinner early to camp outside their favorite stores. Instead, shoppers can get their deals on line.

Indeed, according to the National Retail Federation, while more money was spent by shoppers at the real store, there were more shoppers visiting the online versions this year. Yet in total, there was a drop of retail sales from last year (4.1%) at 3.7%.

Given these figures, this news in China came as somewhat of a surprise. A retail giant in China – Dangdang – recently announced that it would be building one thousand actual bookstores within the next three years. This, at a time when many bookstores are facing bankruptcy. But Shenzhen Publication and Distribution Group GM, Yin Changlong believes there is a different reason for this. He explains that it is due to “the failure of business strategies rather than the fall of brick-and-mortar bookstore industry itself. The biggest challenge for traditional bookstore lies in its single form, which makes it hard to build strong ties with customer. As such, bookstore operators need to be more creative.”

Perhaps with this dedication to keeping book stores alive, it will curb people’s online addiction. As a recent Adobe campaign found in its survey of 400+ over 18-year-old US-based white collar workers, people are “practically addicted to email, checking it around the clock no matter where they are or what they’re doing. In fact, more than half of millennials check email from the bathroom!”

While the Internet has its place very much in society, the bathroom should probably not be a part of it.

The Business World: How NYC Features Nationwide

Economy, , , ,

businessWhat is it like living in New York, when it comes to running a business? How do people feel about setting up and managing companies in New York, as compared to other states around the nation. Forbes every year, conducts an analysis entitled Best States for Business. In 2015, New York ranked at Number 29. While this number doesn’t seem too bad (out of all 50 states) it’s not really that great considering it came in at No. 19 last year.

So why is New York not doing so great? What has happened this year that has made the city not the most preferred option for businesses?  Well it seems that people are still interested in starting their business in New York. According to the New York State Empire State Development, “Small businesses are the heart of the American economy, comprising 98 percent of all businesses in New York and employing more than half of New York’s private sector workforce.” In addition, according to data from the US Census Bureau, “revenue for New York-based businesses is over $1.1 million” on average per year. furthermore, according to an article written a few months ago in Nerd Wallet, “There have been significant job gains in New York over the past year in areas such as educational and health services, professional and business services, trade, transportation and utilities, as well as construction. The unemployment rate remains at its lowest level since August 2008, according to state officials.”

So this result from Forbes is somewhat surprising. Especially since the article in which it was recorded also stated “If New York were a country, the state’s $1.4 trillion dollar economy would be the 14th largest in the world after South Korea.” There are also many incentives for New York businesses, such as those which hail from: Business First Resource Center, StartUpNY, etc.

The problem is tax costs. According to Forbes, New York fared worst in tax prices, coming out at number 50 (the last) being 42% above the national average. Union workforce was also the worst ranking, at 24.6%.

So there are good and bad features about opening a business in New York. And of course, the ‘cool’ factor of owning a successful start up in New York should never be overlooked.

Will Bloomberg Run for President?

Politics

white-houseThe question on everyone New Yorkers’ lips is, will Michael Bloomberg run for President? According to Gabriel Sherman, absolutely not. Why? Simply because no matter how much theorizing, the guy “isn’t on board.” There is very little to suggest that he is making any real moves to run for President.

Business-wise it might make sense though for Bloomberg to run. According to billionaire hedge fund investor Bill Ackman, “He’s all the best of Trump without the worst of Trump. I would do everything in my power to get this guy elected.”

In addition, back in 2013 Bloomberg was quoted as saying he was “100 percent” sure running independently would be impossible.

It might be good for business if he did succeed though. He does – after all – have a background in business, having established a financial data-services firm and graduated from Harvard University with a Masters in Business.

Empire State Building Deliveries

News,

starbucksStarbucks is going to be making deliveries from downstairs to upstairs…at the Empire State Building. If you happen to be one of the 12,000 individuals who works in the Empire State Building, and don’t want to make the trip down to the lobby (where there is a Starbucks in operation), you can order “takeout” and they will deliver it to you…for a fee of $2.

That fee may seem quite high but the time it takes to get an elevator, make your way down to the lobby and line up for a cuppa Joe might just make it financially viable. In addition, the fee is the same for up to 15 different items (so the fee for a group order really comes out quite cheaply when divided equally between all the customers).

Starbucks is making a commitment also in this case to ensure that the beverage or food one orders will be delivered within a half an hour to a drop-off area, like the reception desk where one works.

Starbucks Corporation said that it is making this service available in conjunction with its business model of trying to make things as convenient as possible for its customers.

Comic Con

Entertainment,

superheroWhile the annual Comics Convention in New York – which began in 2005 – is a cultural event, since it is so well-attended it can also now be seen as an economic event for the city.

This year it is expected that over 150,000 people and 850 companies will come to the event, being held at the Javits Center, with planned screenings for shows like X-Files and The Walking Dead.

Moreover, there is a $5,000 cash prize awarded to the winner of the NYCC Eastern Championships of Cosplay.

One reason this event is getting so much business is because movies are becoming bigger business. In 2006 only two movies were based on comic books but just eight years later that figure had jumped to six. Much of this increase has been attributed to the acquisition of Marvel, for which Walt Disney paid $4bn in 2009.

Comic Con is getting so popular that even superstars feel the need to attend as well.

Good News for NY Economy

Economy, ,

new yorkStatistics for the economy in America looked good at the end of September. According to chief United States economist at High Frequency Economics, Jim O’Sullivan, “The overall labor market continues to improve, with domestic strength offsetting foreign weakness.” There has been solid consumer spending, home sales have remained steady and businesses have been doing okay. In addition, according to Automatic Data Processing (ADP) a further 200,000 jobs were added (with 35,000 of these being from the construction industry, which was the highest number in that field in 9 years).

All of these numbers are indications that America’s economy could currently be experiencing a boom.   However there are still some weak areas. There was a cut in manufacturing jobs of 15,000 (which was the highest number in five years). In addition there has been a drop in jobs in the oil and gas drilling industry, in conjunction with the drop in oil prices.

And of course the increase in jobs has resulted in a boost to the housing market which new home sales being at a seven year high. It is all a domino effect as more homebuilding has been encouraged which is why there are more jobs in construction!