The west coast grocery chain Smart and Final aims to raise $100 million in an IPO today. The company plans to expand a line of stores that combine elements of warehouse-club outlets and traditional grocery stores; something like Costco without appliances or membership fees. The company wants to grab a piece of a business that's changing dramatically, and getting more competitive.
Once upon a time, we bought groceries in supermarkets. Then came Walmart, which is now the nation’s biggest grocer. And then came everybody else; Whole Foods and Trader Joe's, for example.
"If you look at the past ten years, conventional supermarkets have lost almost 15 percent market share to all these other channels," says Phil Lempert, editor of Supermarket Guru. "Whether it’s drug chains—and if you take a look at CVS and Walgreens, they're building stores that are 50 percent food—we’ve got dollar stores, we’ve got warehouse clubs, we’ve got almost everybody who wants to sell food. Even folks like Bed Bath and Beyond."
"That’s a really hard circle to square," says William McKitterick, a retail analyst with Ibis World. "It seems like all the signs are pointing toward this being a terrible industry to enter."
Even so, everyone wants in. And McKitterick won’t rule out the idea that there’s room for Smart & Final in a highly-fragmented sector.
Southern cook Paula Deen is attempting a comeback by launching a new online cooking network on Wednesday.
Deen was one of the biggest names in food television until racist remarks she made off screen became public last year. As a result, the Food Network cut ties with her and she was dropped by sponsors.
But before her racist remarks, Paula Deen was best known for her artery-clogging recipes, like the Lady’s Brunch Burger: a burger paddy stacked with a fried egg and bacon, sandwiched between two glazed donuts for buns. She gleefully described it as “over the top – even for me!”
Viewers eager for access to Deen’s old shows with said gems, plus some new content, can sign up to pay $8 to $10 a month for access to her new online network, launched by her Paula Deen Ventures with the backing of private investment firm Najafi Companies.
“About 15 percent of Americans do look up recipes online,” says Jerry Power, with the USC Marshall School of Business, adding the cook book market is also sizable. “So it’s a fairly stable and good sized market that she’s going after.”
But getting people to subscribe—controversy aside—could be a tough sell, since there’s already so many free sources of cooking shows and recipes, says Max Dawson, director of national television and video for Frank N. Magid Associates.
“Paula Deen’s audience, the sort of people who really love her, they’re not early adopters,” explains Dawson. “They’re not experimenting with new content distribution paradigms.”
Those who do could pay a similar amount for service like Netflix and getting lots more variety.
Paula Deen is far from the first celeb to start her own website. Here's a few other examples:
Created—or "edited"—by Blake Lively, Preserve is like Etsy run through an Instagram filter and marketed to a much higher income tax bracket. It's structured like a lifestyle magazine and proceeds go to Lively's charity.
Will Ferrell and Adam McKay's video site has expanded into a media empire. Its big hits like "Billy on the Street" and "Drunk History" have been adapted for TV, and "Between Two Ferns" won an Emmy after an appearance from President Barack Obama.
Gwenyth Paltrow's lifestyle site also boasts recipes, a store and a blog, which made the news in March when Paltrow and Coldplay frontman Chris Martin used the site to announce their "Conscious Uncoupling" (some call that a divorce).
Another subscription service, the Sarah Palin Channel charges $9.95 a month or $99.95 for the year, but you view a national debt ticker and a countdown of Obama's days left in office for free.
Zooey Deschanel's site offers entertainment and lifestyle writing aimed at women, but everyone can enjoy their various live feeds of kittens, puppies, cicadas, owls and more.
Since 1962, Forbes Magazine has been headquartered on 5th Avenue in New York City, behind a limestone facade with Ionic columns. But by the end of the year, it's moving a twenty-minute train ride away to a glass tower in Jersey City.
For decades, companies in New York City have moved offices across the Hudson River, to the city that has been dubbed New York's "sixth borough."
"You can look not too far away and see Manhattan, you’re on the water, and the rent’s a lot lower," says Gordon MacInnes, president of local policy watchdog New Jersey Policy Perspective.
For many of those companies, there has been another, bonus factor: Tax breaks. Forbes has been approved for $27 million in tax credits by New Jersey's Economic Development Authority. It's a small example of a growing practice in the state, which has pledged tax incentives of $1.6 billion in the last ten months—more than in the first ten years of the millennium.
"It’s the only thing that New Jersey’s doing to crawl out of the great recession," says MacInnes. "And so if this is the only thing you have, do a lot of it."
New Jersey's incentive programs have meant a spate of calls from New York City businesses to Lee Winter, director of incentives at Grant Thornton LLP. "There’s a certain back and forth, but right now I’d say New Jersey is winning that battle," says Winter.
But how does bringing a company from New York City to Jersey City affect the regional economy?
"No one thinks in terms of the region, they just think of their state," says Winter. "So, you know, if a company moves from New York to New Jersey, those really are new jobs—to New Jersey."
While this interstate arms race isn't new, the recession made it more fierce according to Greg LeRoy of Good Jobs First, a long-time monitor and critic of tax incentives.
"States and cities are spending more than $70 billion a year for economic development, and that number’s been steadily up in recent years," says LeRoy. "There’s less money available to build infrastructure, to retrain workers, to keep classroom sizes small. Those are things that benefit all employers. And instead we’re putting lots of eggs in a few corporate baskets."
Seth Pinsky, former president of the New York City Economic Development Corporation, defends the use of tax incentives for specific projects, such as grocery delivery company FreshDirect, which was granted more than $100 million by his agency. But he also says they were "not the optimal form of government investment," and emphasized instead the important of long-term investment in workforce training, infrastructure and basic research.
"Tax incentives are easy to explain to people," he says. "They’re easy to explain to businesses. They're appealing to politicians. Long term investments are harder. Unless and until the American public itself starts thinking long term again, it’s going to be hard to turn economic development officials back towards thinking long term as well."
Big aid agencies are gearing up to help Ebola-ravaged countries. Small communities are also pitching in. The Y in Missoula, for example, is raising money to help the Y in Freetown.
Sunset marks the start of the Jewish New Year as well as the 10 Days of Awe, when observant Jews reflect on the past year. Some are taking this reflection out of the temple and onto their tablets.
The World Health Organization warns of more than 20,000 cases by early November if help doesn't arrive quickly in West Africa. The CDC projects 1.4 million cases by late January.
High end consumers in a global city – it makes sense. Still, one wonders what Antoine de la Mothe Cadillac – the guy who founded the City of Detroit – would think if he were still around.
The National Institutes of Health want to end a long-standing bias in biomedical research, towards men. It turns out when researchers do what are called pre-clinical studies, most of the time they’re using male animals and male cells. Today the NIH announced that it has awarded an extra $10 million to help bring more balance into the lab.
Researchers have long preferred male animals and cells, partly because they thought the female menstrual cycle introduced too much variability. That’s not true, says Janine Austin Clayton, director of the Office of Research on Women’s Health at the NIH. This additional funding encourages researchers to study both sexes, she says.
“We’re really looking to transform how science is done, and in order for us to do that, we have to help scientists understand the methods and the benefits of studying both sexes,” Clayton says.
By not studying both sexes, Clayton says we may be missing out on discoveries that could help both men and women. One grant will help look at why women have higher rates of Alzheimer’s disease, for example. Other studies will look at sex differences in stroke, lung disease and alcohol abuse.
But is $10 million enough to change science?
“It will hopefully spill over,” says Kathryn Sandberg, director the Center for the Study of Sex Differences in Health, Aging and Disease at Georgetown University. Researchers will present their work at meetings, and others may become interested, she says.
“I think it’s a good first step,” Sandberg says.
The money won’t just bring more female subjects into the mix. Sarah D’Orazio, an associate professor at the University of Kentucky, has a grant from the NIH to study the immune response in mice to the bacterium Listeria monocytogenes. The extra $100,000 in supplemental funding will help her buy male mice. Each one costs $24, she says, plus shipping and lodging.
“They’re very well cared for here at the University of Kentucky. So I have, basically, a hotel bill that I have to pay for the mice while they’re here during our experiment,” she says.
D’Orazio says she had done small studies with both males and females in the past.
“We had an observation all along that female mice were much more susceptible to the infection, and we just didn’t really have the funding to follow up on that observation,” D’Orazio says.
If she can prove there is a difference, D’Orazio says she could get more funding to study why and develop treatments to help women.
The Treasury Department has announced that it's going to change tax rules to curb corporate inversions - deals that let U.S. companies move their headquarters overseas, and avoid U.S. taxes.
The new rules would keep companies from playing one of their favorite inversion games: hopscotch.
Here's how you play: say you’re a U.S. company with a foreign subsidiary. The subsidiary earned loads of money. But you don’t want to bring it back to the U.S., where you’d have to pay taxes on it. So the subsidiary loans the money to a foreign parent you create through an inversion.
“They hopscotch over their U.S. parent," says Lee Sheppard, contributing editor to the journal Tax Notes. "That’s why it’s called hopscotch."
Sheppard says the new Treasury rules would make hopscotching illegal. And you can’t play skinny down anymore, either. That’s a way to shrink a U.S. company’s share in a foreign firm created through an inversion.
“I think these rules will be effective at stopping some of the abuses of the past," says Steven Rosenthal, a senior fellow at the Urban/Brookings Tax Policy Center. “The question, though, is, how effective they will be at stopping potentially new abuses.”
Especially since Treasury hasn’t banned all of the inversion games. Take earnings stripping. That’s where a U.S. company takes out a big loan from the foreign parent it creates in an inversion, and gets to write off the debt payments.
Still, Treasury is making inversions more complicated.
“A lot of transactions that might have been relatively easy are now going to have to be analyzed much more carefully,” says Ryan Dudley, a partner at the accounting firm, Friedman LLP.
In fact, some of the big inversions announced lately may not go through now, because Treasury says the new rules are effective immediately. So if you’ve announced a big inversion deal, but haven’t completed it, you may have to find a new game to play.
For the first time in more than 40 years, both the overall crime rate and the overall incarceration rate have fallen by around 10 percent in a roughly five-year span, the attorney general says.
This week, the U.S. Department of Education will release data on the percentage of borrowers who have defaulted on federal student loans over the last three years. Schools with high rates of default face consequences.
There are new standards. According to Nick Hillman, an assistant professor at the University of Wisconsin-Madison School of Education, a college doesn’t want its default rate to hit 40 percent a year, or 30 percent over three years: “They eventually could lose access to not just their student loans, but also Pell Grants and other types of federal aid, which can rack up to millions of dollars, depending on the institution.”
If a school is worried about its default rate, Hillman says, that institution will try hard to lower it. “There’s a lot of gaming that can happen, and just really weak incentives and penalties involved with current policies,” he says. Schools can push students to ask for forbearance, or defer payments.
According to Thomas Weko, a managing researcher in the American Institutes for Research’s education program, “Not that many institutions fail to meet this test.” After the government released the last data set on default rates, it penalized eight schools out of some 6,000. Weko says a school that is worried about its default rate can hire consultants for tracking borrowers who are at risk of default, “doing sort of briefings and trainings with students.” A college that can’t lower its default rate, Weko adds, definitely has problems navigating the federal financial aid system.
“It’s like knowing where the speed camera is, and still getting it wrong,” he jokes.
According to Jacob Gross, a professor in the University of Louisville’s College of Education and Human Development, this highlights a bigger issue. “I think a real important part of this debate is whose fault is default,” he says.
Is default the student’s burden? Or the institution’s? And the federal government doesn’t always consider a would-be borrowers’ credit risk the way private lenders can.
Many brokers feared the new federal health law would make them obsolete. But more than 40 percent of people who signed up for insurance via Kentucky's state exchange used a broker.
Companies like Anheuser-Busch pay hundreds of millions to be identified with the NFL's aura. The last thing they want is to be associated with scandal, but it might be financially tough to walk away.
“black-ish” is being hailed for bringing new ideas to the family sitcom landscape, but it's all very familiar for creator Kenya Barris.
“My wife is a doctor, we have five kids. We kind of came from humble beginnings and pulled ourselves up," Barris says. "[Then we] looked around at who our kids were, looked around at our friends’ kids, and kept having that same conversation over and over: We didn't really recognize the life that they were living compared to the life we were living."
That closely resembles the premise of "black-ish," which stars Anthony Anderson as a successful marketing executive who's worried his family — his four children, his wife (a doctor) and his father — have lost sight of their roots.
"Black-ish" also stars Tracee Ellis Ross and Laurence Fishburne. Larry Wilmore helped craft the first season before leaving for his own Comedy Central show.
Wilmore says he was on board as soon as he read the first page of the script. "black-ish" tackled race as a social issue, putting it at the center of the plot, not the sidebar.
"There was content on this show that I felt hadn't been on television in a long time," Wilmore says. "And the fact that he was so honest about race: It wasn’t a family that happened to be black.”
The show, which debuts Wednesday on ABC, has already drawn praise for the way it handles nuances of race, class and identity. TV critic Alan Sepinwall wrote that "black-ish" has a smart, defined point-of-view while still achieving the sitcom ideal of "mak[ing] the universal specific and the specific universal." NPR called it one of the fall's best new shows and the A.V. Club wrote that "Black-ish" refreshingly brings more perspectives and ideas to prime time, instead of just "'diversity' for diversity's sake."
For more on "black-ish," listen to Kai's conversation with Barris and Wilmore in the audio player above.
The founding father of "microcredit" is helping to judge a contest with maxidollars: the Clinton Global Initiative's Hult Prize, granting $1 million to a new business idea that'll help the poor.
Business and consumer groups say Congress needs to reform taxes, but few expect change soon. In fact, Treasury's tweaks to tax law may diminish the political will to address broader tax reform.
Research suggests that women may not be getting the information they need to make informed decisions about prenatal genetic testing, particularly invasive tests that can harm the fetus.
An ulcer drug is dramatically changing the face of back-alley abortions in developing countries and cutting the rate of maternal deaths. Misoprostol is widely available even where abortion is banned.
Guess what scientists found lurking inside a common-looking packet of supermarket porcini? Three entirely new species of fungi. That's what happens when you sequence the DNA of your dinner.