America Sets A GDP Growth Rate Record
After a record-setting GDP drop of 31.4% in Q2, the American economy bounced back to set a record gain of 33.1% in Q3. This is definitely some much needed good news for the economy and is most likely the result of economic stimulus, easy money from the Federal Reserve, and the reopening of many businesses.
That being said, COVID-19 cases are spiking again in many areas of the country, many industries are still struggling, and there is no economic stimulus package in the near future. The country took a big leap forward but there is definitely more ground to cover.
Let’s take a look at some of the biggest business updates from this week.
Postmates launches retail delivery
Just in time for the holidays, Postmates announces the launch of their retail delivery. Right now, it’s only available in LA but they plan on spreading to new cities based on their success.
Retail delivery is just what it sounds like - You’ll be able to order online from stores and Postmates will pick up your order and deliver it directly. This allows consumers to order online but still receive their packages in an hour or two.
It will be interesting to see how this impacts online shopping sites like Amazon and which method consumers prefer.
Dunkin’ goes private
Usually, it’s big news when a private company goes public. This makes headlines because now public investors will be able to get a piece of something that was previously unavailable. Public companies going private usually is not as newsworthy but that’s partly because it rarely ever happens.
However, Dunkin’ (formerly known as Dunkin’ Donuts) announced this week that they might go private and sell themselves to Inspire Brands. Inspire Brands also owns Sonic, Arby’s, and Jimmy Johns.
One of the main reasons they might be going private is because they will be shielded from the scrutiny of investors. Dunkin’ has been trying to transform their stores from “fast-foody” to “Starbucksy” for some time now. This sale might give them more freedom to make changes.
Chipotle revenue grows but profit shrinks
In an interesting turn, Chipotle’s sales grew 14% from last year with most of the growth being powered by online sales (online sales more than tripled). This sounds like great news but there is just one problem: it’s expensive to deliver.
Chipotle would rather you come in-store or pick up your burrito but those weren’t always options this year. Because of this, Chipotle’s overall profits actually took a hit and fell 19%. This is because delivery companies will charge restaurants double-digit commissions on orders.
A few other updates:
➢ Exxon announces additional job cuts.
➢ Moderna is on pace to release a late-stage vaccine next month.
➢ The LVMH and Tiffany deal is back on.
➢ Unless Prop 22 passes, Uber and Lyft will most likely be forced to shut down their California business.
➢ Tupperware sales grow for the first time in 3 years.
That’s it for this week -- Join us next week for another market update.
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