Business and Finance
How attacks on ships in the Red Sea may affect what you buy
WASHINGTON (AP) – Car factories in Belgium and Germany have stopped working. Spring fashion collections at a preferred British department store are delayed. A Maryland hospital supply company doesn’t know when to expect parts from Asia.
Attacks on ships in the Red Sea represent one other shock to global trade, on top of pandemic-related port congestion and Russia’s invasion of Ukraine.
Houthi rebels in Yemen, searching for to halt Israel’s offensive against Hamas in Gaza, are attacking cargo ships plying the waters connecting Asia with Europe and the United States, forcing the movement away from the Suez Canal and around the tip of Africa. Disruptions are causing delays and rising costs – at a time when the world has yet to beat a resurgence in inflation.
“What has happened now is short-term chaos, and chaos drives up costs,” said Ryan Petersen, CEO of supply chain management company Flexport. “There are 10,000 containers on each diverted ship. Many emails and phone calls are being made to re-plan each container trip.”
Adding to the confusion in global shipping is what Petersen calls a “double whammy”: passage through one other key trade corridor – the Panama Canal – is restricted by low water levels brought on by drought. And shippers are rushing to move goods before Chinese factories close for the Lunar New Year holiday from February 10-17.
The threat increases significantly as the war in Gaza drags on. A yearlong trade disruption in the Red Sea could push commodity inflation up by as much as 2%, Petersen says, adding to the pain at a time when the world is already grappling with higher prices for groceries, rents and more. It could also mean even higher rates of interest, which have weakened economies.
For now, Man & Machine in Greater Landover, Maryland, is awaiting shipment from Taiwan and greater China. An organization that makes washable keyboards and accessories for hospitals and other customers has suffered setback after setback.
Founder and CEO Clifton Broumand often receives a shipment of components about once a month, but the latest shipment, which left Asia 4 weeks ago, has been delayed. The normal route – a three-week route through the Suez Canal – was closed on account of Houthi attacks.
Redirecting to the Panama Canal also didn’t work – the shipment was hampered by the drought mess. He may must cross the Pacific to Los Angeles and arrive by truck or train in Maryland. Broumand has no idea when the products will arrive.
“It’s annoying and interesting. I feel our customers, all of them understand that. It’s not an issue like, “Why didn’t you plan this?” – who knew?” he said. “We call our customers and say, ‘Hey, that is going to be delayed. That’s why it’s like this. Nobody likes it, nevertheless it won’t kill anybody. It’s just one other frustration.’
Other industries experience similar problems.
Electric automotive maker Tesla must close its factory near Berlin from Monday until February 11 on account of delivery delays. Chinese-owned Swedish automotive brand Volvo was idled on its assembly line in Ghent, Belgium, where it produces station wagons and SUVs, for 3 days this month, waiting for a key gearbox part.
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Production at the Suzuki Motor Corp. plant. in Hungary was suspended for every week on account of a delay in the delivery of engines and other parts from Japan.
British retailer Marks & Spencer warned that the confusion would delay latest spring collections of clothing and homewares, which were on account of be released in February and March. Chief executive Stuart Machin said troubles in the Red Sea “affect everyone and that’s what we’re very focused on.”
About 20% of clothing and footwear imports into the U.S. arrive through the Suez Canal, said Steve Lamar, CEO of the American Apparel & Footwear Association. For Europe, the impact is even greater: 40% of garments and 50% of shoes go through the Red Sea.
“This is a crisis that has global implications for the shipping industry,” Lamar said.
According to Flexport, as of January 19, nearly 25% of world shipping capability is or might be diverted from the Red Sea, adding 1000’s of miles and every week or two to journeys.
The cost of shipping a regular 40-foot container from Asia to northern Europe has increased from lower than $1,500 in mid-December to almost $5,500. According to freight booking platform Freightos, moving cargo from Asia to the Mediterranean is even dearer: almost $6,800 in comparison with $2,400 in mid-December.
But it could possibly be worse. Two years ago, at the height of supply chain backup, it cost $15,000 to ship a container from Asia to Northern Europe and nearly $14,200 to ship a container from Asia to the Mediterranean.
“In terms of supply chain disruptions, we’re not even close to what happened during the pandemic,” said Katheryn Russ, an economist at the University of California, Davis.
In 2021 and 2022, American consumers, reeling from Covid-19 lockdowns and armed with government aid checks, went on a spending spree, ordering furniture, sports equipment and other goods. Their orders overwhelmed factories, ports and cargo yards, resulting in delays, shortages and better prices.
Now is different. After this supply chain mess, shipping corporations expanded their fleets. They have more ships to deal with shocks.
“The market is overcapacity,” said Judah Levine, head of research at Freightos, “which is thing. The capability needs to be sufficient to deal with this disruption.
Global demand has also weakened – partly because the U.S. Federal Reserve and other central banks have raised rates of interest to combat inflation and partly because China’s powerful economy is weakening. Inflation has fallen over the last 12 months and a half, even though it continues to be higher than central banks would expect.
“There are some really big forces driving inflation down,” said Russ, who was a White House economic adviser in the Obama administration. “It’s hard to say that (the Red Sea disruption) will significantly offset the declines in inflation that we’re seeing here and there beyond a tenth of a percentage point.”
Many corporations say they’ve yet to see a major impact. Retail Target, for instance, said most of its products don’t go through the Suez Canal and “was confident in our ability to provide guests with the products they want and need.”
BMW said: “All lights are green… our factory supply is secure.” Norwegian fertilizer giant Yara said it was “only slightly impacted” by transit challenges in the Red Sea.
Carlos Tavares, CEO of carmaker Stellantis, said: “So far, everything is fine. Things are going well.”
The rest may not last long. Flexport CEO Petersen warned that if shippers avoid the Suez Canal for a 12 months, “it’s a really big deal.” Higher costs would result in “goods inflation of 1 to 2%.”
Jan Hoffmann, a U.N. shipping expert, warned on Thursday that shipping problems in the Red Sea pose a risk to global food security by slowing the distribution of grain to parts of Africa and Asia that depend on wheat from Europe and the Black Sea area.
It could be even worse if the conflict in the Middle East deepens and drives up oil prices, which are actually lower than the day before Hamas attacked Israel on October 7.
For now, corporations are hesitant.
The Free People subsidiary of retailer Urban Outfitters imports clothing from India and “ships a lot of it by air,” co-CEO Frank Conforti said at an investor conference this month. However, putting furniture and home items on planes is simply too expensive.
At least home items aren’t as “fashion sensitive” as clothes, Conforti said, so wasting 15 days “sailing around the tip of Africa isn’t the end of the world.”
Business and Finance
JAY-Z Cuts Ribbon at Fanatics Sportsbook Opening in Jersey
Brooklyn-born billionaire JAY-Z officially entered the sports betting industry with the grand opening of the primary Fanatics Sportsbook at the Ocean Casino Resort in Atlantic City.
The “Hard Knock Life” announcer cut the ribbon while his partner in the enterprise, Fanatics founder and CEO Michael Rubin, was there together with Fanatics Betting and Gaming CEO Matt King and Ocean Casino Resort CEO Bill Callahan at the Sept. 15 event.
According to , immediately after the ribbon-cutting ceremony, 15-time PGA golfer Justin Thomas was the primary person to place bet at the venue. He placed a $100 bet on his alma mater, the Crimson Tide, to win the NCAA football championship.
Although the ribbon-cutting ceremony only recently took place, the 1,100-square-meter facility has been open since September 5.
announced that Quavo, Jalen Rose, Dez Bryant and Ryan Clark Also attended.
JAY-Z has greater plans for the betting industry.
Two years ago, JAY-Z and his group Roc Nation joined SL Green and Caesars Entertainment announce they try to open a brand new, state-of-the-art gaming facility at 1515 Broadway in Times Square, New York City. Roc Nation has taken out promoting in several distinguished New York publications, including , , and in an open letter addressing “conflicting parties” attempting to “spread disinformation” about their casino plans.
A trio of independent corporations imagine the property, which will likely be called Caesars Palace Times Square, cause seven million recent visitors to Times Square. Native New Yorkers and tourists will bring billions of dollars in economic advantages to Broadway and surrounding businesses.
No public decision has yet been made regarding opening a casino in the town center.
Business and Finance
Breakr Founders Discuss Innovation and Support from Us
The relationship between Breakr founders Anthony and Ameer Brown is what happens while you mix innovation, entrepreneurship, and resilience. As siblings, their love for one another runs deep, and they convey that very same admiration to their work as co-founders of a dynamic platform that connects artists, brands, and creators as they work to rework the landscape of the music industry.
As a tech company, Breakr quickly became an industry powerhouse, changing the best way music, talent, brands, and influencers are discovered and shared. Since its launch in 2020, Breakr has been connecting artists with labels and brands seeking to capitalize on the creator economy. Beyond that, Anthony says ensuring creators are paid what they’re value keeps him up at night (in the easiest way) with regards to business.
“We’ve been doing this for about three and a half years now, and you can get tired if you don’t have a reason to,” Anthony said. BLACK ENTREPRENEURSHIP. “I think our why has really crystallized over the last few weeks, which is really more like months. It’s like, Hey, we want to make it easier for brands and labels to find creators, but we also want to make it easier for brands and labels to interact and provide value to creators.”
“The most important thing is streamlining those payments. Payments was a really important innovation that we pushed at Breakr,” he continued. “We made it our business and kind of our modus operandi to pay these kids in real time. For us, that stops evictions. That stops people from having to have a job and be a creator on the side. It allows people to go out and price themselves appropriately because they know they’re going to get their money immediately.”
The company’s name comes from the beatbreaker that DJ is, and the opposite half of its name comes from the concept that the corporate desires to act as a switchboard or an off switch for the entities that use its platform, whether or not they’re creators, brands, or record labels.
“We want to be the central infrastructure,” Ameer explained. “Think about a home. All the different devices in your home are powered by electricity, but they need to be told where to go, what voltage needs to be delivered, all the information that needs to get there is transmitted through the electricity that goes to that device, so we think of Breakr as a way for the creator economy, we want all the different inputs and all the different devices to get the right information. They need the right payment. They need the right resources. They need the right performance. They need the right data that they need at the right time, and that’s basically why we’re called Breakr. We’re just a routing engine that connects people and solves problems at an efficient scale.”
As founders of Breakr and graduates of the esteemed HBCU, Florida A&M University (FAMU), the Brown brothers’ vision for the corporate got here as an “aha” moment at the identical time the world was shutting down attributable to the COVID-19 pandemic. The Brown brothers were in a position to bring their friends along on the journey. For Anthony, working alongside his siblings was “the biggest, most stressful, amazing experience” of his life.
“We started Breakr with two other co-founders who are friends of Ameer,” he recalls. “They did a ton of events together in college. They went to FAMU, Daniel Ware and Rotimi Omosheyin, and that was the beginning. They created a whole culture from the beginning in terms of how they operated together, and I think Breakr works because from my perspective, as a technical outsider who didn’t know how they operated together, I kind of got to know them, and what they mastered together was culture. It’s a deep appreciation of culture. My background was more in finance, Wall Street, Goldman Sachs, JP Morgan, but they spent so much time in culture, curating culture, and creating culture, that it ended up being part of our DNA as a company. We really stand on the shoulders of that culture.”
Breakr’s culture itself attracted early investors like rapper-turned-entrepreneur and culture maven Nasir “Nas” Jones. Through a program called General Assembly, which each Ameer, along with his background in PR and communications, and Anthony, along with his work in tech, had access to earlier of their careers, they not only got a deeper dive into the world of digital marketing and coding, but additionally caught the eye of Nas and Queensbridge Venture Partners, this system’s early backers.
The pair had no concept that not only would they meet Nas just a few years later at Hip Hop’s fiftieth anniversary party, but that it will occur while they were fully immersed of their entrepreneurial careers, constructing Breakr from the bottom up.
“The story has come full circle for Tony and me and everything,” Ameer said. “We’re both from Queens. Our family is from Southside Jamaica Queens. Our whole story is from Queens, and Nas is basically a Queens kid, you know what I mean. So the fact that he is who he is and we know him is the coolest thing in the world.”
Anthony added, “We had the opportunity to meet him in person, tell him the whole story, take pictures, etc. It was just a great moment, a complete turnaround, to meet him as an entrepreneur who literally taught himself technology and coding through an investment he made years ago. And also for him to reinvest in our company, which was significant for us in those early days in terms of just giving us a battery in the back to keep going.”
“The opportunity to actually fund our business is just crazy. It’s a story that no one would believe if it wasn’t true,” Anthony continued. “I actually wrote it. My essay to get into the General Assembly was read and they said, ‘Why did you name your essay that?’ I was like Nas said in 2009: it meant ‘worst of the worst, coolest thing ever.’ And I thought, I want to be the greatest tech guy. I want to be able to do tech with the best of them, right? So I named the paper. And that was the thing that the person at the General Assembly who read the essay said that convinced me. She said, ‘That’s a unique approach and I think it’s a great story and I want to hire you for the program.’ So it’s a crazy story.”
In addition to being an investor, Nas is included in Breakr’s ever-evolving roster of artists using the platform. Other notables include Megan Thee Stallion, Gunna, Rick Ross, Future, and more. In addition to musicians, corporations like Meta, Live Nation, and P&G are among the many brands currently tapping the startup for various campaigns with the aforementioned artists.
With exponential growth in a brief time frame, Breakr has built a world database of 55 million creators, and the corporate is growing by the minute, employing over 70,000 creators. Looking ahead, the Brown brothers hope to succeed in over $25 million in transaction volume by the tip of next 12 months.
“I think it’s not unrealistic to see a world where we’re doing over $160 million in transactions by 2026,” Anthony said. “In fact, by 2027, we predict we’re doing somewhere around $330 million to $350 million in transactions. The North Star for me is what’s it going to take? How long is it going to take us to get to a billion dollars in payments processed per 12 months? So every strategy and all the things we do is tied to attending to that in the following five years.
Crash Here to learn more about methods to join the Breakr community.
Business and Finance
Home Depot to pay $2 million to settle false advertising case
Home Depot has settled a civil case alleging false advertising and other deceptive business practices. The home goods store will pay nearly $2 million despite admitting no wrongdoing.
District attorneys in California initially filed the grievance in San Diego Superior Court. According to the Los Angeles County District Attorney’s Office, Home Depot allegedly cheated customers to pay the next price than the advertised price of the product. This was considered a “scanner violation”, the product label on the shelf won’t ring the identical on the checkout due to the costlier UPC code.
Case lawyer George Gascón called the settlement a “clear message” that these illegal practices by large corporations won’t be tolerated.
“False advertising and unfair competition are serious crimes that undermine consumer trust and distort the marketplace,” District Attorney Gascón explained in a press release. “When companies engage in deceptive practices, they not only deceive consumers, but they also gain an unfair advantage over companies that operate ethically and transparently. This settlement sends a clear message that such behavior will not be tolerated and underscores our commitment to protecting the rights of consumers in our community.”
The company began negotiations with district attorneys on August 26. As a result, the ruling ordered Home Depot to pay $1.7 million plus an extra $277,251 in investigation costs and damages. The additional fee may also support enforcement of consumer protection laws.
In addition, Home Depot is prohibited from promoting false advertising and charging more for an item than is visible. The ruling also ordered it to implement a price accuracy program. It includes more audits and training, in addition to eliminating weekday price increases.
However, an act of contrition was not certainly one of the necessities, as Home Depot didn’t admit to committing against the law. LADA noted that the corporate, which Identifies as the world’s largest home improvement retailer, cooperated throughout the investigation.
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