MZ Hammer's Profile

I think that it’s difficult for a start-up with limited size and influence to be worried about international trade policies (unless there is a known law/deal change that is imminent); it’s a risk that they can’t afford to take as a high priority. However, to echo Jonathon’s point above, if the product is honestly high quality and cheaper, it should have plenty of avenues for distribution in other parts of the world where there aren’t as high tariffs. So, if I were Hubble, the hedge I would be looking for to mitigate these risks are in the form of international expansions via a sales force/distribution channels in other countries (potentially a country which there is virtually no risk of trade barriers).

I think that autonomous ships might be a far way off. Even if Maersk were going to be able to execute on this from their side, you would have to get port buy-in (which is a fragmented industry) with all the different routes where you are going to be able to manage legislative risk and day to day operations when you have a non-human physical entity (ship) interacting with a human entity (port). In addition, I’m not sure how much the labor costs are when it comes to running a ship; for cars/trucks the driver represents a large percentage of the cost, but I’m not sure if that is the case for ships, meaning the financial opportunity might be a lot smaller.

Seeing as tourism is one of the largest industries in Cuba and reading this article, I think AirBnB can gain a lot of positive publicity by pushing for more open travel between the US and Cuba. Currently, almost one million Canadians go to Cuba annually (https://en.wikipedia.org/wiki/Tourism_in_Cuba), and given the US population versus Canada, the opportunity might be about ten times that (or billions of dollars for the hospitality industry). That provides a lot more flexibility in spending money now to both invest in getting AirBnB entrenched in Cuba and lobbying (or other great government influencing activities).

I honestly think that as water pressures continue to rise that small independent breweries are going to struggle to keep up. I think it’s likely that we see further segmentation within the beer category, with microbrews or local breweries having to charge higher prices and promote quality to justify their pricing if water prices become too high and there isn’t technology/technique developed to improve water ratios needed to make beer. Luckily (or unluckily), it may be many years before water prices see upticks since governments will likely have to tackle the issue first.

I would argue that many people globally do not care about the environmental sustainability of beef and without legislative pressure, McDonalds has little incentive to focus on sustainability unless customers move away from beef completely. There is a higher barrier cost-wise for sustainable beef, as much of the supply chain is through fragmented farms and often the beef making processed is not vertically integrated, meaning moving multiple layers of businesses into the sustainable model. Potentially focusing on consumer preferences (similar to what happened to chicken) is the best way for the world to get more sustainable beef?

Great read – I’d like to push back on the idea of fulfilling orders from DCs. Right now, many Kroger DCs are sending pallet or truckload quantities of products to retail stores; adding a separate “pick” process for customer orders would involve having to disrupt those existing processes and breaking down SKUs into the individual product level. This is not only a huge investment from an technology perspective, but is also extremely difficult to handle from an operations perspective. In addition, delivering products last mile to customers is very expensive and introduces more complexity for Kroger. I much like the second idea of re-configuring stores and potentially finding ways to be more efficient with physical store presence (in the form of smaller space or fewer stores) and potentially doubling down on the customer pick-up model (Wal-Mart has seen a lot of success with this model).