This has been an interesting story to watch unfold. In terms of the long-term sustainability of Foxconn’s U.S. operations, a couple additional risks I would raise:
– Foreign companies operating in the U.S. are likely to not fair well if Trump’s tax plan passes (which is looking more likely by the minute) as a key tenet of the plan are excise and base-erosion taxes. This would at least partially offset the $3 billion incentive that Foxconn has been promised.
– As more and more Americans are employed by a Chinese employer, the U.S. government and American citizens will likely start to raise questions about what the company does with the profits produced from its employees activities. As outlined in a recent WSJ article, a number of China’s tech giants have been criticized for helping Beijing “spy on its people.”  It will create a big challenge if Foxconn gets labeled by Americans / Wisconites as a company that helps the Chinese government suppress political dissent, facilitate surveilling its people, etc.
Alaska Airlines is making some great advancements, as you displayed above. But like the other comments above, I don’t think that the 5th player in the airline industry is going to be able to make a substantial impact on it’s own. Yes, it can prioritize green fuel internally, and yes, it can be an industry example and garner positive PR and potentially even increase brand loyalty. However, with the investment required to make real headway in this space, regulation will be have to play a heavy hand in forcing change. Right now, airlines have a responsibility to current regulations and then to shareholders. As long as they are meeting the necessary improvements, their stock price is going to be the next priority instead of initial investment that might not have a proven payout. I admire what Alaska is doing but they are just too small to have it be enough.
Thanks for posting, Ian! This is a very similar business model to a company called SpoonRocket in the SF bay area that I was a big fan of. Your simplified menu planning was spot on. I remember them offering a handful of “everyday option” like a basic sushi roll or a curry chicken. Then the other items rotated. Where you have to be careful with too much simplifying is pushing people away with boredom or uninteresting dishes to save on costs, because there are plenty of alternatives. If your value prop is restaurant quality food, it is hard to move towards less unique options. I think the consumer that is busy enough to value the convenience of a delivery is likely willing enough to pay for unique offerings. But I guess the Maple story would say otherwise… To your second question, I just don’t think this model makes any sense in a less populated area. A company will only be hurt by further delivery times, more complicated routes and fewer people ordering consistently making demand planning nearly impossible.
Thank you for sharing- great topic! I feel personally conflicted on this topic. While I see that point of view that AB InBev is a large consumer, especially in certain locations, they are not driving the scarcity. The scarcity (or inefficient distribution) is due to lack of infrastructure. Is that the responsibility of a public company to take on? I don’t think so. That feels like the role of government to me. HOWEVER, if they see a problem on the horizon (and they do based on the initiatives they are dabbling in), it’s hard to see a situation where they ignore the issue the are contributing to and ignore it. A company that I admire in a little bit of a similar space is International Paper. For every tree they harvest for their paper business, they plant 3 or 4 more. This is leading to an actual increase in the forest land where they play. To me that makes a real impact. For AB InBev to have that kind of an impact, they have to make substantial capital investments. To the point above, I think there is a side that says that does increase Shareholder Vale because it ensures the long-term viability of the model and reduces the risk of being regulated out. Without the increase in value to shareholders though, I’m not sure this sits on their shoulders.
Great read! One thing that stands out to me that Isabel started to touch on above is that Ralph Lauren isn’t trying to be “fast fashion”. When I think of the RL brand, I think of classic, timeless styles. While they have some high-end more fashion forward pieces in their line, so much of their line seems like it would hardly change year over year. Going after an aggressive, data driven model with a company / brand that really resonates as a classic staple seems like a mismatch to me. I think there are ways to produce and sell (i.e. e-commerce) smarter without forcing a heritage brand into a data space they don’t fit in.
Your point about accessing sufficiently skilled labor in China in additional to the labor costs is an important piece. Manufacturing executives in the U.S. are quick to point out that in many instances there are not enough American workers with the requisite skill-set to fill the jobs that are currently available. President Trump invited a number of manufacturing executives to the white house in February (2017). While Trump focuses on tax, trade and regulatory reform to bring jobs back to the U.S., these execs overwhelmingly highlighted the lack of advanced skills as the bigger issue . Protectionism will do very little to save auto (or any manufacturing) jobs if the country is not making the necessary investments to ensure its workforce has the skills required to work in an increasingly automated world.