❌ Nixing noncompetes

Plus: Beyond bankruptcy | Thursday, January 05, 2023

Open in app View in browser   Presented By MOXY   Axios Closer By Hope King and Nathan Bomey · Jan 05, 2023 First Thursday of 2023 ✅ . Today's newsletter is 698 words, a 2½-minute read. 🔔 The dashboard: The S&P 500 closed down 1.2%. Biggest gainer? Lamb Weston (+9.8%), the producer of frozen potatoes, on strong quarterly earnings and revenue estimates. Biggest decliner? Constellation Brands (-9.7%), the beer, wine and spirits company, after missing analyst expectations on quarterly earnings.     1 big thing: Retail bath bomb Illustration: Sarah Grillo/Axios   Bed Bath & Beyond — whose 20%-off coupons and towel towers have been a staple of the American shopping landscape — warned today that it had "substantial doubt" that it could stay in business, Nathan writes. The WSJ reported after markets closed that the retailer is preparing to file for bankruptcy "within weeks." Why it matters: Bed Bath & Beyond still had some 32,000 employees and 955 stores as of last summer, including its buybuy Baby and Harmon properties. Its stock closed down 30% today, and it's shed 88% over the last year. Flashback: Not long ago, Bed Bath & Beyond was a meme-stock favorite, fueled by an investment from GameStop chair Ryan Cohen. But the stock plunged in August after Cohen exited the stock, leaving shares to trade on the not-so-good fundamentals. State of play: The company has been distressed for years, having failed to reinvent itself in the digital age despite efforts to declutter its stores and remake its coupon strategy. Today it said it expects to report a 33% sales decline in the quarter ended Nov. 26, driven in part by lower customer traffic. It is also struggling to get product on its shelves due to "reduced credit limits" from vendors, which often tighten terms for retailers careening toward a liquidity crisis. What they're saying: The company said it continues to consider all strategic alternatives. What others are saying: "In our view, Bed Bath & Beyond is too far gone to be saved in its present form," GlobalData retail analyst Neil Saunders wrote Thursday. Go deeper.     2. Charted: Discounts drove holiday shopping Data: Adobe Analytics; Chart: Axios Visuals American shoppers took advantage of deep discounts online and rang up a record $211.7 billion in e-commerce spending in November and December last year, a new Adobe Analytics report out today shows, Hope writes. The results — unadjusted for inflation — reflect resilient consumer demand for holiday goods and discounts, despite a greater number of options for spending as the economy has reopened. Flashback: Retailers faced with a glut of goods and worried about waning consumer demand cut prices across the most-wanted holiday categories, including toys, clothing and electronics. Go deeper.     3. What's happening 💊 Walgreens and CVS confirm they plan to start offering abortion pills. (Axios) 🪙 Crypto lender Genesis laid off 30% of its staff, and it's considering filing for bankruptcy. (WSJ)     A message from MOXY Real political savvy at your fingertips     Tired of the ranting echo chambers? MOXY has smarter discourse via issue-based forums, a broad-spectrum newsfeed, personalized politician directory, legislation, ballot info, surveys and more. Try MOXY Free for 30 days or get a MOXY Premium 60-day upgrade using code AXIOS2023. Learn more.     4. FTC takes aim at noncompetes Illustration: Aïda Amer/Axios   The FTC wants to put an end to noncompete agreements, Axios' Emily Peck writes. Why it matters: If enacted, this would be a big change in the business world, where the agreements are widely used. The FTC estimates that 30 million people, or 1 in 5 workers, would be impacted, and the rule could increase wages by nearly $300 billion a year. The big picture: Noncompetes were once used mainly to keep high-paid executives from jumping ship and taking insider knowledge to rivals. But they have become more common. In 2014, they were given to workers at sandwich maker Jimmy John's, and the FTC yesterday cited a case where security guards, earning close to minimum wage, were required to sign a two-year agreement enforced with a $100,000 fine. The other side: The proposal has detractors, including the Chamber of Commerce. Go deeper.   Share Axios and earn rewards If you like this newsletter, your friends may, too! Refer your friends and get free Axios swag when they sign up. Be a good friend and share   5. Cardi B's inflation PSA 🥬 Cardi B performs during the Wireless Festival at Finsbury Park in July. Photo: Joseph Okpako/WireImage   Cardi B has had it with the price of lettuce. The rapper posted a "PSA" last night on Twitter, putting anyone responsible for the rapid rise in food prices firmly on notice, Axios' Pete Gannon writes. Details: "When I'm starting to see that grocery prices are, like, tripling up, it's like, 'Hey yo, what the f**k is going on,'" the "Money" singer says in the clip. She zeroed in on the explosive surge in lettuce prices. Cardi B isn't wrong. Food prices were up 10.6% in November from the year before. And lettuce prices have exploded — up 8.9% from the previous month, and nearly 20% year over year. Supplies of lettuce grown in California's Salinas Valley, known as "the salad bowl," have been impacted by a virus spread by tiny insects called thrips. The bottom line: Thrips, Cardi B would like a word.     6. What they're saying "We've been in constant contact with these companies, and they are running manufacturing 24-7." — Anita Brikman, spokesperson for the Consumer Healthcare Products Association, on the ongoing shortage of children's Tylenol and Motrin.     A message from MOXY Tired of the Ranting Echo Chambers?     MOXY puts real political savvy at your fingertips with: Issue-based forums. Personalized politician directory. Legislation And much more. Try MOXY Free for 30 days or get a MOXY Premium 60-day upgrade with our compliments using code AXIOS2023. Get started.   Today's newsletter was edited by Pete Gannon and copy edited by Sheryl Miller. Why stop here? Let's go Pro. Join the thousands of professionals using Axios Pro to keep up with the companies, deals and trends changing their industries.   Axios thanks our partners for supporting our newsletters. Sponsorship has no influence on editorial content. Axios, 3100 Clarendon B‌lvd, Arlington VA 22201   You received this email because you signed up for newsletters from Axios. To stop receiving this newsletter, unsubscribe or manage your email preferences.   Was this email forwarded to you? Sign up now to get Axios in your inbox.   Follow Axios on social media: