All posts by Harshi Rasania

High Class Fashion Handbags Meet Low Sales

Throwing it back to the ‘90s when high end fashion products were a symbol of nonchalance in the social facet. Coach, Kate Spade & Co.,Gucci, Michael Kors, and many more were the place to shop if you had the money. This generation’s teenagers or the “Gen Z” as we call it, have definitely deviated this concept. Adolescents nowadays do not wish for the costly, luxurious items they would have desired about a decade ago. Instead, they rather support their fashion icons who encourage them to purchase the affordable products on the market rather than the expensive. Nancy Nessel, a Generation Z expert, told Business Insider “For Gen Z, gifting is an occasion that mirrors the more conservative behavior of Gen Z: they are practical, frugal, and prefer to blend in, not standing out with glitzy items.” Concluding from Nessels statement, young people do not have interest in purchasing expensive goods such as handbags to show their standards. Researchers have noticed the changes in sales in many of these high end companies which may not be so high end anymore.

Data shows that Coach, a prevalent handbag company, dropped 12% in sales in its fourth quarter of 2015 and declined 19% in stock value. In addition, Kate Spade & Co. plummeted in stock value about 35% since the beginning of 2015. Michael Kors lost nearly half of their value in share price. Lastly, Gucci’s sales have slumped 1.1% in 2014. As you can see, reduction in sales have certainly occurred. The real question is, what conflicts will arise for these companies if the situation is not treated properly?

The shift of preferences in goods could lead to a surplus in goods for the high end companies who experience a decline in sales. The company then loses all the money they spent into producing how much is left over. In addition to sales dropping, the value of the company drops as well, inducing its share price to fall. People start selling the stock when they come to realize the company’s sales is not doing good and the company itself loses even more. The chain of events that may occur could lead to a very disastrous outcome. On the other hand, Vera Bradley, being a well known but not so lavish compared to the others, saw an immense growth in the latest holiday season in which their sales rose 48% and share price increased by 46%. Therefore, the chic companies are in trouble as a result of the Gen Z finding interest in fashionable products that are not so high end.  

 

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Chipotle’s Stock Crisis

A recent outbreak in October 2015 has captivated everyone’s attention as hundreds of news reports dominate in about every news network. Chipotle, a franchise known for having the healthiest organic ingredients, has depreciated its stock price after several cases of E-coli were disclosed in numerous consumers. Reports reveal information about fifty-three customers who were infected with E-coli in nine states including Oregon, Washington, California, Minnesota, New York, Ohio, Illinois, Marchipotle-2yland, and Pennsylvania. As a result, forty-three Chipotle restaurants closed for cautionary purposes. Although the commotion has ended with the solution of officials from the Centers for Disease Control and Prevention investigating the issue and intensifying food safety procedures, Chipotle is still suffering through an immense decline in sales.
Customers discontinued the consumption of meals from Chipotle in fear that they would become infected with the virus. As seen in the image, profits plunged throughout the last four quarters. The chipotle.jpgpublic has lost faith in the quality of the food produced by Chipotle, causing them to abominate the restaurant for putting them at the risk of severe disease. The stock price has plunged to a disappointing $480 when it was originally $730 before the E.coli chaos. Investors have also lost faith in the company so they have sold stocks that they have invested earlier in the year. For this reason, the market value of the company has plummeted leaving the company at a loss. Merrill Lynch and CRT Capital, credit rating agencies, both downgraded Chipotle and five analysts cut their price targets for the company. As you can see, there are several factors that contribute to the slump of Chipotle’s wealth. While Chipotle is in a crisis to recover their sales, rivals celebrate as the previous Chipotle fans revert their preference to alternatives.

Data proves that Chipotle’s rivals are benefiting through Chipotle’s struggles. Many rivals had growth in sales as customers turned to alternative fast foods/restaurants. Some of these businesses include Taco Bell, Moe’s Southwest Grill, and Qdoba, all of which had a growth ranging from 4%-8%. Taking advantage of what has happened, sales increased with no extra marketing necessary because they have similar choices as the poorly repudiated, Chipotle. In addition, Chipotle lost market share to Qdoba, being its biggest rival and Meditteranean restaurant, Zoe’s Kitchen. Although Chipotle and Panera are said to be the two leading fast food chains for their healthy food choices, Panera may be taking the lead because of the E.coli outbreak.chipte stock.jpg

Not only is their reputation damaged, but profit margin may also be affected. The chain of restaurants may need to reduce their prices in the future so people start to buy their food once again. On top of low sales, the business will have a lower margin which may barely exceed their costs. The entire corporation is put at risk as it is possible for it be at default in the near future. Although these are only possibilities, Chipotle must take action to acquit their name. All in all, the erupted conflict resulted in improved cautionary procedures by the Center for Disease Control and Prevention which is one of the few beneficial impacts of the event that occurred. Going forward, other companies and Chipotle itself will be attentive so such action does not occur again.

Trust…does it exist?


“Trust. It takes years to build and seconds to break.” The brilliantly accurate quote, by an unknown genius, represents how corrupt our world has become because of the lack of trust in mankind .

Trust is the foundation of any relationship, equally as important to building a house as to support a family. A hammer, used to concur the wood together when building a house, correlates to the communication needed to assure that both parties are on the same page when creating a trustworthy relationship. The nails, which the entire house relies on to hold the walls together, correlates to the promises being made in a trusting relationship. Finally, the walls which create a layout for the entire house, represents the honesty of each person existing in a trusting relationship. Whether it is in your social life or workplace, all these tools are necessary to build the trust you want with your companions. However, trust is beginning to diminish while betrayal is under the spotlight.

Cheating, lying, stealing, law breaking. They are all forms of betrayal. Perhaps this disloyalty is not only identified in people themselves, but also detected in a respected precedent, which should be encouraging right rather than wrong. The National Security Agency (NSA) illegally scrutinizes our phone calls without our consent. The issue, which arose in 2013 when Edward Snowden released information about the NSA collecting data of telephone conversations, live chats, emails, an
d search histories, angered many citizens who fought against this action, stating it violates their Fourth Amendment rights. Considering that the citizens of our nation assume that all of their Constitutional freedoms are protected, the government is betraying innocent residents of our country. Civilians expect privacy which our government promises in the Constitution. Through this act of inspecting personal information without approval illustrates a reason for citizens to not trust our “reliable”  government.

Believe it or not, the U.S. government is not the only one deceiving us. Our country’s acquaintance, Iraq is destroying the integrity between our countries. The Islamic State In Iraq, also known as ISIS, is a terrorist group intruding into other countries and killing an abundant amount of people. The latest outbreak of the aggressive hate group was on the 14th of November, 2015 in Paris, France. The shooting and bombings in Paris killed about 129 people and injured approximately 352. Major okterrorist groups such as this one provoke all of mankind and brings fear to all individuals because of the lack of trust between countries. Nations cannot trust their allies because they are too afraid of further barrage. People these days are taught to trust no one due to hate groups such as ISIS, which may strike and surprise anytime without any suspicion.

In this case, the hammer is used to break down all the walls of our home, keeping no promises. The nails, which hold our countries together, are not strong enough to retain the walls. Lastly, the support we obtain from the walls of our home are destructed through the dishonesty of other countries.

Our world endures betrayal. We must reestablish the trust we once had to improve humanity, complementary to the quote of obtaining trust and having it betrayed in the matter of seconds.