These are stories Report on Business is following Monday, April 9, 2012. Get the top business stories through the day on BlackBerry or iPhone by bookmarking our mobile-friendly webpage.
Tips for Target I was taken aback by the decision by Canada's Heritage Minister to review plans by Target Corp. to open up shop here. James Moore, by cabinet order, wants to test the cultural aspects of the pending move, given that it would sell things like books and DVDs.
The review may be standard, but it's still one of the dumbest things I've ever heard of. Like Zellers somehow shrieks Canadian culture?
So I decided to offer the giant U.S. retailer some tips:
1. Accept Canadian Tire money at par.
2. It's the pop and snacks aisle.
3. You can market direct using something known as a robocall.
4. You can charge more in Canada even though the loonie's worth more than the greenback.
5. You cannot, however, cut the pay of your Canadian workers. You have to shut down and move to Indiana instead.
6. When we say icing, we may be talking about hockey, not cake.
7. Bicentennial here means commemorating the War of 1812. And you have to know who really won.
8. Stack the DVD bin with discount copies of Goin' Down the Road.
9. You have to know what two-four means.
10. You can sneak images of the Mounties into your marketing. But you cannot name your mascot Pierre Poutine. That's taken.
Facebook to buy Instagram Facebook is buying Instagram, the photo-sharing app for mobile devices, for about $1-billion (U.S.) in cash and stock.
"This is an important milestone for Facebook because it's the first time we've ever acquired a product and company with so many users," founder Mark Zuckerberg announced on his Facebook page today.
"We don't plan on doing many more of these, if any at all. But providing the best photo sharing experience is one reason why so many people love Facebook and we knew it would be worth bringing these two companies together."
Facebook plans to build on Instragram, independently.
"We believe these are different experiences that complement each other," Mr. Zuckerberg said.
"But in order to do this well, we need to be mindful about keeping and building on Instagram's strengths and features rather than just trying to integrate everything into Facebook. That's why we're committed to building and growing Instagram independently. Millions of people around the world love the Instagram app and the brand associated with it, and our goal is to help spread this app and brand to even more people."
Survey shows business outlook brighter Canadian businesses are growing more optimistic about the next year.
A Bank of Canada survey released today shows executives in a much brighter mood about sales than were in a previous poll three months ago, The Globe and Mail's Jeremy Torobin reports.
Most companies also saw a further easing in credit conditions in the first quarter, a separate survey showed.
"The reports released this morning depict a resilient economy with plentiful credit available," said chief economist Stéfane Marion of National Bank Financial.
"These developments are consistent with our view that the Bank of Canada will need to upgrade its views on the Canadian economy for its upcoming monetary policy report. A more hawkish guidance from [Bank of Canada Governor Mark]Carney would be justified at this point in time but still do not expect rate hikes this year."
Others also suggested the findings won't alter the central bank's course at any time soon.
"The Bank of Canada's quarterly Business Outlook Survey may not have moved the needle dramatically in terms of the Bank of Canada's thinking, but it certainly confirmed an evolving story on the economic expansion that supports the eventual removal of monetary accommodation," said Mark Chandler, chief of fixed income and currency research at RBC Dominion Securities. "Nevertheless, there is no 'smoking gun' that would suggest an imminent tightening."
AOL in patent deal AOL Inc. is selling more than 800 patents to Microsoft Corp, for almost $1.1-billion (U.S.) in a deal that sent its stock surging today.
AOL will still hold more than 300 patents after the deal, which includes selling Microsoft a subsidiary.
"This is a valuable portfolio that we have been following for years and analyzing in detail for several months,” said Microsoft general counsel Brad Smith. "AOL ran a competitive auction and by participating, Microsoft was able to achieve our two primary goals: obtaining a durable license to the full AOL portfolio and ownership of certain patents that complement our existing portfolio."
The Globe and Mail's Boyd Erman examines the AOL-Microsoft deal, and what it could mean for Research In Motion Ltd.
- AOL raises $1.06-billion cash from sale of 800 patents to Microsoft
- Boyd Erman's Streetwise: As AOL sells patents, is there a play for RIM?
Sony said to cut jobs The new chief executive of Sony Corp. is reportedly poised to slash about 10,000 jobs in a planned turnaround for the Japanese electronics giant.
Kazuo Hirai plans a briefing Thursday, the Nikkei newspaper reports.
An august institution? This isn’t about golf and green blazers.
It’s about the hypocrisy and timidity of Corporate North America when it comes to sexism, and how we tolerate it even though it’s no different than racism.
We’ve seen the facts and figures on pay disparity, the number of women in the boardroom and the corner office. This weekend, we got a very public display of keeping women in their place, in this case a hospitality cabin at the Masters golf tournament.
For those who may not have followed the story over the past week, here’s a recap.
There are three major sponsors of the Masters, a major golf tournament and one of the biggest events in the sports world, held at the celebrated Augusta National Golf Club in Georgia.
One of the sponsors is IBM Corp. , for whom the Masters is a marketing dream. Its four previous chief executive officers have all been offered memberships in the prestigious men-only club, raising questions in the run-up to this year’s Easter weekend event as to what Augusta would do about IBM’S new CEO, Virginia Rometty.
Had Augusta followed tradition, Ms. Rometty would have been the first woman offered a membership.
It appears it did not. Augusta seems to have chosen instead to slap a major benefactor in the face, and IBM responded by turning the other cheek.
Just to be clear, Ms. Rometty did not put herself in this position. She earned it by being the best person for the CEO’s job in the eyes of the board.
Her board, however, failed to take a stand at the 76th Masters. As did the two other major sponsors, Exxon Mobil Corp. and AT&T Inc. As did the current and former captains of industry who are members of the prestigious club.
Of course, we’ve no way of knowing what may have transpired behind the scenes, but that’s beside the point. This is not to tar everyone with the same brush, but the sponsors and members needed to make a public statement through their actions that they would not stand silent and allow the ignorant to rule.
It’s particularly surprising in IBM’s case because the company has a stellar reputation when it comes to diversity and equality. And it has taken stands in the past, notably in 1990, when, in the run-up to the PGA championship at Alabama’s Shoal Creek Country Club, IBM and others pulled back on some $2-million (U.S.) in advertising over comments by the club’s founder over excluding African Americans.
IBM and Ms. Rometty have been put in a tough position. How, by their actions, do they tell the women who work for them that they’re second-class citizens despite what they boast in their own policies?
The company would act on the Augusta controversy if in fact it honoured its policy, which stresses that “business activities such as hiring, promotion, and compensation of employees, are conducted without regard to race, colour religion, gender, gender identity or expression, sexual orientation, nation origin, genetics disability, or age.”
Its partners in sponsorship make similar declarations.
AT&T: “AT&T’s 133-year history of innovation is a story about people from all walks of life and all kinds of backgrounds coming together to improve the human condition. It is our diversity, coupled with an inclusive culture that welcomes all points of view – which makes us who we are: a great place to work, a desired business partner and a committed member of the communities we serve.”
Exxon Mobil: “At ExxonMobil, we understand that creating economic opportunities for women is one of the wisest investments we can make. That’s why in 2005, we launched our Women’s Economic Opportunity Initiative – a global effort that helps women fulfill their economic potential and drive economic and social change in their communities.”
The three companies involved, all powerful in their own right, now have that opportunity to drive that social change, and should use that power against the small-minded for whom discrimination is a way of life.
This is the same club that excluded African Americans until 1990 and at one time dictated that caddies had to be black.
What’s stunning is that we’re even having this discussion in the year 2012. And that many people still dance around the issue. We call it sexism but it’s no different than racism, though not illegal.
Ginni Rometty has the balls for the job. But not for the Augusta National Golf Club.
- Why is IBM sponsoring the Masters?
- Obama takes a swing at all-male Augusta National
- Augusta in the rough: Women, money, prestige
- Payne refuses to talk about Masters membership
Avon names new chief Avon Products Inc. has named a new chief executive officer to replace Andrea Jung and help turnaround the struggling beauty products company.
Sherilyn McCoy takes over the new role April 23, and Ms. Jung continues as executive chair.
Since 1982, Ms. McCoy has been with Johnson & Johnson, which announced her resignation today.
Ms. McCoy has a tough new job ahead of her. Avon is the subject of a bribery probe by the Securities and Exchange Commission - no allegations have been proven - and is the target of a proposed hostile bid by Coty Inc., which it has rejected.
Sales at the 126-year-old company have slumped.
China inflation rises The People's Bank of China has of late been generally winning its war against inflation, but the latest data show the battle's not over.
China's annual inflation rate picked up to 3.6 per cent in March, from 3.2 per cent in February. That's still well down from the peak last summer, and below Beijing's target. But it's a noteworthy reading, said Derek Holt and Dov Zigler of Scotia Capital.
"That still leaves inflation below the government's stipulated 4-per-cent target but the figures have been dirtied by the earlier than usual Lunar holiday that may have only now shaken out of the year-over-year inflation readings," they said.
What to watch for this week There's a lot going on this week, from economic reports to the start of another earnings seasons.
In Canada, we'll get a look at how our exporters did in February when Statistics Canada reports the country's trade balance on Thursday morning. It's expected to be little changed from January's $2.1-billion, perhaps slightly less.
"Canada’s trade surplus has been stayin’ alive in recent months, dancing to the tune of a more upbeat U.S. trading partner," said Emanuella Enenajor of CIBC World Markets.
"Stateside demand likely supported Canada’s exports again in February, with rising domestic auto production suggesting that vehicle shipments to the States may have done well," she said in a report.
"Other sectors of exports, however, may have struggled. Production disruptions at a large north Alberta oil sands producer saw crude oil output in February plunge, according to data from the National Energy Board. Associated exports may have also taken a hit. As well, falling natural gas prices and production could have contributed to the first decline in energy exports in four months."
In the United States, markets will get a fresh reading Friday on inflation, which is believed to have slowed in March to about 2.6 per cent or 2.7 per cent on an annual basis, from February's 2.9 per cent.
"Though retail gasoline prices continued to rise, the pace has slowed markedly in the face of some stabilization in crude oil prices," said Paul Ferley and Tom Porcelli of Royal Bank of Canada. "This is expected to result in the energy price component rising a more moderate 0.7 per cent in March."
In the markets, it may seem like earnings seasons never end. The latest is set to kick of as Alcoa Inc. reports its first-quarter results. Other companies scheduled to report include Google Inc., JPMorgan Chase & Co., Wells Fargo & Co., Astral Media Inc., Cogeco Inc. and Shaw Communications Inc.
"The Q1 earnings season unofficially gets under way next week when Alcoa reports on Tuesday, and the general theme will likely be one of much cooler profit growth," said BMO's Mr. Kavcic.
"S&P 500 earnings are currently expected to rise 3.2 per cent year over year in the quarter, down from 9.2 per cent year over year in 2011Q4 - that would be the slowest pace since 2009Q3 when the economy was pulling itself out of recession."