By Alexa Ritacco

“Travel Agent? What’s the point?” said the 18 year old, as he finalized his booking for his senior spring break trip to Cancun on Expedia. With a click of a button he books his flights, all-inclusive hotel, airport transfer and adventure trips for a 5-day vacation for him and 3 of his friends.

Yes, nowadays it is extremely easy to book a trip to literally anywhere. You want to go to Bali? Go right ahead. Paris? Just go! All you have to do is visit some sort of travel site, whether it be Expedia, Orbitz or Priceline, and you’re halfway there. There is nothing complicated about booking travel these days. But obviously it wasn’t always this way.

Fifteen plus years ago was the age of the travel agent. These people had all of the power when it came to getting you from point A to point B, and dealing with your travel needs. It seemed as though they were the only way one could easily book and handle their travel plans. There was a point in time where one could not simply go to American Airlines’ website and view all of the possible flight times. Schedules were displayed in complicated codes, often through the popular travel system of Sabre, that generally only a travel agent could access and work properly. The same went for hotel bookings.

Consumers were able to call and book their own travel through airline telephone lines as well as hotel telephone lines, but comparing prices, times and schedules could get extremely time consuming and frustrating for both parties involved. Enter the Travel Agent. A magical person who could do all of the dirty work, and leave the customer with the easy part, which was picking and choosing what best suited their budgets and schedules.

With the Internet boom of the late 90’s that led into the early 2000’s, like many business models of the 1990’s, the travel industry saw a major change. Their entire business model was suddenly disrupted. All of the services a travel agent had to offer began to be readily available online. Flights could be easily booked on their own. Schedules, times and prices could be easily displayed and collected with a single click. Same with hotel rates. As more and more hotels began building websites, reservations could easily be made online.

But what really killed the true art of the travel agent were the bundle websites, sites like Orbitz, Expedia, Priceline, and Travelocity. These sites can book your flights, hotels, cars, excursions, airport transfers, you name it. The rise of these sites seemingly erased the need for this particular job.

So you’d think by 2015 the profession would be dead, if not close to dying, right? Well actually, wrong. The popularity, or rather mainstream-ness of travel agencies has most certainly decreased. But the need is most definitely still there. Believe it or not, members American Society of Travel Agents report the booking of over 144 million vacations each year. And in 2012, ASTA reported $17 billion dollars in revenue. As the industry witnessed extreme changes in the flow of their business model, travel agents adapted and found new holes to fill.

In an effort to alter consumers’ views of the profession, John Pittman, a vice president at ASTA, said the society prefers to use the term “travel professional.” This title illustrates the profession more broadly as most current travel agents do much more than simply act as the go-between for travelers, airlines and hotels.

In what used to be a business that targeted everyone, travel agencies have begun focuses largely on targeted markets. These markets include luxury, business and nice travelers, as well as large groups and corporate travel, and the often not as tech savvy elderly. Many boutique travel agencies exist for the sole purpose of catering to some of the nation’s most wealthy travelers. Or others cater for many Fortune 500 companies, booking corporate travel, retreats and company outings.

Valerie Ferrara began her career as a travel agent at Liberty Travel, one of the very few chain travel agencies that is currently left standing. What she witnessed there was a turn from serving the travel needs of her surrounding community, to the travel needs of anyone in the nation. Liberty Travel, which operates in free standing stores and shopping centers around America, developed an online matching system that connected consumers with an agent either via email or phone, depending on preference. Their agents began taking on the role of virtual agent. Customers still have the freedom to browse their options, but have the support and consulting perks of a personal agent. This is one example of how agencies have adjusted. But what about the smaller ones?

Currently Ms. Ferrara works at a much smaller, boutique travel agency as a travel consultant. Here, they specialize in luxury and group travel. She had this to say about the majority of their clientele, and how the money keeps coming in:

“I’m sure the average person would be surprised to learn that all of the agents in my office make a more than decent living off of being a travel agent. Our clients are booking regular vacations that can sometimes total up to $200,000. Just a few days ago I booked and planned a trip for $50,000 for a family of four going to New Zealand for 13 days. We plan the little details that the online sites just can’t, and probably won’t ever be able to handle. We also have incredible connections and great relationships with hundred of hotels and service providers around the world. It’s unbeatable in many, many ways. Our clients are extremely needy, and the services provided online will probably never be up to par for them. I can’t tell you how many times we have had clients come crying back to us after booking disastrous vacations online. To most, their situations would probably not be considered ‘disastrous’ but with this particular clientele, they have very specific travel needs and only the services of an agency can provide.”

So clearly, public perception of travel agencies does not tell the whole truth when it comes to the actuality of the business. But of course that side of the business has suffered, taken a hit, and has had to adjust as a result. And what’s been taken from that side has been crazily multiplied and expanded into what is now a huge business of online travel booking.

Expedia, one of the largest online travel booking empires, was founded in 1996 and is now worth $16 billion. In just under 20 years it has almost taken over the online travel booking market, having acquired other travel giants like Orbitz, Trivago, Travelocity, and most recently, online rental service HomeAway. In fact, much of the travel industry has seen a large consolidation over the past few years. Whether someone is booking on Orbitz, Expedia or Travelocity, their money is going to the same place. Think you have a lot to choose from when it comes to car rentals? Sure, you’ve got Alamo, Avis, Budget, Dollar, Enterprise, Hertz, National, Payless and Thrifty. Except not. Those 9 are collectively a part of 3 corporations, those being Avis, Enterprise and Hertz. Same goes for airlines, cruise lines and hotel giants.

What do these mergers mean for the consumer? Well typically giant company mergers, in general, have not often benefitted consumers. In most industries, the consumer’s benefit most from fiery competition in an effort to please them the most. Yet executives at Expedia and Priceline have remained positive that this will not be the case with the online travel industry. Expedia CFO explained how the online travel industry is a $1.3 trillion dollar industry, yet what Expedia owns is likely in the single digits.

But one issue that mergers do help to remedy is the idea of an approaching perfect market that the online travel industry could potentially set up. A perfect market can happen under such conditions when all parties are selling identical products or good, when parties can no longer control the market price of what they’re selling, when all parties have a relatively small market share, and when buyers have complete information of what’s being sold and what the price should be. Having giants like Expedia own large portions of the market has helped prevent this from occurring.

Since the 1990’s the travel industry has undergone some incredibly major changes. It shifted from being an agent dominated field, to a self-booking online industry giant. Yet, somehow agents have managed to survive and evolve and continue creating a place in the market for themselves. While the agent does not dominate the travel market by any means, it is naïve to say that the profession of a travel agent is dead. The industry has grown so rapidly, and there is more than enough room for everyone, even as more and more keep hopping on the travel train.

It is important to note that the changes seen and experienced in the travel industry are not unique to just this industry. Similar growth and change has occurred in the music and transportation markets, and it is an interesting comparison to be made for such varying industries.

 

http://www.usatoday.com/story/travel/columnist/mcgee/2015/03/04/airline-mergers-expedia-orbitz/24319965/

http://www.cnbc.com/2015/07/01/online-travel-industry-is-booming-report.html

http://www.huffingtonpost.com/us-news-travel/when-to-use-a-travel-agen_b_4611806.html

http://www.cnn.com/2013/10/03/travel/travel-agent-survival/

http://www.businessinsider.com/why-you-should-use-a-travel-agent-2015-7

http://www.ajhtl.com/uploads/7/1/6/3/7163688/article_37_vol_3_1.pdf

The Undercover Economist by Greg Ip

 

 

 

By Alexa Ritacco

“Income inequality” is a phrase that has been popping up all over the place lately. Personally, I’ve been hearing it pretty frequently in the current race for the White House. It has been brought up in multiple debates, democratic and republican, and it’s clearly something that the public is concerned about. Of course by just looking at the two words, the average person could probably guess what it means. There’s something unequal about incomes in the U.S. Despite having heard the phrase so many times, I still don’t quite understand what it is, what it means, why it exists or how/if it can be fixed. So I decided to begin to delve into these questions for this week’s blog post.

So first and foremost, why has it become such a hot topic? Well, as I discovered, it all dates back to the 1970s. Around then is when, after decades of stability, income inequality began to increase significantly, meaning that higher income households began receiving a higher share of the nation’s total income. The gap between the rich and everyone else has grown steadily by every statistical measure over the past 30 years or so. And just to clarify, income encompasses revenue from wages, salaries, interest on a savings account, dividends from shares of stock, rent, and profits from selling something for more than you paid for it.

30+ years of rapid growth equates to a whole lot of inequality, especially when you compare the US to other countries. Currently the US ranks around the 30^th percentile in global income inequality. This is pretty bad. 70% of countries around the world have a more equal income distribution than the United States. I personally find this shocking.

Of course The Great Recession of 2007-2009 had negative impacts all across the board, with everyone from the richest man to the poorest man taking a huge hit from the crash. The increases in income inequality most definitely slowed, but post-2009, things began to increase at an even faster rate. As the effects of the recession reversed, the gap only grew wider. In 2012, the wealthiest percentile saw incomes rise around 20%, while the income of the remaining 99% rose only 1%.

People are frustrated. People are angry. People want to know why this is happening and how it can be stopped. So naturally, it has become a partisan issue. Democrats tend to believe that action can be taken to slow this growth and potentially redistribute some of the wealth of the 1% among the other 99%. Republicans tend to be more skeptical, arguing that redistribution would interrupt the natural flow of the economy. But in a recent effort to connect with more middle class voters, republicans have taken a more vest interest in the income inequality gap. This, as well as more about the democrat views on the issue, is something I plan to explore more in my personal presentation, so stay tuned!

 

https://www.cia.gov/library/publications/the-world-factbook/rankorder/2172rank.html?countryname=United%20States&countrycode=us&regionCode=noa&rank=41#us

https://www.cbo.gov/publication/49440

http://inequality.org/income-inequality/

 

 

 

By Alexa Ritacco

As a college student in LA, Uber has become an essential way to get around, especially when it comes to nightlife. It even has its own verb now: “Oh yeah, let’s just uber.”

Founded in 2009, Uber now exists in sixty countries, and over three hundred cities. In just six years Uber has become a globally used and extremely well-known app. But global success does not necessarily mean global acceptance. Resistance to the ride sharing service has come about from all angles. Some consumers think the service is sketchy.

There have been numerous reports of harassment, extortion, and sometimes even robbery, and Uber’s response to such reports have been pretty mixed. In a few cases, in response to reports of sexual harassment, Uber offered users a small credit. They typically do not release any type of statements in response to reports against them, and have been criticized in their slow response to release names of drivers in said harassment scandals. But some view Uber as the lesser of two evils.

“I would much rather hop in an Uber than a taxi cab,” said NYU student Elizabeth Gurdus, “Taxi drivers are so incredibly rude, and never take the route that I want to go. Uber drivers have a rating incentive to make the experience at least somewhat pleasant, and generally, that’s been the case in my experience.”

While consumer perception has been an issue, the most resistance to Uber has come from city taxi cab drivers, as well as local city legislation. New York City, a place known for its thriving taxi sector with the instantly recognizable yellow cabs, has seen quite a bit of controversy surrounding Uber and other ride-sharing services.

Uber launched in New York in May of 2011. Since then, the service has exploded, having given millions of rides to New Yorkers, and employing over 30,000 drivers. And it has been driving the NYC taxi drivers absolutely insane. Many drivers claim to be taking a hit financially, and feel that it is completely unfair that Uber just waltzed in one day and began stealing customers. They feel betrayed by New York City for letting this go on.

For so long, they were the only ones on the market for private transportation around the city. If a New Yorker wasn’t taking the subway, bus or personally driving themselves, chances are they were taking a taxi. And really, that was their only other option. Now, suddenly, the consumer has quite a few options when they’re strapped for a ride. Rather than stepping out onto the sidewalk and hailing a cab, they very well may be whipping out their phone and calling for an Uber or a Lyft. The transportation market has changed completely, and now taxis are dealing with some very hungry competitors.

For decades, New York City has controlled the number of taxis by limiting the number of medallions, which is required to legally operate a taxi. Introduced in 1937 by Mayor Fiorello H. La Guardia, the medallion system was created to remedy the overflow of cab drivers that the city was facing at the time. It set limits to the number of cabs licenses that could operate in the city.

This caused prices for medallions to shoot through the roof over the years, seemingly posing as what would prove to be a good investment for anyone who acquired a medallion. The price of medallions has gone as high as one million dollars, and currently, medallions listed for sale online range from about $500,000 to $700,000. Generally, people that own the medallions do not drive the taxis; the medallions are leased to drivers who are then responsible to pay money back to the owners, or the company of the owners.

One of the reasons that the price of medallions has risen so high in the past is because of scarcity. For so long, this is how the taxi market survived and prospered. But the rise of ride-sharing services like Uber and Lyft have totally threatened this. Taxi drivers and taxi companies are required to pay heavy taxes and fees in order to operate legally. Uber has managed to get around this, creating a completely uneven playing field. Medallion owners are essentially watching their investments plummet as Uber rises in the ranks. The question of fairness in the market has become a big issue. Most taxi companies, medallion owners and drivers feel completely blindsided. The entire industry is being threatened.

Taxi medallion owners have put a lot of pressure on Mayor Bill de Blasio’s administration to help them and act in their favor. Satwinder Singh, a NYC Taxi Medallion owner gave this analogy in a New Yorker article, “The city is the father and mother. They created the yellow cab as the baby. Now they’re refusing to take care of it!”

Another owner, Lal Singh, continued the analogy citing, the fifty cent tax that is charged on cab fares that goes directly to the MTA. “We’re giving them eighty-five million dollars a year! And yet everybody accepts Uber is the stepfather and all the politicians are the stepsons!” he said.

After much badgering, de Blasio pushed to start regulation and capping on Uber in NYC in the late Spring of 2015. The legislation would basically limit the amount of Uber drivers that could be in New York City at all times, and prohibit any further growth of the company in the city.

This launched Uber into full-on defense mode. They put out countless adds dissing taxi cabs, attacking their well-known racist stereotyping practices, as well as pushing all of the different types of services they offer, ranging from Pool to Lux. They rallied support from consumers in the form of petitions and protests, and even got a few celebrity endorsements via Twitter, including Kate Upton, Neil Patrick Harris and Ashton Kutcher.

It came as no surprise to many when de Blasio decided to halt his efforts to place a cap on Uber while further studies were conducted to see really just how hard Uber is hitting the transportation market. Obviously, this infuriated NYC cab drivers and launched them into a series of protests. Some of the leaders of these protests have gone as far as to suggest emulating what cab drivers in Paris did in response to Uber, which included blocking major intersections and entrances to airports. But until something drastic happens, for now, it looks like Uber will not be leaving New York anytime soon.

Since Uber is still a private company, it is pretty difficult to tell just how much of an impact hey are having on the transportation market. But by looking at employment numbers, leaked reports and the cab side of things, it is pretty easy to tell that Uber has made a giant mark on the Big Apple. A New York Post article reported that as of October 2015, 30,000 Uber drivers are employed in New York, and that they could be making an average of $40 per hour. Forbes reported that the number of Uber drivers has nearly doubled every six months over the last two years. The growth of the company, from every angle, appears to be unstoppable. In November of 2014, it was leaked that Uber was set to generate $350 million in revenue for that year. It could have only grown since then.

Business Insider recently noted that the number of abandoned taxi cabs in Brooklyn outside of dispatcher offices has been on the rise. Many drivers have reported that they jumped ship for Uber. By doing this, they lose the worry of paying the lease on their cab, and the countless other fees that cab drivers that do not own their own medallions have to pay.

The next step in this big move from taxi driver to Uber driver is purchasing a car. The question of cost comes into play. In a Neon Tommy article where a Los Angeles based cab driver who switched to Uber, it is illustrated that car payments end up being way lower payments than leasing a cab. Plus, they are getting a personal vehicle out of the deal.

Based on all of these factors, there is no doubt that Uber has taken a large bite into the transportation market in New York City. So will this mean the end of taxi cabs in NY? Of course not. But this situation has forced taxicab companies to start thinking towards the future. It has been reported that they have been developing apps similar to Uber for cab drivers to being using. Features would include GPS based fares as well as a possible rating system.

Uber has awoken what was otherwise a sleepy transportation market in New York. It is most definitely worth recognizing some of the disparities in the fairness of the situation in this war between Uber and taxis. While Uber may be the cool new kid in town, taxis are still an integral part of the city, and most likely will always be. Only time will tell what will come of the industry, and if these two competitors will ever be able to peacefully coexist.

Sources:

http://www.forbes.com/sites/briansolomon/2015/05/01/the-numbers-behind-ubers-exploding-driver-force/

http://www.neontommy.com/news/2014/03/why-did-l.a.-cab-driver-switch-to-uberx

http://money.cnn.com/2015/07/21/news/companies/nyc-yellow-taxi-uber/

http://www.theatlantic.com/technology/archive/2015/04/he-said-she-said-how-uber-relied-on-data-in-an-assault-dispute/389811/

https://www.washingtonpost.com/news/wonk/wp/2014/06/20/taxi-medallions-have-been-the-best-investment-in-america-for-years-now-uber-may-be-changing-that/

http://www.businessinsider.com/uber-revenue-rides-drivers-and-fares-2014-11?op=1

http://www.businessinsider.com/proof-that-uber-is-obliterating-new-york-citys-taxi-industry-2015-8

http://www.newyorker.com/magazine/2015/08/03/revving-up

http://newyork.cbslocal.com/photo-galleries/2015/09/17/medallion-taxi-drivers-rally-against-uber-drivers/

http://www.capitalnewyork.com/article/city-hall/2015/09/8577153/uber-fight-city-hall-overshadows-congestion-hearing

http://nypost.com/2015/10/07/there-are-more-than-30000-uber-drivers-working-in-nyc/

https://nextcity.org/daily/entry/number-of-uber-drivers-in-nyc

http://www.nydailynews.com/news/politics/n-y-taxi-drivers-rally-uber-article-1.2363707

http://www.cbsnews.com/news/uber-defends-surge-pricing-with-nyc-case-study/

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By Alexa Ritacco

The number of empty containers being shipped back to China from US ports is pretty alarming. According to the Wall Street Journal, the Ports of Long Beach and Oakland have reported a 20% increase in the number of empties since last year. That is a pretty steep jump. In August, the Port of LA dealt with more than 225,000 empty shipping containers, bring their increase up to 21% from the following year. Even the east coast is feeling the effects, with New York and New Jersey ports reporting a combined increase in empty container exports of 31.5%.
It was crazy to actually see all of the giant empty containers in person on our class trip to the Port of LA. It really put the importance of this issue into perspective, and obviously made it seem much more real as well as pressing. The fact that most of those containers used to be going back filled, and that are now just sitting there empty, is most definitely concerning, and something that needs to be more widely addressed.
These increases are huge, and are happening because of a few reasons, but the main one being the high-profile slow down of China’s economy. The article notes that normally after receiving the imports from China, the containers are stuffed with American agricultural products, specialty luxury goods and recycling waste, that is typically turned into products or packaging once it enters China’s factories.
China’s demand for U.S goods has been faltering over the past few years, with the article citing that its “imports fell 20.4% year-over-year in September following a 13.8% decline in August” and as “of June, U.S. exports of scrap materials were down 36% from their peak of $32.6 billion in 2011.” These figures not only reflect the weakening of China’s economy, but economist Paul Bingham believes it to reflect a lowering demand in Europe as well, so it would only be natural for the US to be feeling these types of effects at our ports.
It will be very interesting to see how these issues progress, and to see what solutions are brought forward as concrete ideas to help handle these looming problems. The continuous growth of empty containers being shipped back is just not sustainable for US Trade. Is this simply just a cyclical slow down that the global economy will bounce back from? Or is it something more serious that may require some sort of intervention?

By Alexa Ritacco

My mother calls Uber “the magic app.” She loves that with just a touch of button you can call a ride that could arrive in just minutes. Not to mentions the completely digital, cashless transaction that makes for a smooth ride, with no awkward moments or hesitations when it comes to tipping.
As a college student in LA, Uber has become an essential way to get around, especially when it comes to nightlife. Coming out of a bar in Downtown LA, the streets are normally lined with dozens of Ubers and Lyfts waiting to pick up their passengers. This is a completely different picture than what existed just a few years ago. It even has its own verb now.
“Oh yeah, let’s just uber.”
“Going to uber over now!”
“No, I ubered.”
Founded in 2009, Uber now exists in sixty countries, and over three hundred cities. In just 6 years Uber has become a globally used and extremely well-known app. But global success does not certainly mean global acceptance. Resistance to the ride sharing service has come about from all angles. Some consumers think the service is sketchy.

“I don’t know, I just get a bad feeling about it. You’re getting into a complete stranger’s personal car. What if they’re a creep? What if someone tries to take advantage?” said Alexis Colner, a senior at USC. Colner’s not alone in her sentiments. There have been countless reports of harassment, extortion, and sometimes even robbery, and Uber’s response to such reports have been pretty mixed. But others view Uber as the lesser of two evils.
“I would much rather hop in an Uber than a taxi cab,” said NYU student, Elizabeth Gurdus, “Taxi drivers are so incredibly rude, and never take me the route I want to go. Uber drivers have a rating incentive to make my experience at least somewhat pleasant, and generally that’s been the case in my experience.”
While consumer perception has been an issue, the most resistance to Uber has come from Taxi cab drivers, as well as local city legislation. New York City, a place known for its thriving taxi sector with the infamous yellow cabs, has seen quite a bit of controversy surrounding Uber and other ride sharing services.
Uber launched in New York in May of 2011. Since then, the service has exploded, having given millions of rides to New Yorkers, and employing over 30,000 drivers. And it has been driving the NYC taxi drivers absolutely insane. Many drivers claim to be taking a hit financially, and feel that it is completely unfair that Uber just waltzed in one day and began stealing customers. They feel betrayed by New York City for letting this go on.
For so long, they were the only ones on the market for private transportation around the city. If a New Yorker wasn’t taking the subway, bus or personally driving themselves, chances are they were taking a taxi. And really, that was their only other option. Now suddenly, the consumer has quite a few options when they’re strapped for a ride. Rather than stepping out onto the sidewalk and hailing a cab, they very well may be whipping out their phone and calling for an Uber or a Lyft. The transportation market has changed completely, and now Taxis are dealing with some very hungry competitors.

Taxi medallion owners have put a lot of pressure on Mayor Bill de Blasio’s administration to help them and act in their favor. Satwinder Singh, ad NYC Taxi Medallion owner gave this analogy in a New Yorker article, “The city is the father and mother. They created the yellow cab as the baby. Now they’re refusing to take care of it!”
Another owner Lal Singh continued the analogy citing the fifty cent tax that is charged on cab fares that goes directly to the MTA. “We’re giving them eighty-five million dollars a year! And yet everybody accepts Uber is the stepfather and all the politicians are the stepsons!” he said.
After much badgering, de Blasio pushed to start regulation and capping on Uber in NYC in the late Spring of 2015. The legislation would basically limit the amount of Uber drivers that could be in New York City at all times, and prohibit any further growth of the company in the city.
This launched Uber into full on defense mode. They put out countless adds dissing taxi cabs, attacking their well-known racist stereotyping practices, as well as pushing all of the different types of services they offer, ranging from Pool to Lux. They rallied support from consumers in the form of petitions and protests, and even got a view celebrity endorsements via Twitter, including Kate Upton, Neil Patrick Harris and Ashton Kutcher.

It came as no surprise to many when de Blasio decided to halt his efforts to place a cap on Uber while further studies were conducted to see really just how hard Uber is hitting the transportation market. Obviously this infuriated NYC cab drivers and launched them into a series of protests. Some of the leaders of these protests have gone as far as to suggest emulating what cab drivers in Paris did in response to Uber, which included blocking major intersections and entrances to airports. But until something drastic happens, for now, it looks like Uber will not be leaving New York anytime soon.
Since Uber is still a private company, it is pretty difficult to tell just how much of an impact they are having on the transportation market. But by looking at employment numbers, leaked reports and the cab side of things, it is pretty easy to tell that Uber has made a giant mark on the Big Apple.
It has been noted that the number of abandoned taxi cabs in Brooklyn outside of dispatcher offices has been on the rise. Many drivers have reported that they jumped ship for Uber. By doing this, they lose the worry of paying the lease on their cab, and the countless other fees that cab drivers that don’t own their own medallions have to pay.
In November of 2014, it was leaked that Uber was set to generate $350 million in revenue for that year. It could have only grown since then, as Uber has expanded over 14% in NY over the past year.
A New York Post article reported that as of October 2015, 30,000 Uber drivers are employed in New York, and that they could be making an average of $40 per hour.
Based on all of these factors, there is no doubt that Uber has taken a large bite into the transportation market in New York City. So will this mean the end of taxi cabs in NY? Of course not. But this situation has forced taxicab companies to start thinking more forwardly. It has been reported that they have been developing apps similar to Uber for cab drivers to being using. Features would include GPS based fares as well as a possible rating system.

Uber has totally woken up what was a sleepy transportation market in New York. Only time can tell what will come of the industry, and if these two competitors will ever be able to peacefully coexist.

Sources:
http://www.businessinsider.com/uber-revenue-rides-drivers-and-fares-2014-11?op=1
http://www.businessinsider.com/proof-that-uber-is-obliterating-new-york-citys-taxi-industry-2015-8
http://www.newyorker.com/magazine/2015/08/03/revving-up
http://newyork.cbslocal.com/photo-galleries/2015/09/17/medallion-taxi-drivers-rally-against-uber-drivers/
http://www.capitalnewyork.com/article/city-hall/2015/09/8577153/uber-fight-city-hall-overshadows-congestion-hearing
http://nypost.com/2015/10/07/there-are-more-than-30000-uber-drivers-working-in-nyc/
https://nextcity.org/daily/entry/number-of-uber-drivers-in-nyc
http://www.nydailynews.com/news/politics/n-y-taxi-drivers-rally-uber-article-1.2363707
http://www.cbsnews.com/news/uber-defends-surge-pricing-with-nyc-case-study/

On August 13th, 2007 Rick took a leap of faith and opened his take-out style restaurant, “Wings Plus.” In an effort to once again make a decent living, he invested every last dime from the sale of his house, after downsizing, into a small storefront in Port Washington, NY, located on the North Shore of Long Island.
At the time of opening, Rick was also in process of selling his family sports bar, located in Bayside, Queens, which had been in the family for over 60 years.
“It was a tough time. I had no income. My brother and I were selling our family bar, which at one point had been the pride of my family, and I was pouring every last one of my pennies into a new business. Not to mention that the economy wasn’t looking too hot.”
But Rick saw a hole in a community filled with just pizza parlors and Chinese take out.
“The Buffalo Wings were the claim to fame at our bar. People went crazy for them. I figured, why not bring em to the island?”
This was at a time when Buffalo Wild Wings had not reached the east coast quite yet, and chicken wing chains were not really on the radar yet. He came up with “Wings Plus,” meaning they of course had chicken, but also a whole lot more. Hence the “plus.”
It seemed like a win-win. Keeping a piece of the old family business alive while creating a new legacy to start supporting his wife and child again.
“It was a bittersweet time. I was sad to have to lay my father’s business to rest, one that I had run with my siblings for over 20 years. But it was what needed to be done. And I was excited to venture into something new with a long-time friend, who I was able to secure as an equal partner. Together we put in about $250,000 to create Wings Plus.”
The first six months of being open went extremely well. He hired a decent staff, pulled over some cooks from the old sports bar and within a month, he felt they had found their groove. The fall season brought in all of the football fans ordering for their Sunday games, and Super Bowl Sunday brought in unimaginable sales. The community seemed to like the new establishment, and Rick noticed quite a few repeat customers coming through the doors.
By the end of the first year they were closer than projected to breaking even. Rick and his partner were very pleased, and if things had continued the way they were going they would have made back their investments by the end of the second year. But unfortunately things did not go as planned. The fall of 2008 was rough for Wings Plus.
“The only thing that carried us through that fall and the beginning of winter, was football Sundays. Even with those, cash flow was extremely low.”
Rick noticed a major change in how people were paying. Customers were starting to use their credit cards way more frequently then before. He said it went from being about 50% cash business to around 25% cash business. Not to mention that sales seems to be declining each month.
Discouraged after a less than stellar year, Rick and his partner were left wondering if they had made a big mistake. Part of the reason they chose to open up in Port Washington was because of the amount of wealth in the community. The median household income in Port Washington is approximately $109,000, a little more than double the national media household income. It is an extremely wealthy community, with many of its community members being business people who commute and work in the Financial District in Manhattan. But that does not mean they weren’t feeling the effects of the 2008 recession.
“It was clear that something was going on. People were not spending money. Average order amounts were way down. Customers began questioning prices. And on top of all that, the price of chicken was going up.”
By the end of year 2 they were forced to raise prices, which definitely turned off some people, but it was essential to their survival at that moment in time.
Rick and his partner decided to invest in some marketing and promotions at the start of year 3. They put out various coupons in local papers and pennysavers, tested out some deals on Groupon, and created an email rewards program. While year 3 was still pretty slow, their investments in marketing paid off, and they decided to go for year 4. By this point, they were extremely close to breaking even, and mid-year 4, Rick and his partner finally saw the return.
Currently Wings Plus is doing just fine. Of course it has not been completely smooth sailing, but Rick is proud to have made it through such a horrible recession, and has come out with a profitable business. He is hoping to open up a second Wings Plus in 2016.
But Rick is a little worried about the future. New York seems to be pushing for a $15 an hour minimum wage. This would be catastrophic to Wings Plus.
“Most of my workers are part-time students. I pay my cooks well, but there’s no need to be paying my counter people who work 5-hour shifts at a time, $15 an hour. I already pay them above minimum wage. That would be the end of Wings Plus.”
In the meantime, Rick is planning to move forward with opening a second location, and looks forward to creating a Wings Plus legacy.

After reading dozens of lists of strange economic indicators, ranging from things like unclaimed corpses to baby diaper rashes, I settled on researching more about the Alligator Population Index. Believe it or not, generally when there are more alligators in the world, the economy usually is not doing so well.

The reason? Well think about it. Alligator skin is typically used to make high priced luxury goods like handbags, shoes, belts and more. Basically anything that comes in leather comes in alligator skin, except it is usually around triple the price. These items are sold in stores like Neiman Marcus, Bergdorf Goodman, Saks Fifth Avenue, and Bloomingdales. They’re produced by brands like Gucci, Hermes, Manolo Blahnik and Jimmy Choo.

And who buys these goods? Generally it is the people who have the most money to spend. The trend starts from there. If the rich are not dropping $25,000 on an alligator skin handbag, then Gucci is not buying alligator skin from the tanneries, and then the tanneries are not buying the alligators from the farmers.

So the rich are watching their funds by not buying luxury goods. Then Gucci cuts back by not buying the skins at all. Then the tanneries have no reason to buy from the farmers. And the farmers lose A LOT of money.

A New York Times article from 2009 tells the story of Tommy Fletcher, a Floridian man who was forced to shut down his alligator farming business after 5 years. In 2008, Louisiana farmers gathered over 500,000 alligator eggs fro the wild. But in 2009, for the first time in a very long time, most farmers collected none.

The article names the economy as the “lead culprit.” It discusses how “even wealthy customers began balking at the price of alligator skin products, which can range from the expensive to the wildly expensive.” Once considered a bumper crop, there was now a large surplus in the alligator skin market. Alligator farming is a business that cannot sustain itself on even a shaky economy. It is an expensive business from top to bottom. It’s expensive to buy the eggs, raise the gators, buy the skin, produce the product, and then buying the finished product.

Since that large 2009 dip in alligator products, it has since shown signs of bouncing back, with the reopening of a few farms, and the re-production of products by the high-end brands.