Jennifer W's Blog

As a student of Sauder, I, like many others before me, have been given the opportunity to sit in on a semester worth of Professor Gateman’s economics lectures. On the first official day of class, the first, most important principle Prof G stressed to our class was that, the basis of economics was studying the management of scarce resources to satisfy unlimited human wants. “Stuff is scarce” (if you don’t believe me, flip to the third page of Gateman’s microeconomics G-Book).

It is common knowledge that we have a finite amount of resources on earth. However, what if we expanded our horizons slightly to the vast depths of space and the idea of mining asteroids and other minor planets for their valuable raw resources. This space mining would vastly change the core principle of economics and the way we live our lives. While this idea might seem farfetched, it is currently being supported by a $330 billion industry, with many believing that the first mining expedition could be executed in the next ten years.

Space mining is an exciting prospect for more than one reason. The obvious being access to an almost endless supply of finite terrestrial resources.  However, in addition to the large quantities of commodity materials, many asteroids hold an abundant supply of water, making them a viable “pit-stop” for future space exploration missions of space.

“The famous quote is that there’s enough [resources in space] to build a skyscraper 8000 storeys tall and cover the Earth in it – which no one wants to do – but we’re just saying there’s a lot there.” – Professor Brian Cox from the School of Physics and Astronomy at the University of Manchester.

There are however many naysayers to the idea of space mining, citing economic affordability, practicality and a lack of a legal framework as large factors to its probable failure. I, however, believe that this industry has the potential to shape and define the 21st Century, and should be heavily funded by governments in preparation for the unavoidable future of our finite resources. In the past, natural resources have been the driving force that has allowed civilizations to expand to new frontiers, and if we want to continue progressing as a species, we should be looking to change our change preconceived notions of sustainability by investing in the future of space mining. Simply from a market perspective, for some metals, the commodities markets will be completely reshaped. The general availability of abundant, cheap new precious metals in the market would significantly alter our current economy and affect the course of civilization.

So while there are still a few decades left for space mining to become commercially viable, the industry is one worth investing in. Not just for its limitless profits – as per Nasa’s estimates, there is over $700 quintillion dollars in mineral resources in asteroids available to humankind – but also as a stepping stone to the 21^st century’s extra-terrestrial industrial revolution.

 

 

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Iron Man was released just 9 years ago in 2008. I remember watching the movie and being completely fascinated by the technology of Tony Stark’s office and Iron Man suit; specifically, Jarvis – Stark’s virtual “helper” (or rather do-all glorified secretary). Would technology really progress so far that we could have our own Jarvis’s running our lives? While I don’t know much about universal Iron Man suits, I do know that we will have the option to live our lives through a much more convenient, portable piece of technology with the emergence of augmented reality eyewear. The once revolutionary idea has now become an accepted wisdom with the imminent release of multiple AR headsets from companies as ODG, Sony, and Microsoft.

Still, with the emergence of any disruptive technology that has the potential to change the way our society functions, we’re faced with the question of whether or not we are ready to accept such a product. In my opinion, we’re just not ready yet.

The AR industry has marked many major milestones this year. The most recent (as mentioned in Yariv Levski’s blog) being the announcement from tech titans Apple and Google, who plan to introduce AR to the mass consumer market – via mobile devices – with the release of the ARKit and ARCore respectively. These new system frameworks will allow developers to easily integrate AR experiences with existing Apple and Google products.

“I regard it as a big idea like the smartphone. The smartphone is for everyone, we don’t have to think the iPhone is about a certain demographic, or country or vertical market: it’s for everyone. I think AR is that big, it’s HUGE.” – Tim Cook, Apple CEO

Many may wonder why Apple and Google’s AR announcement didn’t dive right into wearable components that many competitors had previously tried to promote. However, with the successive failures of the Google Glass and Snapchat Spectacles, it’s become abundantly clear that the public has not picked up on the AR eyewear hype as many enterprise users have.

From a development trajectory, Pokémon GO has been one of the most successful AR implementers, earning $1.2 billion in revenue for the AR industry in 2016. Nevertheless, developers can’t expect to jump from walking to sprinting within such a short time span. Technology takes time to develop and users in turn need time to adapt to these developments. The Pokémon phenomenon has warmed the consumer market for a more robust AR experience on their mobile devices; and in time, mobile devices will pave the way for the next logical AR development, wearable products.

Therefore, we are still more than a few years off from an AR eyewear buying frenzy as the consumer market is still stuck within an adjustment period, just as they would for any new technology. Not to mention the many hurdles that manufacturers still need to solve for wearable AR technology, including: affordability, product flexibility, security concerns, as well as a full immersive, mobile and visual functionality for everyday use.

Until these problems are resolved, consumers simply ARe not ready.

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“To buy or not to buy” is the perpetual question that I’m always asking myself while online shopping. My bank card says no, but my answer, of course, is always an enthusiastically resounding YES. As many of my close friends can attest to, I am a serial online shopper part of a new, largely expanding demographic of millennials and Generation Z shoppers who value convenience and efficiency in my shopping experience. So, when I stumbled across an article detailing online store, Rent the Runway’s new marketing project aimed at price-sensitive shoppers – like myself – I was immediately intrigued.

Rent the Runway is a subscription-based online fashion rental service that allows its customers to rent out expensive pieces from labels such as Oscar de la Renta, Vince and Diane von Furstenberg for a fraction of the original cost. The company recently announced a new budget-friendly pricing option of $89 a month, which is a 35% price decrease from the regular $139 monthly subscription. The only restrictions to the plan are a limited number of monthly rentals and some higher-end designer exclusions.

With more and more innovative e-commerce sites, like Rent the Runway, positioning themselves in markets that were previously seen as blue oceans, it seems that traditional brick and mortar retailers will become more and more obsolete in the future if they do not try and adjust to the changing market of consumers.

“Channels which traditionally dominated the field are in steady decline worldwide. Step forward the new order: e-commerce and discounters, cannibalizing the big retailers with their promise of convenience and lower prices” – Kantar Worldpanel global shopper and retail director Stephanie Roger.

For many millennials, the most convenient option is the now the best option. E-commerce sites have now become one-stop-shops for almost any consumer desire at the simple click of a button; and with huge companies like Amazon championing fast and reliable delivery, the most significant caveats to online shopping is a consumer’s need to feel and see the item they are purchasing.

However, there are many e-commerce sites who are actively working to integrate the dominant customer need to physically interact with their purchase with their current business model. Take, for example, the “guideshops” explored in Teaghan McNeill’s blog. Created by popular online store, Bonobos, the concept allows customers to try on samples in store but have their purchases delivered to their home, ensuring that there are always specific sizes and colours in stock at all times for customers to try on, and eliminating any fears of disappointing a customer’s product expectations.

“Technology is fast-changing the way people shop, and with e-commerce and discounters set to continue their march at the expense of large-format retailers, there is an urgent need for retail reconfiguration across the world.” – Kantar Worldpanel global shopper and retail director Stephanie Roger.

All in all, with the current rate that e-commerce sites are able to rapidly adapt and alter their services to better serve consumers, brick and mortar retailers will soon find themselves put in a precarious position within the retail industry trying to fight for relevance in a consumer market filled fast-paced, efficiency seeking customers. Traditional retailers need to start thinking of ways to help solve these consumer problems so that their customers can go back to thinking about the more important questions in life. Like whether “to buy or not to buy”.

 

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Two years ago, I took a family trip back to China. The purpose of the trip was to reconnect with relatives, but for my dad, his most pressing goal was to find the cheapest, biggest, most up-to-date drone that he could get his hands on.

Drones are currently the hottest product within the tech industry and are a must-have cool kid toy for any serious tech head, aspiring videographer, or amateur surveillance professional (home security can be a serious matter). Apart from their obvious recreational uses, drones are being steadily implemented into various industries to help in ways that have surpassed many expectations. From its roles in Amazon’s Prime Air delivery, to Dubai’s drone taxi service, and even to their data-collection role for American insurance companies during the recent hurricane devastations in Texas and Florida, drones have become a hot commodity.

The reason behind the drone’s exponential success can be attributed to the product’s versatility that crosses over multiple sectors of use that has the potential to revolutionize entire industries. In response to the overwhelming demand, the industry has boomed within the last couple years, with 2.4 million personal drones being sold last year in the U.S. alone – double what was sold the year prior.

While many may look upon the industry’s booming growth in awe, I view the numbers with alarm, because, with innovations like drones comes a lack of boundaries, and from there, major safety and privacy concerns that require the right form of regulation. Our current global regulatory controls are just not able to keep up with the rapidly changing unmanned-aircraft technology.

With new product upgrades coming in every few days, regulators are just unable to guard against major concerns and threats that drones pose, including airspace threats, privacy invasion, corporate espionage, and civilian accidents. Therefore, I find it completely necessary for governmental bodies to implement and enforce regulatory laws for the use of drones.

I believe that all consumer drones should be prohibited to fly below 400 feet over any permissible public or private property and that any drone-user wishing to fly higher must register a license with their municipality. Furthermore, any offenders should be fined as a warning to others. While these restrictions might seem overly rigorous, I believe it to be necessary for the time being so as to allow time for regulators, officials and industry leaders to develop a global operating standard for unmanned flying vehicles.

 “With the technology having just emerged into the mainstream it’s vital that the federal government be allowed to create a uniform regulatory framework, which all drone operators can follow,” – Jeff Ellis, New York-based Aviation Partner at Clyde & Co.

While the limitless possibilities for drone usage is an exciting prospect, they can only be used to their full potential with the right controls in place. So, until governments are able to pass these regulatory laws, I can only say, “Heads up”!

 

 

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To many consumers, the idea of sweatshops is a foreign thought that belongs in foreign countries. We can all visualize a distressing scene of a women bent over a sewing machine working a 16-hour shift, in a crammed workspace in Southeast Asia, for a salary of mere pennies. However, with the recent rise in popularity of the “fast fashion” trend, there has been a huge resurgence of domestic textile productions in developed countries. Sonia Sodha’s article sheds light to an unknown truth that is hidden in some of the world’s most progressive nations.

Many popular high-street brands are currently having a hard time keeping up with their large demands while minimizing their turnaround periods, and have begun looking inward to domestic “sweatshops” to supply their never-ending need for fast, new fashion trends. These sweatshop-style factories operate in well-populated, urban cities – like Leicester, England – and cut costs by exploiting the wage system to get around paying their workers in full.

I, however, have to respectfully disagree with Sonia’s opinion that the main driving force behind these domestic sweatshops is from a weak state governance and an enfeebled union. I rather believe that it is the large retailer corporations that should be held responsible. Clothing brands like Forever 21, Asos, and T.J.Maxx – who rely on producing cheap clothes that sell in large volumes – are constantly pressuring their manufacturers to cut costs in order to maximize their own profit.

“They force the production costs to as low as they want because of their power in the supply chain, with the result of ultimately the workers bearing the whole cost and risk of the system.” – David Weil, former head of the Labor Department’s Wage and Hour Division

Though no matter how tightly retailers squeeze their margins or how frequently the state penalizes them for unpaid wages, many manufacturers are unable to turn down a buyer with the quota and scale of a store like T.J.Maxx.

“It’s like moths drawn to a flame. They keep going for it,” said Daejae Kim, a downtown Los Angeles manufacturer who once supplied garments to Forever 21. “They’ll curse them — then go right back to them.”

Manufacturers are therefore left no choice but to cut whatever costs possible to meet the near unattainable demands from big retailers. With manufacturers spending less than $4 on the production of a garment that a company like Forever 21 would purchase and sell at $9 and then $25 respectively, there isn’t much left at the end of the day for the factory workers. Manufacturers are thus forced to illegally exploit immigrants and illegal refugees who are unable to say no to a paying job, no matter how little that pay really is.

The only party who seems reasonably unaffected from this vicious production cycle are big retailers who generally claim that they are only the distributer of clothes and are therefore not liable for any wage claims by workers, even if said worker has stitched their company’s label onto a garment.

In the end, the result is a situation we see all too often. Corporations 1, the people 0.

 

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