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How UrgentRx Crashed the Party at the Cash Register

August 7, 2013 by

At a time when it can seem as if all retailing is migrating online, many consumer staples still live or die based on their placement in the detailed schematics that stores like Duane Reade use to maximize the profitability of their shelf space. For an upstart brand with no track record, securing any spot in these schematics, or plan-o-grams, as they are known, is difficult. To stake a claim to the prized ground near the registers is all but impossible, akin to a struggling young artist moving his milk crates into a Park Avenue co-op.

Or so it seemed until Jordan Eisenberg came along.

Mr. Eisenberg, 31, is the founder of UrgentRx, maker of single-dose foil packets of flavored, powdered over-the-counter medications with the same active ingredients found in products like Bayer, Pepto Bismol, Benadryl and Excedrin. Designed to be taken without water, the UrgentRx versions have been selling well enough that the company expects revenue this year of more than $3 million. Based in Denver, with 10 employees, the company has attracted more than $7 million in financing from investors like Sam Zell and Herb Simon, real estate moguls; David Bonderman, a private equity billionaire; and Hilary Swank, the actress.

But what really seems to have propelled the company’s early success are the inroads Mr. Eisenberg has made with major retailers. In the three years since the company’s debut, he has placed UrgentRx products near the checkout counter at 2,700 retail outlets across the country, including those of Duane Reade, Walmart and Kroger. Recent agreements and continuing negotiations, he estimates, should put the products in 27,000 stores by the end of the year. Merchandising fees — when big chains do take a flier on a new brand, they often charge stiff first-time stocking fees — have been less than $100,000, he said.

How has he done it? With a simple insight: Mr. Eisenberg realized that while most small brands cannot break into the plan-o-gram, they can persuade retailers to give them access to the unused space in the margins beyond the plan-o-gram. This insight has earned Mr. Eisenberg a reputation as a kind of “store seer,” a master at finding wasted spaces hidden in plain sight. Employing a variety of custom-fabricated display units, the burly former engineering major has designed lazy susan-like trays that spin atop the stanchions of queue lines, racks that hang off the ends of display walls, and oddly shaped shelving units that seem to levitate above sale counters.

“What he’s doing is one step beyond audacious,” said Kim Feil, chief marketing officer for OfficeMax, which recently signed an agreement to allow a horizontal UrgentRx display to sit atop the candy, mint and gum rack at the front of its checkout lanes. A 30-year merchandising veteran, Ms. Feil likened Mr. Eisenberg’s tactics to when 5-Hour Energy got its individual shot-size bottles into the racks by developing a carton of 12 with a tear-off lid and the precise dimensions of a candy, mint or gum slot. “But there haven’t been too many others,” she said.

On a recent afternoon, Mr. Eisenberg was visiting Manhattan, testing his latest prototype for Duane Reade. Although the chain has already installed his lazy susan queue-line display in two-thirds of its locations, its older and smaller stores do not have queue lines. So Mr. Eisenberg asked his fabricator to fashion a different sort of display — a 2-by-12-inch, white powder-coated strip of metal with three clear acrylic pockets affixed to the front.

Near 44th Street and Ninth Avenue, Mr. Eisenberg entered an older Duane Reade, clutching his prototype filled with packets of UrgentRx, to scope out spots near the front of the store. At the register, a cashier surrounded by razors, cigarettes, nicotine replacements, candy and gum was ringing up a customer. Next to the register, a stack of chocolates took up what little counter space was available. Then the UrgentRx rack popped into view, Mr. Eisenberg holding it up to show how it could be fastened to the back of the arm supporting the register screen. Suddenly, it was the most prominent point of sale in the store.

A moment later, he was standing by a metal refrigerated case in a prime location across from the counter. He held the same rack flush against the side of the case. “Put some magnets on the back and it could also go right there,” he said. On the other side of the case, where a clear acrylic rack of Lifesavers mints was attached, he showed how his rack could go on the side of the Lifesavers rack. “This is why my wife won’t go into stores with me anymore,” he said.

He is clearly something of an obsessive. After reading “Secrets from an Inventor’s Notebook” in college, he talked his way into an apprenticeship with its author, Maurice Kanbar, the originator of both Skyy vodka and a type of lint remover, calling on Mr. Kanbar’s office at least once a month for two years before landing a meeting. He eventually assisted Mr. Kanbar with the start of four companies.

By the time Mr. Eisenberg was 27, he had founded two companies on his own: CollarCard, maker of a credit-card-size shirt stay holder given out as a premium by men’s wear chains; and PMS Buddy, an app that reminded men when their wives or girlfriends were having their periods. The app received 30,000 downloads the day Ashton Kutcher, the actor and Twitter sensation, tweeted about it.

The inspiration for UrgentRx came to Mr. Eisenberg, who is severely allergic to raw fruits and vegetables, while disinterring a Benadryl pill that he used to wrap in cellophane and carry in his wallet in case his throat swelled up. The idea solidified when he realized that his father, then 61, was doing the same thing with aspirin, which is known to improve one’s chances of surviving a heart attack. Soon after test-marketing began in Colorado, Mr. Eisenberg became the subject of local news reports when a Denver man claimed that the UrgentRx’s aspirin formulation had saved his life.

Mr. Eisenberg says he believes that many brands can learn from his unorthodox merchandising methods. Walking into a Staples outlet on Broadway, he said that a lot of brands made the mistake of skimping when designing display equipment. He pointed to the counter where a dented plastic container was nearly drained of hand sanitizer bottles. “See, as soon as those are gone,” he said, “that’s going to get thrown out because it looks cheap.”

In the next block, Mr. Eisenberg came across another Duane Reade, this one in a newer location. Inside, he noticed that half of the UrgentRx packets in a display were either upside down or in the wrong slots. “It’s a constant battle,” he said, pulling out all of the packets, re-sorting them and then placing them in the appropriate slots. He noticed a woman waiting in line with a box of Benadryl.

“Here, you should try this instead,” said Mr. Eisenberg, handing her a packet of UrgentRx Allergy Relief To-Go. “It’s much better than that other product.”

She took the packet, read the back of the package, and returned the Benadryl, before turning to the cashier: “I’ll try one of these.”

“I have no shame,” Mr. Eisenberg said.

Article source: http://www.nytimes.com/2013/08/08/business/smallbusiness/how-urgentrx-crashed-the-party-at-the-cash-register.html?partner=rss&emc=rss

Filed Under: Small Business Tagged With: , ,

Magazine Newsstand Sales Plummet, but Digital Editions Thrive

August 6, 2013 by

Magazines continue to struggle with sales of subscriptions and newsstand copies in the first half of 2013, but they have made inroads in selling digital editions, according to data released Tuesday.

Total paid and verified subscriptions declined by 1 percent in the first half of 2013, and newsstand sales, which are often an indicator of a magazine’s appeal, dropped by 10 percent. Both declines were similar to the overall trend in the same period a year ago.

But the numbers, released by the Alliance for Audited Media, also showed that a solid base of loyal magazine readers were simply turning to the digital versions of magazines. Digital replica editions — which replicate the format of the print editions — now make up 3.3 percent of total magazine circulation, with 10.2 million digital replica editions sold in the first half of 2013. During the same time period in 2012, magazines sold 5.4 million digital editions, which made up 1.7 percent of circulation.

“They’re relatively small to the mix,” said Steven Cohn, editor of the Media Industry Newsletter, referring to digital subscriptions. “I would expect these numbers to grow rather steadily. It’s like everything else. You have to walk before you run. Things will accelerate.”

Celebrity weeklies had some of the biggest losses in newsstand sales, including People (11.8 percent decline), Us Weekly (16.7 percent) and Life Style Weekly (20.9 percent). But Mr. Cohn noted that these titles declined in part because they didn’t have a big event — like the birth of the royal baby — to help stimulate sales.

“The royal birth came in July,’’ he said. “They needed a stimulant like that and they didn’t have it.

“If it’s a normal news routine, at least with celebrities, they won’t do as well.”

But Mr. Cohn noted that celebrity titles already have benefited in the second half of the year because of birth of Prince George. Larry Hackett, the managing editor of People, said last week that the Aug. 5 “Royal Baby Joy” cover had already sold 1.2 million copies and he expected that to rise 1.4 million issues. “Already at 1.2 it’s the best-selling cover of the year,” Mr. Hackett said.

Mr. Cohn said he was more concerned about women’s magazines, which were hit hard by losses on the newsstand. Cosmopolitan showed a 23.9 percent decline in newsstand sales. Glamour dropped by 28.8 percent and O, The Oprah Magazine, fell by 22.7 percent. “I’m not sure whatever they can do can make a difference,” Mr. Cohn said. “It’s very newsstand-dependent.”

But Hearst magazines, which owns Cosmpolitan and O, The Oprah Magazine, noted the progress both magazines had made in digital subscriptions. Cosmopolitan grew by 33 percent, to 246,815 digital subscribers, and O grew 22 percent, to 99,412 digital subscribers.

Article source: http://www.nytimes.com/2013/08/07/business/media/magazine-newsstand-sales-plummet-but-digital-editions-thrive.html?partner=rss&emc=rss

Filed Under: Media Business Tagged With: , ,

New Election Rules a Win for Labor Unions

December 21, 2011 by Leave a Comment

Business groups quickly denounced the move, saying it limits the time that employers have to educate workers about the impact of joining a union. The U.S. Chamber of Commerce has already filed a federal lawsuit challenging the rules.

The rules, which take effect April 30, simplify procedures and reduce legal delays that can hold up union elections after employees at a work site gather enough signatures to form a union.

“This rule is about giving all employees who have petitioned for an election the right to vote in a timely manner and without the impediment of needless litigation,” board chairman Mark Pearce said.

Unions say the old rules allowed companies to file frivolous appeals, stalling elections for months or years. The new rules could help unions make inroads at businesses like Target and Wal-Mart, which have successfully resisted union organizing for years.

But business groups claim the new plan allows “ambush” elections that don’t give company managers enough time to respond.

“This decision erodes employers’ free speech and due process rights and opens the door to rushed elections that will deny employees access to critical information,” said Katherine Lugar, executive vice president for public affairs at the Retail Industry leaders Association.

Most union elections currently take place 45 days to 60 days after a union gathers enough signatures to file a petition. The new rules could shorten that time by several weeks, depending on the situation.

Many employers use the time leading up to an election to talk to workers about the cost and impact of joining a union. But union officials claim the lag time is often used to pressure or intimidate workers against forming a union.

“It’s good news that the NLRB has taken this modest but important step to help ensure that workers who want to vote to form a union at their workplace get a fair opportunity to do so,” said AFL-CIO president Richard Trumka.

While union leaders publicly tried to play down the new rules as a modest development, labor experts called the change significant. Unions have seen their ranks dwindle steadily over the last three decades to 11.9 percent of the work force.

“Employers wouldn’t have fought against it so hard if it wasn’t going to make a difference,” said Kate Bronfenbrenner, director of labor education research at Cornell University’s School of Industrial and Labor Relations.

One way employers can currently delay union elections is to raise questions about which workers should be included in a bargaining unit. Supervisors aren’t eligible for union membership, and the company and union can spend months litigating that issue.

Under the new rules, questions about the makeup of bargaining units are resolved after the election takes place.

“This isn’t going to change the world, but it’s one step, and we haven’t had a step towards workers’ rights in a very long time,” Bronfenbrenner said.

The rules were approved by the board’s two Democratic members. Its lone Republican, Brian Hayes, has not yet cast his vote, but he is expected to cast a dissenting opinion sometime before the rule takes effect.

Hayes is so strongly opposed to the plan that he threatened to quit the commission last month, claiming its Democratic members were ignoring longstanding procedures in their haste to finish the rules.

The final rules were scaled back from an earlier version that would have required employers to hand over to union organizers a list of employees’ e-mail addresses and phone numbers.

The board rushed to approve the new rules before the end of the year, when the term of Democratic member Craig Becker expires. The board currently has only three members instead of the usual five, and the Supreme Court has ruled that it can’t issue any decisions with less than three members in place.

Congressional Republicans have blocked President Barack Obama from filling vacant posts on the board, and lawmakers have used procedural tactics to prevent Obama from bypassing the Senate to make recess appointments.

The lawsuit filed by business groups late Tuesday claims the board circumvented its own operating procedures to finalize this rule, and that the rule itself short-circuits safeguards meant to ensure fair elections.

“The blatantly partisan purpose of this rule is to ensure that employers have no time to talk to their workers about unionizing,” said Robin Conrad, executive vice president of the U.S. Chamber of Commerce’s public policy law firm, the National Chamber Litigation Center.

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Follow Sam Hananel on Twitter at http://twitter.com/shananel

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Online:

National Labor Relations Board: https://www.nlrb.gov/

Article source: http://feeds.nytimes.com/click.phdo?i=08379efbe84802fe0e73a35d452c595b

Filed Under: Business News Tagged With: , ,

If U.S. Leaves Vacuum in Iraq, Disliked Iran May Not Fill It

October 9, 2011 by Leave a Comment

Surely, Iran has emerged empowered in Iraq over the last eight years, and it has a sympathetic Shiite-dominated government to show for it, as well as close ties to the anti-American cleric Moktada al-Sadr. But for what so far are rather obscure reasons — perhaps the struggling Iranian economy and mistrust toward Iranians that has been nurtured for centuries — it has been unable to extend its reach.

In fact, a host of countries led by Turkey — but not including the United States — have made the biggest inroads, much to the chagrin of people here in Najaf like the governor.

“Before 2003, 90 percent of Najaf people liked Iranians,” said the governor, Adnan al-Zurufi, who has lived in Chicago and Michigan and holds American citizenship. “Now, 90 percent hate them. Iran likes to take, not give.”

Near midnight, Mr. Zurufi held court at a cafe, his team of bodyguards standing sentry at the door, frisking patrons. Outside, a convoy of white sport utility vehicles waited, and nearby, down a crooked alleyway, thousands of visitors took in the nighttime serenity of the Imam Ali Shrine, one of the holiest sites for the Shiite diaspora, where millions of Iranians flock every year.

Mr. Zurufi’s comments cut against the grain of what is commonly understood about the influence of Iran in southern Iraq, where the two countries have a common religious bond — both are majority Shiite — but where nationality competes with sect.

A standard narrative has it that the Iraq war opened up a chessboard for the United States and Iran to tussle for power. One of the enduring outcomes has been an emboldened Iran that is politically close to Iraq’s leaders, many of whom escaped to Iran during Saddam Hussein’s government, and that is a large trading partner.

Yet the story is more nuanced, particularly in the Shiite-dominated south that became politically empowered after the American invasion upended Sunni rule. It has been other countries — most powerfully Turkey, but also China, Lebanon and Kuwait — that have cemented influence through economic ties.

The patterns were established soon after the American invasion. Shoddy Iranian goods — particularly low-quality cheese, fruit and yogurt — flooded markets in the south, often at exorbitant prices, said Mahdi Najat Nei, a diplomat who heads the Trade Promotion Organization of Iran office in Baghdad. This sullied Iran’s reputation, even though prices have since plummeted, creating an aversion to Iranian goods that lasts to this day, Mr. Nei said.

This has made it difficult for Iranian businesspeople to make investments in southern Iraq, said Ali Rhida, who is from Iran and is building an iron factory on the outskirts of Najaf. “The real problem is with the mangers of the economy in Iran,” he said. “After the fall of the regime, many Iranian companies came here but they screwed it all up.”

In Najaf, officials still complain of low-quality Iranian goods, as well as little real investment from their eastern neighbor and violence perpetrated by militias with links to Iran. Their main complaint about the Americans is their lack of influence.

One aim of the American invasion here was to establish a moderate center of Shiite Islam, democratically inclined and oriented to the West, that would be a counterbalance to Iran’s system of clerical rule. However, something like the reverse seems to have happened. As Iran has used its political connections to hold great sway over Iraq’s leadership class, and has backed militias responsible for assassinations and attacks on American bases, it has been less successful wielding other mechanisms of power at a grass-roots level.

“Investment from Iran has almost stopped,” said Zuheir Sharba, the chairman of Najaf’s provincial council, referring to a phenomenon that has more to do with Iran’s anemic state-run economy than it does to Iranian ambitions. Speaking about Americans, he said, “They were coming, but they’ve stopped.”

Mr. Sharba continued: “We wish that American companies would come here. I wish the American relationship was that, instead of troops, it would be companies.” Mr. Sharba is a cleric, and he spent 14 years in Iran in exile during Mr. Hussein’s government.

Duraid Adnan contributed reporting.

Article source: http://www.nytimes.com/2011/10/09/world/middleeast/if-united-states-leaves-vacuum-in-iraq-disliked-iran-may-not-fill-it.html?partner=rss&emc=rss

Filed Under: Global Business Tagged With: , ,