The Economy

Good Week/Bad Week: Lox, Stocks, and Two Smoking Pharaohs

Troubles at Air Zimbabwe; what does their passenger think? Plus: Wile E. Coyote at Fox & Hound. And: leaving work on time now an annual event.
John GoffJune 3, 2005

Disclaimer: This column, such as it is, does not, in any way, shape, or form, purport to adhere to traditional journalistic concepts.

Further, the comments expressed below are strictly those of the author, and do not reflect the opinions of the Economist Group, CFO Publishing, or anyone with half a brain, for that matter. In addition, the article has not been vetted by outside counsel, inside counsel, or second-baseman Craig Counsell (.313, 2 HRs, 18 RBIs).

Moreover, the column does not meet the high artistic or intellectual standards set by P.G. Wodehouse, P.J. O’Rourke, P.J. Soles, PB&J Otter, or Magnum PI. While the items in this column are based on real events, most everything else is made up. Some quotes are real, some are highly suspect. Please, no lawsuits.

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1. Overworked Employees

If you left work on time last night, congratulations. You were a right proper observer of the first annual “Leave the Office Early Day,” a phony baloney holiday being promoted by — what else? — a corporate consultant in Colorado. The event, which is officially listed in Chase’s Calendar of Events 2005 — along with such notable celebrations as Take a Friend to Scranton Week and Hermine Gingold Tuesday — is intended to focus workers on improving their personal productivity. It also asks them to commit to working no more than eight hours on that day. Plus, they should maybe spend a little more time goofing off.

According to the consultant, Laura Stack, 10,000 workers committed to going home on time yesterday. That beats normal days, when most workers don’t leave the office until well after Wheel of Fortune is over (researchers are still trying to establish a causal link between those two items).

While “Leave the Office Early Day” is clearly a marketing ploy, it does serve to underscore the fact that American workers tend to stay inside a lot. Statistics show that workers in the United States put in nearly 50 hours a week and ask silly questions at meetings. By comparison, employees in Europe work seven hours less per week and get to live in Europe. A related study found that U.S. workers eat substantially less slimy stuff than their Japanese counterparts.

All in, the Department of Labor reckons that American males are working about three hours more per week than they did 30 years ago, and with less hair. Neither is good. Says Stack: “The eight-hour workday remains a myth to many working Americans.” Other myths to working Americans: co-workers want all the details about that camping trip, and it’s OK to download clips from “Polly and Her Naughty Parrot” onto a company computer.

2. Fox and Hound Restaurant Group

Late last week, management at Total Entertainment Restaurant Corp. announced the company had changed its name. The sports bar and restaurant specialist, based in Wichita, Kansas, owns 75 establishments in 20 states. The new name of the company? Fox and Hound Restaurant Group.

Wall Street responded favorably to the switch, driving the share price of the company up by 3, 13, or 130 percent (depending on math skills). Analysts say the new moniker makes sense. “Many of the company’s eateries already operate under the Fox & Hound logo,” noted Tuff Timmel, an industry analyst at investment firm Katz & Sons. “Hence, the change simply builds upon an established brand. Additionally, research indicates consumers regard ampersands as with-it, 21st century punctuation.”

Nevertheless, word is that management at the one-time Total Entertainment was deeply divided over the name change. Indeed, an internal company memo, obtained by the Wichita Lineman, reveals that top executives at the restaurant chain were still debating possible company monikers as late as last week. A portion of that confidential memo is reproduced here, with permission (we asked nice):

To: Senior Management Committee, TERC
From: Brand Committee, TERC
Re: Upcoming Meeting — 4/26

As you know, several potential names still remain from our most recent meeting (4/04, Tulsa Steak and Ale — Harry, legal says you’ll have to pay for the sneeze guard). Announcement of new DBA scheduled for end of Q2. The revised shortlist, with management’s comments, follows:

Fox & Foxy Lady: If we want to go “that way.” Marketing committee voted down “Foxy Lady and Fox” — committee members worried FL&F places too much emphasis on foxy ladies, not enough on actual foxes. Additionally, what would franchisees do with all the saddle blankets?

Fox & Glove: Revenue models indicate sales in lucrative gardening demographic would jump by 12-15 percent. Possible line extension into branded line of handwear.

Fox & Hunters: Folks at Rubenstein believe F&H would enflame animal-rights activists. Risk to brand obvious (we’re still removing “Shrimp Puffs are Murder, Too” from signage in Mobile). Another potential danger: newspaper reports indicate vegans set to launch “Got White Death?” campaign against any restaurant that runs bottomless-cup-of-milk promotion.

(Addendum: Rubenstein says risk from “Fox & Hunters” could be mitigated by requiring franchisees to hang publicity photos of Mott the Hoople, Summer Place on premises. This offers intriguing rock and roll/show business angle, but gets us into possible legal tangle; Bill says Planet Hollywood litigious as hell.)

Red Foxx: High response in focus groups; solves color scheme issue instantly. Downside: clear barrier to access for customers named Esther. Demond Wilson also poses problem. Is he still doing summer stock? One plus: contacts at Simon & Schuster indicate “Big Dummy” not likely to find a publisher.

Hound & Hound Again: In test groups, H&HA strongest with dog lovers/women, weakest with married men. 34 percent of that group called H&HA “a painful reminder of their daily hell.” Team at Ogilvy says it will be difficult to leverage that angle in marketing campaign.

Wile E. Coyote: Non-starter.

One final note: Dan, legal concurred — Fox in Socks poses serious concerns. Memorandum to Geisel estate generated quick response; attorneys for family said they did not regard FiS as “touching tribute” but rather “a clear, willful and knowing infringement of existing copyright law.” Box of candy returned, unopened. Finance thinks we should try flowers, card referencing paddle battle muddle.


1. Air Zimbabwe

This week, lawmakers began debating the merits of the Wright Amendment. That amendment, passed in 1979, was essentially a congressional incentive aimed at convincing American Airlines to move to the new airport in Fort Worth. Specifically, the amendment prohibits airlines operating out of the old Dallas Love Field from flying to any location outside of the state of Texas. The so-called Texarkana Compromise exempted border towns that nobody has much interest in visiting.

Scrapping the amendment — one of the last vestiges of government favoritism towards established airlines — would be a further blow to struggling carriers like American, Delta, and United. “This is a strange time for us — a weird, unsettling time” said a spokesman for United. “Oil is $50 a barrel, low-fare competitors are popping up at every turn, and Jessica Simpson is singing with Willie Nelson. What’s next? Placido Domingo and Carrot Top at the Sands?”

Nevertheless, Congress appears set to repeal the Wright Amendment (some Southern lawmakers hope to include the repeal as part of a larger piece of legislation “toning down” the Bill of Rights, the Magna Carta, and any other “legal framework undermining the right of the majority to impose their values on any group that doesn’t get in line with everybody else”). Despite the trend toward airline deregulation in the United States, industry-watchers say government-owned airlines continue to dominate markets outside North America.

Indeed, surveys of the world’s best airlines consistently rate state-owned Singapore Airlines, Swiss Air, and Emirates as the top carriers. Typically, the surveys rank the carriers based on most efficient service and least cold cutlery.

Not all government-owned airlines have been garnering high praise, however. On Monday, officials in Harare lambasted the state-run carrier, Air Zimbabwe. The local Herald newspaper quoted Transport and Communications Secretary Karikoga Kaseke as saying the national airline was a victim of “inept management.”

As a high-ranking official in the world’s most corrupt government, Kaseke clearly knows inept management when he sees it. Still, his comments were hardly surprising. Authorities in Harare have been extremely critical of Air Zimbabwe’s recent moves. The airline’s current ad campaign, “It’s Us or Jail,” has been roundly criticized by human rights groups, including, for no apparent reason, Save the Whales.

Other management decisions have come under fire of late, as well. According to the carrier’s website, “Air Zimbabwe really does offer an individual approach to our passengers.” They’re not exaggerating. In May, the airline inaugurated nonstop service from Harare to Dubai, a flight of some 3,728 miles. The return leg of the maiden voyage (on a Boeing 737) had just one passenger. “Our investigations have revealed that no proper market research was done before they [Air Zimbabwe] engaged on the Dubai trip,” Kaseke reportedly said. “Also, they lost the guy’s luggage.”

Other problems abound. An acute fuel shortage has forced the struggling airline to cancel several routes — some in mid-flight. Well-placed sources in the Transport Ministry say Air Zimbabwe officials had hoped to stretch fuel supplies by mixing small amounts of rocket fuel with standard jet fuel. The plan backfired, say the sources, when non-English speaking ground crews ordered hundreds of gallons of smoked salmon instead of liquid oxygen. And last month, the airline drew heavy criticism from heavy people when it began insisting that passengers squeeze through a series of ever-narrowing doors prior to boarding.

Not surprisingly, the troubles at the airline have driven down the share price of Mugabe Hayes, the largest stakeholder in the airline and the personal investment vehicle of Zimbabwe strongman Robert Mugabe (he can bench-press his weight in nickels). Reportedly, Mugabe’s company holds a 172 percent equity stake in Air Zimbabwe, along with providing in-flight food service, and all rental cars. When asked recently to comment on the struggling airline, Mugabe blamed the Air Zimbabwe’s poor performance on a conspiracy orchestrated by Norwegian Prime Minister Kjell Magne Bondevik. He then confiscated the property of 4,000 farmers and gave their land to the Eskimos.

Analysts in Harare do point out that Air Zimbabwe has attempted to generate revenues by adding new services. But the airline’s initial foray into so-called “ultra high-end cargo services” fizzled in April when sparks in the cargo hold of a Cairo-bound flight accidentally ignited a pair of Armana period Egyptian mummies. An aviation authority in Harare blamed the sparks on “a substandard or inappropriate fuel source, most likely something with a high omega-3 content.”

The ongoing troubles at Air Zimbabwe has left members of the Turkey Club, the airline’s frequent-flyer program, fuming. Many members say they’re put off by the airlines suggestion that, on flights under two hours, passengers “hoof it.” Says one business traveler: “I cannot walk 700 miles. Not with a cow and a goat. Not and get there feeling refreshed, anyway.”