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Bloodsucking Bedbugs Back Biting Big Apple

bedbugs nightmare

Along with a new wave of bed bug infestations in New York City has come a lot of reputation damage to local companies. The critters forced an Abercrombie & Fitch store to close up shop. A movie theater in Times Square had to hose down its seats to kill bedbugs living in its seats. And apparently even the mannequins in a Lexington Ave Victoria’s Secret were alluring enough to the little guys that the store had to be shut down.

It’s tough to gauge the exact bottom line impact, but such headaches are becoming increasingly common for stores — particularly now that the bedbug resurgence seems to be widespread and customers are growing increasingly creeped out.

And it is becoming increasingly clear that one major hurdle to eradicating the pests is that no one really knows that much about them, mostly because they don’t actually transmit disease and, thus, don’t pose the same health risks to humans that, says, ticks or lice do.

Bedbug research “has been very limited over the past several decades.”

Ask any expert why the bugs disappeared for 40 years, why they came roaring back in the late 1990s, even why they do not spread disease, and you hear one answer: “Good question.”

The article goes on to explain pretty much all the info that scientists do know for sure about bedbugs in just a few paragraphs.

The bugs are “nest parasites” that fed on bats and cave birds like swallows before man moved in.

That makes their disease-free status even more baffling.

(The bites itch, and can cause anaphylactic shock in rare cases, and dust containing feces and molted shells has triggered asthma attacks, but these are all allergic reactions, not disease.)

Bats are sources of rabies, Ebola, SARS and Nipah virus. And other biting bugs are disease carriers — mosquitoes for malaria and West Nile, ticks for Lyme and babesiosis, lice for typhus, fleas for plague, tsetse flies for sleeping sickness, kissing bugs for Chagas. Even nonbiting bugs like houseflies and cockroaches transmit disease by carrying bacteria on their feet or in their feces or vomit.

But bedbugs, despite the ick factor, are clean.

There is plenty of speculation about why they disappeared for around four decades (DDT perhaps) where they come from (foreign travelers, say pest control companies) and how to get rid of them (gun powder and even Zyklon B were tried in the old days), but there is very little concrete information to rely on.

So it seems that those companies that have been affected, particularly in these 15 most-infested cities, have nowhere to turn for help. And according to this article, the current remedies are not only unreliable — they are ungodly expensive.

The cost of treating a single hotel room is estimated at $6,000 to $7,000. The problem is even worse if a customer alerted the hotel to the problem: Given the danger of a bedbug stigma, hotels often go to extremes to ensure that customers are pleased with their attentiveness. According to an article in Bloomberg BusinessWeek, one Las Vegas hotel’s standard procedure for bedbug complaints is to move customers to new rooms, dry clean all their clothes, and replace their luggage with new, uninfested bags.

What a nightmare.

(See what I did there?)

Was a Bad Egg Behind the Egg Recall?

eggs

380 million eggs have now been recalled from an Iowa egg production facility in what some are calling the largest egg recall in history.

Unfortunately, as one of the nation’s top food safety advocates predicts, the outbreak will likely grow over the coming weeks. So far, close to 2,000 people have been sickened with salmonella from the bad eggs, with that number pretty much guaranteed to grow.

At the center of this massive recall is the family-run egg farm Wright County Eggs, based in Galt, Iowa. The owner of this company is Jack DeCoster, 75, who could be labeled a bad egg if one reads the litany of lawsuits and plant health violations he’s had filed against him in the past. Let’s take a look at two complaints:

One of the more egregious was filed in the summer of 1996 when DeCoster was made to pay more than $3 million in fines after the U.S. Labor Department found dead chickens being picked up by workers with bare hands. The complaint also stated that DeCoster’s workers also lived beside manure and rat-infested trailers, according to the Associated Press. The complaint led to a boycott of DeCoster’s eggs by several major supermarkets. In 2000, the Iowa attorney general dubbed DeCoster a “habitual violator” of the state’s environmental laws and ordered him to pay a $150,000 fine. DeCoster had failed to properly dispose of the hog and chicken manure and had let it run into a nearby creek.

Add to that the 10 counts of animal cruelty DeCoster pleaded guilty to in regards to his company’s treatment of its chickens. Then, in June, he was ordered to pay “more than $100,000 in fines and restitution, a ruling that is considered one of the landmark animal cruelty cases in history.”

In seems ironic that new egg safety rules were put into place July 9 by the FDA to help reduce the risk of salmonella outbreaks. This risk management proposition:

Addresses several aspects of egg production, particularly spots where chickens and egg production seem most vulnerable to infection by Salmonella enteritidis. While the new regs only immediately effect the largest of the nation’s egg producers, those producers also account for the overwhelming number of eggs produced.

The average person would say Wright County Eggs failed to successfully implement this, and other, risk management measures. The outcome for any company that fails in this aspect is, most times, lost earnings, lowered market share and tainted reputation. Not a good mix.

Environmental Risk: Not a Hot Topic For Spain’s Businesses

spanish flagBack in May, the European Union’s environmental liability directive was officially put into place, exposing European risk managers to greater liabilities for environmental damage caused by companies that pollute as part of their normal business operations.

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But not all of the EU’s 27 member states are taking charge of their new responsibility. Spain, for one, has shown a lack of awareness when it comes to environmental risks, legislation and avenues of protection available.

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According to the Business Environmental Liability study, more than half of the 700 businesses studies in Spain did not have environmental liability coverage.

The survey also revealed that of those companies that said they had cover in place against environmental damage, only 10% had a policy that conformed to established regulations (Law 26/20071). Companies cited their multi-risk policy/financial guarantee, public liability and general business insurance policies as providing environmental risk protection. However, these products do not conform to the requirements of Law 26/20071 on Environmental Liability.

It seems apparent that many businesses in Spain do not fully understand the implications of the EU’s environmental liability directive. In fact, a whopping 65% of companies surveyed said they were unaware that the Spanish government has the ability to make it a requirement for these companies to have a fund, collateral or insurance to cover them from possible environmental damage.

Though numerous insurers jumped at the chance to offer environmental liability coverage to the EU market, a lack of demand has been evidenced from the beginning of the directive’s establishment.

Risk managers don’t seem to be “aware of how much of a strict regime is now in place and the cost of responding to that regime if you have a problem,” said Simon White, London-based environmental branch manager for XL Insurance.

Why is Spain a laggard when it comes to this topic? If the country’s businesses don’t get on board soon with the EU’s environmental liability directive, it will affect not only their bottom line, but also their reputation.

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Tweeting Earnings: Bad for Your Company?

That’s an issue many have mixed feelings about. I, for one, think it’s a great way to relay investor information to the modern, web-loving world in a timely manner. Along with posting earnings on their websites, companies (well, some of them) are using Twitter to announce, among other news, performance numbers.

The microblogging site has seen a flood of earnings tweets for the second quarter of 2010. Some, however, are doing this better than others. IR Web Report compiled a list of 10 public companies that are using Twitter as an investor relations tool — with comments on what they’re doing right and wrong. Here’s a snapshot:

Picture 6

URL: https://twitter.com/PGNewsUS
Followers: 5,166
Apps used: Twitterfeed, CoTweet, TweetDeck
# of Earnings Tweets: 14
# of Clicks from Tweets: 75
Comments: The tweets are coming from P&G’s media relations team, so strictly speaking their activity doesn’t qualify as IR. Except it does because investors don’t discriminate. The tweets are plain vanilla, no hashtags or tickers. There’s a bit of “spin,” but mostly the tweets are informative. Still, the company’s IR department should have it’s own account. It’s hard to find the signal when sales numbers are mixed in with soap suds. The low click-thrus suggest that earnings tweets on this account don’t resonate.

Picture 7

URL: https://twitter.com/Roche_com
Followers: 4,586
Apps used: CoTweet
# of Earnings Tweets: 21
Clicks generated: 182
Comments: Only company where I had to use a calculator to add up all the various clicks to their site! Probably the best experience from a follower’s perspective. By not live tweeting the earnings call, they don’t overwhelm their followers and drive traffic to the webcast. But the greatest value comes from them referring followers to the media’s rolling coverage of the results throughout the day. From start to finish, it’s a well-managed process that is a valuable enhancement to what the company already provides on its website. The one to emulate.

Picture 8

URL: http://twitter.com/ebayinkblog
Followers: 4,638
Apps used: Blog, Seesmic
# of Earnings Tweets: 63
Clicks generated: 169
Comments: The original earnings live-tweeter, eBay continues to be a standard setter. It’s one of the few to incorporate StockTwits into its distribution. Its disclaimer at the start of earnings call live-tweeting sessions, and use of an unique hashtag for each call, are best practices. But too many tweets for my liking, but no one else complains so I’m wrong. Could say more but Richard’s already gotten a lot of ink here. He’s posted a good piece about his set-up and process.

Sure, tweeting financial performance data may be good for these large, blue-chip companies, but the same may not be true for smaller, less visible firms. According to research from the University of Michigan, small and micro-cap companies that participate in greater tweeting “during news event windows is associated with lower bid-ask spreads and greater depths.” Meaning, essentially, a lower stock price. Not good.

Tweeting earnings can have other harsh side-effects. If a company announces earnings news on other sites (such as their corporate website) first, then turns to Twitter (sometimes hours later), it is a slap in the face to the company’s loyal followers. Here are some examples of delayed earnings tweets (courtesy of IR Web Report):

  • A gold company listed both in the US and Canada issued a results release at 8:00am ET but only tweeted the news at 6:45pm ET –- a delay of 10 hours and 45 minutes.
  • A uniform company released earnings via a PR wire at 4:15pm ET and tweeted the same information 77 minutes later at 5:32pm ET.
  • A technology company issued its release at 4:15pm ET and only tweeted it at 4:43pm ET, a 28-minute period during which more than 150,000 shares were traded.
  • A health care solutions company released earnings at 4:00pm ET but didn’t mention the results on Twitter until announcing at 4:35pm ET that its conference call had started. Eventually, the results release showed up, but almost 8 hours after the fact at 11:53pm ET.
  • A networking company released earnings via a PR wire at 4:05pm ET but tweeted it only at 4:31pm ET – a 26-minute delay during which more than 100,000 shares changed hands.
  • A hard disk drive maker that released its results at 4:01pm ET but tweeted them only 24 minutes later at 4:25pm ET – a delay which saw more than 200,000 shares traded.

To investors, these are serious lapses from major corporations’ IR departments. If a company that is active on Twitter cannot manage to update its followers and investors in 140 characters or less on important information in a timely manner, how can it expect to keep such a following?

With more and more companies waking up to the power of social media, more and more sloppiness in the the Twitter and Facebook realm is visible. For companies large and small, to be complacent with such technology is to dig your own grave.