Kacey Siskind recently took her first business trip to the U.S. since the pandemic began.
The vice-president of business development at Honk Mobile, a parking app, attended an industry conference in Texas.
“Our team was fully vaccinated and we felt that we could probably make our way and see how it went… we just wanted to take a chance and really be back out in the world,” said Siskind.
But in Dallas, you’d barely know there had ever been a global pandemic. Panel discussions and networking sessions at the conference happened indoors with no masks in sight — just lots of people eager to re-connect.
Siskind said she found the environment unnerving at first, but soon began to appreciate the experience.
“There is really nothing like being in person with somebody,” Siskind said. “There’s nothing like physically seeing them and talking to them.”
Canadian Kacey Siskind, vice-president of business development at Honk Mobile, recently travelled to Texas to attend her first in-person industry conference since the pandemic began. (Submitted by Kacey Siskind)
Only essential business travel has continued throughout the pandemic; for example, trips related to healthcare issues or critical infrastructure. Work trips related to maintaining or building relationships, making sales or attending conferences had been shut down.
In an online survey of 640 industry professionals, a June poll from the Global Business Travel Association, a U.S.-based industry group, found 91 per cent of companies say they’ve cancelled or suspended most or all international business travel — a huge hit for the industry.
Slow return for business travel in Canada
In Canada, virtual, online gatherings are expected to be the norm at least until the end of the year, event planners said.
“Our friends down in the states are moving a little bit quicker than us,” said Anh Nguyen, an event planner in Calgary. “In Canada, we’re seeing a little bit of a more conservative approach.”
Event manager Anh Nguyen of Calgary thinks that in-person events will continue to have a virtual presence for the forseeable future as many companies seek to reach a wider audience. (Dave Rae/CBC)
Nguyen’s company, Spark Event Management, organized a number of virtual events over the past year. She believes many organizations — here and in the U.S. — won’t be willing to give up all the benefits that come with going online.
“There’s no such thing as sold out, right? So if you’re a 300-person event you can now reach 5,000-6,000 people if you wanted it to.”
Nguyen adds that with avatars, networking and breakout room software, industry is getting close to being able to replicate much of a real-life event experience online — though it’ll never be quite the same.
“The technology has grown and there’s a lot of money and investments being put into event technology right now,” Nguyen said.
Ontario-based TK Events is one of several event management companies replicating some aspects of real-life conferences virtually. (TK Events)
Virtual gatherings may be great in some ways, but industry insiders note that they do next-to-nothing for local economies. Business travellers are often big spenders. They’re often on expense accounts, which benefit hotels, restaurants, taxis, airlines and more.
“Business travel contributes over $40 billion towards our Canadian economy in pre-pandemic numbers,” said Nancy Tudorach, who works with the Global Business Travel Association. “It’s about 2.5 to 3 per cent of our typical pre-pandemic GDP.”
Airlines are hurting
Vik Krishnan, a consultant with McKinsey & Company, said airlines in particular depend on expensive business class tickets.
“The business traveler tends to book late, they tend to travel with higher frequency, and they tend to also buy some of the more expensive fares,” he said. “Business travel for some airlines comprises 50 to 75 per cent of profits.”
A recent report from McKinsey noted that it took six years for airlines to recover from the impact of the Sept. 11 attacks, and that the industry still hadn’t fully recovered from the 2008 global financial crisis when the pandemic hit.
The COVID-19 pandemic has been larger in scale and deeper than any of those prior crises, Krisnan said. But if corporate travel remains curtailed, he said airlines probably won’t make up the difference by charging regular consumers more.
“This is an industry that has faced a lot of competition, has faced fairly relentless pricing pressure and cost pressure, and therefore, it’s no stranger to having to deal with an environment where you don’t have a lot of leeway and flexibility to raise prices.”
The recent emergence of new discount airlines in Canada, such as Flair and Canada Jetlines, could make it difficult for WestJet or Air Canada to charge more.
Business travel may stay depressed
Many of the companies that depend heavily on business travellers are expected to continue to struggle. McKinsey’s report on the airline industry forecasts pre-pandemic travel levels won’t be reached until 2024, and even then will only be at 80 per cent.
Others say the pandemic may have changed the approach to corporate travel forever.
Kacey Siskind suspects all business trips will now be evaluated differently.
“Is it efficient for us to go to a conference? Yes, if we’re going to see hundreds of people, it’s going to make sense for us to be there,” she said. “Is it smart for me to go off to New York for a night to have one meeting? Maybe not so much.”
TOKYO (AP) — Japanese technology group SoftBank swung back to profitability in the July-September quarter, boosted by positive results in its Vision Fund investments.
Tokyo-based SoftBank Group Corp. reported Tuesday a fiscal second quarter profit of nearly 1.18 trillion yen ($7.7 billion), compared with a 931 billion yen loss in the year-earlier period.
Quarterly sales edged up about 6% to nearly 1.77 trillion yen ($11.5 billion).
SoftBank credited income from royalties and licensing related to its holdings in Arm, a computer chip-designing company, whose business spans smartphones, data centers, networking equipment, automotive, consumer electronic devices, and AI applications.
The results were also helped by the absence of losses related to SoftBank’s investment in office-space sharing venture WeWork, which hit the previous fiscal year.
WeWork, which filed for Chapter 11 bankruptcy protection in 2023, emerged from Chapter 11 in June.
SoftBank has benefitted in recent months from rising share prices in some investment, such as U.S.-based e-commerce company Coupang, Chinese mobility provider DiDi Global and Bytedance, the Chinese developer of TikTok.
SoftBank’s financial results tend to swing wildly, partly because of its sprawling investment portfolio that includes search engine Yahoo, Chinese retailer Alibaba, and artificial intelligence company Nvidia.
SoftBank makes investments in a variety of companies that it groups together in a series of Vision Funds.
The company’s founder, Masayoshi Son, is a pioneer in technology investment in Japan. SoftBank Group does not give earnings forecasts.
Shopify Inc. executives brushed off concerns that incoming U.S. President Donald Trump will be a major detriment to many of the company’s merchants.
“There’s nothing in what we’ve heard from Trump, nor would there have been anything from (Democratic candidate) Kamala (Harris), which we think impacts the overall state of new business formation and entrepreneurship,” Shopify’s chief financial officer Jeff Hoffmeister told analysts on a call Tuesday.
“We still feel really good about all the merchants out there, all the entrepreneurs that want to start new businesses and that’s obviously not going to change with the administration.”
Hoffmeister’s comments come a week after Trump, a Republican businessman, trounced Harris in an election that will soon return him to the Oval Office.
On the campaign trail, he threatened to impose tariffs of 60 per cent on imports from China and roughly 10 per cent to 20 per cent on goods from all other countries.
If the president-elect makes good on the promise, many worry the cost of operating will soar for companies, including customers of Shopify, which sells e-commerce software to small businesses but also brands as big as Kylie Cosmetics and Victoria’s Secret.
These merchants may feel they have no choice but to pass on the increases to customers, perhaps sparking more inflation.
If Trump’s tariffs do come to fruition, Shopify’s president Harley Finkelstein pointed out China is “not a huge area” for Shopify.
However, “we can’t anticipate what every presidential administration is going to do,” he cautioned.
He likened the uncertainty facing the business community to the COVID-19 pandemic where Shopify had to help companies migrate online.
“Our job is no matter what comes the way of our merchants, we provide them with tools and service and support for them to navigate it really well,” he said.
Finkelstein was questioned about the forthcoming U.S. leadership change on a call meant to delve into Shopify’s latest earnings, which sent shares soaring 27 per cent to $158.63 shortly after Tuesday’s market open.
The Ottawa-based company, which keeps its books in U.S. dollars, reported US$828 million in net income for its third quarter, up from US$718 million in the same quarter last year, as its revenue rose 26 per cent.
Revenue for the period ended Sept. 30 totalled US$2.16 billion, up from US$1.71 billion a year earlier.
Subscription solutions revenue reached US$610 million, up from US$486 million in the same quarter last year.
Merchant solutions revenue amounted to US$1.55 billion, up from US$1.23 billion.
Shopify’s net income excluding the impact of equity investments totalled US$344 million for the quarter, up from US$173 million in the same quarter last year.
Daniel Chan, a TD Cowen analyst, said the results show Shopify has a leadership position in the e-commerce world and “a continued ability to gain market share.”
In its outlook for its fourth quarter of 2024, the company said it expects revenue to grow at a mid-to-high-twenties percentage rate on a year-over-year basis.
“Q4 guidance suggests Shopify will finish the year strong, with better-than-expected revenue growth and operating margin,” Chan pointed out in a note to investors.
This report by The Canadian Press was first published Nov. 12, 2024.
TORONTO – RioCan Real Estate Investment Trust says it has cut almost 10 per cent of its staff as it deals with a slowdown in the condo market and overall pushes for greater efficiency.
The company says the cuts, which amount to around 60 employees based on its last annual filing, will mean about $9 million in restructuring charges and should translate to about $8 million in annualized cash savings.
The job cuts come as RioCan and others scale back condo development plans as the market softens, but chief executive Jonathan Gitlin says the reductions were from a companywide efficiency effort.
RioCan says it doesn’t plan to start any new construction of mixed-use properties this year and well into 2025 as it adjusts to the shifting market demand.
The company reported a net income of $96.9 million in the third quarter, up from a loss of $73.5 million last year, as it saw a $159 million boost from a favourable change in the fair value of investment properties.
RioCan reported what it says is a record-breaking 97.8 per cent occupancy rate in the quarter including retail committed occupancy of 98.6 per cent.
This report by The Canadian Press was first published Nov. 12, 2024.
