The Best One Yet - 🎃 “Gummy-ween” — Chocolate’s Napoleonic moment. Uniqlo’s 75/50 strategy. Plumbing & AC millionaires.

Episode Date: October 21, 2024

With chocolate prices at record highs, brands are handing out gummies this Halloween… and it goes back to Emperor Napoleon.Uniqlo, Japan’s fast-fashion brand, just enjoyed its 3rd-straight record year… because the 75/50 rule.The most successful entrepreneurs in America right now… are in plumbing and air-conditioning.Plus, we already know who won the election… It’s a New Jersey company that makes hats for both campaigns.$HSY $NSRGY $GPSSubscribe to our new (2nd) show… The Best Idea Yet: Wondery.fm/TheBestIdeaYetLinksEpisodes drop weekly. It’s The Best Idea Yet.—-----------------------------------------------------GET ON THE POD: Submit a shoutout or fact: https://tboypod.com/shoutouts FOR MORE NICK & JACK: Newsletter: https://tboypod.com/newsletter Connect with Nick: https://www.linkedin.com/in/nicolas-martell/ Connect with Jack: https://www.linkedin.com/in/jack-crivici-kramer/ SOCIALS:Instagram: https://www.instagram.com/tboypod TikTok: https://www.tiktok.com/@tboypodYouTube: https://www.youtube.com/@tboypod Anything else: https://tboypod.com/  Hosted on Acast. See acast.com/privacy for more information.

This is Nick. This is Jack. Welcome back. It is Monday, October 21st. And today's pod, today's pod is the best one yet. This is a T-boy. The top three pop business news stories you need to know today. Martin McFly, welcome to the future, man. Great Scott. Doc Brown, if you know, you know. Where is the flux capacitor? Three stories for today's show. Jack, what have we got on the pod, man? For our first story, this Halloween, you're going to notice something different during trick-or-treating. chocolate, more gummies. Candy companies are swapping out chocolate, and that strategy goes all the way back to Napoleon. It's possible. For our second story, it's Uniclo. The Japanese fast fashion brand just enjoyed its

third straight year of record sales. Uniclo, they follow the 7550 rule. More bang, less buck. And our third and final story, the most successful entrepreneurs in America right now, they're not coders, no. They're plumbers. Plumbers. Plumbers.

heating and electrical, mom and pop businesses are Minton millionaires. And we'll tell you how they did it. But Yeties, before we hit that wonderful mix of stories, fantastic mix to kick off the week, Jack, love the mix. We are 15 days until Election Day. 15 days, Yeti's, there are just over two weeks until Election Day. But there's already someone who won, no matter who gets voted for. We already know who won the election, and the winner is Union Wear Apparel.

Okay, Jack, let's explain. Because Union Wear Apparel is based in New Jersey, and they make hats. But here's the key. Union Wear Apparel makes hats for both candidates. They make hats for both Kamala Harris and Donald Trump. Unionware, they've made a Trump MAGA hat, and they've made Harris Wall's camo hats. They make baseball hats for the entire political spectrum. This company is pumping out 5,000 hats every day during campaign season.

We're talking two million hats in just the last year. They're selling hats left and right. Right. Literally. In fact, Unionware has been doing political hats since 1992. They were founded by a Wharton MBA who strategically noticed that politicians love baseball hats. And politically, these politicians want to support unionized workforces. Union-made hats. They're both union-made and made in the USA.

It's all in the name. We've said that to find your value, you have to find your monopoly. Well, Jack, Union-made campaign hats? It feels like they found their monopoly, man. Yetis, make sure to vote early or vote on Election Day, November 5th. I actually already got my ballot, already voted. I already got my ballot, too. Haven't voted yet.

But in a way, we already know who won the election, don't we, Jack? This New Jersey hat company, apparently. It's a hat company in New Jersey. They're making hats left and right. Literally. Let's in our three stars. Fifteen years before this song, two boys from the Northeast met in the dawn. They had an idea to cause a cultural storm.

It's the best one yet, but the best is a norm. Jack Nick, that's it. I don't even think they need to practice. 50% that's a fat tip. Tea Boy City on your at list. If you know, you know, because we're ready to go. We can't wait no more. So just start the show.

Start the show. First, a quick word from our sponsor. For our first story. The new candy trend you're going to see this Halloween. It's less chocolate, more gummies. And the reason for this gummy swap actually goes back to Emperor Napoleon. All right, Jack, I don't want to talk about it, but we're kind of going to talk about it. What is the big trend we're all dealing with this year?

Chocolate is a luxury product. Yeah, chocolate stocks and now luxury stocks. Like, Hershey's is the new Hermaze. Because cocoa prices quadrupled in 2023 to an all-time high record price. Your chocolate bar was becoming your gold bar. You're going to sit on that. That's your new nest egg, Jack. And here's why. 75% of the world's cocoa bean growth happens in just four West African countries.

What happened there, Jack? El Nino Weather crushed the harvest and killed the supply of cocoa necessary to make chocolate. So, Coco prices jumped off and honestly, Jack, my best performing asset this year, it's a Kit Kat bar that I left under my bed. It's like a reverse tooth fairy situation. You put the candy under your bed. I can retire early thanks to the Kit Kat bar. In the meantime, Yetis, American consumers, they would explode if Hershey quadrupled its prices. So instead, candy companies have pivoted just before this year's Halloween. And here's what they're doing. They're swapping chocolate for other ingredients. Some chocolate bars are just going really heavy on the nuts this year. Yeah, what did you tell me earlier? Ammon Joy is just a bag of almonds these days. But the bigger trend is that candy companies are redirecting consumers away from chocolate to gummies.

So if you're trick-or-treating this year, expect to see more candy corn, more sour-patch kids, more Swedish fish. No, I'm sick of the Swedish fish. I'm off the fish. Even Hershey's, the King of Coco, launched a new gummy just in time for this year's spooky season. It's called the shackalicious XL gummy, and there's not a bit of chocolate in sight. But there is Shaquille O'Neal's face, which is huge. But yet, here's why Jack and I got fascinated by this story. We study history, and we noticed a connection here. This is an awesome twist.

Chocolate swapping goes back to an early 19th century European war. Okay, Jack, let's set the scene. Take us over to Northern Italy, please. Piedmont, Italy. Up near Switzerland, it's in the European Alps. This place has loved chocolate for centuries. One could say they were cocoa afford a chocolate. Yeties. But in 1806, Emperor Napoleon of France launched a blockade of all of continental Europe. So Northern Italians couldn't get the cocoa beans they need to make chocolate because of a blockade from Napoleon. Well, Jack, what did those enterprising Northern Italians do instead? They turned to the one resource they had plenty of.

of nuts. Nuts. That's right. Italian started mixing hazelnuts with the little bit of chocolate they still had to make it go further 200 years ago. So 200 years ago, roasted hazelnuts was the chocolate substitute. Today, it's gummy bears that are the substitute. And Napoleon didn't realize it, but his continental blockade two centuries ago,

it forever changed an entire industry. Because of our takeaway. This is wild. Little guy, big impact. So Jack, what's the takeaway for our budget? is over in the candy industry. This isn't swapflation. It's a swap grade.

And it resulted in Nutella. Now Yeti's swapflation, it's usually a bad thing. Like companies trade out high quality ingredients for cheaper ones. No one's a fan of that. But sometimes being forced to swap ingredients can result in something new and amazing. It can result in an innovation like Toblerone bars, Ritter Wafers, Nutella chocolate spread. They are all descendants. of that legendary chocolate shortage.

That's right. Nutella comes from hazelnut's sugar and a tiny bit of cocoa. It's just a little, little bit, actually. The Italians were forced to innovate 200 years ago, and they created what would become Nutella. They whipped up the hazelnut recipe during the Napoleonic blockades of 1806.

And that brilliant recipe is what I fed my son. I mixed it into his oatmeal this morning, so we'd actually eat the oatmeal. And you fed it to me, too, when I visited you. I can't get enough. Yeties, Jack and I would call it a swap. It's a swap, that's an upgrade. Because necessity is the mother of innovation.

And sometimes a swapflation situation results in a swap grade. For our second story, Uniclo. The Japanese fast fashion brand just had another record year. Its revenues are booming because of a bang for your buck strategy. And we call it the 7550. Now, Jack, I wasn't in the delivery room and you weren't either. But if Zara and Patagonia had a baby, they probably would have named it Uniclo. Uniclo.

They probably just moved into your local mall and the place that Express used to be. Yeah, Unicle. It's affordable but functional. It's like the North Face, but you definitely shouldn't wear it if you're going to the North Pole. Unicloat was actually born out of World War II. They started as a men's shop in Hiroshima, Japan, after the bomb. Now, interesting detail we noticed in our research. The name of this company in English originally was unique clothing store.

which they shortened to unique clothing, which got shortened to Uniclo. This brand didn't leave Japan for 50 years, but now it's become the third largest fashion retailer on earth. Sit down, stand up, and head back to the dressing room. They are bigger than every other fashion brand on Earth, except for two Uniclo. My brother, Teddy, was wearing Uniclo all last weekend when I saw him.

I mean, he's an early dad fluencer job. He checks out. He really is. I like this for him. I like this for him. But here's the news. Yetis. While Uniclo's rivals are struggling, Uniclo just had its best year ever. In fact, it's third straight record year. Growth is actually accelerating. Revenues doubled this past summer from the

year before, which is crazy growth for a clothing company. That's insane. Now, part of the reason here is Uniclo just hired the same woman who designed Megan Markle's wedding dress. So Uniclo, they're kind of, you know, they're New York Fashion Week these days. Wide-leg denim trousers. And those led to the sushi-grade results from this past summer. Uniclo's earnings report, it was sushi grade. But the best way to explain Uniclo's success is with a Michael Jordan quote. Yeah, Michael Jordan, we noticed. One said, without fundamentals, your game falls apart.

And we think that applies to Uniclo. Because tastes change and fashion changes. That's why Uniclo doesn't do weekly drops like H&M and Zah do. We're actually not sure why Uniclo is technically considered fast fashion because they've actually slowed things down more than their competitors have. They stick to the old school fashion calendar of one drop every seasonal quarter. Uniclo doesn't try to blast out the latest trend, you know, with the leopard print, whatever. Instead, they focus on the essentials.

That's their core product. Their highest selling products are white teas, gray sweats, and blue hats. And Jack's brother tends to wear white teas, gray sweats, and blue hats. Because customers always need those. things. They're wardrobe staples that are reliable for a long-term business. Yes, they are. And that's why Uniclo focuses on the fundamentals. It worked for Michael. It's working for Uniclo. And it's working for Teddy. What's the takeaway for our buddies over at Uniclo? Uniclo follows the 7550 rule. 75% of the quality for 50% of the price. Yeties, more bang for your buck. That is a timeless value proposition. You don't have to be

the highest quality, you're not the lowest price either. You're just good value for the price. But it's actually a very nuanced way to do it. Uniclo isn't trying to be the best brand, but they're also not trying to be the cheapest brand. They're trying to thread the needle of being almost as good as those really legit brands, really close, but for a significantly lower price. Not even that close. And it's working. And we've seen this strategy before, right, Jack? We've seen it with the Gap and Old Navy. When the Gap launched the Old Navy, They tried to be 75% of the value of the Gap, but for 50% of the price. And you know what? It worked.

The Old Navy continues to be the Gap's best performing brand. In fact, Old Navy makes three times as much revenue now than the Gap. That is wild. Yes, it is. And Uniclo, they have found that sweet spot too, with the rule of 7550. Now a quick word from our sponsor. For our third and final story, the hottest industry. for mergers and acquisitions right now, it's HVAC, heating, ventilation, and air conditioner.

There's entrepreneurs in that industry selling for millions. And we'll explain why that's a fantastic thing. But first, Jack, full disclosure, I've never actually changed the tire. What about a spare tire? I don't really understand what you're talking about right now. I'm actually kind of confused. But that is why I'm still confident to make this statement. Plumbers are the coders of the physical world.

And venture capital is finally paying attention. You know what you need to change a tire? You need a jack. I call AAA, that's what I do. Yeties for a century, we have relied on plumbers, heating guys, and air conditioning people to fix our stuff. These are blue-collar workers. And they finally got the recognition during the pandemic as essential workers. Well, recently, big money managers have realized that an essential business?

It's a profitable business. No offense to bend the Bitcoin, but crypto, still not exactly essential. So in the past two years, private equity has been buying up a whole bunch of essential businesses. In fact, in just the last two years, 800 heating, ventilation, and air conditioning companies have been acquired by private equity. We're talking about 800 mom and pop businesses sold to PE in the last couple years. Heating, air conditioning, plumbing, electrical, small town business owners getting paid a million dollar payouts. Plumbers in Pittsburgh air conditioners in Atlantic City. That was quick. Was that on the spot? Unlike my tire skills? Yes, Jack. Yeties, Jack and I noticed this article in the Wall Street Journal. They interviewed two entrepreneurs who recently sold their heating, cooling, and ventilation companies, and I was curious. One of those companies was 12 years old, had 18 people on staff, and was generating $3 million a year, fixing air conditioning down in Arizona. Another company was 65 years old in that same industry doing $30 million a year in revenue. Now, both of those,

companies sold to the same PE firm that then merged the two and have quickly doubled the combined company in revenue. And here's why Jack and I got curious. Often, private equity simply jacks up the prices after they buy a smaller business, which, you know, it's bad for us consumers. But this private equity firm invested in this air conditioning company. Yes, they did. They bought new vans. They budgeted to recruit new workers. They updated the booking system. They basically modernized the entire air conditioner business. And they kept the previous owners involved. That's key. Those previous owners are now millionaires because they sold their companies, but they remain on staff and they remain minority owners. So they got skin in the game and they can keep advising the company. So they doubled

revenue for this AC company, not by doubling prices, but by growing the business to serve more customers. And Jack, what's the best part of all these big money sales in these totally shocking industries? They motivate somebody to start their own AC business so they can sell. sell out someday too. Pause the pod Jack. I think we need to buy some plungers and start a side hustle. So Jack, what's the takeaway for our buddies who are everyone in an essential industry? Exits lead to entrances. Yeah, it is, we've all typecast the typical entrepreneur as a Stanford grad who knows how to code and raised big money in the Bay Area. But that's unattainable for 99% of us. This story is a reminder that there's a much more attainable route to entrepreneurial success. Bessie, you don't need to move to San Francisco and raise venture capital money.

You could start an essential business right in your hometown. Across America, we have a shortage of essential blue-collar businesses, like heating, ventilation, air conditioning, plumbing, electrical. And maybe these million-dollar success stories as they get publicity, they will inspire young people to start similar, much-needed businesses. Those young people could get certified in a trade, buy a van, buy some equipment, boom, in 10 years, you could be a millionaire. So plumber millionaires, they are a modern, very big.

of the American dream that just doesn't get enough attention. They're not getting a show on Apple TV Plus like we worked in. So Jack and I were glad that these hardworking business owners to get in the huge paydays that they've earned. Because big exits lead to big entrances. Jack, could you whip up the takeaways for us to kick off the week? Today, a chocolate shortage is resulting in more gummy candies. 200 years ago, a chocolate shortage resulted in Nutella.

Sometimes it's swapped flation, but sometimes it's a swap grade. It's a swap grade. It's a swap grade. Total swap grade. For our second story, it's Uniclo. They just enjoyed their fastest sales growth yet, and a third straight record year. It's all thanks to Uniclo's 75-50 rule, 75% of the quality, but for 50% of the price.

And our third and final story, mom and pop blue-collar businesses are selling to private equity for millions of dollars each. Plumbers! They're making big bucks, and we love it, because big exits lead to big entrances. But Yeties, this pod's not over. yet. Here's what else you need to know today. First, Ferrari just unveiled their most expensive car ever. The Ferrari F80 is going to cost you $4 million. $1,200 horsepower. Hybrid engine, only 799 of these these will be made. The top speed is 217 miles per hour, which is fantastic because you're never even going to drive half that fast. I know. Top speeds are so dumb. I'm going to need someone to help me change that tire check. And second, Sam, all

his side hustle company, WorldCoin, has just changed their name and their big implications. WorldCoin is all about verifying human's identities in the world of artificial intelligence. But they tossed coin into the name because crypto was like really super cool two years ago in particular. Now they're just calling it World, which better reflects their mission of human ID verification. And finally, in the most unlikely collaboration of the year, NASA is partnering with Prada on spacesuits. The next mission to the moon happens in 2026 using a SpaceX spaceship. Next mission to the moon will happen in a Prada designed spacesuit.

If we encounter extraterrestrials, we might as well do it. Looking good. Those Martians are pretty judgmental, Jack. Sorry, I'm not wearing red. Now time for the best fact yet. This one sent in by Alex over in New York City. Last week, we covered a story that the Tokyo subway was having an IPO. It was a Japanese subway IPO, but Alex contends that the best subway in the world is actually

in Copenhagen Denmark. Because the Copenhagen metro system is self-driving, which is wild. And it runs 24-7-365, which is one of the only few in the world to do so. I guess it makes sense to be self-driving, because you only go forward and backwards. Like, you don't turn left or right, really, do you? Feels like they can handle this one. But the wildest part is that the Copenhagen subway operates on the honor system. They don't have turnstiles. They don't have gates. You don't have to show that you paid for the turnstile to let you in. You just go and come and go as you please. Sometimes there's a plainclose officer who may check you for your ticket, but true, yes, you better have paid. Don't abuse the system. But if you're listening to this pod in Denmark right now, enjoy the ride.

Yeties, you'll look fantastic to kick off the week, Jack. You're glowing over there, man. Thank you, Nick. You're welcome. You're quite welcome, Jack. I needed that to start the week. wanted to give it to you. But besties, Jack and I got a surprise for you tomorrow. We're launching our second episode of The Best Idea Yet, our brand new weekly show. Here's a hint for what episode two is all about. What do these three things have in common? Popeye the Sailor Man, ramen noodles, and a banana peel. Those are all key plot points in episode two of the best idea yet. The untold origin stories of the products you're obsessed with. We got a link in the episode description so you should subscribe right now. We'll reveal episode two tomorrow and we'll see you on TV.

And before we go, a legendary shout out to Yeti Jonathan Darmus who just got engaged to O'Dallis in Boston just outside Boston after six years of a lovely relationship. Happy anniversary to Alexander and Francis Relich. Down in Arizona, many more to come. And Larry and Tara Argueo are turning 24 years of marriage into a celebration and five years of their cleaning. business, a fresh palette in Minnesota. Congratulations, guys. And a shout out to Vinnie Sabatino, who is an all-star host on Turro. He's got a huge fandom down in Florida. Yes, he does. And Ivan Oaks heard our show last week about Uber, Jack, and he thinks Uber and Airbnb should merge to create the ultimate travel super app. We basically agree. We'll take that. And a happy 30th birthday

to Kaylee Hines down in Phoenix, Arizona, entering her 30s feeling and looking fantastic. Happy birthday to Dill Naki, the space cowboy down in Dallas. And to anyone else, celebrate something today, make it a T-boy. Celebrate the wins. This is Jack. Nick and I both own stock of Apple and Airbnb.