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How a hair-care company went from salon supplier to sanitizer powerhouse



When AG Hair moved into its new, 70,000-sq.-foot, state-of-the-art manufacturing facility in Coquitlam, B.C., two years ago, it was part of a plan to supercharge expansion of its hair care product line to salons in international markets. Europe was next on its list. Then COVID-19 hit.

Not only was the European expansion put on hold, but salons in major markets across Canada and the United States were temporarily closed. Very few were purchasing hair products, so manufacturing was halted in mid-March, leaving most of the company’s 82 employees out of work.

AG Hair could have waited out the pandemic but instead decided to lean into its entrepreneurial culture and make a sharp pivot. It began providing hand-sanitizing products for front-line health-care workers, addressing a global shortage.

“We realized there was this massive need for health-care professionals, and we wanted to make a difference and be able to provide them with the products they needed,” says AG Hair CEO Graham Fraser.

AG Hair received Canadian and U.S. approvals a week after applying for the licences needed to make sanitizer, and produced samples to show local authorities within 48 hours.

AG Hair’s Coquitlam facility has pivoted to making hand sanitizer (Photograph by Alana Paterson)

“That rapid response time, and the fact that we had gone through all of the Health Canada regulatory hurdles, showed [the local health authorities] that we were a partner they could trust and someone they could look to, to deliver the products they needed,” Fraser says.

Within a month, the company started pumping out the products, first for the health-care industry, then for consumers on its own website and on Amazon. About 10 per cent of AG Hair’s hand-sanitizer production also went to people in need, as identified by organizations such as United Way.

Parallel 49 Brewing Company is also using AG Hair’s Coquitlam manufacturing facility to produce its own blend of liquid hand sanitizer for front-line health and emergency workers, in partnership with the B.C. government.

Fraser credits his team for its energy and creativity in making the hand-sanitizer production happen, and helping put AG Hair staff back to work.

“We realized we had an opportunity . . . and then it became this incredible, almost war-room mentality and collaboration with our owners, our executive team and our people to say, ‘How are we going to get through this?’ ” Fraser recalls. “I think our success speaks to the type of people we have and the entrepreneurial spirit of pursuing every avenue we have, understanding how we can produce the products and making it happen.”

AG Hair’s commitment to investing in future growth is a big part of what makes it a Best Managed company, says Nicole Coleman, a partner at Deloitte and co-lead of its Best Managed Program in B.C.

“Capability and innovation come through quite strongly with this company,” says Coleman, who is also AG Hair’s coach at Deloitte. “I don’t think they would be able to pivot as quickly if they weren’t so strategic and had the internal capabilities to do it.”

The manufacturing facility was a big investment, but one Coleman says has already paid dividends.

“They were looking forward with a strategic plan in mind about future growth and how they could expand, rather than just focusing on the day to day,” she says. “Best Managed companies are always pushing the envelope and are conscious about planning for the future.”

AG Hair was founded in Vancouver in 1989 by hairstylist John Davis and graphic artist Lotte Davis. The husband-and-wife team began bottling hair products in their basement and selling them direct to salons from the back of a station wagon.

The company eventually moved its manufacturing off-site, to a third party. One day, John went to watch the operations and was surprised to see salt being poured into the mixture. Although he was told salt is commonly used as a thickener, he didn’t like the potential side effects of dry hair and skin.

It was at that moment John decided the company would oversee its own manufacturing. “Through that experience, John also became an expert in product development,” says Fraser, who came to the company in 2000 as director of sales.

After having worked for more than two decades at PepsiCo and Kraft Foods, Fraser was eager to work at a smaller, more agile company where he felt he could help make a difference.

“It was perfect because I got to bring a lot of structure and process that I learned in those organizations, but I also learned an awful lot about being an entrepreneur from John and Lotte: that sense of urgency, the decision-making process, the need to get things done and drive things forward and pursue opportunities,” he says.

Fraser has helped drive AG Hair’s expansion into the U.S. and internationally, including Australia, Taiwan, and Central and South America. A portion of its sales go to One Girl Can, a charity founded by Lotte that provides schooling, education and mentoring for girls in sub-Saharan Africa.

Fraser also oversees the development of new, trending products, including a new deep-conditioning hair mask made with 98 per cent plant-based and natural ingredients. Hand-sanitizing spray and gel will be the latest addition to the company’s product lineup.

“We don’t see the demand [for hand-sanitizing products] going away,” he says. “As the isolation policies start to get lifted, people are going to need forms of security and protocols as they get back into regular life and work. We see there’s going to be a need for these types of products long-term.”

This article appears in print in the June 2020 issue of Maclean’s magazine with the headline, “Working out the kinks.” Subscribe to the monthly print magazine here.

The post How a hair-care company went from salon supplier to sanitizer powerhouse appeared first on Canadian Business - Your Source For Business News.

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Tesla Slumps as Battery Day Letdown Clouds $320 Billion Gain



(Bloomberg) — Tesla Inc.’s highly anticipated “Battery Day” fell short of expectations that helped fuel its $320 billion surge in market value this year, with Elon Musk outlining grandiose goals that will take time to pull off.The chief executive officer laid out a plan Tuesday to build a $25,000 car and cut battery costs in half over the next three years. Analysts said while the technology and manufacturing innovations outlined were impressive, Tesla’s valuation already reflected its ability to disrupt and investors may be let down by the lack of surprises at the much-hyped battery-showcase event.This seemed to be the case on Wednesday, as the company’s shares fell as much as 10% to $380. They were trading at $380.16 as of 2:48 p.m. in New York and are up about 360% for the year so far.“With the Battery Day in the rearview, we think there is a lack of upcoming catalysts and are cautious about demand given the recessionary environment,” Robert W. Baird’s Ben Kallo wrote in a Wednesday report naming Tesla a bearish “fresh pick.”That was echoed by Patrick Hummel, an analyst at UBS with a “neutral” rating on the stock, who said in a research note Tesla’s leadership in battery technology and costs is fully valued into the stock. “Given the high expectations into the event, we think the market will initially respond negatively to the relatively long timelines of the innovations and the lack of granularity,” he wrote.Musk, 49, said Tesla wants eventually to produce 20 million cars a year. He described a series of innovations that include using dry-electrode technology and making the battery a structural element of the car. Those incremental and longer-term advances belied expectations for a blockbuster leap forward, which Musk himself played up in the weeks leading up to the event.“The challenge with the stock is that everything they are talking about is three years away,” said Gene Munster, managing director of Loup Ventures. “I think traditional auto is in an even tighter spot, but Tesla investors want this tomorrow.”Vertical-integration improvements — from making its own battery cells on a pilot line at its factory in Fremont, California, to owning rights to a lithium clay deposit in Nevada — are designed to allow Tesla to cut costs and offer a cheap car as soon as 2023.“This has always been our dream from the very beginning,” Musk said at the event focused on Tesla’s battery technology. “In about three years from now, we are confident we can make a compelling $25,000 electric vehicle that is also fully autonomous.”Halving Battery CostsMusk is teasing prospects for a cheaper mystery model without ever having really delivered on the $35,000 price point he had long promised for the Model 3. Three years after Tesla started taking orders for the car in early 2016, the CEO announced plans to close most of Tesla’s stores as a cost-saving measure, allowing him to offer the car at that cost. He backtracked 10 days later, and the cheapest Model 3 available now is $37,990.Making a truly mass-market electric car and boosting Tesla’s current annual production to 20 million cars will require vastly more batteries than are currently being produced from a handful of suppliers around the world. So Musk plans to expand global capacity by manufacturing battery cells in-house to supplement what it can buy.“Today’s batteries can’t scale fast enough,” said Musk, who is driven in part by the need to find sustainable energy sources. “There’s a clear path to success but a ton of work to do.” Musk said the gasoline-powered internal-combustion engine will one day be obsolete.Musk described an “incredible series of innovations with varying levels of difficulty,” said Venkat Viswanathan, a battery expert at Carnegie Mellon University. While battery-manufacturing advances are feasible and deliverable in the three-year time frame, Viswanathan thinks that chemistry developments will take a longer.If the planned innovations pay off, vehicle range could increase 54%, cost could decrease 56% and investment in gigafactories could decline 69%, said Andrew Baglino, Tesla’s senior vice president for powertrain and energy engineering.BloombergNEF estimates Tesla’s pack prices were $128/kWh in 2019. A 56% cost reduction would bring prices down to $56/kWh. In addition to the pilot line for battery-cell production in Fremont, and Musk said the company also will make cells at the factory that is under construction in Berlin.Battery Cell ‘Leap’Most global automakers have shied away from making their own battery cells, citing the high investment costs and their lack of expertise in an industry dominated mostly by Asian electronics manufactures such as Panasonic Corp. and LG Chem Ltd.Musk said in a tweet Monday that Tesla will need to start producing its own battery cells to support its various products, even as it ramps up purchases from outside suppliers. He wrote that the company expects significant shortages of cells in 2022 and beyond unless it ramps up output of its own.“I’m really surprised that they’re taking that leap themselves,” said Tony Posawatz, a consultant who led development of General Motors Co.’s plug-in hybrid Chevrolet Volt and now sits on the board of Lucid Motors Inc., a Tesla rival. “I think this is going to be a bit harder than what they think, and I don’t think we’ll see a lot of volume out of that for quite some time.”Tesla’s most important and long-standing partner on batteries is Osaka-based Panasonic, but it also has smaller-scale agreements with Contemporary Amperex Technology Co., or CATL, in China’s Fujian province and South Korea’s LG Chem.Read more: LG Chem, Panasonic Slide as Tesla Looks to Lower Battery CostsThe highly technical Battery Day presentation included several nuggets of news that were overshadowed by the talk of cathodes and electrolytes. One example: The “Plaid” version of the Model S sedan — with a range of 520 miles — is now available to order, though the vehicle isn’t expected to go on sales until late 2021.Tuesday’s three-hour event began with the annual shareholder meeting, held outside to allow for social distancing. Shareholders sat in Tesla cars in a parking lot, beeping loudly instead of cheering as Musk spoke.Investors voted to re-elect Musk and chairman Robyn Denholm to the board and voted against resolutions that would have required more transparency about human rights in the supply chain and the use of arbitration with employees. One shareholder resolution, which requires Tesla to adopt a simple majority vote, did pass.Musk told shareholders he expects to see deliveries grow on the order of 30% to 40% this year, reaffirming Tesla’s forecast at a time when automakers are struggling to recover from the coronavirus pandemic. “While the rest of the industry has gone down, Tesla has gone up,” he said.Tesla has said it anticipates delivering 500,000 vehicles in 2020, up about 36% from 2019. In July, the electric-car maker said achieving that goal would be “more difficult” due to a pandemic-related production shutdown early in the year. Global sales are projected to drop about 17% this year to 75 million from 90 million last year, according to research firm LMC Automotive.(Updates stock performance in third paragraph)For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.

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The Census is due in a week. What happens if it’s incomplete?



Amid congressional debate over a new Supreme Court justice and a second COVID stimulus package, Washington is faced with another divisive challenge: the race to complete the 2020 Census by its now-shortened deadline of Sept. 30.

The Census shouldn’t be a partisan issue. Many on both sides of the aisle recognize the importance of successfully completing the once-a-decade national headcount that determines the number of House seats, the apportionment of $1.5 trillion in federal funding, infrastructure planning, and so on. President Trump initially agreed with this, urging Congress in April to pass a 120-day extension on the legal deadlines in light of the growing public health crisis. But in July, the administration abruptly changed its stance, around the same time Trump issued a now-court-blocked memorandum to exclude undocumented immigrants from the apportionment count.

The Census deadline has since been cut short one month from the previously approved plan of Oct. 31. Recent Republican proposals for coronavirus relief included $448 million in funding for the Census but no additional time to conduct the survey. On Monday, the Inspector General’s office at the U.S. Department of Commerce—tasked with overseeing the Census Bureau—released a report stating “the accelerated schedule increases the risks to obtaining a complete and accurate 2020 Census.”

What happens if the Census doesn’t reach its target of reporting 99% of the population ahead of the deadline? According to the report, not even “senior Bureau officials know what will occur.” The report adds that if the goal isn’t reached, it must be decided to either continue data collection after the deadline—or use the data it has already collected for decision-making.

“There are risks either way,” the report states. “If data collection ends before 99% completeness is met in every state, the Bureau will not achieve what it views as an acceptable level of accuracy and completeness. But, if data collection extends beyond Sept. 30, 2020, that will either further condense an already compressed schedule for data processing—which carries its own risks—or the Bureau will miss the December 31, 2019, statutory deadline,” (the date in which the numbers must be presented to the President).

Additionally, internal Bureau emails and memos shared between senior officials—released last weekend due to a federal lawsuit in California—state that shortening the collection deadline down to Sept. 30 to meet the Dec. 31 statutory deadline “will result in a census that has fatal data quality flaws that are unacceptable for a Constitutionally-mandated national activity.”

Attorneys for the Justice Department, according to NPR, maintain that Congress is the only authority that can step in and resolve the problem. But legislation has failed to pick up steam thus far, despite a recent bipartisan Senate effort to push the tallying deadline back to Oct. 31. It remains to be seen if any such legislation will pick up momentum in time; Congress is currently attempting to find agreement on another COVID stimulus package ahead of break in early October.

On Tuesday, the Bureau reported that more than 95% of U.S. households have been tallied so far in the Census. Roughly 30% were counted from field Census takers, while 66% of respondents submitted information online or via phone or mail. Still, 17 states currently lag behind a 95% total response rate, which Census officials clearly believe is enough to dramatically skew the results of the effort. Louisiana, Montana, and Alabama have the worst rates of response at 90.4%, 90.3%, and 89.1%, respectively. West Virginia, Idaho, and Hawaii sit at the top with 99.8%, 99.8%, and 99.5%, respectively.

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PSEi flat as market anticipates new restrictions



By Denise A. Valdez, Senior Reporter

PHILIPPINE SHARES continued moving sideways on Wednesday as investors started taking into consideration the expiration of current quarantine measures in the country towards the end of the month.

The benchmark Philippine Stock Exchange index (PSEi) closed flat, shedding 1.56 points or 0.02% to end at 5,892.72. The broader all shares index was, likewise, flat, posting a 1.21-point or 0.03% uptick to 3,545.14.

The main driver of sentiment remains to be the coronavirus disease 2019 (COVID-19) situation in Europe, where cases have surged in the past days, said Darren T. Pangan, trader at Timson Securities, Inc.

COVID-19 cases in Europe swelled 5,331 to 4.54 million as of Wednesday, prompting new restrictions to contain the fresh virus outbreak in the region. Britain has announced tighter restrictions on Tuesday, which Prime Minister Boris Johnson said may last up to six months.

“Locally, investors may be weighing the government’s decision on the quarantine measures to be enforced after the month of September,” Mr. Pangan said in a text message.

The relaxed quarantine restrictions currently in place in Metro Manila and nearby cities are set to last until the end of the month. By October, the government will announce a new set of restrictions, which may tighten, relax or maintain current protocols.

“The general sentiment remains cautious, despite the daily improvement in economic activity. There is some concern that without additional mobility, with the easing of restrictions on public transportation as well as reopening of tourism focused industries, economic activity may be at its peak,” AAA Southeast Equities, Inc. Research Head Christopher John Mangun said in an e-mail.

Timson Securities’ Mr. Pangan said the PSEi’s nearest support area is 5,750, and resistance is 6,100. AAA Southeast Equities’ Mr. Mangun expects the PSEi to continue lower in the remaining two days of the week.

Four of six sectoral indices recorded losses on Wednesday’s closing. Mining and oil dropped 63.35 points or 1.05% to 5,944.54; services trimmed 8.69 points or 0.59% to 1,446.72; property lost 10.62 points or 0.38% to 2,733.81; and financials dipped 0.07 point or less than a percent to 1,142.48.

The two gainers were industrials and holding firms. Industrials improved 68.46 points or 0.87% to 7,872.45, while holding firms picked up 11.63 points or 0.18% to 6,158.34 at the end of session.

Value turnover slipped to P4.45 billion on Wednesday from P4.63 billion the previous day. Some 1.47 billion issues switched hands.

Advancers beat decliners by two, 92 against 90, while 56 names ended unchanged.

Foreign investors were net sellers for the ninth straight day, but net outflows declined to P95.86 million from P655.13 million the previous day.

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