Political Uncertainty Puts Freeze on Small Businesses

Very Good Wall Street Journal Article about why small businesses are not hiring or may be laying off. Think this is a common reason businesses are not taking advantage of the economy to expand market share. The uncertainty of the new health care costs, increasing taxes in 2010 when the Bush tax cuts expire, and political new taxes like Cap and Trade are causing businesses to hold on to cash. The recovery may be slow in the current situation until some direction is clearly coming from Washington.
http://online.wsj.com/article/SB125659324579108943.html
The leaders who can see a way to expand their businesses will be rewarded when the recession ends. How can you affordability grow your business market share now? Your customers will thank you.
Steve Amos

Energy prices have resumed rising

The price of oil is going up and there are several questions why.Oil storage are full and full tankers are sitting outside our harbors. Due to supply, prices should be falling.

In the back of everyone mind should be the situation in Iraq. The nuts running Iraq want to dominate the middle east, and really believe they can bring their mullah back from the 13th century by destroying infidels (Israel) and spreading their religion throughout the world. Russia is not supporting sanctions against Iraq, and may force Israel to attack. If that happens Iraq will mine the waterways and trap 25% of oil tankers from reaching the West. Needless to say prices should spike if this happens.

Add to that US government spending tripling our debt without any job creation. The value of the dollar is falling by design which also drives up prices of commodities. They believe it will make us able to export more, but they have not eased regulations on small businesses. Add to that small businesses are afraid what will happen with the health care bill. No wonder the economy is slow. This does not even include banks and businesses deleveraging, nor consumers reducing spending over job fears and increasing savings.

No wonder oil went from $65 to $80 in the last eight weeks. Gold has crossed $1,000 per ounce and is still rising. The dollar is still easing. Do not see anything stopping these trends in the next six months, or until the Iraq situation and health care is resolved. I bought ETF's in Gold at $950 and Oil at $65 because I expected the dollar to fall.
Steve

PS - see current MarketWatch article below about oil prices.
http://www.marketwatch.com/story/oil-falls-as-api-reports-rise-in-crude-supplies-2009-10-21

Barnes and Nobel Competes

You have to admire what Barnes and Nobel is doing these days. In a weakening economy they have chose to compete. Amazon had better look over its shoulder.

• Barnes and Nobel are offering free electronic readers for use to download. You can read electronic books on PC’s, Mac’s, iPhones, iPod touches, and Blackberries. They even give you a few classic books to get you started.
•  College textbooks are offered up to a 30% discount and with free shipping. Really important in September and January.
• B&N offer free Wi-Fi in their stores, especially the ones with a Starbucks. There is no decrease in books on the shelves, and the stores in Socal are all orderly.
• The membership program is still active with healthy discounts on books.

Would not be surprised to see them sell Sony’s reader to take more share from Amazon Kindell. Would be a natural partnership for Sony.

 

In short it is good to see well run companies innovate.
Steve

 

9/11 showed us who we can be

A very good article about the grace and warmth of people after a disaster. We are much more caring and helpful than people believe. This is from the LA Times.
http://www.latimes.com/news/opinion/la-oe-solnit11-2009sep11,0,5396972.story

Actually went to dig up the original article, and think the LA Times article was more focused (i.e. better). Here it is
Rebecca Solnit, 9/11's Living Monuments
http://www.tomdispatch.com/post/175112/rebecca_solnit_9_11_s_living_monuments

Sorry the links are not working. Copy and paste into your browser. You may have to search www.latimes.com to find the title article.

Know we are meant to be better than the self center children we started out to be. Amazing how much better we can be.
God bless,
Steve

Tough Tech Rugged Gear That Can Survive Almost Any Calamity

A fun article for your Labor day about technology that is not fragile, but meet a MIL spec for strength and durability. Fortunately my job does not require these tools.

http://www.pcworld.com/article/170706/tough_tech_rugged_gear_that_can_survive_almost_any_calamity.html?tk=nl_wbx_t_topstoryn

You may have to go to PCworld.com and search for the article title Tough Tech

After you peruse the high priced I really don't need its, go to the Essential (and Cool) Laptop Gear article to see laptop gadgets like the PLANon DocuPen Color Scanner RC805 and other elite tech gear you probably don't need... :)

http://www.pcworld.com/article/170418/essential_and_cool_laptop_gear.html

Have a great Labor day! I have to get back to working on finding more work.
Steve Amos

A peek into the future

Good article about the near future of technology.

http://www.latimes.com/business/la-fi-cover6-2009sep06,0,6494829.story
Copy and paste or just search "A peek into the future"

I love predictions. It is amazing how wrong we get them. Yet is it shows how we are trying to solve problems all the time.

Wireless electricity seems like a side effect failure, but there are great places to use it. Especially how difficult it is to run some wires. RUF seems too costly. There is a better chance for cars to use other software technologies which do not require the infrastructure.

N + 3 Aviation and Nanotechnology do seem like the future. There is a tremendous need for both of these technologies.

Just my guess about these technologies. What is yours?
Steve Amos

Health Care Analysis NY Times

Have been watching the health care debate with interest. The truth is we have had free health care provided in Los Angeles for 8 days, and the demand is immense.

We also have unemployed who can not afford the Cobra coverage provided by the company, and companies who can not afford the cost to keep all employees with high insurance prices.

I am not assured that changing the debate to health insurance care is correct. Most insurance companies work hard to keep prices affordable and I have never had any trouble beyond filling out the form.

I also see No cost containment, nor limiting litigation liabilities in the House bill. Frankly there is no sense the government is going to not expand spending tremendously beyond the initial plans.

What I would like is portability of my plan, and preexisting conditions covered. As far as what is politically possible, I really enjoyed reading intelligent commentary. I recommend:

A Public Option Isn’t a Curse, or a Cure
By RICHARD THALER
August 15, 2009

http://www.nytimes.com/2009/08/16/business/economy/16view.html?hpw

Copy and paste the link in your browser,
Steve Amos

Manufacturing Recovery?

Forbes has a good article by Joshua Zumbrun on the state of manufacturing. Needless to say my industry has been hard hit by the recession. Unemployment is up 17% in manufacturing.

However signs of a bottom are occurring. The average workweek in the sector rose from 39.4 hours to 39.8 hours from June to July. This has been falling for about a year. In addition, only 52,000 more people joined me in job hunting for manufacturing jobs. Needless to say, if it is you it feels worse.

The cash for cars program may actually get some manufacturing to increase next month. However, that should be only a short shot, and the cars that would be sold later are just coming sooner.

Read the article from the link below, and you will see the mixed message. But the trend is getting better.
Steve
http://www.forbes.com/2009/08/06/manufacturing-recession-unemployment-business-beltway-manufacturing.html

PS - Forbes is known for changing links, so you may have to search for "Manufacturing Recovery?" or Joshua Zumbrun

Microsoft Marketing and Advertising

John Dvorak has a very good article commenting on Microsoft’s advertising. (See link below) His main point is Microsoft is only advertising for lowest price versus Apple. Microsoft doesn’t sell laptops, they sell software. This is a recipe for disaster. Low price means low margins. It also means low respect and lower profits.

I much preferred the ads with the kids and adults showcasing their talents on a PC. “I am a PC” was that slogan. It at least showed why you want a PC.

Not sure the advertising was working. Apple makes superior hardware with software that is convenient to use. Look at how easy it is to integrate your iPhone and iPod with your Mac. All these affordable apps make owning and synchronizing multiple machines easy so your time is productively spent.

Now Microsoft is no slouch in software. Apple is now able to make us of multi-core chips. Microsoft developed this capability with multi-core chips three years ago (more or less). Second the biggest U.S. gains in productivity came when businesses starting using Microsoft Windows machines with Office. How many businesses have not used this combination? Microsoft is still superior for large corporations. Their server and pc software is productive to manage for IT. They improve and service their customers well. Updates are ready regularly to keep your computer safe and sound.

Microsoft is not the greatest innovator for software. Others often came up with ideas how to use computors. Microsoft is the integrator of software supreme. Buy what you need, and Microsoft will take care of you. Really when you look at their marketing for many years they were leaps ahead of any competitors. Who else would a business work with?

When Microsoft focuses on business benefits and advantages for small pc owners and business they market successfully. What advantages? How about more programs for any purpose available. Why does Apple offer programs to mimic Windows? Because you can’t get everything for a Mac. My business card scanner is one application that won’t transfer to a Mac. In fact even though Apple offers compatible programs to Office, most small business owners will buy Office for the Mac just to make sure.

Let’s get back to your business. How are you Marketing and Advertising Your Business? Are you showcasing your advantages and benefits for your customers? Let’s focus on benefits. It is not you offer a product or service, it is how the customer benefits from buying your product or using your service. This is what you have to do for your marketing to succeed.

Also check out John Dvorak’s good article. Very good read.
Steve

Apple vs. marketing on 'best price'
http://www.marketwatch.com/story/apple-vs-marketing-on-best-price

The Bernanke Market

More commentary By ANDY KESSLER in the Wall Street Journal. Favorite line in the article: "But I think what really bothers the market is that the structural problems that got us into trouble in the first place still exist."

http://online.wsj.com/article/SB124762005061042587.html

Happy reading,
Steve

The Economy Is Even Worse Than You Think

An interesting analysis of the economy and commentary by MORTIMER ZUCKERMAN. My favorite line of the article: " So what kind of second-act stimulus should we look for? Something that might have a real multiplier effect, not a congressional wish list of pet programs. "

http://online.wsj.com/article/SB124753066246235811.html

Happy reading,
Steve

How About a Real Stimulus Plan?

Washington is now talking about another Stimulus Package. The problem is the current one has not spent the money necessary to stimulate the economy. Only 10% of the pork laden bill has been spent.

How many permanent jobs will the bill create anyway? Aren’t GAO estimates we are spending $600,000 per job created? You could give away money cheaper. Let’s not forget what this is going to cost us. Consumers eventually pay all taxes.

To create jobs we need to focus on manufacturing domestically. Businesses grow from creating real value. Services and finance grow from these bases.

Stop the Cap and Trade nonsense. It will export more jobs than create jobs. Climate change occurs naturally. Temperatures have not gone up in the last ten years. That disproves the theory that CO2 will increase temperature. Remember, temperature was much higher millions of years ago. Wasn't that the natural temperature we should go back to?

How about limiting litigation costs by capping awards? That would lower medical costs. Even better lower the costs of government regulations. Make filling out forms and information simpler for reporting. How about simplifying tax regulations so we can concentrate on serving customers?

For more jobs we need nuclear power and domestic oil production to lower our energy costs. I am okay with alternatives, but these are the lowest cost energy for transportation and electricity. What regulations have to change to allow investment?

Government building infrastructure is a worthwhile investment, but central governments do not respond quickly to needs. Government needs to be neutral to the market, or we export more jobs which slows the economy.

Let’s stop government from ruining our economy and stimulate real growth.
Steve

Advice from an Economist Who Saw 1929

Interesting article in Time commenting on the actions (stimulus) the government is taking. Good read.
Steve

http://www.time.com/time/business/article/0,8599,1909115,00.html?xid=rss-biztech-yahoo

Plastic Molders Predict Increasing Oil Prices and Report Market Conditions

Interesting report by Injection Molding magazine that covers a prediction the price of oil will be in the 90's or 100's again by the end of the year. Notable is the recommendation manufacturers convert to all electric molding machines to save energy costs.

It also reports every market using plastic injection is down except medical products. It is an interesting read on the economy by Lisa M. Pellegrino
Steve

http://www.plasticstoday.com/imm/articles/MEI0709

Oil falls for second week as demand worries return

This article comments on the falling demand versus the falling dollar. Oil is in an interesting position.
Steve

http://www.marketwatch.com/story/oil-extends-rise-above-70-in-asia-trade

Maxwell: Oil Price Forecast

Energy expert Charles Maxwell notes that because of the recession, oil supply and demand are in balance, but down the road there will not be enough supply.

http://www.moneyshow.com/video/video.asp?wid=4022&t=3&scode=009597

My conclusion, there will be more demand for domestic and international drilling starting in 2012. This may hurt President Obama's reelection campaign since the energy policy has been discouraging more drilling.
Steve

Adapt to Change – or You May Be Left Behind

Laura Rowley has a good article on change. The best advice comes from a company with 50 years of growth. Listen to the customers. Change when the customer needs something.
Listen. Change. Two actions for us to take today.

Read the article here on Yahoo Finance:
http://finance.yahoo.com/expert/article/moneyhappy/171226

Are Oil Prices Going to Continue to Rise?

Friday the market price closed at $72.25 per barrel. The price of a barrel of oil has increase 17% in the last month. Four months ago the price per barrel was around $36. Here in California, gas prices have zoomed from $2.25 per gallon to $2.85 per gallon. Just in time for the driving summer season. What is happening?

First of all, oil went too high when it zoomed past $100 to $147 per barrel. There was no economic justification for oil going up so high. Speculators drove the market too high has everyone had to buy oil to make some money. When everyone is buying the same thing, you are nearing the peak price.

Oil usage dropped rapidly as gas cost over $4 per gallon. Mileage driven went down as people drove less, bought better mileage cars or took the public transit. This is a permanent change in behavior, and lowered usage more. Of course oil supplies rose. Then the price per barrel over-corrected into the 30’s. This happened despite cuts in production by OPEC. Demand fell faster due to a global recession.

But there are multiple situations affecting price. Developing countries like China and India are buying more cars. Oil stocks have fallen to normal levels. Bio-fuels have risen to be roughly 6% of consumption. Politically the Obama administration is not supporting drilling more oil domestically. Lower prices let that slide by without much political pressure, but I expect that to be a mistake as usage will increase worldwide. The energy alternatives for the green energy do not replace oil however. They generate electricity.

OPEC desires stability. They realize now too high of prices can stall the global economy reducing demand which ruins their economies. They recently increased production about 0.5% to stabilize demand.

So what is driving the price increases? The amount of money the government is borrowing and the policies of the treasury to fight the recession. The dollar is under pressure due to the debt levels and the value of the dollar will fall as the economy recovers. The Chinese and OPEC are looking to protect themselves by diversifying away from the dollar.

So what is my prediction? Oil will stay in the $50 - $80 range this year. Expect this bubble to deflate a bit by August. $3 per gallon gas is too big of a drag on the US economy to help the global economy recover. Second this should be a slow economic recovery. Oil usage is starting at a lower consumption rate for 2009 and 2010.

Long term the falling value of the dollar will be inflationary. US energy policies with global warming taxes will hurt energy independence for the next ten years. It will be cheaper to import oil than produce it domestically. Unless an energy break through occurs, expect oil prices to rise in the years 2011 - 2013.
Steve Amos

The Myth of the Rational Buyer

How Too Much Thinking Can Hurt Your Brand

BY Mark Dziersk

Fast Company blog

A wonderful question is conventional marketing hurting sales. What if the best thing is to market emotionally to your customers. After all, what are you offering them?

http://www.fastcompany.com/blog/mark-dziersk/design-finds-you/myth-rational-buyer-how-too-much-thinking-can-hurt-your-brand

The truth is often simpler. People want what works, looks good, and give pleasure by doing what it is suppose to. How can product development be easier.

Celebrities Share Secrets of Success

Great article about a Fox News special on how to succeed. The ten rules are spot on for business and your life. Please read...

http://www.foxnews.com/story/0,2933,521421,00.html

Watch “Secrets of Success,” hosted by Uma Pemmaraju on Sunday at 2 p.m. and 2 a.m. EDT.

Search the title if the link does not work
Steve

Here is part of the article:
"Here is a list of some of the common threads they share: lessons they picked up on their own personal journeys towards what they describe as happy and fulfilled lives.

1. How You Think Is Everything. — Learn to visualize success and not failure. The phrase "You are what you think" is a powerful idea. Don’t listen to the voices that are pulling you down -- you can’t spend all your time trying to win over your critics. Run your own race.

2. It's Not About the Money — Material things are the results of success, but are not success itself. It’s great having a nice home, a six-figure salary or luxury vacations, but success isn’t measured by the dollars. It’s measured by how satisfied you feel.

3. Goals, Goal, Goals — Remember that goals must be meaningful and personal; otherwise, you won’t be inspired to achieve them.

4. Great Expectations — For something desirable to happen, you must want the event to happen, firmly believing it will occur and expecting it to take place.

5. To Fail Is to Succeed — Failure pushes you to levels you never dreamed of, and can open doors you never thought possible. See failure as a life lesson for what works and what doesn’t.

6. Dream Big — Never be afraid to follow the dreams of your heart. It’s the fuel for success. Your dreams give you the energy and inspiration to aim for an authentic life.

7. Take Responsibility — Stop expecting things to just happen without action. You need to take action to reach your goals, without blaming others for bumps or setbacks you may find along the way. Own the choices you make: Be a victor, not a victim.

8. Positive, Not Negative — If you are passionate about your dreams and goals, you’re likely to attract people who will want to support and help you. Call on them when you need encouragement or guidance.

9. Never Stop Learning — Read books, take classes, take the time to learn all you can about things that excite, motivate or inspire you. Never lose that sense of wonder or curiosity when it comes to seeking more knowledge.

10. Belief in a Higher Power — Regardless of your religion, develop a strong sense of faith in God and have a daily attitude of gratitude for what you have in this life. Believe that there is a divine purpose to your life and know that there is power in prayer."

Game Changer Pocket-Sized Robot Could Change Urban Warfare

Here is a perfect example of a game changer innovation. A successful supplier to the US military, iRobot, develops a better product that will revolutionize warfare. This is the type of innovation needed to stay on top of your business.

http://www.foxnews.com/story/0,2933,520851,00.html

If link does not work, search Foxnews for “Pocket-Sized Robot”

How can you change your market today?
Steve

Deregulation versus Regulation Failure

Really good commentary by NIALL FERGUSON on blaming the right source.

"All of these were sins of commission, not omission, by Washington, and some at least were not unrelated to the very considerable political contributions and lobbying expenditures of the financial sector. Taxpayers, therefore, should beware."
Enjoy!
http://www.nytimes.com/2009/05/17/magazine/17wwln-lede-t.html

Really enjoy reading about economics, the market and will include links in the future.
Steve

Manufacturers have not yet truly embraced what LEAN Six Sigma tells us

Good article at Industry Week. Lean Manufacturing produce to order which is a huge advantage in agility and responding to customers. The US has not fully embraced an advantage we have over suppliers across an ocean. Read "Viewpoint - Industry's New Look" below:

http://www.industryweek.com/articles/viewpoint_--_industrys_new_look_18708.aspx?ShowAll=1

There are also good webinars available on http://www.industryweek.com/
Steve

Businesses Need to Plan for the Recovery

It is about the opportunities, not the problems. We are in a good sized recession, and the uncertainty is making life difficult for business owners and managers. Orders are down as customers order smaller quantities, or no longer have demand for some products. Credit is in short supply, and cash is king.

Even worse is the drumbeat of bad news shouted from the TV, and on front pages of magazines and newspapers. They are trying to scare you to look or listen for better ratings. Hello, this is about the size of the 1982 or 1975 recession. Not the Great Depression 2 or even the end of the world.

Today is not about the fear. Business is about the relationships, especially with the customers. Business is about being better than the competition. Business is about finding our niches, and serving the customer. Business is about making a profit through service.

So what can you do differently to improve profits?

Can you offer 2 for 1? Make twice as much and lower your prices? Develop a low cost version? Add more products to sell to your customers? Redesign dated products? Bundle more services together?

What about when the recession ends? What products or services would you like to develop now to be ready for the next couple years? Who do you need or want on your team? What skills do you need to train your staff to have? Don’t you think this is the best time to prepare?

We have to be careful, but business will go on during and after the recession. Will you be ready?
Steve

Scroll down to Anticipating the Credit Crunch for more ideas to increase profits.

About the Market
Personally I am not ready to declare the bottom of the market, and it may be further off than we would like. However there are reasons to think we are closer to the end than at the beginning. Housing has already corrected about 40% from the peak of the bubble. The Dow has dropped from the $14,000’s to the low $7,000’s. For other hints see Irwin Keller’s article below.


Signs of life
Commentary: The economy's worst may be past
By Irwin Kellner, MarketWatch
Feb. 24, 2009

http://www.marketwatch.com/news/story/evidence-mounts-recessions-worst-past/story.aspx?guid=%7B71467556%2D3683%2D4018%2D906C%2D7FFC8A3F9E8C%7D&dist=TNMostRead

Note Marketwatch Links are soon broken. If the link does not work, go to
http://www.marketwatch.com/
Search for Irwin Kellner

Some businesses think big during the downturn

A great article about the companies that will succeed during and after the recession.

http://www.latimes.com/news/la-fi-expand13-2009jan13,0,4036581.story?track=ntothtml

We all need to think like this,
Steve Amos

Happy 2009!

Everyone is finally over 2008, but the economy is still a concern for most of us. Lets face it, few investors made money last year, and most of us took a substantial loss. At least my 401K has been crunched :( Thank God I am 50% cash right now, and the rest is losing money in stocks. However I focus on long term investments and good companies, so I will survive and recover.

However my predictions for 2009 are not as pessimistic as most of what you read in the media. Most of the worst effects of the recession already occurred in 2008. No one knows what will really happen, but I will make a few economic predictions like I did last year with oil prices. Warning your mileage may vary as I am limited in experience and make lots of mistakes. But it is good to present views for you to think about and analyze.

Recession: We are still going forward with the recession, and businesses are hanging on to money carefully since borrowing is so difficult. I do not expect the recession to grow into a worldwide depression. The news reports comparing us to a depression are vastly exaggerated. Most people have not experienced a serious recession since the early 1980's. We have lived through recessions before, and will survive.

Jobs: If you personally have a good job you may not feel the recession. People who are job hunting or looking for a better position will have to take more time to find a great job, and may have to take a step backward right now. It is just a delay for the good times to come. My prediction is job loses will peak early in 2009, and by the end of the year jobs will start recovering. So if you are job hunting keep persisting.

Stock Market: I suspect we are getting closer to the market bottom. I suspect we are within six months of the bottom. It may take a year, but I am looking for evidence it is time to fully invest again.

Housing: I see no bottom to the real estate market until around 2010. The over supply of home will have to be worked off the market. I expect prices to fall another 5% - 15% in 2009.

Oil prices: This was my best prediction of 2008. On January 17, 2008 I predicted oil prices would peak and fall during 2008. I thought the bubble prices were way out of line at $105 per barrel, and thought oil would fall into the $60 - $80 per barrel by the end of the year and to $40 - $60 per barrel early in 2009. My prediction was based on the long term cost of alternatives to oil were in the $40 to $60 per barrel range. In spite of the gyrations of politics, wars and speculation, I expect prices to stay in the $40 to $60 per barrel range. We might see another over correction with prices falling into the $30's per barrel with the slow economy. There is an oversupply which will be corrected over the long term.

The best advice summary: The best thing you could do is maintain a very positive attitude. This one action will help no matter the crisis's you face, and will help you reach your goals. Heck you may even succeed with your resolutions. Spend some time every morning meditating on what is good in your life, and thank God for everything. Even the challenges and problems you face.

Have a great 2009! I will no matter what.
Steve

Anticipating the Credit Crunch

Business has to adapt to the changing conditions and change your plans. Business conditions right now are transitioning into a more severe recession than expected. The shutdown and forced sales of US financial companies and banks. This is the reason for the bailout which really should be called a credit stabilization bill.

Inflation was the story at the beginning of 2008. Currently inflation is being reduced by the improving value of the US Dollar. It is not how much the US economy has improved, but the global economy has gotten worse faster than expected in Europe and Asia. Only the oil producer’s economies are doing well. The rest of the world is slowing down quicker than the US economy is.

Helping with inflation is the bursting of the bubble in commodity prices. Oil rose to a high of $145 per barrel, and now has returned to around $95 per barrel. This happened in only a few months. Oil price will be volatile depending on political and weather related interruptions, but is gradually dropping towards the $60 – 80 range in 2009. Demand for all commodities except food has dropped.

The real problem now is the credit crunch. Banks are trying to raise capital to survive, and are not giving loans they gave last year. Credit card companies are tightening their limits because of losses. This not only affects consumers, but lots of small companies use credit cards instead of a line of credit. Lines of credit are harder to get for larger businesses. Taking a second mortgage on your house is more difficult due to lower values and tightened lender requirement. These all will accelerate the credit crunch.

Keep your perspective. No recession lasts forever. There are a few steps to take right now to prepare.

Hang on to all your cash
1. Sell down inventory as low as you can. Sell excess and obsolete products by reducing prices.
2. Cancel all unnecessary expenses, subscriptions, software, and leases.
3. Sell and scrap unnecessary equipment.
4. Lease out or sell unused space. A sublet tenant can improve profits.
5. Pay credit on time and make sure your bank knows you are profitable. You need a good relationship for future credit needs.

Review your products and prices
1. Do you know which products create profit for you? What do they actually cost without overhead?
2. Increase prices or discontinue unprofitable products. Do you need all the finishes or colors? Increase prices on money losers to reduce demand, or…
3. Replace dated and noncompetitive products with new designs to improve margins. Design simpler products or combine two products to reduce cost and improve margins.

Improve your business

This is a major opportunity to improve. Focus your business on a mission. We need to serve our customers better and better. Measure your most important attributes for customer satisfaction and make sure you improve.

1. Advertise more. Stay in contact with existing customers more. Find new customers.
2. Expand by adding more products to sell existing customers. Partner with other suppliers to your customers.
3. Keep your key people and performers. It is too expensive to replace your best talent.
4. Hire better talent. Lose your weakest performers who slow down or move them to positions where they have ability. This is the best time to find the people you need to grow and be ready for the recovery.
5. Plan to grow more profitable over five years. Find new products, services, or profitable niches. Others are cutting costs only. The great companies grow more competitive.

Recessions are opportunities. Take full advantage of them for your benefit.

A Geeky Remedy For Recession Blues

Forbes has a wonderful article by Christian Lindholm about the power of design in results, and what sells in a recession. Highly recommend reading it

http://www.forbes.com/technology/2008/09/16/iphone-nokia-design-techsolutions08-enter-cx_cl_0917design.html?partner=technology_newsletter

It has been too long since I have written, so expect some new postings soon. Basically would like to comment on the economy.

Enjoy,
Steve

When Will Oil Prices Fall?

The main cause of high oil prices is political. Environment nimby’s have stopped construction of power plants with lawsuits, and punitive taxation stopped investment domestically.

No government has successfully managed an economy like a business. We have been successful letting the market determine winners. The government can sponsor research, but business has to invest. Its simple – higher taxes equal no profits and no oil.

What should we do is promote every energy source. Drill offshore, coal, natural gas, solar, hydrogen, conservation, and nuclear. Government should not pick the winners, but goal has to be energy independence.

When will oil prices fall? When the US has the will to build nuclear power plants.

Energy Independence

President Bush’s energy proposals to Congress include the right solutions to free the US from energy dependence. We need more domestic oil production, natural gas, pipelines, nuclear power, solar, grass based ethanol and to better technology to clean coal for our independence. There will be few jobs in the future without energy infrastructure, and the political risk from oil producing countries cutting our supply is substantial.

Our dollar is falling in value for because of oil imports. Oil imports were 4.9 billion barrels in 2007. Estimate $75 per barrel is $367.5 billion, or 50% of the $711.6 billion US trade deficit. We need to expand drilling off all coasts and domestic refining.

Corn based ethanol is not efficient and is causing food shortages. We need to develop cellulous (grass) base ethanol.

France generates 90% of their electricity with nuclear power. Our nuclear plants are decades old and need to be replaced for safety. Solar power will contribute in the next decade, but we need electricity at night for non polluting electric cars.

We need to balance fiscal, political and environmental responsibility in our energy policies. The US can not surrender our children’s future to imports. We need to meet our own needs domestically.

Invest in Productivity and Innovation

The economy is in a mild recession. The housing bubble has burst and is reverting to mean (normal) values. The super leverage of the 2000’s is being unwound as the investors who took the risk are paying the price of risk. There is a lot of speculation about how bad the economy will be.

We will not have a great depression. This is just a normal business cycle, unless political protectionism makes the situation worse. This cycle is predictable and expected by mature investors. There are challenges coming, but nothing to panic over.

Consumers will not be able to use their homes to use like an ATM to keep spending. Increased energy and food costs further will reduce consumer spending power. Consumers will change their spending towards different priorities for the next few years until incomes increase again. Job outsourcing globally will keep salaries low.

Consumer spending is the driver of two thirds of spending. Fortunately the world is now more successful everywhere, and increased demand is now coming from Eastern Europe, Asia, India and the Middle East. So consumer spending will recover internationally first.

So how will the economy recover? Productivity and innovation has always driven economic growth.

Invest in businesses, products or services that increase productivity. Can you lower shipping costs, use energy more efficiently, use less material in products, service clients quicker at less cost, or reduce overheads? These are the drivers of productivity. And the companies that do this are the ones to own.

Innovation and market changers are the companies that will thrive in the future. Look at Apple’s success in changing the music market. There are kids who have never bought a CDs nor albums. They buy music through iTunes. Television and movies are the next to be changed. Low cost hardware and better software has made an explosion of producing content available. With so many choices for customers, how can major studios or networks hold on to viewers? Look for distribution over the web to grow.

Computer grow exponentially more powerful, and programs now do the leg work of thousands of technicians or clerks. CAD changed how we design products, test ideas, and do research. Better quality and lower prices have come with these innovations. In fact, as the price gets lower more people have access to the power of software. Look at the success of new medical products that are improving medical care. CAD has speed up development tremendously. Furthermore the web will be replaced by cloud computing which will increase the amount of data available faster.

Invest in energy businesses that increase productivity of creating energy or conserving energy. One caveat, they must be profitable at a much lower oil prices. Energy will be the next bubble to break. $100 to 120 per barrel is not sustainable.

Oil was stuck in the $15 to $20 per barrel range for two decades. A price of $30 dollars per barrel would be reasonable today with normal inflation. The value of the dollar fell about 30% over the last two years, so $20 to $30 per barrel is now $30 to $45 per barrel. Demand will fall at the current high prices, and alternative production methods are cost effective above $30 per barrel. Both will reduce future demand for oil and lower prices. Invest only in energy processes that are cost effective at $30 - $45 per barrel. I expect oil to fall to $60 – $70 per barrel in 2009.

In summary, the future economic growth will be from productivity and innovation. Productivity and Innovation will overcome a few years of low growth or recession. This is where we need to invest for future profits.

Redefining Success

In High School success was passing your courses and graduating. Having friends, a date on Friday, and a date for the Prom are good.

In college success was still passing your courses, but more important was figuring out your major. Most of us had no experience whether we would like our career afterwards, but we choose them anyway.

After college success was getting your first job and an apartment. Friends and good times may be a priority. The adventurous take breaks and travel, while most of us tried to figure out what we are doing at work.

Next success was finding love and marriage. Success is finding a partner to love and who will love us.

Family comes after marriage. Success was buying a house or condo. As the family grows, success was getting a bigger house.

Getting promoted, or getting a better job was our next definition of success. Some will choose to be self employed instead.

At some point, the economy or business cycle changed and success was keeping our job as other were laid off.

Maybe your next success will be retiring, or maybe it was a recent success. Perhaps you will consider it a success to find part time work to keep you busy, or success is more games of golf.

While these are all fine goals, I think most are not a good definition of success with the exceptions of love and family. Let’s propose a better definition of success.

Success is when we take care of customers. Success is earning a living. Raising good children is a success. Success is when we make the world a better place.

Success is when we do for others selflessly. Success is not about us, not what we own, but about serving others. We succeed when we help. Help any way we can by either our time or money. Volunteer at charities or church. Volunteer in you schools or neighborhood. Just take action for others.

Isn’t that a better definition of success for you to live by? Change your definition of success and you can leave a better world. Then you are succeeding!

Solving the Energy Problem

Why do we want to solve the energy problem? Look at the risks of doing nothing. How much of our trade imbalance is based on oil? Oil is a significant threat to our economy and world peace.

Hugo Chavez in Venezuela has threatened to cut off oil to the US? Vladimir Putin and Russia has the power for using natural gas and oil over Europe. Iranian President Mahmoud Ahmadinejad is using oil wealth to threaten destroying Israel and potentially starting a world war against the West?

Think about the war in Iraq? The fight between the Shiites, Sunnis and Kurds is over religion, power and oil wealth. Iran, Syria and the terrorists are all interested in Iraq’s power and wealth.

How about a potential overthrow of the pro US government in Saudi Arabia? Al Qaeda was spawned under the House of Saud, and a large number of their citizens hate their government. What happens if they lose power?

Why should we continue to give money, political power, and an economic weapon to people who hate us? The current risk of supply problems is significant, and would damage our economy.

How much of our trade deficit is based on oil? The 12 months through November 2007 the US imported 3,647,889 barrels. Assuming the average price over 2007 was approximately $75 (Current prices are in the low $90’s), oil imported was approximately $273.5 billion in 2007. Our trade deficit in 2007 was $711.6 billion, making oil imports about 38% of the deficit.

To solve the oil problem, we need plans for the long term as well as the short term. This is a series of solvable projects that needs a long term vision to happen.

Short term actions:
Drill more domestic oil off all the coasts and in Alaska to cover the next decade. Everyone points to the potential for pollution. Oil drilling and transportation processes have improved dramatically over the last 50 years. The rare accidents are cleaned up quickly. Oil will always be needed for premium energy, plastics and products. The US needs to increase production.

Locate more natural gas reserves and develop pipelines to heat buildings and homes. Our infrastructure is reaching its limits, and needs expansion.

Find better ways to clean pollution from coal emissions, and require the whole world to use the technology (including China, India, Russia and developing countries) for a level playing field. China and India are causing three to ten times the pollution than the US. Why should we be held to higher unfair standards like the Kyoto protocol than the rest of the world?

About global warming:
Human caused global warming is not scientifically proved beyond a doubt. Global warming is a natural cycle with a little human contribution since the industrial revolution.

Why is a 1 degree Fahrenheit (0.5 degree Celsius) increase over 100 years traumatic? History shows a normal range of variation around 3 degrees Fahrenheit (1.7 degrees Celsius) in the last 2,000 years. Go back millions of years and the natural temperature variation is larger. The biggest factor related to global warming is the natural variation in the output from the Sun.

The fanatics are talking CO2 will destroy the world. People and animal exhale CO2. Are we talking about people and animals breathing CO2 being the main cause of a pending future natural disaster? I don’t think the world is that fragile.

If human kind is contributing less than 1% to 5% maximum of global warming, why are some panicking? Most of the research is based on computer models that are simpler than reality. These models do not work well when compared with current data. Look at the hurricane predictions from 2006 & 2007. The results missed reality going the wrong way from the faulty models. Most global warming models are based on faulty logic. The lack of good science is why I do not take global warming seriously as a panic.

Long term actions:
Generate more electricity using solar and nuclear. Solar electrical generation is finally becoming efficient enough to be cost effective. It could generate 10% of future needs as well as being pollution free. Tax incentives and private industries should be the source of solar products.

Nuclear energy is the choice of many countries including Canada, Britain, Spain and France. France generates 90% of their electricity from nuclear power. The plants in the US are aging, and need to be replaced with new, safer designs that are also more energy efficient soon. The older nuclear plants need to be retired for safety. Legal battles with environmental extremist have prevented new nuclear energy plants. We need to make nuclear power politically possible and economically feasible.

Convert hybrid cars to plug in hybrids to use less oil. This requires more electric generation from solar, coal and nuclear. Hybrids work because of the expanded range for practical transportation. Pure electric cars are too limited in distance for average commuting, and public transportation takes too much time for busy Americans to use. Most of us do not live near transportation that goes near our offices without doubling our commuting time. Time is our most valuable resource. This is why less than 3% ride public transit to work.

Create fuel cells to replace the gas engine generating electricity for hybrids. Fuel cells are getting close to being more economical for gasoline and alternative fuels like ethanol, natural gas and hydrogen.

Grow and develop grass based ethanol since corn based ethanol is too energy inefficient. Grass based ethanol generates much more energy than corn at a lower cost. We also need a pipeline system that carries ethanol. Transporting ethanol in trucks is too expensive and unreliable for extensive use.

The Results of Energy Independence Program:
A ten year program for energy independence will bring world oil back to $30 - $50 per barrel when the US stops importing oil. Dictators will have loss their income and a threat to use against the West. The possibility of war would be reduced. The American economy would improve with less trade imbalance.

The technology is there for everything proposed here. It takes a leader, political commitment, private and governmental investment, and the will to get it done. We are ready for the leadership to step up.

What Sells During a Recession?

The economy is slowing down in 2008, and this is part of a normal business cycle. The question is what should you be doing right now to get your share of business? There is no reason your business should not do well regardless of market conditions. We just have to adapt to the market and be aggressive marketing and selling.

First let’s focus on what sells during recessions. These areas do well in slow economies. So how can your business cater to the desires of your customers or consumers?

Exports sell – The recession generally lowers the dollar (already happened!) so this is the time to find products to export. The growing economies of China, India, Asia, Russia, Dubai and other petroleum wealthy countries are ideal for expanding business while you have a currency advantage. Use the value of America to sell. McDonalds and Coca Cola are great examples of exporting.

Comfort sells – people are worried about their homes, their jobs, and their family. For most people they pull in spending on big luxuries and vacations. However they replace them with familiar pleasures and little treats to make staying home more pleasant. Traditional foods, decorations, home entertainment, and health products are examples that will do well.

Value sells – money is tight, so people will hold it unless it is a good emotional or financial investment. Return on Investment and quick payback work for businesses, investors and consumers. Have features that are usable, use less energy than competitors, are green, save money, and do more for the price. Wal-Mart, Costco and Sam’s Clubs do well when people are watching their dollars. But you don’t have to be the cheapest to be a value buy. Offer guarantees and let them know they are buying a product or service that does what it says it does and performs well. Remember decisions are emotional first, then buyers justify their decision logically.

Quality sells – Ford advertised “Quality is Job 1” and it really is. People will pay for better quality. Toyota and Honda have made the best quality cars over the last twenty years, and look how their sales are worldwide. Toyota is about to be the bigger than GM.

Simplicity sells – Easy to use products and services always do better than competitors. Lower priced products and services with fewer features do well when people are being frugal. Design new versions to make a basic and simple product or service as possible. Your higher end customers will still want the old features and pay more, but get new customers into your base now and upgrade them later. Existing customers you can offer sensible upgrades and extras for more.

Luxury sells – the very wealthy are immune to slow economies unless the stock market drops precipitously. They want to impress friends and enjoy what they get. However they are less likely to buy the ostentatious instead of more subtle beauty. They don’t want to offend as much as impress. Green mansions still have cache since you look responsible, green, and have something unique compared to the merely rich in their regular McMansions. The wealthy will still travel but may justify it to themselves being combined with another purpose – “since we were in Greece on business, we visited Athens”. There are less people feeling wealthy, so you have to target and appeal to the really well off. This market is wiser about value and will negotiate more, but purchases are still emotional decisions.

Design sells – often the real decision maker between competitors is design. Better performance, distinctive appearance, new colors, fashion, different fragrances, and artistic design do sell strongly. Does the product fit the hand, easy to use, and the curves look appealing? Cadillac has recovered it name with better design products. How do the competitors look? People will pay a little more for a Target styled product than a cheaper Kmart or Wal-Mart product. They want what will impress them and their friends.

Love Sells – seriously there is no greater need for people than to love and be loved. This is where advertising has always succeeded. The original Mustang “makes it happen”, “every kiss begins with Kay” Jewelers, beer ads making you look attractive, Victoria’s Secret, and Match.com are example of how you can make it easier for romance and family. Family is often a stronger bond to support. How can you make it easier or appeal to singles and families?

Humor sells – Seriously we buy from people we like. Look at the successful Miller Lite’s ads which were making people laugh at celebrities. Some of the most famous ads were from two football players making fun of the perception football player are dumb. Playing dumb sold a lot of beer and got these guys into the movies as actors. Make sure your clients know they will have a good time with your product and service. Southwest Airlines built a great business making passengers enjoy the trip.

Novelty sells – something cute, cheap, funny and easy to talk about always sell well. A good video on YouTube.com can create insane demand. Pet Rocks with those silly directions on ‘How to Care for Your Pet Rock”, Superballs (where did mine go?), the Wallcrawlers which were funny looking octopuses that flopped down the walls, the Slinky which still fascinate kids, and the hula hoop all still sell.

Security sells – people still have desires, but with less opportunity to earn it a small percentage will take what doesn’t belong to them. Incidences of crime, especially locally, can be used that so people want to protect what they have. The tendency is already there for consumers, just get them to look at a risk they ignore to get them motivated. If you sell security advertise to your market using fear.

Advertising sells – Most businesses cut advertising first when times are tight. This is when you want to expand your advertising and take market share from competitors. Make sure to track results, and watch your budget. Negotiate better deals from your media while they are losing other business. Successful companies often expand advertising in slow economies. Save by expand internet marketing and focusing your print, radio and television advertising. Consider switching to cable television in focused markets versus broadcast ads. Send postcards instead of sale letters to save postage. Have the postcards get customers to go websites with shopping carts. Call old customers regularly. Stay in the selling mode no matter what the market is.

Follow these ideas and you may not have a recession in your business. These ideas generally work in most economies, but will work better during slow times. What can you sell now?

Business Predictions for 2008

Everyone makes a fool of themselves by predicting the future at this time of the year. So I will badly make a fool of myself by expressing my opinions on the difficult business market for 2008. Please be aware opinions do not affect the future, and your mileage will vary. So here we go…

Housing will drop big due to credit crunch. If you can’t get financing very easily, how do you buy from someone? Since it is harder to get loans, fewer buyers are available with good credit and money down to buy houses and condo. Investors buy at the value of the net income they can rent a property for, and look for bargains. Neither the lack of buyers and investors caution is good for supporting prices in housing.

Disclosure here: I have done residential and commercial real estate appraisal in California and assisted in Nevada, so actually have real estate analysis expertise. The rise in residential values ran 9 years in southern California from 1997 to 2006, and went years too far. Values could really drop back hard. Las Vegas and Arizona have already dropped prices around 30% and could go lower with so many new homes. The Inland Empire and San Diego values have dropped over 20% in 2007, so Los Angeles and Orange County are behind the curve and may fall 20% in 2008. I have predicted prices to fall off the peak 20% to 30%, and up to 50% if the economy really fell. So I tend to be regarded as pessimistic since I think the boom went far too long. Recovery should start around mid 2009 to 2010, but it is very hard to pick the bottom. If your housing prices have been falling since 2005 you are closer to the bottom than we are here in southern California.

Your area housing values will vary based on local conditions, but I expect a national average to fall by 10% without crazy loans, easy money and speculators to inflate home values. Best analysis I have read is from JP Morgan predicting land values will return to 2002 – 2003 levels, and near the east and west coasts the land may be up to 80% of home values. Location, location and location still rule when it comes to evaluating properties. Look for investment opportunities this year and in 2009.

Commercial property values will go down since it is harder to get credit here as well. It is early in this correction, locations, and property use varies so much will not predict how much values will fall. Commercial prices did not go up as crazily as they did in housing, but value depends on income and cost to borrow. A ten to twenty percent retreat would not surprise me this year in some areas.

Economy will recession early, and start the recovery before end of 2008. The credit crunch will hurt borrowing for businesses, but the hallmark of the American economy is how quickly capitalists adapt to change. China’s currency is increasing in value to the dollar, which will increase inflation as well. Consumers will cut back slightly, but most spending will continue to be stable. Styles will move away from excess to value, so imports may be hurt with higher prices of the now lower dollar. However booming economies internationally especially in India and China will improve American exports. In all, the diverse and adaptable economy will be recovering this year.

Employment will only drop mildly in the US. Finance, automobile and housing industries will be significantly hurt in 2008, but the rest of the economy should grow needing good employees. Your local conditions will vary. I will be looking for a new position in 2008, so understand personal concerns depend on your situation and industry. I expect to be with a business unit growing quickly or turning around by mid year.

Oil will fall from $90 – $100 per barrel to $60 – $70 per barrel in 2009. Politics in unstable countries can have a tremendous affect on supply making timetables hard to guess. So this is the riskiest prediction I am making. Have no special information here, but let’s look at history. Recently it took many years to go from $20 to $30 per barrel. Prices were stuck in the $15 to $20 range for over a decade. The sudden jump in oil prices from $30 to $90 per barrel happened way too quickly from a historical perspective. The cause was speculators and fears driving gains with increase international demand. The value of the dollar fell about 30% over the last few years, so $20 to $30 per barrel is now $30 to $45 per barrel. Demand will fall with current prices, and alternative sources are cost effective above $30 per barrel further reducing demand. Politics will have an effect with a president elect promising a program to reduce oil imports could speed the price reduction. Overall I expect a gradual reductions happening with jumps and falls starting in 2008.

Stock market will fall early and start recovery about mid 2008. The recovery will be mild and I like John Mauldin’s description of the “muddle through” economy. The stock market often acts as a predictor of the market and it has had a lot of growth. The question is how far we are going to correct recess or depress the market? More importantly which business sections are going to fall the most. My record here is poor historically, so do your own research. Falling should be finance companies, housing, and consumer related businesses. Everything else depends on design, innovation and value to grow businesses.

The election in November is too close to call right now. The Democrats are likely to have either Hilary or Obama, and they would be wise to have a joint ticket. Republicans have five good candidates, and possibly no one will come with a majority to the convention. Voters usually look at experience, positions, leadership and pandering. Could be another close election based on the experience of the Republican candidate versus the changes proposed by the Democrats. There is a lot of potential changes based on the economy, world events, Terrorists, Iraq and Afghanistan. In the final election the most moderate candidates between the Democrats and Republicans usually win, so that is my prediction.

Okay, this is enough predictions for me to reasonably make in 2008. Lets see how wrong I am since my record has never been perfect. Black swans events make predictions more of an art than a science. Use your own judgment about the validity of these guesses and how they may affect you.

Recommend Forbes, marketwatch.com, John Mauldin, Doug Fabian and Mark Skousen for research and information.

What To Do During 2008 Recession

Hate to be the bearer of bad news, but the credit crunch is bringing a recession to the US in 2008. If you are managing or owning a business, now is the time to plan for this year’s recession.

Are you familiar with derivatives, CDO’s, credit swaps or the subprime mortgage market? They have been the latest way banks, hedge funds, insurance companies and other investors tried to increase yields by bundling loans together. The problem is they have not properly accounted for the risk, and not enough reserves are in place for when these investments fall in value.

So people who lend money do not have enough money to lend more. Credit will increase in cost, and less will be available for business to borrow. This will slow the economy, and consumers are not able to borrow to finance more purchases.

What do we do now?
First of all keep perspective, no recession lasts forever. They are normal parts of the business cycle, and there are several steps you can do. It may be mild or a full depression, but the actions you will take are similar. You just may be forced to take more actions in the event of a depression.

Hang on to cash
If credit is hard to get, you are going have to fund expansions internally. The Stock market may not fund you, and lenders are nervous. Be prepared by watching spending and cutting overheads.

Know what makes you profit
Most people know volume of sales, but few allocate expenses fairly to each product line. It is easy to spread personnel, advertising, and overheads over all sales. It makes more sense to know which products or services cost more and what they make. Allocate almost all personnel to product lines, allocate inspectors and freight to materials, and then spread the remaining unallocated personnel and expenses over all labor and material expenses. This will show where you actually spend your resources, and how much each product or service costs. Then figure out your profit margin.

Re-price products to make a profit
Sales have to make money. Even advertising loss leaders have to increase sales to be worth doing. So evaluate which products or services create value, compare to competitors, and don’t just be the low cost provider. Less sales may make more sense for some products and services. Especially if you are losing money per sale. Price accordingly.

Kill weak products or product lines
Redesign or rationalize product lines. Let good products eat weaker products. You want products to go after competitor sales (or increase your profits), but not just because we always sold that. Can you buy someone else’s cheaper?

Design better products
Design is often the deciding factor in sales. Good design has value in attractiveness and functionality. Don’t blame the sales team for a poor product or service. Create better, faster and new services. Make products have more value. Create new looks and new markets. Growth is finding opportunities. Make sure you design to win.

Sell more to existing customers
Offer additional services and products to your existing customers. Your customers are valuable. Don’t lose them to competitors, but make yourself their partner by adding value to them a discounter can not match. Sit down and find out where their pain is. Look where you can grow servicing your best customers. Bring ideas and contacts that will grow their business. They will remember.

Find new customers
Don’t quit marketing or advertising. Find competitors to your existing customers. Especially find the young growing business that may become prime customers.

Export
The US dollar is falling in value, so find new customers in other countries. China, India, Dubai and Asia are growing in wealth so are great markets to open. Europe is now cheaper to sell to. Take advantage of your value by finding representative in these markets.

Make advertising show results
Get their attention. State your benefits clearly and believably. Get feedback. Motivate your customers to do something. Make sure your advertising is in line with your strategy.

Hire people who will contribute to bottom line
Keep your winners and make them partners. Always look for designers, engineers, sales, and leaders to make your business grow. The advantage of a recession is less competition hiring the best people.

Review your strategy
Does your current strategic plan match the changing economy? Be realistic, be opportunistic, and believe you can succeed. Others will just try to shrink their business and may hurt themselves. You can actually grow market share by being aggressive in going after business by creating value.

A recession is really just normal business. Just be focused on what needs to be done like normal, and do the hard work that gets missed when you are growing fast. Your people will overcome a recession if lead to face the problem. It is up to you to lead.

Thanksgiving Thoughts

Have been researching what to do about when business enters the recession cycle. Taking a longer than anticipated to consolidate the research into a useful article for you.

Today’s blog is about being grateful. There is so much we have to be grateful for. The country we live in, the people in our lives, and our businesses.

Be grateful for the customers and clients you already have. Be grateful for the work you do, the skills you have learned, and the benefits of working. You work with good people, benefit society, get self esteem from your business, get new challenges to stretch yourself, and your income pays for your family and life.

We waste a lot of our life on the annoyances. We focus on this has to be done, traffic was bad, this machine is broken, we have to meet on this product, the quality is bad, or other daily problems. Have you ever noticed 90 percent of business gets done without any supervision or special effort? Be grateful!

Our lives are getting better by new services and better products. Cars today are much better and safer than just 20 years ago and they continually improve. Homes use less energy. The internet is a group of great tools. Cell phones, VOIP, instant messages and email give us more freedom to travel and stay in touch. Clothes and furniture cost less. Be grateful for how much easier it is.

So enjoy your weekend, and think how much we have to be grateful for.

Self Insuring Your Home or Neighborhood

Tonight I get to unpack the car and put the important papers back in my unit. The wind has died down and I am far enough away to be safe from my local Orange County CA fire. My apartment would have likely survived because of location and construction. We do not back up to a canyon nor have woods surrounding us. But the closeness of the disaster and my cousin evacuating in San Diego has me thinking about protecting your home or business. In the western US, we have fires every year ore so.

Your home or business is a big investment. Firemen can get overwhelmed during a big fire. They can’t be everywhere. You don’t want to be one of those heroic people trying to save their property against a 50 foot wall of flames with a garden. Your life is not worth the risk. Evacuate when you are told to!

It would be great buy the right house or pick the right business building. Get a fire proof roof if possible. Tile and metal roofs are best choices. If you have a shake roof, replace it! You can get modern tiles that look like a shake roof.

You want the walls to be Stucco, Cement or Brick. These materials will resist burning best, and should be good long term investments.

View homes have wonderful appeal, and living trees are great shade for summer comfort. I want a home like this too, but fires love to climb hills and travel through treetops. Location will affect your risk.

Most homes burn from the fire getting into the attic. The fire licks the side of the house, and the embers find their way through the vents or eves. Make sure you clear brush, woodpiles, and other fuel away from the house. At least 30 to 100 feet are recommended.

Some experts recommend sealing under the overhangs. I am not sure how to let air circulate and block the embers, but this is worth investigating. Would love to hear from someone how.

Have or install a sprinkler system. Make sure the attic is covered. Water will keep the fire from expanding although I would expect some water damage.

Above is wonderful advice if you are choosing a place, but what if you already own property? So what else can you do? Invest in a fireproof foam system. The fire is nearby and you have to start packing your important papers. Close the windows and doors. Park the car in the driveway with the engine running, get out your hose and ladder and start spraying under the eves, over the walls and windows. Spray trees too close to the house, the tank on the barbecue, and any car or truck to be left behind. Leave the sprayer tool soaking in a bucket of water. Then leave as soon as you can or you are told to.

The firemen will not have to risk their lives to save you home. If the fire comes too fast, your place is still safe.

Find out more by going to the following websites:

Barricade Gel www.barricadegel.com
No Char www.nochar.com
Thermo Gel www.thermogel.com

There is some downside to these products. Your outside walls will probably discolor and the foams can remove oxidized paint. So you may wind up repainting. If the fire isn’t right there, you have to water them to keep them moist and effective. The foams are very slippery, so you have a good chance to fall while applying the foam.

Kits start around $300 and neighborhood associations can protect ten to twelve houses for $2,000 to $3,000. The chemical does age and have to be replaced.

Note: I have no financial interest, nor am receiving no reimbursement for writing this. Just want you to be aware foams are available. I heard about Barricade Gel in Florida a few years ago when visiting family in the Daytona Beach area.

Consider investing in foam to insure yourself. Who wants to lose all those memories inside?

Real Strategy Versus Planning

Too many companies do their year end planning and call it strategy. Often the discussion at these meeting is simply how to incrementally improve the business. Everyone predicts they will sell slightly more product this year. It is a good business practice to have long term resource plans, but that is not strategic business development.

Real strategy is focusing your business. Strategy is finding potential opportunities, and enabling your resources to produce and sell new products, and services to grow.

Continuing operations have to be profitable and products updated. Equally important is to discontinue or outsource products and services no longer key to your success. The important idea is to concentrate your resources where the profits are. Work less and make more.

The best opportunities are market disrupters. All innovation flows from the unexpected combination of two or more things. You need to spot and exploited a change whose time has come. Not necessarily being the first mover, but be the first to get it right.

Steve Jobs says, “I am going to wait for the next big thing." Then he develops a position to take advantage of the opportunity. Look at the iPod. Lots of people in and out of the industry knew about music downloading, and people knew that MP3 players were coming along. The music companies and the music retailers had asset positions that were being threatened, and didn’t want to act. It was not a fantastic leap of imagination into the far future. He found a set of ideas that needed to be quickly and decisively acted upon.

A value denial is a business opportunity. Every change and innovation creates new value denials. These are products or services that are both desired and feasible but are not being supplied to the market.

What makes a business unit healthy? Operating efficiently and having a good strategy. A good strategy, in turn, is one that is responsive to change and that builds, builds upon, and stretches the resources that yield competitive advantage. Be focused on going after changes.

How do you actually plan strategy? For that, you need a small group of smart people. Strategic insight is essentially the solution to a puzzle. Puzzles are solved by individuals or tight-knit teams. With big groups and complex processes you can select the better solution to the puzzle, and you can get consensus and buy-in and even commitment. But that comes later.

Start with a SWOT analysis. It is time to look at your strengths, weaknesses, opportunities and threats. Basically as a group evaluate your business internally and externally. Where do you have advantages, and where do you have to improve? What opportunities are there and what weaknesses do you have?

Write three coherent paragraphs about what is changing in your industry and why. Having to link your thoughts, giving reasons and qualifications, makes you a more careful thinker and a better communicator. No bullet points.

Other questions to ask include: Where are the profits too low? Are the margins low? Can we increase margin with a new design? Can we partner with a competitor? Does someone else do it better? Can we minimize expenses on mature products? Do we just raise prices and give up market share? Do not underestimate the inertia of buyers. Can we sell part of the business without damaging the whole unit? How will the customers react?

Speculative judgments are the essence of strategic thinking, and they can be the starting points for taking a position. Strategic thinking is essentially a substitute for having clear connections between the positions we take and their economic outcomes. You have to determine where to invest in projects with a goal.

Companies create competencies by making bets, and putting the right resources in place to develop those competencies. Companies get good at something by doing it, and that give you a sustainable advantage.

You job is to figure where your resources are best spent. The most important job of any manager is to break down a situation into challenges that subordinates can handle. Absorbs a lot of the ambiguity in the situation and gives less ambiguous problems to others. That is the heart of strategy.

This article is based on the research and studies of Richard Rumelt.

Miserable at Work

You spend massive time at work, work gives you status, your income comes from your work, the income supports your family, and most of your problems come from work.

You work with demanding customers, coworkers of all cultures, political persuasions, religions, strange foods, irritating manners, and all types bosses that range from smooth salesmen to irrational dictators.

Most people do not get fired from jobs for incompetence. They wear out their welcome. Poor attendance, regularly coming in late, leaving early or at the minute, maintaining the welcoming attitude of an ogre or at least the neighborhood grouch, and eventually being left out of the daily give and take. Job performance of course follows this attitude with missed deadlines, sloppy work, and others beginning to take over your workload.

How We Get Miserable

First of all, remember when you got the job? You wanted it, begged for it and said “Pick me, Pick me! I will do a good job.” Think how thrilled you were to get your job? Were you ecstatic? Proud? You told everyone about your new job and company.

Gradually thing are not as new and fresh. There are problems. Grumpy coworkers, complaining customers, poor suppliers, and a ton of attitude. After a while, you’re now complaining about the alarm, the commute, the grind, the workload, his mess, her perfume, the weather (even though you work inside), the politics, the decisions, the demanding customers and the boss. What don’t you complain about?

Now you are in the rut that leads to getting passed over for new assignments, raises and promotions. The downward spiral gets worse when others are getting ahead and you stay right where you are. Be honest, are you thrilled with your performance.

You can be Happy at Work

Look for where you can make a difference. How are the customers happier? How are sales increasing? What you accomplished?

Fall in love with your profession again. Read business journals, magazines, and websites. Compare your products and services with competitors and see where you can improve. The difference between top performers and the average is top performers often give 1% more. Brian Tracy points out the difference is less than you would think. Persistence, service and a little extra often make all the difference.

Mentor coworkers, especially newer employees. They will appreciate the help and you will not believe how much you learn teaching.

Create business relationships. Let other people be right. Respect their contribution and ignore their unimportant shortcomings. Who is perfect? Learn about your coworkers and find out what you can respect about them. The biggest donor to charities at a small plant I worked with was a third shift machine operator who had adopted four kids. Would have never know him if I did not volunteer to help a charity drive. Take pride in where you work, and who you work with.

Have a little humor when things don’t go right. Humor often makes the daily trials livable. Laugh at yourself. In this politically correct world, you can always make fun of you, and others will love you for it.

You will be surprised in a few months how much more fun and productive work is with the right attitude. So go and enjoy work, and start looking forward to Mondays.

Wolfgang Christoph, Brian Tracy and Dr. Roberta Shaler deserve credit for the ideas presented in this article.

Productivity Office Tools

Productivity Office Tools you can use to get more done.

We all need to be more productive. Experience and focus get your projects done. Speed up by using good business tools to produce effectively. Below are some of my favorite computer and business tools to save you time.

Cardscan – Why type contact information when you can just scan it in with over 95 percent accuracy? I have over 1,500 contacts and could not maintain this data base without this software and scanner. Customer service is great, and the best thing is the Accucard service which is included. All your contacts are backed up on a secure website, and they are contacted every 6 months to

Laptop / Dell – Why not work other places than your desk? Portability is wonderful. Yes, it cost more. Yes it is riskier because you can drop it. It is worth it. I buy refurbished Dell’s to save money. Laptops are also more likely to have problems, so buy the service program where they come to my office if needed. You can buy HP and other brands with good service from Circuit City, and Circuit City covers battery replacement which is costly.

MemoryTen – Add more RAM to your PC. All these new software, the internet, required anti-virus, and anti-spyware programs use slow down machines that are a couple years old or more. RAM really speeds up your programs, internet surfing, and life and is the best dollar to dollar investment. Have upgraded 4 machines myself, two desktops and two laptops. It is an amazing simple do it yourself project for most people. Go to MemoryTen http://www.memoryx.net/ and find out exactly what you need.

Flash drives – Take your in process work with you in your pocket. Very fast transfers between other computers. Back up your work in process when traveling. 1 gigabyte is around $8 – 12 and falling. Only burn disks to send to clients.

Gmail – Google email is accessible anywhere you have an internet connection. Best spam filter out there, go through the spam folder and teach it who your friends and newsletters are. Higher security maintained with no personal effort. I download my gmail to Outlook for convenience, and keep a back up copy on Google’s server. Was able to recover all my messages quickly after a hard drive crash. Used with Cardscan to get my contacts back was able to recover quickly.

Carbonite / External Hard Drives – Been through 4 hard drive failures and upgrades over the years. You can’t afford to lose your data. Carbonite backs up your computer to their servers. Your data is safe in case of theft, fire and hard drive failure. Works when computer is idle so it does not slow you down. Also have a local backup like a external hard drive. Why? Because if something happens it will take hours to download data from a server. You can plug in an external hard drive in another computer and get back to work quicker. Seagate, Western Digital, Maxtor, Iomega and Simple Tech are reputable companies. (Note to Seagate marketing, put your name on the product so I what I have)

Blogger.com – How I bring you this blog. I write in Word and post here. My spelling is too poor to type here. Overall very simple to use so you just write.

PDA is old school, but I find not having to pull out the laptop or find another computer is priceless. Cell phones are taking over this function and it is a good marriage. Neither will ever totally replace my favorite business organizer, a Steno pad.

Steno Pads – simple notepads eliminates loose post-its, scrap paper, envelops picking up phone numbers, addresses, ideas, and plans. It is easy to chronologically find what you have not transferred into your electronics. Consider Sir Richard Branson manages 150 – 250 companies at a time with large pads of papers. He does not use computers, but plans marketing and projects. Also like 8 x 10 inch 70 page spiral notepads for a larger size pad.

Skype / Google Talk – If you make lots of calls or travel overseas, Skype is a great way to stay in touch. Google Talk looks like it is easier and simpler to use, but have not tested it yet. Still trying to get my father to install Skype, maybe we can figure out Google Talk easier.

PCWorld.com – Where to get technical advice? PC World is usually on the cutting edge. Great reviews and software downloads. CNet, and Forbes are good places to find out what is practical to use.

Ebay / Buy It Now –I like shopping for bargains, but if you want to know what something costs at a discount this is a great place to start. Then shop Yahoo, Google, Buy.com and other places for better deals online. But Ebay often has great deals on software. Just make sure the software is able to be registered legally.

I promised good tools. Now it is up to you to take action and get what you need. I recommend once a week maintaining your systems (computer and otherwise). Install one of these suggestions a week until you have incorporated what you want into your life.

September 11th and Everyday

We remember those who died in the attacks on New York and Washington. They were victims of attacks on the United States by evil people who wish to destroy us. Al Qaeda started World War III by attacking any western nation they can.

The World Trade Center was targeted (twice by the way) because they thought if you destroy a Wall Street finance center, you will destroy or damage the American Economy. America would be too weak to respond.

The Pentagon was also targeted because it is the headquarters of US military, and they wanted to slow our response. They feared the military, but think of us as a weak enemy. Based on our response to military losses in Somalia, they think we would quit after the loss of a few soldiers. Take out our headquarters, and no one would stop them.

The reality is the leaders of Al Qaeda are older, educated and dedicated to destroying anyone in the way of their vision of an Islam led world. Al Qaeda is targeting Christians, Catholics, Jews, Hindus, Buddhist and other Muslims who do not believe their distorted interpretation of the Korean. They kill randomly with bombings, mass attacks, and wipe out innocent families for their convenience and security. Parts of Iraq has woken up due to the number of Iraqi’s who have been victims of Al Qaeda murders, and areas of Iraq are coming to us for help ridding themselves of this evil.

Remember 9/11. Remember Pearl Harbor. Remember the Maine. Remember the Alamo. One if by Land, and Two if by Sea. History has taught us winning wars takes persistence, sacrifice and dedication. We have been in Bosnia over 15 years to insure peace. In Korea 54 years. In Germany and Japan for over 60 years. Al Qaeda wants to take over every country possible. The world needs to step up and help contain this enemy of religious freedom with us.

The best strategy for this ongoing World War is to enlarge our military now, to prepare for the long battles remaining, and to remain determined to win over evil. That is how we will succeed remaining free.

Ways to Have a Better Life

It is hard to separate work and life, and you are better off with an integrated life. The suggestions here will help you live and work at a higher level. The benefits of these ideas may be immediate from trying them. Others will have long term rewards.

Talk about what is good – Focus on the great to the nice parts of life to have better perspective when difficult times come.

Look for the good in people – Yes we all have flaws, but you will enjoy people more when you see their strengths and heart.

Talk with friends and family – Be with people who love you regardless of the stupid mistakes you will make. And love them unconditionally.

Hang around with positive people – Why not find people who enjoy life if you want to live life fully?

Work hard and work smart – Action is the tool that makes things happen. But we all have the same 24 hours a day. The people who get things done, do things in common. They think, visualize what they want, plan what to do in small steps, and then take action by priority. They do not do it all themselves, but build a team and delegate to be productive. They continually learn, and improve by reading, listening to seminars and making mistakes.

Volunteer and serve others – Our purpose in life is to help others, not to take from the world selfishly. “It is not about you!” [Rick Warren’s Purpose Driven Life]

Work with your gifts – We are all naturally good at some things. There are things you care about more than other people. Why not use what is easy for you (and not the rest of us) to make your living? A passionate employee or leader will accomplish much more in their life.

Let little things go – There are plenty of little things that you will not care about in about 2 seconds, 2 minutes, 2 hours, 2 days, 2 weeks, 2 months nor 2 years. If you will laugh at this later, why not laugh now?

Stop thinking depressing thoughts – Do a “Brain Interrupt”! After 10 to 15 minutes, I catch myself, and say time to stop. Whatever it is, it will not be the end of the world. Tomorrow will come in spite of everything. Most events resolve themselves in a few days or weeks. This is easier if you are religious and can give it to God.

Laugh daily – Especially if you can laugh at yourself. You will always be entertained.

Journal your life –Write down the good and the less than perfect. See what you learn from the day, and really enjoy the successes. Lessons from mistakes are better learned without beating yourself up. Write a little down, let it go, and get on with your life.

Limit the news – Too much negativity and sensationalism will affect your attitude. In the 24 hour cable news world, “everything” is a crisis Now! To be honest, most events are not the end of the world. Keep your perspective.

Limit your vices / Moderation in everything – Too many people mess up there life with drink, drugs or sex. You want to be the person who can have fun sober, and the dependable person worth someone spending their life with you. Be moderate in moderation. A rare excess of exercise, food, drink or fun is wonderful.

Choose to Enjoy life – Life still has hard days, but then you can find joy everyday if you choose. Try it.

Things I Would Have Done Different

Was in a reflective mood about my career recently. Writing (with other coaches) a career book to dispel myths. Normally would not change my experiences since they made me who I am today, but surprised myself this time and wrote a person list of changes I would make. Truthfully would love to know what I know now then. So this posting is general advice to manage your career and life.

Study Real Estate for Investment. (Bad investment for next couple years, then will return as good investment. Study business cycles.)

Studied Real Estate / Business Finance

Learned more about computers (useful tools.)

Saved more (More to invest.)

Bought a home where I love. (Get a small home on a big enough lot in the nicest neighborhood you can afford.)

Bought fun autos (Had three fun cars to date and recommend you buy what you love.)

Join Toastmasters (Talking to groups is a tremendous career booster.)

Write more (Communication skills are vital to your career.)

Taken more seminars: (Invest in yourself.)
– Dale Carnegie: How to Win Friends and Influence People
– Real Estate Investing
– Investing
– Finding your gifts
– Sales

1. Made lists of my dreams
2. List actions steps to make dreams happen
3. Take action (Keys to your success.)

Drank less (Really negatively affect your life.)

Exercise more (Being healthy has improved my life and work.)

Dated more, and avoid toxic people (Read Ten Stupid Things (Men, Women) Do to Mess Up Their Lives by Dr. Laura C. Schlessinger)

Not stayed home so much (Overcome shyness.)

Seen my family more often (Plan.)

Be more grateful (Best thing for your mental health.)

Be less depressed (Don’t be too hard on yourself. Limit how long you beat yourself up to ten minutes.)

Been more confident (Lets you be humble and sure of your commitments.)

Stay active in your faith (Being Catholic turned my life around. The most important thing you can do.)

Follow these and you will have a good life from now on. Wish I had read this list years ago.

Why Bridges, Products and Companies Fall

The bridge collapse on 35 West in Minneapolis is in the news today. Have just seen the security camera video of the collapse. The cause is off camera. You just see the bridge start falling level from one end, and then the structure pulls itself down section by section in seconds.

Falling level is a hint, if one joint failed on one side it would have tipped or wobbled when it fell. The initial failure has to be on the hidden support at that end. Whether the support collapsed, the section slid off the end, or too much concrete (weight) had been added for the structure will be determined by more knowledgeable engineers than me.

The truth is the real cause has taken years to be created. It is probably the accumulation of several human errors: possibilities include the design, past maintenance, the planning, and the execution the current project.

The same thing is true of any product or business. When they start to fail it is an accumulation of causes: late deliveries, poor trained customer service, customers struggling to order what they need, lack of marketing to new clients, and often the lack of new products and services. These are all symptoms to be taken seriously and corrected before the collapse.

Getting Projects Done

When you want something bigger than a task done, something that will take longer than a couple days, you are getting into a project.

The main secret to success is to properly define the project. It is amazing how hard it is to complete something where you don’t know what it is suppose to look like!

So what does success look like? Define it. Is it a new product release with all marketing materials. Is it a new service as a business profit center? Is it increased profit margins for existing products or services? Are we changing the company culture? Is it a combination of several of these? Focus by defining what success will look like.

Focusing on defining success will motivate you to do break down the step of a project, overcome the problems that will, stay with a project until completion, and enjoy the fruits of success from getting projects done.

Secrets to Sell Real Estate Now

It is Memorial Day, and Now is the Prime Selling season for Homes. A friend of mine is flipping an investment house he bought and is fixing up. He needs to finish soon and sell before July. Do you need to sell your home, condo, single family, duplex, vacation home, forclosure, or investment real estate Now? I will disclose the secrets to a fast sale.

Most homes are sold after school is out and before September in most of the country. We will exclude the winter home markets where the fall is the big market like Florida and desert communities.

When you get promotions, new jobs or if your company moves you may have to sell quickly. My advice is based on my experience as a homeowner, an investor, a former agent, and as an appraiser. Have over twenty years experience. I sold my last house in 4 days on the market within $3,000 of my asking price, so I do know how to market a house.

The steps are simple: Price the house right for your market. Get professionals involved. Prepare for buyers. Develop a marketing plan. Deal fairly.

1 - First focus on being realistic. Every house is special, but every house has flaws, neighbors, and competition. To real estate professionals and investors, houses are a commodity and won't generate emotion like when selling your own house. Find out what houses are selling for in your neighborhood, NOT what other homes are listed for. List prices are wish lists. Then find out how long it took to sell the homes that sold. You need to know what is the sales trend for similar homes. Price it below the median to generate buyer traffic. Price it near or at the bottom to sell now!

The general trend in 2007 is prices are falling after the big boom of the last 6 years. Investors and speculators are selling, or only buying bargains. Buyers with borderline credit will not qualify for loans, so there are less buyers.

Why should you ask a low price? Because you don't have time for someone to fall in love with it. You need a buyer now. Agents will only bring buyers to houses priced fairly. Ask too much and no one will see your home. The ideal to get multiple offers so you can pick the best qualified buyer and get close to your price.

Special note to those who owe more than it is worth. Mortgage holders will work with you if you are selling below what you owe. Technically they can make you pay the whole amount, but they do not want to take the foreclosure. If you can sell it for them and get most of their debt they will be thrilled. Don't forget the second or third mortgage holders. They have the most to lose.

2 - You want to sell fast? Get every real estate agent in town to see your place. The odds of your listing agent having a buyer also is low. That is why they want other agents to bring their buyers. Hold agent open houses. Clean up, get out of the way, and they will run through your house in five minutes as they tour all the open house. If an agent wants to see your place quickly, let them in no matter how messy or inconvient. The agent just will run through quickly, ask a couple questions, and bring buyers. Have your agent invite agents for other companies!

Don't consider selling yourself if you are in a hurry. The odds of your advertising beating the Multiple Listing Services (MLS) is low. Great agents will maximize your sale price and do lots of paperwork for you.

Disclose any problems to your agent. They may help remedy them, and you will avoid a messy lawsuit or canceled sale. You can write down an allowance for new carpet or whatever necessary will be included in the sale.

3 -Buyers buy within the first 5 to 10 steps into your home. First impressions are the most important! Beware, lots of buyers will stay in their car unless your house appears ready.

So get the buyers into your house. Key is to have a neat front lawn, fresh paint or washed walls, and some colorful flowers by the front door. Potted plants are a good investment.

Next clean up the junk in your house. Especially the living room and any room you can see from the entrance. Start packing momento, family pictures, knick knacks, books and anything you won't need until you are in your new home. Especially throw away anything you can.

The next thing is how does your house smell? Go out for an errant, and check when you come in. The kitchen is the main culprit. Especially cooking with oil, garlic, onions, or strong spices. Next where do you keep shoes? I ate out, cooked outside on the grill, and still sprayed the house with Lysol or Oust every time I left for work or someone wanted to see my house. Don't forget to pack and remove clutter from the cabinets.

Next focus on the bathrooms and the master bedroom. You have made a good impression, don't destroy it. Pack, throw away, and pack some more. Storage is a good idea, and I found buyers will forgive your garage if it is filled with packed, taped moving boxes. They like the idea you are ready to leave.

4 - Market your house. Now is not the time to be private or discreet. Anyone can find out how much your house is list for or what it sold for. Before the internet, most homes are sold to friends of one of your 20 closest neighbors by them telling family or friends about a house for sale. Tell everyone you know and tell them the price.

Classified ads with prices get 5 to 10 times the response than ads without a price. I don't know why agents don't put the price on the for sale sign instead of making people stop for the flyer. So tell every neighbor a couple street each way with a flyer your house is for sale. Some agents will mail postcards for you.

Next I will remind you how important it is to be nice to agents. They are your friend no matter what a nuisance they seem to be. They bring buyers. Hold a second agent open house. Invite other agencies to visit.

5 - Deal fairly with everyone. People can tell if you are looking for an excuse to stiff the agent his commission, or trick a buyer. If you smell tricky, or desperate you will not do as well. It is best to be honest, disclose fairly, and be a good seller to do business with. Agents make their money by commission, and they will keep buyers away rather than deal with a foolish seller. Especially with so many other homes for sale. In this market your deal may fall through, so you want them motivated to deal with you.

Be reasonable. I was trying to sell another home in Connecticut when I changed jobs in Texas. My agent called me up with an offer below what I wanted. When he told me the price was $3,000 below my asking price, I responded "That is only a couple months mortgage payments", and we countered $1,000 higher to insure the deal went through. I saved money by being reasonable.

Good luck and get to work! Believe it or not this method will get you the most money as well as sell quicker.
Steve

Ways to Make More Money

Looking at improving my career and earnings. To get a higher salary the clients need more value. So where can I learn more that will deliver more value to my customers? The answer is to solve their problems better. My clients need more profits, better margin, new product and services, reduced cost, and more productivity.

Came up with focused areas to help clients:

• Marketing / Branding
• Core Offerings
• New Product Ideas / Extensions / New Services
• Project Management

So to accomplish this I need to focus on education, but not necessarily a degree. You can learn from research, reading, and classes. I just completed a SolidWorks CAD course to update CAD skills. Did not become a CAD expert, it serves my purpose to be able to use CAD tools faster and better in Project Management.

• Marketing
• Website Development
• Selling Information
• How Rich People Think

This may not be the obvious answer for the top subjects, but based on my skills, talents, experience, and interests this is the focus for the this year minimum.

Now, what would improve your value? Write down some ideas. Think about service.

New Products and Services

The most important thing in business is to create profitable products or services. The problem is after a while, everyone copies success. So how do you keep your growing profits when margins are under pressure?

Think about it, and we will discuss it in a future post. Email your questions to problem1solver@gmail.com and we will discuss it here.

Suggestion: How can you better serve your clients or customers?
Steve

Turnaround Business and About Me

My catch phrase is "Turning Opportunities into Profits". I enjoy business and business is about being profitable. Quite frankly, with no profit there is no business. Only a charity that will eventually fade away.

Business is about serving the customer so well they don't want to work with anyone else. You want to solve their problems for them.

Problem Solving is my core skill. Before I had a degree in Engineering, I could fix some of my family's and friends toy's. I fixed my and their bikes, put chains back on the sprocket, adjusted the gear changer so chains would not fall off the ends of the gears.

My father is a do it yourselfer, so I learned by watching and helping. Watching Dad change the tubes on the television (the black & white one), building and painting sheds, gardening, maintaining pool filters, building a trellis for mom, and of course maintaining the cars. It is amazing the patience he had to let us try what he could do in seconds so we would learn.

At fifteen I started working on cars. I insisted on taking Auto Shop as an school option for one semester. Dad bought a meter and a timing light to interest me in taking care of the cars, and was shocked as I taught him what it was for and how to use it. Typical teenager I was car crazy and fascinated with them today. Hybrids are cool, and I have been waiting for hydrogen cars for to come for over 25 years. Thank you BMW for answering that desire. Can't wait for a ride in one.

At sixteen I learned to use computers. I started with teletypes and punch cards. Yes I am an antique. Same time I learned about cars and computers, I also learned to swear. Not sure which one led to that :)

My engineering education and experience taught me how to solve more problems. The facinating thing to me is how little it was calculations to do things, and more about common sense and working with people. Then again my favorite professor in college only taught one formula per semester, and probably needed a calculator to balance his checkbook. So computers can only help us do our work, not think for us.

Now I enjoy growing and fixing businesses. Great products and great services only happen when a small committed team infects everyone to do it together. Someone has to decide lets do it, and the leader has to commit to make it happen. Then magic happens. Airplanes fly, cars get safer, air gets less pollution, more food gets grown, and man can walk on the moon.

So how does a business turnaround from losing money? From losing customers? From having poor quality products and services? It is the same thing. Someone commits to doing it. A leader creates a small team that decides it has no option but to succeed. People don't feel sorry for themselves, and do the hard work it takes to make the customer happy. The team grows, struggles, succeeds a little, fails some, learns and improves. The team solves a couple problems, grows some more, and tackles bringing out new products or services. Along the way, more problems get solved, customers get made happy, and pride comes in being part of a successful business.

That is how you can turnaround businesses.
Steve

PS - Look forward to more thoughts on business, life and problem solving...

How to Solve Any Problem

How to Solve Any Problem
by Steve Amos © Copyright 2007

If you do not have any problems, you can skip this article. Notice everyone is still reading... :)

Life is full of problems. We encounter them daily in business and in our personal lives. How we handle problems often dictates how others perceive us, our position, and how much we earn.

Here are the basics to successfully solve any problem:

1. Really want to resolve it. Most people are “Wouldn’t it be nice if this went away.” You have to be really ready to change. There are going to be obstacles and failures. It is going to take time and effort. It will upset some people to solve your problem. It can upset you to solve your problem.

To fix anything, someone has to change what they or you are doing. There is a natural resistance to change that does not go away easy. We have all said “That’s the way we always do it” at some point in our life.

2. Why is it a Problem? Who does it bother? Your customer, your coworker, your boss, your significant other, or is it you who are bothered? Why are they bothered? Once you have identified the problem, you can do something about it.

3. What are the causes? What causes affect your problem? Why do the sources do that? Somewhere there is a reason the task was started. The secret is to track back down to the root causes. Then break down what variables can affect your problem. Then you can try changing the variables to see if you can find a solution. This is a basic description of the “Black Box” analysis technique used daily by Engineers.

4. What Changed? The shortcut used to find the source of the problem. If something worked before, and now doesn’t work, this question will often identify the cause. However if something worked poorly, you will only go back to working poorly.

5. Ask everyone involved for their input. Whoever is closest to the problem has the best insights to what is going wrong. They can help ferret out the roots of the problem. Often the answer comes from the person least likely to know the solution. Be open-minded.

Describing a problem to someone helps define it. It's a simple, fast and effective way to analyze problems. Two heads are usually better than one.

6. Stay with it. The first attempt at anything is rarely successful. Try and try again is the only way to solve anything. Solving a problem is often done with stubbornness as much as from talent. Refuse to quit. Be bullheaded. Solutions don’t require a degree. The experience will make you a more talented problem solver.

Thomas Edison had over 900 failures before he succeeded in creating the light bulb. Problem solvers don’t give up.

7. Look for others who have a similar problem. Industry, professional, and self-help groups are often great sources of ideas how to attack a problem. American industry lost a great lead on the rest of the world by not taking others' ideas. Call it the “Not Invented Here” syndrome. Look at other industries for ideas.

8. Try different problem solving techniques. History is full of companies (and people) that found a solution for customers, blossomed, and then died as changes left them behind. Don’t be a One Trick Pony. Learn how other problem solvers succeed and try it yourself.

9. Analyze the consequences. What effects will different solutions have? Solutions need to be evaluated before they are implemented. For instance, starting a war may leave your country’s economy and military ruined. Diplomacy may be a better solution to try first.

10. Test your solution. What consequences will your solution have? Try to model the smallest piece of your problem, and see if it works. Listen carefully to any feedback. Do not take the griping personally that comes with the feedback. Just try to ferret out the facts.
If your solution fails to work, refer to #6. Experience always has value.

11. Sell your solution. Now you think there is a solution. You must start to overcome the resistance to change. Most of the resistance comes when people are told to do something without a reason. If you can explain the reason clearly, your solution is more likely to succeed. Do find the solutions are rarely accepted the first time they are explained. Generally people need three or four exposures to a new idea before they accept it.

12. Give credit to those who helped you. People will be more likely to help you in the future if you have established a track record of not hogging the glory. You will get your share of the credit.

We can see persistence and patience are necessary to solve any problem. Practice and experience will make it easier as you go along. So please don’t give up. Then find your next problem to be solved.

© Copyright Steve Amos 2007

The Success Ladder

The Success Ladder
100% I did
90% I will
80% I can
70% I think I can
60% I might
50% I think I might
40% What is it?
30% I wish I could
20% I don't know how
10% I can't
0% I won't