05.11.08
Posted in Political, Small Business at 17:11 by lnxwalt
I have recently made several posts on political subjects.
The object isn’t primarily political (as in pro or anti this or that candidate), however, but to help mold the agenda to focus on SLOBs as the key to our economy and our society (in conjunction with another small, local unit, the family).
For small towns in far away areas around major cities, SLOBs provide the economic wherewithal to keep the town going when economic swings cause large, out-of-area corporations (LOOACs) to retreat. Because they are locally-owned, their interests are intimately tied to those of the local economy. Because they are small, they are less likely to be able to coerce local governments into sacrificing residents’s interests for the benefit of the business. Certainly SLOBs are not a panacea for every possible ailment, but they are a fundamental piece of bringing about a locally-focused economy where fewer individuals are marginalized.
When the glass factory, the slaughterhouse, and the furniture store leave your town, the only way your community will keep going is to have a strong local economy, based upon smaller, locally-owned businesses, and not upon LOOACs.
The Victor Valley’s cities are currently oriented toward attracting LOOACs, rather than organically growing their economies through backing SLOBs. This must change, if we are to have any chance of adequately employing all or nearly all of our residents. The best thing about backing SLOBs? No tax subsidies! All they really need to do is fund the training and education work of the local college and help with loan guarantees for smaller start-up businesses. Barstow, in a similar state, needs to back its college and help with start-up funding for its local residents. LOOACs ask for all of this and tax subsidies too!
For inner cities, SLOBs, rather than LOOACs, are the key to bring about prosperity. LOOACs hire hundreds or even thousands of people at once, and therefore attract applicants from far-away parts of the city, often leaving nearly as many local area residents unemployed (or underemployed) as there were before the corporation’s arrival. They also use that large number of jobs to extract tax and other concessions from city governments. In essence, your local minimart probably pays extra taxes in order to allow “Big Blue” to bring a few hundred minimum-wage jobs and Chinese goods to the market.
Small, locally-owned businesses cannot exist in isolation, if we want the local community and economy to benefit. There must be a veritable ecosystem of small, locally-owned suppliers, distributors, and retailers to help the community become resilient against the various twists and turns of the wider economy. But there is more: SLOBs are more strongly integrated into the local community, sponsoring Key Clubs and youth sports, ponying up funding to send the local band to a competition in the state capital, hiring your brother-in-law who just got out of jail, and giving a first employment experience to your neighbor’s high school kid. Because SLOBs lack the resources to go it alone, they are more likely to support your local community’s attempt to bring about high-speed Internet access, towers and infrastructure for mobile telephone service, and better lab facilities at your local high school and local college.
In remote farming communities in middle America, SLOBs may be the only things still keeping some towns on the map. When LOOACs leave a farming-based community, or during times of consolidation, where smaller, family-operated farms are gobbled up by large, corporate-operated agricultural businesses, graduates often have no choice but to leave the area.
So it is vitally important that any so-called small business advocate makes his voice heard on political choices that will affect the direction of our national policies toward smaller businesses.
Tags: political, small business
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04.08.08
Posted in General Management, Small Business at 2:58 by lnxwalt
The article is here.
I believe that small, locally-owned businesses (SLOBs) need more help than the big guys to form tight connections with their customers. After all, a bad experience can permanently chase a customer away from a SLOB, but a nationwide fast food chain will continue to get repeat visits even when a single visit is unsatisfying.
That said, we often hear about how we need to jump on the latest fad or get left behind. The article discusses many of the requirements that you should meet before you consider starting a company blog.
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03.11.08
Posted in FLOSS, Small Business at 3:13 by lnxwalt
Alfresco VP Matt Asay responds to an article in eCommerce Times.
He points out that SMBs should be using open source software, when it meets their needs, and that hosted software (SaaS) eliminates the need for the business’ owner and staffers to act as an IT department:
What could possibly be better for an SMB than not having to install software?
…
Fair enough. But what this doesn’t note (perhaps because the author doesn’t understand) is that just because you can access source code in open source doesn’t mean that you must. Most people don’t.
Even if an SMB elects not to modify source code, however, they still benefit by all those that do. Better code. More accountability from one’s vendor. Lower prices. These are just some of the benefits that are attendant on those that buy into open source, whether they’re a hacker or a surrogate of the hacker.
Which brings up the point: when you buy proprietary software, someone has to install it, configure it, customize it for your needs, and perform other administrative tasks from time to time. If the software has a failure, you are still on the phone, paying for support. You still have to search out online fora to find out how to fix your problem. So what is the advantage? It isn’t even always more polished than open source.
With FLOSS, someone has to install, configure, customize, and administer your software. Most of your support is free, from online fora, and many applications have a company where paid support can be obtained.
If you are approached by someone who wants to help you set up your business’ software, make sure that the person knows, uses, and supports FLOSS. Your setup doesn’t have to be only open software, but a significant part of what you use should be.
One other thing: Unlike what eCommerce Times wrote, No business should be installing or using Windows Vista. It is years away from being ready to use. Check out Mac OSX systems as well as Linux and BSD-based systems. If you are looking to buy computers, make sure that your vendors offer Mac and/or Linux systems.
From someone who supports Windows systems as his day job, trust me: you do not need the headache that is Windows Vista. If you must have Windows, buy only XP Professional.
Tags: SmallBusiness
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11.22.07
Posted in News and Announcements, Small Business at 3:58 by lnxwalt
Determined To …
Determined To Build A Business
I have been home less than a month. In this time, I have not had a lot of time for anything. When I left, there were some things in progress, but opportunities and people rapidly move on when you tell them to wait for an indeterminite time period while you are preoccupied with X, whatever X may be. I returned to find some network and system administration issues had arisen in the household. And that the users had forgotten how to do things like upload the photos they use for their own writing.
In addition, I have been busily trying to get another job (preferably) or assignment. I prefer if it is fairly close to home this time, so I can come home after work and work toward starting our family’s business ventures.
If you are seeking to change major and important things in your life, you can expect some opposition. It can be as simple as the family member who wants to stay in the Victor Valley area [or the Upper Peninsula of Michigan, for that matter], even if it means that you will continue to struggle. It can be an overhang of debt from your lower-income college student days. It can be a household that has gotten used to your present income level and is not not willing to accept the necessary sacrifice for you to pursue your dreams. If you have no opposition, you must be a loner—family and friends do not want you to change, because it might change their situations or they might even have to change in response.
When you know you really want to accomplish something, you also know that you have to change what you are doing, or you will never get different results. If you live in an area like the Victor Valley and you are not independently wealthy, you have to work. If, as is the case here, the local politicians believe that attracting large chain retailers to build stores and create low-wage part-time jobs is what progress is all about, then you have a few choices:
- Shut your mouth and work for “Big Blue” or another retail or restaurant chain, sharing a two-bedroom apartment with three of your co-workers so you can afford to live here.
- Buy lottery tickets. Ignore the fundamental unlikeliness that you are going to win a big prize. The odds are, if you buy enough tickets over a long enough time, you will win, even though your winnings will only be a portion of what you spent to get them.
- Commute fifty miles or more one way to obtain better-paying employment. Be sure you understand that you have to make enough to cover the costs of vehicle maintenance & repairs, fuel, and the additional hours out of your day that you will spend on the freeways.
- Find some miraculous burst of funds that enables you to start a business providing some kind of service to local residents who commute outside the area for work, since they haven’t the time to take care of things themselves.
- Get out of Dodge. Yes, that’s it—move away, to a place where you can live and work in the same area.
If a family member or so-called friend is standing in your way when you are trying to liberate yourself from financial bondage by moving out of the local area, you may need to just leave them. Cut them off like a gangrenous leg, and limp away to your future.
Determined To Build A Family
The family is actually more important than a business, at least in my eyes. When I’m gone, it isn’t a business that will be my legacy. It is the people whom I have touched that will best reflect who and what I am.
That may seem to conflict with the “gangrenous leg” comment above, but it does not. I used to have friends where all we ever did together was watch television. As television has become a smaller and smaller influence in my life, that is, as I recognized that there were other things I could be doing with all those hours that were being wasted, we began to grow apart.
Your family is the reason for starting a business. If you are starting a business simply for yourself or for strangers, it is time to “stop, turn around, and skate in the opposite skating direction.” The same applies if you are starting a ministry or other non-profit: If your family is not part of the reason you are doing it, then you’d better stop. Now.
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10.11.07
Posted in Small Business at 21:52 by lnxwalt
Real Estate “Investors” Investing Or Are They Speculating?
Defining Terms
It is very easy to lump everyone who calls himself or herself an investor into the same pot. This would cloud the issues and make any solution ineffective.
Speculators tend to rush into something for the prospect of short-term gain, rather than a clear-headed evaluation of the long-term factors that are relevant to the choice to get involved.
In the context of real estate, I am using the term speculator to refer to a person or organization that purchases a piece of property for the sole purpose of reselling it for a profit in the not-too-distant future. I am also refering to related practice of taking a lease in order to sublet at a profit as speculating, especially for those with longer leases. Finally, I refer to the whole “buy with little or nothing down to rent out and then pyramid these properties into an empire” type of scheme as speculation.
Why do I label these perfectly legitimate practices with a term like speculation? Let us take a look at the effects to answer the question.
What Happens In Those “Nothing Down” Schemes?
The first thing that happens is good: rentable properties that are available get purchased. However, the new owner starts out with a relatively high debt load that can only be lightened by doing things like cutting back on maintenance and on-site management. Given enough time, the earlier properties become derelict slums, tending to attract criminal elements that damage the building and threaten the tenants. The other thing that happens is that the landlord is continually refinancing to take out any equity in order to buy more properties, so when the economic cycle flips to the downward portion, the landlord often cannot generate enough cash flow to continue making the payments on the properties. Banks and previous owners then wind up foreclosing and losing money.
What Happens In Those “Buy It And Sell Next Week” Schemes?
During times of increasing prices, they speed up the increase and spread it to other areas. Sometimes, they buy a “fixer-upper” and repair it, but more often, they buy already acceptable properties and quickly put it back on the market.” This increases the cost for real buyers, although it does shorten the wait for sellers to dispose of their properties.
In times of decreasing prices, these “investors” may resort to panic selling in an effort to cut their losses. This has the not-unexpected consequence that market prices may fall more rapidly than otherwise. Taken to its logical conlusion, this practice may even contribute to bank failures.
As you can see, the effects are both positive and negative, depending on whose viewpoint you take. However, this practice appears to act as a feedback loop to amplify price swings and volatility.
Conclusion: Advice For Politicians
When there is a financial decline caused in part by speculators, it is best for the market to let the speculators feel the lash. Any “rescue measures” should target the residential homebuyers who suffer because of speculative excesses and lenders who knew that the government would bail them out rather than let them suffer the consequences of their lack of discipline.
Tags: personal+finance
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08.12.07
Posted in General Management, Small Business at 20:36 by lnxwalt
Overheard at that really big retailer last week:
Cashier: I’ve been working over eight hours and I still haven’t had my break.
In nearly any field, big companies use “economies of scale” to thrive and grow. When augmented by computerization, we get “management by the numbers”. That is, we get decisions being made based upon ratios and measurements, rather than the readily observable needs. Smaller companies do need to implement some of this, but you can see the effect of taking this to an extreme.
This cashier works longer than she should work without a break because there are more customers waiting to pay for their purchases than the available cashiers can handle. Rather than call in additional cashiers (and possibly incur unapproved overtime), the managers on duty just keep the existing staff from leaving their posts when they should.
This doesn’t just happen when I am visiting New Jersey. We have the same chain in the Victor Valley area of California. At one of the two locations of this chain, it is common to come in late in the afternoon and hear cashiers saying, “I’m supposed to be off already, but I still haven’t had my break.” Again, it is to the advantage of management to do this, rather than to incur overtime.
This is an effect of the centralized management in larger organizations. Despite laws and policies that are supposed to prevent such abuses, Lower-level supervisors and managers may lack the authority to actually enforce these rules. Certainly, they are constrained by dictates from their superiors that they meet numeric targets such as labor cost percentage and customers per hour. Because of the top-down nature of management in large organizations, seeing that it is widespread and frequently-repeated is a clue to where the problem comes from. (I often wonder why such places do not have “rovers” whose job is to cover breaks throughout the store. Even during a rush period, it should only take a minute or two to put a rover in the place of a cashier.)
For SLOBs [Small, Locally-Owned Businesses--search the site for the term] and OMBs [Owner-Managed Businesses--search the site for the term] that deal directly with consumers, it is vital to your business that you take good care of your staffers that do the actual interaction with your customers. One large company decided that its employees cost too much, so it laid off its best employees (the ones who had gotten raises) and forced them to reapply for their old jobs at a lower wage. In a field where most sales happen because a knowledgeable salesperson helps a customer decide which item is right for them, this was a major mistake. Their mistake may land them in the trash pile with all the other failed consumer electronics retailers, or they may last long enough that customers and employees forget the betrayal. Your customers, however, are not likely to give you enough time to prove that you meant well when you let management by the numbers replace common sense.
An OMB or a SLOB that pushes MBTN too far is likely to close its doors, with the owner winding up back in the job market.
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08.09.07
Posted in Political, Small Business at 2:12 by lnxwalt
I recently wrote about the political campaign. This has the potential to be a series of small articles.
Look, there are a lot of major problems in the educational system. There are far too many for me to list, and even if I did, some would disagree with nearly every point.
Tonight, I want to focus on one problem only: unrealistic goals.
First of all, school is supposed to give you the general background needed to learn a job on the job. Our school system is not supposed to train the workforce to walk in the door and immediately be competent engineers. Anyone who expects something different is lying to himself. It has never been that way, and it will never be that way.
Secondly, I have read that nearly fifty percent of all U.S. employees say their first job was in fast food. Yet, we constantly hear about the poor quality of our graduates. Don’t get me wrong: dealing with customers and incompetent managers is challenging and takes an amazing level of skill. Still, when I worked in fast food, I said I could teach a ten year-old to do most of my job within thirty to sixty days. The whole design of the business is to take away the latitude to make decisions, and therefore the necessity to do any thinking whatsoever.
The one thing that I do wish schools taught kids is how to count back change instead of depending on the computerized register. That skill that is even more valuable as a customer, because it will clue you in to possible theft by an employee.
Still, if we do not have the challenging jobs available, why do we need to give kids so-called entry-level skills in a particular field?
What is wrong with schools? Schools need SLOBs to absorb many of their graduates and give them the on-the-job training that will help them for the rest of their lives. Schools need the owners of OMBs to come and help the kids get acquainted with the kinds of jobs that they are likely to be doing once they graduate. Schools need some major organizational structure-type changes, but these two changes are doable NOW. Get involved.
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08.03.07
Posted in General Management, Small Business at 2:19 by lnxwalt
I recently responded to an article by James Robertson about China’s product problems. USA Today has an opinion item today that reiterates my words. If the link dies, it is also in the dead-tree edition, on page 11A (”Hidden culprit of product scandal made in China”, USA Today, 11A, 2007-AUG-02).
I quote:
Nearly all the recent alarms raised about Chinese products point fingers solely at the Chinese, neglecting entirely how China’s success as an exporter is, in large part, the product of roughly a trillion dollars of foreign investment and limitless expertise that floods into the country in order to escape some standard or other at home.
In other words, when we want to make the product more cheaply, without dealing with all the restrictions that are built into Western social democracies, we have it made for us in China. When we don’t want to pay employees enough to own homes in pricey American cities, we move to work to factories in China, where they don’t have our standards. When we don’t want the cost of conforming to environmental regulations, we move the work to factories in China, where there are effectively no regulations.
Unfortunately, it is easy to blame China, its government, its culture, or its people, for the shortcomings of American corporations. If big-name-corporate retailer insisted that products it sold were produced under “ethical management” and held producers to similar standards as U.S.-based producers have to meet, Chinese companies would either step up their quality (in exchange for higher fees) or lose business to companies that would comply. In some cases, the products could even be produced in North American factories.
It is up to those of us in OMBs and SLOBs to take this message to heart. When a large company wants you to bid for work, refuse to bid if you have to compromise ethical standards in order to get or keep the work. Make it clear that you are willing to work extremely hard to get your costs down and your output up, but you are not willing to mistreat your employees or the community where you operate. There is a good chance that you will lose some big-business customers to foreign suppliers. Even so, take a stand and make it public. Make it a part of what you do and the way you present yourself and your business.
“Joe’s Upholstery uses only the finest materials, assembled by our highly-skilled workforce, right here in Pinon Hills, California.” Be sure to emphasize your local workforce, even if your only “employees” are your children Joey and Anna. Emphasize the quality of your work, but don’t make it just a slogan–make sure you really do produce a good product or service and price it fairly.
It also takes a commitment to bring your pocketbook in line with your principles. If big-name retailer violates your principles, you are going to have to stop doing business with them (and their “business club” subsidiary), even if it means you’ll have to pay a little more for what you buy. If other suppliers violate your principles, you are going to have to stop doing business with them also. It doesn’t have to be immediate, nor does it have to be ironclad. If your plumbing requires a plunger at midnight and big-name retailer is the only place that is open, go buy yourself a plunger.
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Posted in General Management, Small Business at 1:34 by lnxwalt
Today, while I am away working on the East Coast, I got called about something I had put in for at home on the West Coast. While there is no assurance that it will work into something for me, it does point out the reality that no matter what someone tells you, all jobs are temporary. A wise man keeps that in mind.
You and I need to always be working on what is next. When the “next” thing comes along, it may not be the expected thing, but it is probably going to be something that got started because you were willing to try new things and break out of the mold.
OMBs and other SLOBs [Owner-Managed Businesses and other Small, Locally-Owned Businesses] may find their whole mission changes–as Force Protection Inc, formerly Sonic Jet Performance Inc, found out–or the owner may move into and out of external employment. It is important that SBOs [Small Business Owners] recognize this and plan for the possibility.
What you do not want is for your current project (business, employment, or whatever) to end without you having any idea about what is ahead.
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07.29.07
Posted in General Management, Small Business at 15:56 by lnxwalt
In Overloaded With Gimme Gimme, I responded to a discussion currently going on about how valuable social networking sites are. Let me expand upon a few ideas here.
In the real world, people get up in the morning, rush out the door, spend an hour on the road, and are working for the next ten hours, before spending another hour on the road to get back home. In many cases, they also juggle family schedules, having to have someone home with dinner in time to feed the kids and pets. There is precious little time for juggling lists of “friends” and requests for help with some issue that does not touch their lives yet. This is because most Americans work in the physical world and have to spend their work time doing productive things (productive as in “makes more money for the company”), rather than playing with the latest social networking site.
Only the guy in the corner office of the tenth floor has time to practice his putting while he’s on the clock. The rest of us have a huge hole in our days where (no matter how much we’d like it to be different) we have to be productive.
Maybe I don’t get it because I don’t trawl Facebook and LinkedIn trying to gather employees or clients or interviewees. If I was doing Robert Scoble’s type of work, it might be advantageous to spend much of my day collecting “contacts”. There might even be some advantage for a job like the one Jason Calcanis has, although even he questions whether it is worthwhile in the light of the time it takes to manage contacts on such sites. James Robertson says it has to do with your popularity, with highly popular people having the largest number of extraneous “friendship requests”.
One thing is sure: I have enough to deal with just trying to maintain contact with people I already know without the added pressure of people wanting to add you because of what you can do for them.
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