Do Business Well

The performance of his product was his best publicity! Let it also be yours.

If you are the first in the right market you may need little advertisement. Sun Microsystems’ workstations were the first on the market with the new UNIX operating system and needed no advertisement. They became the world leaders with their Sun workstations and in the early nineties were voted the fastest growing company on the Fortune 500 list, with a phenomenal 114 per cent compounded annual growth rate. Continue Reading »

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Just over 40 percent of households (42 percent) bought some kind of art in 2005, up significantly from the purchase incidence in 2003. With consumers turning their attention to the walls for decorating, they are responding to new availability of ready-to-hang art at retail outlets ranging from mass merchants and discounters to home specialty stores. No longer are consumers required to seek decorative art in out-of-the- way galleries and art dealers, or pay exorbitant prices to custom frame a print. Already-framed art, as well as the explosion of specialty framing boutiques that offer affordable and quick custom frames, have opened the art market to the masses. Continue Reading »

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Leadership first, perception second. To try to reverse this sequence is almost impossible.

What if you do everything right? What if you are the first in a new category and subsequently go on to dominate that category domestically? Then you should try to expand the market in the U.S. at the same time that you take your brand to the global market.

Coca-Cola did all of these things. But what’s next? Are there no second acts in branding history? Continue Reading »

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But everybody wants to grow, and you can’t blame them. So what should an Internet brand like Amazon.com do? There are five fundamental branding strategies for a leader in any category.

1. Keep your brand focused.

There are more than 5 million dotcom sites registered on the Internet, and you want your site to stand for more than one thing? Amazon.com should stay focused on books and music CDs. After all, the site accounts for just 4 percent of the $24.6 billion book market in the United States. Continue Reading »

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The biggest mistake of all is believing you can do anything.

Success in business doesn’t just show up on the bottom line of the profit-and-loss column; it also goes to the top. Success in business inflates the egos of top management.

Supremely successful companies believe they can do anything. They can launch any product into any market. They can make any merger work. It’s just a question of having the willpower and the resources to throw into the task. “What is it that we want to do?” is the question that management usually asks itself. Continue Reading »

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Purchase incidence of furniture was the same in 2005 (41 percent) as in 2006. The purchase of furniture can range from inexpensive occasional tables and ready-to-assemble and unfinished furniture to major furniture acquisitions that are often bought on credit and paid for over time.

Furniture Industry Snapshot

Personal consumption of furniture, including mattresses and box springs, reached $69.8 billion in 2002, up 3.2 percent over 2000 levels of $67.6 billion. Continue Reading »

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Every bank and lending institution will require a business plan before they commit themselves to lending you money. A business plan basically shows that you have established that there is a market for your product/service and that having established sufficient demand, you have a good estimate of what your costs will be, as well as your sales volume, cash-flow and likely profit (although the last is often optimistic). Continue Reading »

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Companies can increase profit either by cost reduction or by margin improvements. Margin improvement or improvement in the gross profit can be achieved either by increasing unit selling prices or by increasing sales volume (this includes the possibility of reducing unit selling prices in order to be more competitive and increase sales volume).

Selling prices are affected by supply, demand and cost conditions. All companies need to ensure that their pricing policy gives the best opportunity for maximising sales and profits.

1. Keep pace with inflation

The inflation rate is the percentage rate per period that prices are increasing and should provide a guideline to the level of price increases generally. Continue Reading »

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Many companies find that after their first few years they hit a sales plateau. Up to a certain volume, business comes easy. Then there comes a time when it seems as if the next sales dollar is very elusive. Ironically, the sales ceiling usually hits just at the point where profits start.

A variation of this dilemma is the seasonal sales phenomenon. I know of one motorcycle parts distributor who made huge profits eight months out of the year, only to lose almost all of it in the winter months. Continue Reading »

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BOOK VALUE

Each month or quarter you should be determining the company book value. This is the net worth figure on your financial statement. It’s the difference between your total assets and total liabilities using all the rules of accounting and taxation. As you’ll see, this has very little to do with the actual worth of your company.

LIQUIDATION VALUE

You would only rarely want to sell a successful business for less than liquidation value. You might do so to provide continued employment for loyal staffers, or some types of deals might include your continued employment or the receipt of certain royalties unrelated to the sale price. You arrive at the liquidation value by adjusting each asset to take into consideration its real value, as opposed to its book value. Next, you adjust liabilities to account for any amounts that aren’t going to be realized. Finally, there’s a cost of liquidation. Let’s look at all three for some examples: Continue Reading »

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