Saturday, August 31, 2013

Let People Work

The heart of the conflicts worldwide, no matter where you find them, is State policy failure in relation to letting people work.  Those not free to work look for solace in religion or drugs, both of which the powers that be, whose policies are failing, look to suppress.

A coordinated effort is being made in the USA to raise the minimum wage of fast food workers.   Such actions in the past, if they get violent, lead to State intervention.  some policy is set, with winners and losers.  Over time, the policy fails, but those who designed the policy are long gone.

Now we have the problem of a crust of failed policies on a polity expected to pay for the 40 year vacation of those who crafted the anti-market policies.  Those who expect to have a 40 year vacation funded depend on an economy they themselves hobbled to the point that it cannot perform.

USA is contemplating yet another criminal act, this time attacking Syria, and extremely doubtful evidence for an event that is absolutely none of our business.  After destabilizing the Middle East and ruining the economies of those countries, we must borrow the money from China to attack Syria.

Here is some state of the art thinking by a USA intellectual:
“[The] major world powers, new and old, also face a novel reality: while the lethality of their military might is greater than ever, their capacity to impose control over the politically awakened masses of the world is at a historic low. To put it bluntly: in earlier times, it was easier to control one million people than to physically kill one million people; today, it is infinitely easier to kill one million people than to control one million people,” said Brzezinski during a 2010 Council on Foreign Relations speech in Montreal.
Now that is a happy thought.  How about instead of talking about the false dilemma of control a million vs kill a million, how about leave a million alone.  Let them trade.  Get out of the way.

No one can do it like USA can.  We have seen it before, when President Carter deregulated, somewhat,  telecommunications, beer, transportation and eliminated some Federal agencies.  And in a move that few people appreciate the full import, Carter normalized diplomatic relations with China just as Deng Xiaoping was launching liberalization in China. While idiots gnashed their teeth over Japanese world domination, China grew.  The felicitous times over which Reagan presided where the result of Jimmy Carter's administration.  Lucky Reagan to have followed Carter.

We need another Jimmy Carter, but election fraud is material in USA, so those who believe we must be in perpetual war and total spying (mostly so those doing the spying can check up on hot chicks) stay in power.  Too bad.  USA could be a world leader and force for good.  But we have a standing military.  We have election fraud.  We are in a pickle.

We don't need to bomb Syria.  We need to bring our soldiers home and deregulate something.  Anything.  Let people work here, and the rest of the world will follow.  We've seen it before, but we need a Jimmy Carter.

Feel free to forward this by email to three of your friends.


Do Chinese Communists Care About China?

Part of being a first string leader is to actually care about the people upon whom you are imposed.  The Communist Party came to power after winning a war, and so it is recognized as a legitimate power, if they can keep it.  It is no democracy, so its leaders depend on getting it right to stay in power.

It is said the Arab Spring events truly shook up the Communist Party.

When I see the new President of China dressed like a 1970s Chinese leader, off-the-rack shirt, PLA pants and a discount belt, no special watch, I am thinking he is playing to the Chinese masses.  At the same time, by making his visit to USA a tie-in and shorter than his visits on this trip to Trinidad and Costa Rica and Mexico, he is telling small countries China cares.

Ready to open a new chapter

USA politicians get their office by election fraud, so they truly do not need to care about what voters want.   Voters certainly did not put them into office, so why should the politicians care about the voters?    This is why the politicians can lie to our faces and not worry about consequences.

We are not even a democracy, let alone a republic.  The USA politicians are not in power after some struggle.  They are just there by momentum.  One thing for sure, is they do not have to respond to the people.  This is an advantage the Chinese people have with the Communist Party.

Feel free to forward this by email to three of your friends.


Law Vs Relationships


John,

Why importers in USA (when wholesaling to customers) has to go with Net.45 rule when the orders are usually small like $150 (but exporters overseas get prepaid)?
*** I can collect $150 within USA easier than an exporter overseas can collect 150, 2500, 25000 25 million form me.  So exports are prepaid...***

But when it comes to oversea purchase, you are willing to prepay $2500?

***Willing, only after checking their references...***

Is prepay between US importer and retailers common? For how much order?

***Never.***

Feel free to forward this by email to three of your friends.


Friday, August 30, 2013

Italian Sneaks His Biz Out of Italy

Mish has a great article on wage differential, which in passing has an article on an Italian factory owner...
Earlier this month, the owner of an electrical components factory in the north of the country waved his employees off on their summer holidays. Then, without informing them, he moved the entire operation, lock, stock and barrel, to Poland.
The comments are even wittier...  such as the idea the workers can re-start the factory on their own...  hmmm...

Feel free to forward this by email to three of your friends.


New York Times Highlights Patent Success Stories

The New York Times has an article on patents, with some interesting quotes:
“This is not an area where people should do it themselves,” said Jonathan Putnam, a New York patent lawyer. “You need to understand prior patents and prior inventions. You need to explain how you’ve advanced the product. You need a dedicated adviser who has only your interest at heart.”
Ah, yes.  Only your interests at heart.
Ms. Birmingham said she used a friend who was a patent lawyer, spent about $5,000 on legal and filing fees and just recently received the patent for CityShade — two years after filing. The average wait between filing and receiving a patent is 29 months, according to the patent office.
While the patent was pending, she got her Web site, citymum.com, up and running and has sold 2,500 covers at $68 each ($78 for organic cotton).
That would be about $170,000 in revenue, or about $85,000 per year.    I wonder what the net is.  Another example..
She filed a provisional patent application by herself and started manufacturing SnapIt Screw. But then she discovered that “the invention was the easy part,” she said. “Marketing and getting it out is horrible.”
Ah yes.  Note that.  An “inventor” finds out marketing and production is where the really heavy lifting is in business.  But the person who thinks something up should own it and those who do the heavy lifting should pay the “owner.”  What a system!  The patent system is the result of an opinion, and of course there are other opinions.  The bad idea wins with government.
Finally, she took matters in her own hands, hired a patent agent recommended by a friend and paid $250,000 to patent her product in the United States and 51 other countries.
She got her $3.88 repair kit in some stores. But it wasn’t until she read about an invention contest run by Walmart, where consumers could vote for their favorite product, that things took off.
“I had a screw costume made,” Ms. Tedeschi said, who lives in Florida and Washington State. “My assistant and I flew to New York and walked through Times Square handing out samples urging people to vote for me. I was on the morning talk shows.”
To over the cost of $250,000 in attorney fees you need only sell about 65,000 units, gross.  But what is the net?  Say it is 10%.  Then they need to sell 625,000 units to cover the lawyer fees.  Gross or net profit?  Love to learn things that, for without it these stories are impossible to derive any lesson.  One winner is the lawyer who got $250,000 no matter what.  Ka-ching, with only your interest at heart.
She was one of three winners — out of 5,000 contestants.
Ms. Tedeschi, who said she had earned more than $2 million in profit, laments the lack of trustworthy advice available to the neophyte.
Gross or net profit?  Love to learn things that, for without it these stories are impossible to derive any lesson.  But all you have to do to make $2 million (gross or net?) in the patent system is....

1. Invent a repair kit.

2.  Pay $250,000 to patent it all over the world.

3. Read about an invention contest that Walmart runs once.

4. Have a costume made of your invention, fly from Seattle to New York and walk through Times Square giving your invention away asking people to vote for you.

5. Get on the Morning Talk shows.

6. Win the contest.

7. Get orders because you won the contest.

So that is all there is to it.  This kind of thing happens everyday, of course, so it will happen for you too.    Absolutely no problems at any step of the process in any way!  Really!  What are you waiting for?  All you need is a patent attorney, and they have only your interests at heart.  Oh, but wait, there are some scammers out there, so here is advice on how to avoid them...
The patent office offers tips on spotting companies that are out to defraud inventors; one bit of advice is to ignore sales pitches from people who want money upfront. Also, be wary if the offer is for a free kit. The company will most likely then ask for money for an invention evaluation. And more money for a report. And then more money.
It is fraudulent if either -

1. They want money up front.

2. They don’t want money up front.

OK.. what else is there?  Do patent attorneys ask for money up front, or not ask for money up front?

How much evidence do people need before they say "no more"?

Feel free to forward this by email to three of your friends.


Thursday, August 29, 2013

Commodity vs Specialty

When exporting, most inquiries go nowhere.  There are several reasons for this, but suffice it to say maybe one in ten becomes an order.  Now, it would not surprise me if the percentages are different with a commodity item, but even within commodity items there are speciality versions, and organic flax seed, say, would be one, vs. plain old flax seed.

So there is a strategic question a small farmer has to sort out...  are you in the commodity biz where the price and terms are largely dictated to you, or in the specialty business where you drive the deals?  (and you very well may decide "both" at which point you have two channels to manage: bulk and MOQ FOB.)

I'd argue if "both" you sell bulk from the field.  If anyone is a legitimate consumer of a 20' of flax seed, then they have the sophistication to connect with your FF and get the seed into the totes (or whatever) right off the field (or wherever big buyers usually take delivery) and off to Kota Kinabalu....  that is a sort of MOQ FOB style...  the bigger the risk, the less you do....  not C&F Kota Kinabalu, but "Ex my field,  Abdulla..."  And of course prepay...

And then of course you can do standard MOQ FOB to the specialty market....

Small businesses do not have the economies of scale and resources and time to support all of the business out there.  They have beautiful product, and plenty of people would like it without paying for it.  In int'l trade it is easy enough to get it without paying for it, and that is why some people rip off others in int'l trade rather than robbing banks.  It's safer.

Small business/farmers have to accept that not all potential is workable.  Business is mostly no, or "yes, on my terms."   You have the beautiful product that others can make money off.  For them to do so, they must pay you first.  If they can't, then they were never your customer.

Prepayment beats any fraud... so the time spent asking the questions and processing answers is unnecessary.... The challenge in exporting is to not get to where you must stop farming in order to process all of the information one could process associated with exporting.  You will end up with no seed and no customers...  I exaggerate to make my point, but it is a common initiative -killer, all of the processing for nothing.  With MOQFOB you don't have to worry about what you see...  you manage only the exceptions...

Now, I absolutely hate talking about scammers because they are not that common...  it is just that it takes only one 20' of seed gone or one payment held up and the business is not so charming, and you personally feel very bad.  The way you avoid them is structurally...

1. Protect your time - take it or leave it offers

Clarity

Simplicity

2. Protect your relationship with the freight forwarder

Rarity - only take solid leads to the FF

3. Protect your crops/revenue.

Prepay


The MOQ FOB assures all of the above for the small farmer, whether bulk or specialty.

A tip: Scammers spend a lot of time asking questions and telling you about themselves.  Your list above reads like a scammers talking points (not you as the scammer, but the buyer as scammer... I mean to say you are inviting them to overwhelm you with info... which tires you out, you drop defenses, etc...)

Yes, there is small business international trade to be done for farmers, but the direction is the opposite of what people expect.  If going international, you do less than in your domestic markets, not more.

Feel free to forward this by email to three of your friends.


Wednesday, August 28, 2013

Traceability Trumps Trademark

Dr. James Chan checks in with an article highlighting Linux Red Hat founder's views on intellectual property rights...
Intellectual property is simply an opinion, Whitehurst asserts. It's a policy that we use to try to maximize innovation. But because it's merely policy—government policy—and not some objective truth implanted on our brains by the cosmos, there's no reason to think that other governments won't disagree with the US approach. For example, in India software is not patentable. Different governments provide different opinions on what IP means.
Now that is a pithy restatement of what Patry says...  although I think Patry would not give it the status of even opinion...

An associate was recently asked to knock-off an American product here in USA for a Chinese importer.  This is new, having a USA product knocked-off in USA for the China market.  In this way the Chinese importer would have all of the documentation required to prove the item came from USA, and therefore, not a Chinese knock-off.  Subtle.

China today is like USA was when it became great: there simply is not enough law enforcement to effect compliance with copyrights, trademarks and patents.  By wildly violating those laws, American became a great nation.  So is China today.

Back to trademarks...  with the internet, we now can trace products back to the source.  Trademarks are meant to tell the buyer the article in question is genuine.  Of course, a trademark alone on a package can do no such thing... but tracebility can, and if your product is traceable, a trademark is pointless.

Let's review...

Patents -    GMO foods

Copyrights   (can't copyright recipe), written, sound or visual works.

Trademarks  vs.  Trade Secrets.  KFC  & Coca Cola are trademarked, but, their formulas are secret.

Trademarks are country specific, so you must trademark your product in every country.  But if the end user can whip out his phone and trace the item in question back to your company, then traceability trumps trademarks.

There are many ways to effect traceability, holograms, serial numbers, rfid, and secret means... but either way, it is easy.  Not all consumers need to be able to trace... only a few who can will warn all others when they discover a retailer perpetrating fraud.

Traceability will be the death knell for Trademarks... one-third of "intellectual propoerty rights" is going down.  Yay!


Feel free to forward this by email to three of your friends.


Tuesday, August 27, 2013

Apple Computer Does It Again!

Steve Jobs lives on.  Check out the new Apple Mac Pro.  Click on the little buttons on the right side to scroll down...


PCMag.com
Feel free to forward this by email to three of your friends.


Monday, August 26, 2013

You Have No Idea What You Are Talking About

If you are in business, your opinion does not matter.

The people flogging the Steve Jobs biopic are on late night radio talking.  I heard the producer relating stories about Steve Jobs, one I found interesting.

Apparently, when laser printing technology first showed up, Steve Jobs said do it.  Well, the problem was in 1985 a laser printer was $6,000.  A new Acura was $6,000.  Was he nuts?

So they fired him.  And Jobs went on his way for a decade.  And Apple went downhill.

Now, who would buy a laser printer for $6000 when an Acura was $6000?

The problem with the question is it presumes a false dilemma.  There is an opinion implicit in the question, of that false dilemma.  Either or.

Had someone formed the question as a hypothesis, perhaps they would have tested and found out Jobs was right.

For a word processor, a brochure maker, layout editor, etc, typesetting is an expensive proposition.  Say such a step adds $250 to a job.  A laser printer cuts that step out.    It takes only 24 jobs to cover the cost of the laser printer.  When your firm spends more than $6000 over the amortized PVT life of a laser printer on typesetting, you are money ahead.

How does the price of an Acura have anything to do with that calculation?

If you are starting up a business, you need to understand something:  You have no idea what you are talking about.  Your opinion does not matter.  Form every opinion as a hypotheses, and then test it.

Feel free to forward this by email to three of your friends.


Sunday, August 25, 2013

MOQ FOB Tactic

MOQ FOB stands for "Minimum Order Quantity, Free on Board (named port presumed).  In international trade FOB is an incoterm, with precise legal meaning.  In essence, it means the price of the goods with all freight and costs paid to the export port (that named port.)  FOB will always have the name of a port associated with the term, eg, FOB Elizabeth.

The "Free" in Free on Board, means free of any encumbrances such as sheriff's liens, bill notations for short or wet boxes, etc, and of course all freight and fees paid to get the goods loaded on the vessel.

MOQ FOB is a tactic in international trade used to at once...

1. Make export sales no more difficult than domestic sales.

2. Make export sales even less risky than domestic sales.

3. By implication outsource export market development.

4. Direct export marketing efforts at the best customers worldwide.

5. By virtue of the fundamental research in the process, front run competitors world wide.

6. Maintain engagement with the customer on the basis of "if not, why not?"

The tactic is ancient, and new research has confirmed the tactic is widespread and effective.

Ironically, this tactic is the most effective and least costly way of export market development, largely employed at the small business level, although large businesses may employ it to discover new markets.  By offering the simplest possible deal, on the prospective sellers side is a clear understanding of the offer, which makes any requested changes by the buyer very clear inasmuch as they deviate from the clear MOQ FOB.  Studying and pricing changes is easy.

With a firm grasp of buyer requirements, keeping the buyer engaged as long as it appears profitable is doable.  The tactic is common in most business, but appears to be unknown in food and agricultural trade, for reason having to do with the relentlessly bad advice that industry gets regarding market development.

Search this blog for MOQ FOB for more on this topic...

Feel free to forward this by email to three of your friends.