QR Code Update: Even the Dead Can Use Them

In reply to a post yesterday on QR codes, a past participant in my seminars who trades gravemarkers emailed me this note...

On Jan 12, 2017, at 8:06 AM, LR wrote:

HI John,

 

Hope your new year is going good.  I read your blog every day ...  Several monument companies have jumped on the QR code idea without much success.  They give the QR code and charge a lifetime charge for the website but my customers just are not buying into the idea,  The last one I did I have a company make a QR code that liked to a Facebook site and the customer liked that and cost was only $45.00 for a QR reader.  Who knows how it will all go in the future.

 

Samuel

You'd think people would be dying to have a QR code on a gravestone.  (hahaha... what a wag am I!) So you can LIKE the dead guy on Facebook?  Does a dead guy care what we think? Well, who cares, if it is what he wants.

This is a main reason for teaching, the things you hear about...

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Entrepreneurs Do Not Take Risks

When I first read that back in the mid-1980s, written by Drucker, I was astonished.  How could he say such a thing?  All I ever heard was entrepreneurs and risk were one of the same.  Then I began to reflect on what I had learned so far in business, and realized he was correct. Everyone with whom I was familiar and was successful never took risks, they worked to eliminate risks in the business process. Entrepreneurs do not take risks.

So how come we all hear "entrepreneurs take risks"?  At the risk of achieving sic passim, believe it or not the idea only got started with, guess what, ex nihilo credit in the 1970s.  How come?   Well, once you set up an ex nihilo credit regime, there is no rational limit to what can be lent, because literally nothing is being lent.  Only debt is being agreed to...  well, with a limitless supply of debt on offer, at zero cost to the lenders, well, how do you lend all of it out?

First you must socially condition people to borrow more than they need, and to do so you must overcome their natural prudence and common human sympathies.  What worked was to socially condition through media, schools, entertainment and government the idea that entrepreneurs take risks.  Borrowing from banks (who had "risk capital") was step one in an entrepreneurs saga.

According to Merriam Webster, the term "risk capital" first shows up in 1944.  Since business start-up has been around since Cain settled down after bumping off Abel, is it not a little odd the idea of "risk capital' does not show up until 1944?  These are early abuses of the term, and meanings change as people grab an emerging use to apply to an urgent need.

Let's look at some etymologies -

risk (n.) 

1660s, risque, from French risque (16c.), from Italian risco, riscio (modern rischio), from riscare "run into danger," of uncertain origin. The Englished spelling first recorded 1728. Spanish riesgo and German Risiko are Italian loan-words. With run (v.) from 1660s. Risk aversion is recorded from 1942; risk factor from 1906; risk management from 1963; risk taker from 1892.

So the word risk itself is fairly new, in light of how long we've been doing business on earth.

risk (v.) 

1680s, from risk (n.), or from French risquer, from Italian riscare, rischaire, from the noun. Related: Risked;risks; risking.

Etymology[edit]

From earlier risque, from Middle French risque, from Italian risco ("risk"; > Modern Italian rischio) andrischiare ("to run into danger"). Most dictionaries consider the etymology of these Italian terms uncertain, but some suggest they perhaps come from Latin *resicum ‎(“that which cuts, rock, crag”) (> Medieval Latinresicu), from Latin resecō ‎(“cut off, loose, curtail”, verb), in the sense of that which is a danger to boating or shipping; or from Ancient Greek ῥιζικόν ‎(rhizikón, “root, radical, hazard”).

A few dictionaries express more certainty. Collins says the Italian risco comes from Ancient Greek ῥίζα‎(rhíza, “cliff”) due to the hazards of sailing along rocky coasts. The American Heritage says it probably comes from Byzantine Greek ῥιζικό, ριζικό ‎(rhizikó, rizikó, “sustenance obtained by a soldier through his own initiative, fortune”), from Arabic رِزْق ‎(rizq, “sustenance, that which God allots”), from Syriac [script needed]‎(ruziqā, “daily bread”), from Middle Persian [script needed] ‎(rōčig), from Middle Persian [script needed] ‎(rōč,“day”), from Old Persian [script needed] ‎(*raučah-), from Proto-Indo-European *lewk-.

Cognate with Spanish riesgo, Portuguese risco

The word is a good one, but notice it has more to do with logistics than with business dealings; as to the soldier taking risks, well, war is hardly business, and from the beginning soldiers have had to over run their opponents to gain the necessities to fight.  Rebels assault the armory.  Again an ancient idea, but not business, not trade.  In logistics, oh yes indeed, there are risks, but here again, and expressly, entrepreneurs since the Phoenicians ruled the waves have mitigated risks.  Marine insurance is arguably charity, not insurance, since those whose goods go overboard are made whole by those whose goods did not, thus arguably even halal, especially since the relationship ends with the docking of the vessel.

More here...

So to move from risk in logistics, the problems of time space and matter and botlenecks, and move the idea over to human action took some doing.  But they did it.  How?  Social conditioning, just like today when your smart phone tells you what to think, what to like, where to go, what to do.  (Yesterday a cabbie became perplexed when google maps told him to go one way, and Garmin another...)

Check this bit of research out...

A look at Google Ngram – a search engine tool that allows you to see how often a given word is used across books, newspapers and magazines through time – shows that the usage of “Risk” was fairly stagnant from 1800 to the early 1960s. The frequency with which it appeared during this 160 year stretch ran from 0.002% to 0.004%, about as often as words like “Poverty” or “dog”. Starting in 1970, however, “Risk” became a hot topic. The frequency of its usage increased by over 3.5x, peaking in 2006 at 0.015%. That may not sound like a lot, but the word “Risk” now appears in print four times more often in English-language press than the word “Weather”, according to Ngram. And you know how popular the weather is…Source:Nicholas Colas, chief market strategist at Convergex, a global brokerage company based in New York.Full Disclosure: Nothing on this site should ever be considered to be advice, research or an invitation to buy or sell any securities, please see my Terms & Conditions page for a full disclaimer.

Well, there it is.  After 1971, when Nixon went off the gold standard (lite), the hegemon got to work flogging the idea of risk as central to business.  We've always had fake news and state controlled press, and they did their work.  A term normally associated with logistics is hijacked and applied to human action, business, in order to get their cannon fodder to soak up as much of this ex nihilo credit as possible, and enslave them.

Terms do not just show up universally adopted one day.  They need time to incubate.  You can study such incubation of any given word at the Oxford English Dictionary site, and see how at high levels (academia) the idea of risk and investment begins to emerge even 100 years ago or more, with the dates and works in which a term was used.  This demonstrates how slowly a critical mass forms as more an more people address the idea in their own works.  Certainly before Nixon's move there were people referring to risk in investing.  There had also began the implicit criticism of NOT taking risks, with the term risk-averse first showing up in 1961, and the illiterate version of risk-adverse showing up in 1969.

Just as it takes time for a term to solidify, and the idea behind it, it takes time for the idea to have its intended effect.  The point of misinforming entrepreneurs was to get them to take risk in the form of borrowing ex nihilo credit.  Although it was in 1971 that Nixon made lending ex nihilo credit lending possible, bankers needed proof this would not backfire on them.  Two entities that massively borrowed ex nihilo credit when Nixon changed the rules, Chrysler and Penn Central, went bankrupt, Uncle Sam bailed them out.  Bankers then understood.  In the ex nihilo credit regime, profits are privatized and the losses are socialized.  All that was left was how to carry ex nihilo credit loans on the books?

I have in hand a 1983 seminar manual for bankers, "conducted throughout the country", in which bankers are instructed to lend credit instead of money.  (Note bankers know the difference, even if you are not allowed to know the difference.) How?  There is the problem for bankers of reserve requirement and the bank balance sheet liability of such action.  The solution is clever.  Put the ex nihilo credit loans under Standby Letters of Credit, which at once have no reserve requirement and is off balance-sheet financial statement category.  Sound familiar?  The idea was so evil and contrary to sound banking, that the manual carried a sign letter of endorsement from a regulator for the Governors of the Federal Reserve System.

(As a side note, this scam is also the basis for gold leasing, specifically mentioned in the manual, and a matter of great concern worldwide, with Germans and Italians, etc, demanding that gold supposedly in USA for safekeeping be sent back to Germany, Italy etc..  Problem is, the gold may be in China, and legally so, for apparently people did rash things under "gold leasing.")

As each banking disaster occurred, and taxpayers picked up the tab, the practice got worse.  S&L Crisis in the early 80s, the the 87 crash, the 97 crash, the dot com bust, 2008... not to mention the countless individual disasters.  In every instance, the banks get bailed out.  We are now at total saturation. When Boeing builds a jet, ExImBank creates ex nihilo credit for India to buy it, it costs nothing for India to be a customer of Boeing.  The USA taxpayer is on the hook for any default.  Boeing takes the profits.  When an unemployed 18 year old stops off at a gas station and pays for two corn dogs and a supersize drink with his EBT card, the ex nihilo credit is created at that moment.  Again, it it added to the taxpayers tab. What appears to be happening is this regime is over.  The beneficiaries of this boom can no longer get any benefit.

Airlines are dying for too many airplanes.  I flew Seattle Paris round trip at Christmas holidays, $650 (about $400 taxes, $250 to the airlines).  McDonalds can't find anymore victims.  Sorts Authority cannot find enough people who want more junk.  The dinosaurs are dying.

We all love a system that works for us, even if it doesn't.  What Busby Berkeley learned in the 1930s is you could make a lot of money showing unemployed people movies about rich people living it up (We're in the money!)  Hope is a theological virtue, but it can be hijacked by bankers, and affixed to nothing, giving false hopes.  It is cruel, but the victims are all willing accomplices.

By the way, tell me, what is the primary job of the United States Secret Service?  Do you know?

Here is some more reading, which only bolsters my argument.  These open as .pdfs, and here.  That last one, if viewed in terms of promotion of ex nihilo credit, is devastating to modern economics.  Out of the mouth of babes!

Entrepreneurs do not take risks.  The regime that was based on that is dying off.  What always was and will always be is customers.  You need customers, not finance.  Find customers, and you'll succeed.  And I teach how to find customers first.

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Are QR Codes Over?

No.  Never really got started.  Small businesses need to incorporate this tech and leverage it for our own purposes. Another example of eMarketers trying to justify their worth by charging too much to do too much. QR codes are simply speed dial, making it easy to connect a smart phone to a URL, which ends up being an ad for the product or service in question.  The real benefit is anyone making contact is also offering up info as to the time and place and maybe more of the scan-event itself, great marketing info.  It can offer product assurance, anti-"piracy"benefit, obviating the need for trademark.   Also, it is generally open-sourced technology, another example of someone succeeding by NOT availing of hegemon-sponsored monopoly.  QR codes are free.  You can generate your own online.

 There is this:

HubSpot’s Lindsay Kolowich illustrates that dichotomy when she compares the results of a consumer survey versus those of a marketer survey. In those surveys, 97 percent of consumers reported they didn’t know what a QR code was; however, 65 percent of marketers said QR codes are effective. Are we to believe that marketers continue to invest in QR code technology when only 3 percent of all consumers even use it?

If those numbers are true, it is not about the 65% of marketers, it is about which 3% of 100 who use QR codes. Whatever the limits, the numbers can provide valuable info, much bang for the buck. Next, here is Xerox, noting how to do it right, B2C.

Bar Keeper’s Friend: The QR Code, glued right to the top of the can to cover the pour holes, led to multiple short, mobile-optimized videos showing uses for the product and comparing it to competitors’ products in the same category. The videos were not expensive or high production, just a woman cleaning things in a studio. Not only did they show the product’s performance against its competitors, but they also showed other uses for the product that I might not have thought of.  I have all those problems in my house, so clearly, I need to buy another can — or three.

Next, this round-up...

When we look at the compiled data over time, there are some clear trends that we see:

• Adoption has been hovering around 30% of cellphone users.

• Marketers indicate that their use of QR Codes is — not on the decline as so many people would have you believe — but on the rise.

• While more men are still scanning than women, it’s much a more balanced environment than it has been in the past. The percentages are now much closer to 50/50.

• The demographic of the typical QR Code scanner is getting older. The majority of scanners are now 35+ years old (as opposed to 18-34 years old, as it has been in the past).

• Scanning continues to dominate in retailing, where people are scanning for product information and discounts.

• Growth in mobile payments via QR Codes is significant and rising.

Next... contrary opinion...

The big question we should all be asking is, why hasn’t something as promising as the QR code gained more traction in the 10 years of its existence? Below are five reasons I see that prevented this fairly simple technology from living up to its promise...

5. Even when a QR code is done right (link to mobile-optimized site, available connectivity, clear call-to-action), it’s hard to convince oneself that the minute it takes to pull out your phone, open up a scan-friendly app (assuming one had been downloaded), scan the QR code and then wait for the experience to load, is worth it. 

OK, cited are examples of poor execution, not a summary of the use of the technology.  Good things to keep in mind when deploying the tech yourself.  Xerox flogs QR codes, and here is their list of do's and don'ts.  Here is a critic a few years back who seems to offer an internal contradiction argument, and offers alternative tech that seems too complicated and expensive.

QR codes are no cost, serve a limited but powerful purpose, and ought to integrated into packaging especially when exporting.  It reaches a demographic you want to reach, you want to track.

Can they be hacked?  Yes!  People can either fake a product and put your QR code on it or slap a fake QR code label over yours on a package of the real thing, and either way attempt to hijack your info flow.  Random serial numbers on your product can help thwart this as users can verify whether a give package is from your list of serial numbers on your website.  This slight inconvenience to hackers suggests they pick on easier prey.

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Business Trip

Self-employment is about lifestyle, not accumulation.  Paris, 2017.



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Small Business Optimism Huge With Trump

Actually, it matters nothing what happens on Wall Street or in Washington, it is always a great time to start a business when you have customers.  As I have blogged here countless times before, entrepreneurs take no risks, and mainly because we find our customers first.  To achieve customers first takes a process, which I each in my seminars.  But to the news:

“We haven’t seen numbers like this in a long time,” Juanita Duggan, president and chief executive of the NFIB, said in a statement. “Small business is ready for a breakout, and that can only mean very good things for the U.S. economy. Business owners are feeling better about taking risks and making investments.”

Feelings canot trump reality for very long, what is the basis for this optimism?

The share of business owners who say now is a good time to expand is three times the average of the current expansion, according to the NFIB’s data. More companies also said they plan to increase investment and keep hiring, which reflects optimism surrounding President-elect Donald Trump’s plans of spurring the economy through deregulation, tax reform and infrastructure spending.

OK... if The Donald does all of those things, and there is zero reason to think he will, that could be good.  Far more interesting is if he gets rid of the FED, and we finish off what is dying anyway, the ex-nihilo credit regime.  And that is the big source of optimism (note not mentioned in the article), the fact that the the dinosaur retailers created by the ex nihilo credit boom, concentrating the family life small businesses into one family's life, such as the Waltons.  Into that vacuum much demand and thus opportunity beckons.  That fact has nothing to do with who won the election, plus there is nothing any politician can do about the fact that economic regime is near dead.

So now the work for all businesses is to adjust to he new regime, and small business is always the small quick agile British Fleet against the Spanish Armada.  We win.

You just need to know how to approach this.  That is what I teach in my seminars, how o launch a small business international trade company.  The current rundown of courses available, both online and in-person, may be found here...  if you have any questions, you can email me from the link on that page.

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Dangers of Import - Retail

The problem here is two-part, one is import/retailing, and the other is not competing on design:

At the small business level, we enter the market at the place of the void, products are solutions to problems, and there are no solutions you cannot improve upon.

Your own designs are a solution to a problem not yet addressed, so you'll own that market. You never need compete on price.  Off the shelf is a solution already established, so you cannot own that market.  You are obliged to compete on price.

A retailer is better off to buy from importer who designs his own products.  As the designer, the importer has come up with new-market-tested items, still rare enough to make a retail store exciting, plus acceptable to USCustoms.

A retailer trying to gain savings by cutting out middleman causes losses...

Swope had another smaller shipment en route from Morocco and could see more difficulties ahead. Ornate wooden jewelry boxes with some Mother-of-Pearl inlay were part of the Moroccan shipment and Swope learned that Mother of Pearl qualified as a “wild product.” 
“One of the most unpleasant parts about this whole thing is that I felt like a criminal. I felt like I was in violation. I was just feeling awful,” he said. “They were holding all my merchandise and I couldn’t talk to them.”
Sorting through the mess was time consuming and Swope estimated it cost him more than $20,000. 

A common retail tactic is to "stack 'em high, watch 'em fly" ...  that is to buy a bulk order and use it as a loss leader...  that is great with a product off the shelf overseas where you can get bulk prices, and a known commodity, but exceptions prove the rule.  That works.  but not buying small quantities of known off the shelf, or buying any quantity of unknown off the shelf.

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"He griped."

After 25 years a small eatery shuts down in NYC, crushed by rules and regs.  As Reagan quipped, first tax it, if it keeps moving regulate it, if it quits moving, subsidize it.

So New York City's response to government charging too much to do too much is to create a new layer to pay for, a layer to help out with the crushing layers.

Wu cited one regulation where the restaurant was required to provide an on-site break room for workers despite its limited space. And he blamed the amount of paperwork now required — an increasingly difficult task for a non-chain businesses.
“In a one-restaurant operation like ours, you’re spending more time on paperwork than you are trying to run your business,” he griped.
Increases in the minimum wage, health insurance and insurance added to a list of 10 issues provided by Wu. “And I haven’t even gone into the Health Department rules and regulations,” he added.

He griped.  Reducing the experience of death by a thousand cuts to a gripe.  These people who destroy small business for a living are collectivists, doing for Chinese restaurants in NYC what the Cheka did for small farmers in the Ukraine.  Destroy them!

And now that they have laid waste all before them, they are worried about what is next.

"People don't know what to believe, and they're in a state of uneasiness," said Witold Skwierczynski, a Catonsville man and the head of the American Federation of Government Employees council that oversees Social Security Administration field offices. "That's the feeling I hear. People are unsettled."

Yes, they may be sent to the front lines, as a robot maintenance worker at some new "great again" USA auto plant.  Ouch!  You should have thought about that before you began to destroy small businesses.

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Unemployed PhDs

For over 30 years I have taught on the side, in live classroom settings and online.

This avocation has added feathers to my hat, developing a product, setting up a market distribution channel, written a book, aside from the fact I work when I want, where I want, for what I want, and teach what I want.  This is a second career (a double major?), when most people are lucky to have a single career.

I have no tenure so I never had to falsify science or suppress truths I know to get a position.  I bring money to the school, the school does not have to pay me out of taxpayers subsidies.  It's not that I cannot be fired, it is just they don't want to cut off what money I bring them (out of which they pay me some.)

The point if this is when people say "I have a PhD and can't find work in education..." well, I say, you aren't trying.  Like everywhere else in the world, there may be no jobs, but there is plenty of work.  Just because the ex-nihilo credit regime distorts markets to the point no one needs you IN THAT REGIME does not mean no one needs you.  Look outside that regime.  Get creative.

Here is a book I wrote on this...  Kindle version... paperback version...

It does not matter what happens on Wall Street or in Washington, what matters is what we do.  It ain't what we think that makes us happy or unhappy, it's what we do...

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Guaranteed Income

Finland is finally catching up with US, offering every citizen a basic income regardless of whether they work or not.  USA has had this since the 1930s.  We call it social security, SS.  (Why is SS so often associated with evil plans?)  Actually USA guarantees all people in USA guaranteed income, we just means-test it.   In Finland,

"A universal basic income would provide a much more secure income base in an age of deepening economic and social insecurity and unpredictable work patterns," economists Howard Reed and Stewart Lansley said in a report on basic income published in May last year.

Never mind what else it does, or who has to pay for it, or how it distorts the economy by paying for something without a signal.  In the USA they made it universal with the arbitrary 62 year old retirement age.  In this way it is self-selecting for those are to be harmed by the hegemon for trusting government.

It makes no difference to say "all Finns whether working or not" of "all people over 62 years old working or not" the program itself does damage.  When we pass off human requirements onto third parties, efficacy diminishes.  Yes, sometimes skilled charities need to intervene, especially in disasters, but neither "Being Finnish" nor over 62 in USA a cause for intervention.

We need strict separation of charity and state.

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Where Brick and Mortar Pure Play Beats eCommerce

Now if you ever talk about any given business, even with audited statements, you really cannot tell very much.  And even if a single example is valid, then question the is, is it reliable?  Will it work for anyone else?

I've been in Paris the last couple of weeks, and was introduced to a brick and mortar retailer specializing in sporting goods.  The tactic is pure contra-eCommerce, something I have yet to see, a "brick and mortar pure play" to reverse the jargon of the 1990s.

The natives tell me this fellow spotted the flaw in the eCommerce conceit, and devised a way to best the internet.  But first, let's review.  There are two insurmountables in eCommerce -

1. It costs more to gain a customer marketing online than you can make off what you sell to that customer.  eCommerce is a money pit.

2. The "last mile" is the most expensive part of logistics.

And what is the big advantage of the internet?  If you know what you want, the best version at the best price, the internet is the place to go.  (Fantasy, of course, but that is the world we live in now.)  knowing reality, you may then proceed to make money.

Dealing with reality, this fellow has rented out many small storefronts in one section of Paris, called the Latin Quarter.  Take a look at their website (and scroll down to see a map for a visual of how many stores he has in this one area, and only this area.)  Twenty years so far and still ticking.

Each boutique is dedicated to one sport.  There is the sailing boutique.  The rock climbing boutique.  The whitewater kayaking boutique.  The skiing boutique.  The bicycling boutique.  In each the has the the best brands, the best models and sizes at persuasive prices.  In this way he kills the internet competition.   He has what you want, in your size, at the right price and you can have it right now (which means the last mile is handled by you taking it home.)

Not only has he conquered Paris for sporting goods, he has repeated this pattern in ten other French cities.

Yes, you can order online.  Sort of.  But pay by check is preferred, mail it in.  But over 800 euros, they want a bank transfer. Yes, you can pay by credit card or debit card, but they make that difficult, not easy.  In essence this is just the way you'd pay thirty years ago from a mail order catalog,

Indeed, their stores hand out free-of-charge a huge 500 page paper catalog, for today, as 30 years ago, you have to have a paper catalog for effective retail.  The internet is strictly self-service checkout.

It has a website, with all of the social media buttons, so it is not short of organic materials for being ranked high in search engine searches.  But guess what?  The number one retailer of sporting goods in Paris shows up not until page three on a google search for "Paris sporing goods."  But then, who cares about what a google search gets you?

Another sporting goods store, REI, has proven to be internet-competition-proof as well.   In this instance the store is a co-op, that is it is owned by its customers, so it is not another example as a test of the hypothesis.

How did he figure this out?  First of course, ignore the hype, deal with reality. Was a Starbucks on every corner an inspiration?  Who knows?  But as the dinosaur retailers die, and a small business renaissance fills in the vacuum, examples of how to do it right will be valuable.  If this example is valid, now it needs to be tested for reliability.

The title of this post is disingenuous.  eCommerce is a non-starter, so brick-and-mortar is already the winner.  The internet is about self-service check-out.

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