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Gene Marks Has a Suggestion
The small-business tech consultant says you probably already own enough tech to run your business.
Here are today’s highlights:
Inc. magazine blames the business media for over-hyping growth.
Reader Buzz Park has advice for business owners who don’t pay themselves.
Amazon faces a $1 billion lawsuit in the U.K.
Can Tupperware rebrand itself as cool?
THE 21 HATS PODCAST: DASHBOARD
Gene Marks Has One Piece of Tech Advice: Before you spend more on technology, he says, you might want to figure out how to make the most of the tech you already have. Crazy, huh? Gene also talks about the key elements of a buy-sell agreement, how to get your employees to actually use your CRM system, and whether all of our ever-expanding array of productivity tools actually help productivity.
You can subscribe to the 21 Hats Podcast wherever you get podcasts.
Inc. magazine has decided the business media is too focused on fast growth: “In the world of entrepreneurship, there is one script that dominates them all: raise huge amounts of VC money, ride that hockey stick growth towards world domination, and end up a billionaire. A huge percentage of the business media is devoted to telling these stories and celebrating their heroes, which can leave the impression that the only way to ‘win’ at starting a business is to accept ginormous VC checks. But just like getting married, moving to the suburbs, and raising 2.3 children isn’t right for everyone. Raising VC money isn’t right for every entrepreneur. Even if both plots can sometimes be hard to resist.” READ MORE
Ami Kassar, meanwhile, has some questions about fast growth and the Inc. 5000: “Last week, business owners and entrepreneurs gathered in Phoenix, Arizona, to celebrate their place in the acclaimed Inc 5000 list of America's Fastest Growing Companies. Tuxedos came out of the closet (or rental store), champagne flowed, and Daymond John from Shark Tank came to talk. Have you ever stopped to ask yourself, what are we celebrating? What makes top-line growth something we should applaud without considering bottom-line profitability? It's almost like when we celebrate funding rounds. The more money a company raises, the more we high-five them!! How does this make any sense?” READ MORE
Buzz Park, owner of Lightyear Marketing Group, responded to a piece we highlighted last week on owners who struggle to compensate themselves: “I'm sure many of these entrepreneurs who don't pay themselves a salary think that they will recoup their blood, sweat and tears financially when they sell their business. But the best sources indicate that over 80 percent of businesses that are for sale NEVER SELL. The main reason? There's no salary for the owner and/or no profit (because it's all re-invested into the business).”
“In other words, there's no incentive for a buyer because nobody wants to buy a business that doesn't make any money for the buyer lol!”
“An excellent resource for business owners to avoid this no-salary trap is laid out in Mike Michalowicz's book "Profit First." In my opinion, it's a MUST READ for every business owner and entrepreneur.”
The price of a Chicago-style hot dog hits $6: “The Wiener’s Circle raised its prices late last year. [The restaurant’s accountant, Rick] Novak said the restaurant had discussed raising prices again but described the act of raising prices as a ‘delicate balance.’ ‘You have to hit that sweet spot where you can raise the prices to kind of recoup the cost, but also you don’t want to raise the prices too much,’ Novak said. ‘Right now, we’re at $6 for a hot dog. It’s like, how much more can we charge?’ Even in good times, restaurants often operate on razor-thin margins, something diners might not realize.”
“The price of a case of 80 hot dogs from Vienna Beef has increased only 3 percent over the last year, Novak reported. (The supplier won’t share information about pricing, or how it’s kept the cost of encased beef from rising too high.) But tomatoes are up a whopping 94 percent, from less than a dollar per pound a year ago to $1.75, Novak said.”
“A gallon of green relish costs just over $8 now, a 23 percent increase over last year’s price of $6.54. A case of poppy-seed buns is up 10 percent. A bag of white onions costs only a dollar more than it did last fall, or 4 percent, but sport peppers are up 21 percent.”
“Those price increases don’t account for the fuel surcharge the various vendors of The Wiener’s Circle added to their bills starting in the spring — about $4 to $5 per invoice, Novak said, or higher labor costs.”
“The restaurant increased wages when the Cook County minimum wage went up in July, to $15.40 per hour; [co-owner Tim] Won said the restaurant pays slightly above minimum wage, on average.” READ MORE
Amazon faces a $1 billion lawsuit in the U.K. for favoring its own products: “Consumer rights advocate Julie Hunter plans to bring the collective action on behalf of British consumers who have made purchases on Amazon since October 2016, lawyers representing her said. The proposed case—which Amazon said was ‘without merit’—would be the latest mass action against a tech giant to be filed at London’s Competition Appeal Tribunal. Law firm Hausfeld, which represents Hunter, said on Thursday that Amazon has breached competition law by using ‘a secretive and self-favoring algorithm’ to promote its own products through the ‘Buy Box’ feature on its website.” READ MORE
As shipping costs continue to rise, businesses have to get creative: “‘I have a lot of disgruntled customers,’ said Nancy Madsen, owner of Oh My Goodness Boutique, a vinyl and craft store in Corpus Christi, Texas. Many shoppers have abandoned their online carts at checkout after seeing how much they have to pay for shipping, she said. Ms. Madsen started tweaking in late 2020 how weight is measured for items in her online store so as to better estimate the weight of orders. Each print, which is like a piece of paper, is treated as one ounce in the cart but if a customer buys 13 prints, it wouldn’t add up to 13 ounces, she said. She has also removed heavier items from her online store, such as cotton shirts.”
“‘Shipping used to be around $2, but now, the cheapest shipping price I get is around $4 per package,’ said Ms. Madsen, adding that each item in her online store is priced at less than $20.”
“For her own operations, Ms. Madsen said she purchased a second delivery van for $75,000 in September. She now picks up wooden pallets from her suppliers in Texas and has them take the boxes off the pallet, after the cost of getting pallets shipped to her store rose to more than $1,800, up from $200 before the pandemic”
“‘It’s worth every cent,’ she said, adding that meeting vendors face-to-face helps her get better deals, especially on goods that are overstocked.” READ MORE
Can Tupperware rebrand itself as cool? “That means shedding the throwback to its ‘Mad Men’ era image, and positioning Tupperware products as buzz-worthy, high-utility and with an environmentally friendly purpose. That repositioning is already underway for Tupperware. In early October, Tupperware’s signature plastic food storage products popped up nationwide on the shelves of Millennial and Gen Z-favorite retailer Target, a move that marked a major shift in the company’s history. Generally the company has sold its containers solely and famously through in-home ‘Tupperware parties’ or through its own website — save for brief and limited pilot programs with retailers HomeGoods, Bed Bath and Beyond, and Target itself.”
“Gen Z, even more than Millennials, are a sustainability-oriented generation. So how does Tupperware surmount the obvious challenge of selling plastic products to them?”
“[CEO Miguel] Fernandez said Tupperware is cognizant of the challenge and is taking steps to make itself a more responsible and environmentally conscious company.”
“Tupperware is expanding its container offerings to include more sustainable materials like glass and stainless steel and is making some products from used mixed plastic waste that would have otherwise ended up in landfills, he said.” READ MORE
The North Face is going brick-and-mortar: “The specialty outdoor retailer will open more than 70 new stores in North America and up to 300 additional retail and partner locations globally during the next five years. The North Face also plans to continue to transform existing locations to ensure consistency across all its store environments and create a stronger connection with consumers.” READ MORE
The current spike in New York suggests a coming wave of Covid: “As scientists speculate what an autumn Covid wave might look like in the U.S., all eyes are on the Empire State. That’s because it’s considered a ‘bellwether’ when it comes to viral conditions, and what happens there often provides a preview for the rest of the country. Right now, New York is seeing mounting cases of the extremely transmissible, immune-evasive BQ family of Covid variants, which includes BQ.1 and BQ.1.1. Experts tell Fortune that because such variants are thriving there, they’re likely to thrive elsewhere in the country too.”
“New York is a veritable crystal ball when it comes to Covid forecasting for a couple of reasons: its volume of incoming international travelers, and its robust capabilities to genetically sequence Covid virus samples, experts say.”
“Levels of BQ variants nearly doubled this week in the CDC’s New York region, which also includes New Jersey, Puerto Rico, and the Virgin Islands. The BQ family rose from a combined estimated 9 percent last week to more than 17 percent this week, according to agency data.”
“‘Even if 200,000, 300,000, 400,000 people get infected, some of them are probably going to develop Long Covid,’ Rajnarayanan said. ‘It’s going to affect the workforce, those who cannot do remote work. It’s a huge problem.’” READ MORE
THE 21 HATS PODCAST
Rule No. 1: We Will Not Have Civil Wars: This week, Shawn Busse, Paul Downs, and Liz Picarazzi talk about why it’s so easy for tension to break out inside a business. Liz sees tension brewing between her people in the office and her people in the field. Shawn often sees friction at businesses between sales and those who have to deliver what sales sells. Paul says there’s always the potential for problems when a project gets handed from one set of workers to another, and he’s created a very deliberate process to address it. We have, he says, “really tamped down the civil wars and started solving the problems, as opposed to letting them fester.”
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Thanks for reading, everyone. — Loren