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Posts Tagged ‘big business’

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Is Starbucks Really A Small Biz Killer?

Thursday, June 25th, 2009

Here’s an interesting question to consider: are big chains like Starbucks and Wal-Mart actually as harmful to mom and pop shops as common wisdom dictates? Not so fast, says Temple University prof Bryan Simon, who tells Reuters that that it least when it comes to Starbucks (sorry, Wal-Mart), the assumption is flat wrong:

“‘In fact, Starbucks created the market for the small coffee shop,’ says Bryant, whose new book ‘Everything but the Coffee: Learning about America from Starbucks’ is due to be released in October.

Simon argues that 20 years ago you couldn’t find a ‘good’ cup of coffee anywhere, until Starbucks came along and ‘created a desire and a taste for specialty coffee’ that eventually gave birth to the corner specialty coffee shop.”

So the guy’s got a book to sell, and those kinds of statements make headlines because they fly in the face of what most entrepreneurial types believe to be true. But what do you think? Does the argument hold water? For once we’ll refrain from commentary until you weigh in. More tomorrow…

evilstarbucks

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Perspective.

Thursday, May 14th, 2009

Sure, times are tough for small businesses right now, particularly those of you entrepreneurs trying to seek funding with your business plan. But while it might not be the easiest time for your business, just remember it could always be worse. From CNBC:

“MGM Mirage Looks to Raise $2.5 Billion in Capital.”

Okay, so that may not make you feel much better. But still—ouch.

MGMmirage

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Can Mission Statements Be Useful?

Tuesday, May 5th, 2009

Mission statements have always struck as somewhat useless. While it’s one of those things that every start-up and business plan should have, it’s not entirely clear to us why that’s the case. How many would-be customers even read a company’s mission statement, let alone are swayed by it?

Yet something we read today made us question that stance—at least, the part about mission statements being entirely worthless (we’re still not convinced anyone reads them). AOL’s new CEO Tim Armstrong sent out a memo to employees this week asking for help determining what the company’s new mission statement should be. Here’s part of that email:

“We have done significant deep dives into some of our largest products and services over the last three weeks and there are clear areas of leverage starting to emerge. One area of leverage is our mission as a company and as a team. What is AOL committed to delivering to the world and to each consumer? Our strategy and brands should follow that commitment.

In the town-halls and employee meetings over the past few weeks, I’ve heard over and over again about the need to clearly define AOL’s mission and organize the company around it. The best source of ideas and insights for crafting our mission statement is you and our collective brain power.”

Pushing aside all the fluff and self-satisfying wording, Armstrong is actually asking an important question: what is it exactly that AOL does? At this point—and we’re a former AOL customer—we couldn’t really tell you what AOL’s primary service is. The only thing we’re aware that aol.com email addresses are good for are as spam accounts, and most people who still use it as their primary email are roundly mocked. The confusion obviously extends into AOL offices as well. So in this case could developing a solid mission statement that speaks to what the company does do some good? Done right, it may not only help inform employees regarding the company’s direction, but by extension, current and potential customers as well.

But then maybe Armstrong’s giving mission statements too much credit—and maybe we’ve had a little too much coffee. What do you think? Can a mission statement help define a company’s direction and vision, and keep it on that track? Or is this a worthless exercise? Tell us what you think in the comments section below, and while you’re at it, please offer up any ideas you may have for AOL’s mission statement. So far all we’ve got is “Not just dial up” and “More than chat rooms and loose cybersex.” Contribute your own below!

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testing

Tuesday, January 20th, 2009

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Why Some Entrepreneurs Love The Recession.

Tuesday, December 9th, 2008

You know how everyone says that booze and pornography are recession-proof industries? You can go ahead and add quasi-food products and discounts retailers to that list of too. Gossip media blog Gawker has a round-up of the top businesses that are not only doing well in this economy, but those that are flourishing—and yep, Spam’s on it. As Gawker notes:

“Everybody’s doing bad now, right? Not at all! Capitalism, as we all know and believe, is a wondrous balancing mechanism that ensures that when one area of the economy (everything) goes down, another (ten quirky niches) will rise up.”

Totally. Here’s who they say is hitting pay dirt these days:

-Layoff consultants. Remember the “The Bobs” from Office Space? They’re taking home big paychecks about now.

-Lazard. The Tribune Company called financial advisory firm Lazard after they realized they would have to file for Chapter 11 bankruptcy protection. No word on who else has retained Lazard’s doomsday services, but we’re assuming others will follow in suit. Cha-Ching!

-Wal-Mart. One of the few retail stocks that’s actually performing well these days. Enough said.

-Spam, McDonald’s, and Ramen. The cheap, go-to meals for the penniless and former Wall Street execs.

-Netflix. For whatever reason, this online movie rental company’s stock shot up by 10% today. It is cheaper than going to the movies…

To that we’d add the following:

-Repo Men. When people don’t pay their bills, it’s the repo men who get paid. They reclaim cars, furniture, and anything else a consumer may not be making payments on.

-Pawn shops. When things get tight, people starting pawning. Bonus for pawn shop owners: their stores make for cheap holiday shopping!

-Video games. Despite the fact that Electronic Arts announced today that their earnings next year may be slightly below what they expected, this segment continues to do remarkably well. To wit: games sales jumped by 18% in October.

-Pet goods retailers. No matter how bad things get, pet owners still lavish their pets with toys and pricey chotchkes. The proof is in the numbers: the American Pet Product Manufacturers Association says that the pet sector will reach $43.4 billion this year—a full 6% increase from last year. That’s a lot of chew toys.

hormel

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We Hate To Kick Big Business While They’re Down, But…

Tuesday, November 25th, 2008

Let’s push our business plans aside for a moment and have a happy feel-good moment, shall we? A new study out today from the Small Business Administration’s Office of Advocacy indicates that not only are small businesses more innovative than larger companies, but that their innovation is more impactful. Says the report:

“Small businesses develop more patents per employee than larger businesses, with the smallest firms producing the greatest number of patents per employee. Furthermore, small firm patents tend to be more significant than large firm patents, outperforming them in a number of categories including growth, citation impact, and originality.” And they add, “This suggest that the patents of small firms in general are likely to be more technologically important than those of larger firms.”

Snap!

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(Image via Wired)

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Social Marketing Gone Bad.

Monday, October 20th, 2008

Do you need a “fresh perspective” on lunch? Want to trade in your “tired brown bag lunch or stale deli sandwich for something freshly-made, healthy, and delicious?” The Donald spawn Ivanka Trump totally gets it, or at least that’s what she says over at her new blog, “A Fresh Perspective.” The blog has posts about saving money on lunch, the doldrums of deli sandwiches, and, cryptically, a “lunch trade” that Trump says she and a corporate partner will conduct on Tuesday.

As it turns out, the whole thing—the blog, the lunch trade—is a marketing stunt for ConAgra Foods and their Healthy Choice Fresh Mixers, shelf-stable microwavable meals.

If uber-wealthy Ivanka Trump seems like a bizarre spokesperson for the lunchtime plight of 9-to-5 office worker, it’s because she is. She owns a fur coat. She flies in private jets. Her father is a billionaire. While it’s obviously not unusual for celebrities to promote various products, usually there’s some logical connection between the star and the item. Kirstie Alley and Jenny Craig made sense. Jessica Simpson and Proactive Solutions made sense. A former model pushing “processed chicken from a plastic tub,” as the New York Times points out, does not.

So, what was ConAgra thinking? Company Vice President Michael Locascio tells the Times:

“We wanted somebody who would appeal to a younger office worker who’s technology-savvy. We wanted someone they could identify with, someone they knew, but also not somebody that was on the front of every tabloid.”

The problem is Ivanka Trump isn’t that person. And the faux-blog is an unfortunate example of the pitfalls of new media advertising. It comes off as disingenuous because, well, it is. For their money, ConAgra would have done better with a series of traditional magazine ads in health and fitness magazines. But that’s just our two cents. Are some businesses better off avoiding new types of marketing like blogging and social networking? What do you think?

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The Difference Between Entrepreneurs And Corporate Hacks, Er, Execs.

Tuesday, October 7th, 2008

You don’t have to be a rocket scientist to operate a successful business. What you do need is common sense, a basic understanding of economic fundamentals, and the ability to recognize when you need to keep your own greed in check—something the execs at Lehman Brothers apparently didn’t possess. Just check out this email passed between Lehman execs where two of the company’s higher-ups—including CEO Dick Fuld—mock the idea of them forgoing their bonuses while the business struggled to keep its head above water. Responding to an email suggesting that higher-ups should skip bonuses this year, Lehman exec George H. Walker (and yes, he’s related to the George W.) writes:

“I am not sure what’s in the water at 605 Third Avenue today, but…I clearly have some work to do.”

Unfortunately for, like, THE WORLD, the work he was referring to wasn’t getting Lehman back in line, but rather making sure he got his bonus. While usually it’s small business that can learn from the foibles (and sometimes successes) of big business, here’s one place where entrepreneurs can teach a lesson: if a business is struggling—and struggling badly—you cut your bonuses and scale back on your salary. Most entrepreneurs even skip salaries period during the first year or two of a company’s operation because it just makes sense. They realize that not only will there be a big payoff down the road once a business becomes successful, but that sabotaging the business by killing cash flow with a massive payroll is basically tantamount to sabotaging yourself. Plus aren’t bonuses a reward for a job well done? While these Lehman execs didn’t exactly own the company (they just acted like they did), their salaries, bonuses, and other perks most certainly depended on the long-term success of the company. So why didn’t they possess the common business sense to make that connection? Blind greed? Lack of myopia? All of the above? What do you think?

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Dick Fuld testifies before The Man yesterday.

Image via Dealbreaker

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Here’s Who Really Rules The World. (Sorry, W.)

Friday, October 3rd, 2008

Has everything that’s happened with the economy this week made you feel like a semi-insignificant pawn in a game of chess?

Well, that’s because you are. As proof, check out TheyRule, a website that graphically shows you who sits on the boards of most major corporations. As you can probably guess, it’s basically a big, nasty, tangled web of powerful individuals and corporations mixed up with each other and the government. Not surprisingly, many of these corporate big wigs sit on the boards of not just one, but several major companies. Take Vernon E. Jordan. He sits on the board at Asbury Automotive, Xerox, J.C. Penney, Sara Lee, and American Express, and, oh, was also a Clinton Administration advisor. In addition to seeing which boards various people sit on you, the site also links you to search listings for each person so you can dig deeper if you really want to feel bad about your station in life.

While this site has the potential to be really depressing, it’s (of course) got a fun little schadenfreude tool
that makes the icons for the execs who sit on multiple boards look fatter than the others. Okay, so it’s not that awesome. But we’ll take what we can get in this case.

theyrule

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