Why Buy a Franchise?

 

Why should you buy a franchise? The main purpose is to get a valued company name and expertise. But you can probably acquire a suitable name and expertise at no franchising cost.

Buying a franchise may make sense only if you get a highly recognized brand name and you receive special management expertise.

Understand that the usual upfront fees and the royalty you pay on sales, that cover whatever management training and materials you receive, will probably represent about half your future net earnings, if any.

Many franchisees eventually form groups with other franchisees, to sue over contract terms because they are unhappy with their arrangements.

Think clearly before you make an expensive franchising decision.

(See the Earl J. Weinreb NewsHole® comments and @BusinessNewshole at twitter.)

Impossible Banking Regulation, With “Too Big to Fail” BandAids

 

If a bank, or any business, is too big to fail, according to a government regulator, might it not be too big to manage in the first place?

Perhaps the emphasis on size is misdirected when related only to the need for government banking oversight.

When corporate entities get gigantic, there usually are hidden management problems that are almost impossible to recognize and avoid. These may involve more correction than possible from conventional governmental regulation.

Example: Many commercial banks also are in the investment banking business. But there are aspects of investment banking that can veer off in varying directions, which I have always felt go beyond the normal skills of everyday managerial skills at those institutions. Those specialized skills are business-oriented and are not usually the skills attained by investment bankers.

Problems encountered have little to do with the need for more regulation. In fact, the more regulation, the more likely, management will fail. (See the Earl J. Weinreb NewsHole® comments and @BusinessNewshole at twitter.)

Too Many Hate “Big Business”

 

Too many hate “big business” or anyone who has more money than they. These folks are ignorantly wrong.

Business haters often mean they want to stick it to anyone who they deem “profiteers” or “rich.”

I am speaking about any private sources who provide jobs. Even government jobs must come from taxes paid by the “rich” in business. (See the Earl J. Weinreb NewsHole® comments and @BusinessNewshole at twitter.)

The Real Purpose of a College Diploma?

The idea of having more college graduates  is not productive. Graduates are not producing a smarter population.

Colleges are doing a poor job, achieving in many respects what high schools accomplished in the past. In fact. educational productivity is poor from kindergarten on, through grade and high school and into institutions of “higher learning.”.

The prime function of a college diploma? Apart from impressing friends and relatives? Employers use them merely as a shortcut for lazily screening and evaluating prospective employees. (See the Earl J. Weinreb NewsHole® comments and @BusinessNewshole at Twitter.)

Important Productivity Gains

Economic changes occur without public knowledge or publicity, but they affect the affairs of all of us. The public ought to get basic economics education in the media, so that they may more readily absorb information that has so much to do with everyday life.

One example: Positive changes in output per hour by industry often is considered to be good during economic recessions; it helps recovery. Companies cut staff to do this to keep labor costs low.

It’s painful, of course. Lost jobs produce the favorable statistic. However, that is true only in private industry. The public sector, particularly those unionized, are being added to, with the aid of past federal stimulus funds. And they’re budget-busting, absolutely non-productive. (See the Earl J. Weinreb NewsHole® comments and @BusinessNewshole at twitter.)

    

Corporate Image Changes

Companies try to redo their image as well as re-focus when fortunes turn. They do what individuals do with New Year’s resolutions. Most individuals never seem to take those resolutions seriously.

When companies do the task, the program is an expensive undertaking. Moreover, it’s a sign of desperation and poor management when change periodically and habitually occurs.

Customers and the public instinctively feel management may be hiding real problems and that it is all a sign that management is weak or dishonest.

There is a natural tendency not to believe what corporations say and do, because of populist, left-leaning media and politicians. Corporate managers have to be doubly careful about image. They can be damned no matter what they say or do. (See the Earl J. Weinreb NewsHole® comments and @BusinessNewshole at twitter.)

Overpaid Public Employee Budgeting Solutions?

                   

I have often remarked about problems of government paying over-market wages and pensions to public employees, amounts bankrupting government and taxpayers alike.

The solution: As a start, publish wage and pension scales, along with fringe benefits of all unionized government workers. List only job description, for the public to see. Let voters know how private earnings and pensions compare to public earnings and benefits, that tax-paying voters earn for comparable work.

                   

If there is to be open government, why hide a major cost? This part of the budget is always hidden from voters. (See the Earl J. Weinreb NewsHole® comments and @BusinessNewshole at twitter.)

Shaky but Probable Social Security Promises

                   

Can Social Security checks be truly considered a government “pension” fund? No.

Can Social Security checks be delayed if Congress ever fails to increase the government's borrowing authority? Probably not, for political reasons.

The 2012 Social Security trustees report said that assets in Social Security's trust funds totaled $2.7 trillion, and Social Security expenditures totaled $773 billion. Obligations have since risen.

However, no matter what Congress does about the debt limit, Social Security recipients will get their checks.

                   

Note: There is no Social Security lock box; funds are used by government as received in Social Security taxes. So-called Social Security trust funds are actually IOUs, of no no market value. (See the Earl J. Weinreb NewsHole® comments and @BusinessNewshole at twitter.)

Anti-Trust Laws and the Consumer

The Sherman Antitrust Act has been relatively timid for over 120 years.

There always is a debate about what actually is a monopoly. Many on the left consider size alone as the deciding factor in judging a monopoly, when in the past, the competitive effect on the consumer was important.

                       

The bottom line whether there is a monopoly should be the effect on the consumer. If the corporate situation being investigated helps the consumer, then there is no monopoly. The whole intent of the Act was in the interest of the public.

                       

What is telling is the administration’s position and the support of lawyers, who are always ready to sue. But such plaintiffs do not always have the consumers’ interest at heart

                       

What about jobs? Any effects of strict leftward trusts’action will be jobs-negative. (See the Earl J. Weinreb NewsHole® comments and @BusinessNewshole at twitter.)

                   

               

The Four Basic Business Managerial Risks

The four basic business risks:

                       

1- Knowing what the possible risks are.

2- The size, types and pitfalls of accounts receivables.

3- Salary excesses, their fringe costs and how they can be controlled.

4- Existing and potential production problems and how they can be controlled.

                       

What compounds these problems in many companies, large or small, is the inability to adequately recognize them early on. And to monitor them, while managing their potential risks on an ongoing basis. (See the Earl J. Weinreb NewsHole® comments and @BusinessNewshole at twitter.)

Heavy College-Imposed Debt is Senseless

                       

The numbers about student debt from the College Board have a disturbing lesson for us.

                       

What college-debt estimates don’t take into account are a list of important factors. Student debts racked up in going to college ought to include those of their parents; they weigh down college advantages. Interest on the debts are huge and add to problems associated with those debts. (See the Earl J. Weinreb NewsHole® comments and @BusinessNewshole at twitter.)

Real Value of a College Education

                       

Estimates of a college education’s benefits are being estimated to be from about $800,000 to as much as $1 million. However, I find it’s more likely a fictitious figure, that often compares college degree earnings with those that include laborers working at minimum wage.

                       

An assumption is made that all non-college jobs are non-skilled. Many skilled jobs that do not call for a college degree, such as electricians and plumbers, pay far better than college-bred positions.

                       

Eliminate janitor-type jobs from the conventional comparisons, and the estimates get completely skewed; college’s worth is over-valued. (See the Earl J. Weinreb NewsHole® comments and @BusinessNewshole at twitter

Values of Non-Profit Companies

                       

The public usually gets the impression that non-profit companies are good and for-profits somehow are not. That non-profits are there to be helpful; the for-profits greedy, seeking nothing for the public or consumer, but largess only for themselves.

                       

The public have been taught by populist politicians and the media, that somehow profit is a dirty word. Unless, of course, a member of the public loses a job, where the boss has no profits with which to pay salaries.

                       

Then again, for-profits must have cheated to get their earnings, if you listen to the populist media expositions. However for-profits have an upside, in that they are seen as more competent. Why? Too many folks have had run-ins with the post office and motor vehicle personnel. (See the Earl J. Weinreb NewsHole® comments and @BusinessNewshole at twitter.)

Deceiving Global Warming Talk

                       

Expensive global warming talk has been based on what we are now slowly learning are hoaxes.

                                           

Moreover, ethanol production for inefficient fuel is also expensive. And it is the product of a source of food that is becoming more expensive because of its diversion to energy use.

                       

The outlawing of incandescent bulbs, and the buying of costly compact fluorescent light bulbs instead, is yet another instance of the need for rethinking some of the global warming nonsense.

                       

What about green car manufacturing and the plans of companies who are going "carbon neutral." Lots of talk, and huge expense. Really over nothing.

                       

When will schools stop teaching the kids about the “cataclysmic” effects of climate change? (See the Earl J. Weinreb NewsHole® comments and @BusinessNewshole at twitter.)

What Will Be Tomorrow’s Job Opportunities?

                       

Getting to know what jobs will be plentiful in the future is never easy to predict. In these difficult times it’s tougher than ever.

Consultants hired to make predictions are often wrong; yet they prognosticate, despite only rarely winning accuracy sweepstakes.

                       

We know that economic trends are hard to change overnight. The health care services industry appears destined to continue its growth. There will be some bumps, however, depending on legislation and unionization activity.

                       

Some aspects that require delicate skills, doctors, for instance, may be adversely affected, by legislation or continued lack of tort reform by government. Technology skills will be sought.(See the Earl J. Weinreb NewsHole® comments and @BusinessNewshole at twitter.)

How to Develop New, Real Jobs

                       

Getting the actual unemployment rate to a more normal level is not going to be easy with just meaningless gestures from the administration.

                       

The unemployment rate is actually about 15% when you consider the truly unemployed. Not only those who still haven’t given up seeking a worthwhile job. The truth is, the official unemployment rate is misleading.

To get job creations going, the economy must improve. That means psychology must get rosier. More money has to get into households through economic activity.

What will do that? Lower income taxes, fast. And productive private industry jobs, fast.

To produce jobs you must get small business starts going by cutting their taxes. And you have to cut government debt. Servicing that debt makes it impossible to keep taxes low or to make a dent in debt reduction. It’s really simple. (See the Earl J. Weinreb NewsHole® comments and @BusinessNewshole at twitter.)

An Effective Job Resume

                       

Books and advisories tell you how to write a job resume. But always remember the importance of the covering letter. It’s just as essential as the resume itself.

Place upfront in the covering letter what is most important about your skills. Outline very quickly your professional assets. Tune the theme to what that skill is; technical, leadership, or academic.

                       

The covering letter ought to quickly reprise what you are really selling about yourself. That will make it easier for a prospective employer to scan your’s from, perhaps, hundreds of other job requests. (See the Earl J. Weinreb NewsHole® comments and @BusinessNewshole at twitter.)

The U.S. Fails to Provide Free Market Capitalism

                       

The Annual Index of Economic Freedom reports from the Heritage Foundation and the Wall Street Journal, indicate the U. S. remains far behind countries such as Canada, Australia, New Zealand, Switzerland, Hong Kong and Singapore, in terms of economic freedom.

In economic and bureaucratic terms, there is much improvement the U.S. can make to eliminate business red tape and restrictions. Unfortunately, we have been heading even more from free economic principles.

                       

This, at a time when we desperately need to formulate new private industry jobs.  (See the Earl J. Weinreb NewsHole® comments and @BusinessNewshole at Twitter.)   

Business Owner: Why Sell a Franchise?

First question to ask yourself if you are thinking of franchising your business:

If you have a successful business, it’s easy to think it can be franchised. But why should someone pay for the company name and your expertise when they can probably duplicate the same entity at no additional franchising cost?

You cannot successfully franchise your operation if:

1) It is easily duplicated or entered into by a competitor.

2) You don’t have a highly recognized brand name.

3) You don’t have special management expertise to offer.

4) It’s hard to service or manage operations, from your end.

You must realize, too, that the usual upfront fees and the royalty you take on sales, that cover whatever management training and materials you may offer, will probably represent about half a franchisee’s net earnings.

That fact is bound to eventually infuriate him, assuming he becomes successful. There is no telling what the fury may be if he fails after investing in your advice.

So they may eventually cheat you or form groups with other franchisees you may have, to sue you over contract terms.

Question: If you want to franchise your business, can you finance them  as well to keep franchisees?  (See the Earl J. Weinreb NewsHole® comments and @BusinessNewshole at Twitter.)       

Guaranteed-to-be Government Fraud

                       

We hear a lot about business fraud in the media. However, there are checks and balances in business, by boards of directors and independent audits. The publicity and media extravaganzas, along with government finger-pointing and publicity,  make up for smaller, relative numbers.

Government fraud is taken for granted but is far more prevalent where politicians and bureaucrats take it as a given.

                       

An example: There is a formula for how government grants are used. There always is a euphemistic allowance made for “waste.”

And there is always an understatement of projected cost. It’s a rare government project that ever meets its original cost estimates.

                       

Then there is usually some figure allotted to account for missing funds. Or at least a few percentage points devoted for investigation of fraud.

That is because of the psychological nature of government jobs. You don’t have the same checks and balances of private industry, despite the public image the media provides.

                       

Government projects are always ramped up. Very few are ever terminated. Sunshine laws are passed from time to time but appear ineffectual. Once on the books, laws and agencies they breed have a life of their own. (See the Earl J. Weinreb NewsHole® comments and @BusinessNewshole at twitter.)