As the nation moves closer to the Presidential election, the calls for universal healthcare are increasing. However, looking at the current stances on how this should be achieved, I have toask the question of whether there is any desire to really solve the problem?

The truth is the estimated 47 million people without health insurance are used like a political football and are pulled out every election cycle and passed around by both parties to stimulate their base (pro and con) and then put back on the shelf for a later date. With the country moving toward a more liberal stance on healthcare the likelihood of some change is great as the arguments are made for and against universal healthcare. To this end, I would like to present the current way being proposed (penalties) and an alternative methodology (incentives).

Penalize

Currently, the most prevailant solutions for paying for universal involve penalizing the wealthy, state and local taxpayers and municipalities. Presidential candidates have proposed everything from removing the Bush tax cuts for the top 10% of wage earners to mandating coverage through legislation.

The redistribution of wealth has always been a contentious issue among Americans and serves as a punishment for achievement. Under our system of taxation a family earning above $105K is counted in the top 10% of wage earners in the United States. This income range can hardly be considered lavish, but under certain economic philosophies they are considerd the "evil rich".

In fact, this income level could be achieved by a husband who is a police officer and a wife who is a nurse or an over the road truck driver who owns his/her own rig. While I am certain these working class "rich" would agree with providing universal healthcare, would they agree with raising their taxes to accomplish it?

The second proposed way of paying for universal heathcare would be to mandate employers provide healthcare for all employees. This idea would cause hardship on the employee and employer. If employers are forced to provide healthcare, they would simply lower the wage of any potential worker to compensate for the difference and not offer raises or bonuses for a period commensurate with the increased expense for current employees. It would also cause a shortening of potential applicants to due pre-existing conditions and/or other health concerns.

Additionally, there is a better than average chance those benefits will be classified as compensation and be added to the reported salary of the employee, which would add to their tax burden.

Incentivize

The alternative to using force or mandates to solve the healthcare problem is that of choice and incentives. Properly structured incentives programs could easily solve the problem of healthcare coverage within a single year. The two incentive ideas I would like to share are tax breaks and bond issuances.

Tax Breaks 

Under this scenario, households that are able to subsidize the cost or partial costs of healthcare for another person or family would receive a tax credit on their federal taxes. The system would work by having the State Dept of Health and Human Services develop a cost associated with providing healthcare for people in the State and taxpayers would be able to go online and bid monthly or annual amounts to cover those costs. In return the taxpayer would receive a statement at the end of the year and be able to deduct donated funds.

Bond Issuances

In many state and local municipalities, when the need arises to raise a capital for expenditures  such as sewers, roads or stadiums bonds are issued, in lieu if raising taxes. These low interest paying vehicles are affective because they give those who want to participate the ability to do so to their desired level. They also have an investment that is secured by the health of their stae or local economy.

I believe the same could be done with providing healthcare. Once again the Dept of HHS would come up with a number that represented the costs of covering those people in the respective locality and bonds would be issued on an annual basis. The interest paid on the bonds would be funded through the savings the government would have on indigent care and subsidy programs such as Medicare and Medicaid. 

In short, government is not the answer to all of our problems. Individuals can offer as many solutions at half the cost.  

Thought of the Day | No Comments »

As a consutant, I have met many people who have been bitten by the "flipping" bug. They diligently watch all of the shows dealing with finding, restoring and selling distressed  or foreclosed properties. The have saved their money and now are ready to flip a house for huge profit. Unfortuntely, it’s not that simple.What the popular shows don’t tell you is you have to do your "due diligence" concerning a property before you purchase and begin the remodeling.

These steps include:

• Comparative market analysis
• Crime reports 
• School rankings
• Educational background of current residents
• Average income of residents

These are but a few of the factors that determine whether someone will purchase your home after the remodel.

Keypoint: If no one wants to live in the neighborhood where your property is, it doesn’t matter how good the deal is. 

As a real estate investor, I have owned several properties and have looked into "flipping" houses. Amazingly, as many houses as I have researched, I have not found one that has met the standard enough to have me purchase. There have been homes I made offers on, but they were over priced and were taken by investors who still own them to this very day. 

On several properties of interest, I had our team builder come out an assess the condition of the home and what it would take to repair and remodel. During one of the inspections he asked if I had ever considered building a house to sell instead of flipping. The point he made was even though I could remodel a home with new appliances, fixtures and landscaping, it doesn’t change the age of the house. (Eureeka!)

The undeniable fact about new construction is the buyer has the opportunity to be the first to live in the home and depending on which stage of construction they purchase, can choose paint color, carpeting, cabinets, etc. 

Building a new home in an established neighborhood gives you the benefit of an establish price range, stable residency and the ability to offer brand new features for the same price as the current offerings.

What is most amazing is it isn’t as expensive as you may think to build a home. The are companies that offer plans for all types of homes such as www.frankbetz.com. The key is finding a builder that is reputable, honest, insured, and you can see at least five homes of varying types he/she has built.

I have recently purchased property and we are about to break ground on our first "build for sale". I will be posting updates and photos as the process proceeds and we will see what happens.

Finance and Investing, Word to the Wise | No Comments »

There are those who think this statement is ridiculous. After all, advertising is how a business owner lets potential customers know they have the solutions to their needs…right?

But what does a small business do when there are no funds for advertising? How will their message be heard?

In the absence of a significant advertising budget, networking is the next best solution. No matter what your vocation, there are associations, clubs, and social groups that have the same target market as your company, but are offering different products. Even though you all are competing for the same dollars, many times there are groups of professionals who like to share successes and discuss difficulties as they move through their business cycle.

When choosing these associations, be imaginative, think of businesses your target groups may frequent and learn as much as you can about your customer’s habits within their business. For example, if your target market is "Soccer Moms", then it may not be a bad idea to attend a meeting of the local orthopedic injury association.

One of the benefits of networking is there is no limit to the number of organizations you can join or meetings you attend and most are free. Moreover, many of the meetings you attend will lead to others…I belong to four formal organizations and attend meetings and social gatherings with an additional three. Through these associations, I have  received leads, referrals, and business contacts that would have taken months to generate on my own. 

Before you run out and join ten organizations there are a few thing you need to prepare:

1. Always have ample business cards.
2. Perfect a five minute description of what your company does (elevator pitch).
3. Take any marketing collateral you have , but keep them in your car.
4. Dress professionally for your first meeting, even if it is social.

  The key to effective networking is to meet as many people as possible and have conversations with those who can help you increase your client base or knowledge. Many of the people you meet know more than you, so always be ready to listen and if you really find someone you feel will be beneficial invite them to meet with you within two days of your conversation to further discuss your or their ideas. If you are a reserved person who has trouble in large groups, take it slow by attending but not talking to anyone, then set a goal of meeting one person per meeting, then two, then three - you get the idea.

Business Development | No Comments »

This announcement is just one more example of people relying on someone else to keep them from making bad decisions. It is not the place of the FTC and the NIH to put pressure on manufacturers to take actions that are contrary to their profitability.

The report cited an effort to have manufacturers of certain foods believed to increase childhood obesity to refrain from ads that target children. In a free market society, market forces should be allowed to determine whether a product is sold and marketed to a specific group. It is the job of parents to educate their children on the consequences of purchasing certain products.

If children under 12 are a large enough percentage of sales for Coca-Cola to dedicate a portion of it’s huge advertising budget, then we should be looking into how the children are obtaining the Coke. 

To be clear, there has been no legislation regarding the matter of advertising to minors or improving the nutritional value of certain products, but there has certainly been threats and hints of legislation (ie the trans fat law in NY). The artice states:

"Initial participants in the voluntary self-regulation program, which is backed by the Council of Better Business Bureaus (CBBB), the parent group of the industry-funded Children’s Advertising Review Unit (CARU), are Cadbury Schweppes, Campbell Soup, Coca-Cola, General Mills, Hershey, Kellogg, Kraft, McDonald’s, PepsiCo and Unilever. Masterfoods has also since joined, bringing the current total up to 11 participating companies". - Food Navigator.com

Where are we going with this. Your children are fat because you let them eat foods that make them fat; couple that will a lack of exercise and DUH!. The only exercise kids today get is walking from the bed to the Playstation while eating a bowl of Frosted Flakes.

The lack of parental supervision is quickly degenerating our society into a bunch of whining chubbies looking to the government to save them from themselves. If you want regulate what is sold to your children stop buying junk and buy products that promote good health and I guarantee the product offerings will follow.

Rants | 2 Comments »

I have just returned from a trip to Arizona where I stayed in a four-star resort and was pleasantly surprised at the high level of customer service my family and I received. The entire staff was very accommodating and truly made us feel welcomed. When we first arrived and were escorted to our suite, there was a problem with the room. Not only did the management team quickly resolve the problem by giving us another suite, but the bellman brought us a new set of keys within five minutes of us getting settled in the larger and better located suite. With a start like that, we knew we found the right place.

In fact, after a big meal, my brother and I were walking around the resort, when one of the workers drove up in a golf cart and asked if we would like a ride to our room or were we just enjoying an evening walk? He wasn’t a driver or concierge, but a considerate housekeeping employee looking out for his guests.

As I flew back to Atlanta, I began to think about why this experience was so exceptional and I soon realized it was because we no longer receive good customer service in our daily lives. I thought about when that changed and what was killing customer service?

If we begin with the usual suspects, we could talk about the horrific attitude of the standard hourly employees, but that would be too easy. We could discuss the theories of wages being driven down by foreign outsourcing and the lack of better paying jobs due to immigration or downsizing, but  they are only symptoms of a larger problem.

Newsflash: Managers Sought for Questioning in the Demise of Customer Service!

Investigators announced today a growing suspicion in the management staff of frequented businesses. Managers became people of interest as detectives began to examine the root causes of poor customer service. Chief among the identified traits were:

• A lack of clear management standards and expectations
• No coaching for sales and customer service staff
• No employee incentives to increase customer satisfaction
• A lack of total quality management philosophies
• Hiring practices that do not screen for excellence
• No forum for customers to express concerns

Investigators discovered businesses that did not take measure to hire the proper staff, coach their development, reward their successes, listen to their customers, or have consistent goals and expectations were adding to the demise of customer service. Employees only portray traits and attitudes that are allowed by management and failure to correct these short comings woud most certainly lead to a lack of patronage and the cessation of business.

Finally, business physicians have determined poor customer service is not fatal! Managers willing to take longer in hiring, work harder to instill the importance of taking care of the customers in staff, suppliers and vendors are beginning to show improvement in their business health. Even in instances where price increases are necessary to cover the expense of finding motivated employees, customers are excited about the resuscitation of customer service and look forward to a sunny prognosis.

Management | No Comments »

Effective advertising is letting your target markets know you have the solution to their needs. In the development of the ad piece you use to make them aware, you must understand the consumer does not care who you are until they need you. When I explain this to business owners, it is met with a raised brow and matching grimace. "What do you mean by that", they typically ask. If you look at the sequence of events involved when a potential customer views an unsolicited piece of advertising it usually goes like this:

1. What is it?
2. What does it do?
3. How much does it cost?
4. How can I reach them?
5. Where are they located?
6. And oh yeah, what was the name of that company?

In our busy society we have very little patience for things that are unexpected, therefore advertising campaigns must utilize as much effective pitch time as the readers patience will allow. I can remember in the 1980’s there was a campaign that had the words Great Sex!! at the top of the page and followed with, "now that I have you attention" and went into the pitch. This was great at the time because it gave the reader a chuckle and many times achieved the goal of them reading at least half of the ad. Unfortunately, pop up adds have ruined the effectiveness of surprise advertising; people are for more likely to think an ad the had the words Great Sex!! was for Viagra or some other sexual aid and throw the piece away.

What I stress most to business owners is the understanding of their target market and designing their campaign around the tendencies of said group. If you are targeting "Soccer Moms" the ad has to be short to the point and relevant to what she needs at that time. She is not going to take the time to read your ad unless it hits upon something she needs now or is aware of needing in the next few days. For those of you who are married, have you ever had your wife ask you about an ad for a service that was on TV or the radio? She describes as much as she can remember and asks if you know who they are. That is what I am talking about. She did not care about who the company was until it fulfilled a need she had.

When you are designing your next ad use the large type for an introduction to what you can do for the consumer and put your company’s name in the same small print as the telephone number at the bottom of the page and see if there is a difference in response. If you have associates who fall within the demographics of your target market, let them see your add and ask them what it is about, not what they think about how it looks. Experiment with different layouts and ways of drawing attention to what you are trying to sell and keep pride of ownership from reducing the efficacy of your campaign.

Marketing, Word to the Wise | No Comments »