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November 2012

Tax Dodging Companies & Conscientious Consumers

With many Western governments running large and unaffordable annual public spending deficits (despite claims of austerity) attention has turned to giant companies who use aggressive tax saving schemes.

This includes companies like Google,  Facebook,  Amazon and Starbucks which make high sales in the UK but pay little corporation tax.

They do this by switching revenue out of the UK subsidiaries and switching costs in through loopholes in the tax regulations.

Whether this is appropriate behaviour depends on your perspective.

Governments will see it as bad as they are losing tax but it’s their tax laws that are allowing it to happen.

Company shareholders (direct or indirect through pension schemes) should see it as admirable.  The more money the company keeps, the more valuable the shares.

Companies can point to the value they create for the economy through employment tax, property rates and VAT.

Consumers may be indifferent but it is the body of individual consumers who have the power to make companies do the “right thing”.

Whilst differentiation is usually about creating a positive preference for one particular brand,  negative differentiation can create a preference for anything except that brand.

When I was a student,  there was a boycott against Barclays Bank because of their involvement in apartheid South Africa.

These tax dodging companies risk social outrage creating similar boycotts.

in The Next Economic Crash

The Last Typewriter Made In The UK

Incredibly the last typewriter made in the UK was in November 2012 by Brother and it’s gone into a museum.

Typewriters are a great example of why you need to do a Pest  Analysis to look  for political, economic, social and technological opportunities and threats.

Typewriters & The Destructive Force Of Technology

It was technology that killed the typewriter.

With the invention of first word processors and then  PCs with  word processing software,  the typewriter was pushed far down the customer value map with a low relative customer value which is uncompetitive unless the price is also low.

Delving deeper into the value attribute map, shows why.

A typical typewriter doesn’t have the ability to save what’s been written. This is a problem for both repeating the same letter with minor modifications since the entire thing would need to be retyped and for making corrections much more fiddly. Can you remember Tippex white paint and struggling to line up the paper in the right place?

It also doesn’t have the flexibility to do other things. A typewriter types documents. A PC can do the same task but also run spreadsheet programs, games, connect to the Internet and receive emails etc.

Why Have Typewriters Last So Long?

Given the advantages of PCs and software packages like Microsoft Office, perhaps the bigger question is “how have typewriters lasted so long?”

A manual typewriter has the advantage that you don’t need electricity.

But the last typewriter made in the UK was an electric typewriter.

So there have been small groups of people who have created enough demand for about 5,000 typewriters per year.

This includes people who have no need for the extra facilities that a PC provides, people who refuse to adapt to a PC. I know I’ve sometimes wished for simpler, easier to use technology that has half the facilities for two thirds of the price.

There will also be some people who don’t have the space for a PC and printer. They fill my desk.

Listening to an executive from Brother talk about the remaining pockets of demand, it appears that UK prisons don’t allow inmates to have PCs. If prisoners want to type, they have to use a typewriter.

What Do You Think?

Typewriters have been an example I’ve used for many years of technology making some products possible and some products obsolete. Can you think of other products where technology has overwhelmed demand for an existing product?

E.g. motorised transport and the trains replaced horse-drawn carriage for people and goods. For long distances over oceans and seas, the aeroplane has replaced the ship for small, lightweight and urgent items.

I’d also like to hear your thoughts about why the demand for typewriters has existed for so long, despite technology advances. It helps to show that a product may go into mass obsolescence but sales don’t have to drop to zero if someone has such special needs as to make the more advanced product unsuitable.

in 3 – Your Strategic Positioning

Reconnecting With Customers

What do you do if events outside the business have stopped you from keeping in contact with your customers and your potential customers who have shown interest in your business?

This is a problem I have and it’s a problem that one of the business experts I follow has.

Paul Lemberg has reached out to his email subscribers after eleven months with a mea culpa. [continue reading…]

in 6 – Revenue Regeneration

Country Risks For Global Strategy

Are you thinking about expanding abroad and wondering how you can get data for an effective global strategy?

A reader, Perry Mayer of the Pub & Bar Network pointed out an interesting resource to me – The Legatum Prosperity Index.

This ranks the countries of the world across various indices like economy, governance, education and five more and presents the comparative information in graphical form as well as a drill down by country.

A high (green) rating suggests that there will be lowered risks while red indicates a low score and consequentially high risks.

This is a great starting point for brainstorming how these factors can manifest themselves as threats and opportunities in your global strategy and then of course, thinking about how you can reduce the probability or impact of any adverse issues.

It’s not a substitute for doing a full PESTLE analysis but it’s an interesting place to start and may get rid of the feeling of “same old, same old” if you hold strategic analysis meetings every year.

in 3 – Your Strategic Positioning

Profit Hacks is the latest course promoted by Rich Schefren and Strategic Profits and contains the ideas of the Australian entrepreneur, Pete Williams.

I’d love to say that my Profit Hacks review is independent but I’m an affiliate. I’m in this for the money so if you buy after clicking through from my links, I’ll earn a commission.

Details of Profit Hacks – affiliate link

In fact I’m such a good affiliate for Rich Schefren that I’ve been given free access to Profit Hacks to take a look around.

I’ve earn my success by writing reviews that are as honest as I can make them, that highlight the good and the bad in the product being reviewed and that make it clear that the product isn’t right for everybody.

Let’s begin.

The Profit Hacks Review [continue reading…]

in Internet Marketing

Is What You Do Efficient & Effective?

I’m watching the promotional content for a new product launch called Profit Hacks which is all about helping Internet entrepreneurs to get more done in less time.

This is very relevant to me as I spend a significant proportion of my working time information marketing.

It’s got me thinking about what I do and the way that I do it.

And I don’t like what I see very much. [continue reading…]

in 2 – Your Inner Game, Business Problems And Mistakes