Corpcentre's Blog

April 18, 2010

How to Use Failure to Your Advantage

The word “failure” has negative connotations. It is hard to think of anything positive when discussing failures. Yet, many business leaders will tell you that failure is not the end of the world, nor is it only negative. While a business failure certainly implies setback, it also leaves the door open for improvement, change and opportunity.

American business leaders have embraced the opportunities presented by failures while Canadians lag behind in this respect. The inability or unwillingness to compete is a common denominator of many Canadian business disasters. One of the first lessons to be learned from a business failure is not to cut back but, rather, to dive into the marketplace and compete with all your might. Learn from failure and allow it to be the catalyst that is your driving force. In California’s Silicon Valley, business has embraced the concept of “failing well.” You made good decisions but circumstances were beyond your control. If you are good at what you do, you’ll eventually succeed. In Canada, the opposite is more common. If your business attempt failed, you’ll have a very tough time securing capital for another venture.

Failure in business can be one of your greatest teachers. Successful corporate leaders have learned from their mistakes and impart that wisdom to their employees as well. By sharing this wisdom with one’s staff, it carries the message that even the boss is not perfect. Moreover, it encourages staff to also learn from their mistakes. Every successful mega-company started small and did not achieve greatness overnight. When your staff appreciates the growing pains of a company, they can become part of the driving force to continue propelling the business forward.

This doesn’t mean that one should create a culture that focuses on failure. Just the opposite is true. A business environment should strive for success. Ultimately, that is the goal that we wish to achieve. However, every successful path has setbacks and failures. Learn to appreciate that none of us is perfect and we can learn something new everyday. The only way to avoid failure is to stop trying to achieve. Use every setback to your advantage and ultimately you will win.

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November 17, 2009

Managing Your Corporate Knowledge

Thanks to your hard work and dedication, your business has grown. Once a small workforce that met for coffee and donuts every morning, the company has now grown into a major concern with scores of employees in several locations. As the boss, you knew each employee and probably taught them what to do. In a pinch, you could fill in for them as well. Today, though, the employees are names on an HR roster. The bigger issue, though, is that you have lost touch with what each employee knows. As the person at the top, it is vital for you to know how much human knowledge and skills are at your disposal.
 
A proper Knowledge Management (KM) system is a vital tool. It helps uncover the knowledge in your organization and reduce or eliminate gaps caused by employee turnover. Furthermore, it helps businesses avoid duplication of work.
 
A recent study of companies with a KM program revealed some startling figures. 63% of the companies had realized an acceleration of innovation. Two thirds of the companies had reduced operating costs. A similar percentage experienced a dramatic increase in teamwork and cooperation as well as an increase in responsiveness and performance speed. The study also calculated that failure to exploit knowledge in an organization effectively results in 6% of a company’s annual revenue remaining unrealized.
 
Experts in KM recommend implementing an intranet-based information system in order to make information readily available and accessible within your company. Similarly, exit interviews for departing employees should be carefully conducted so that specific knowledge does not go out the door with the employee.
 
Finally, even though your business has grown, make the time to socialize informally with employees. In order to work as a team, you must know the team members.
 
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October 3, 2009

How Canada Prepared for the Crunch

Looking back just a little, the current recession took hold in 2007 when the inflated U.S. real estate bubble exploded. The speed with which the downfall snowballed surprised many but did provide enough time for legislators to take early action. The Canadian government, under Prime Minister Stephen Harper, was one of the first to prepare for the coming financial challenges.

The first step was introducing legislation in 2007 for permanent tax reductions for Canadian homes and businesses. As the recession hit the U.S. in early 2008, these new tax cuts took effect, helping sustain consumer spending and pumping billions of dollars into the Canadian economy. The lower GST is a blessing for individuals who have more of their hard earned dollars to spend. Canadian businesses now benefit from the lowest corporate tax rate among G7 industrialized countries, providing cash for continued corporate growth and creating new jobs.

During the country’s strong economic years in 2005-2006, the government wisely reduced the national debt by $37 billion. By entering this recession period with a low debt burden, the government has had flexibility to run a short term deficit and provide funds for job creating investments and other economic stimulus programs.

Another preventive measure undertaken by the Harper government was regulating the mortgage market. The maximum term was reduced to 35 years and a minimum 5 percent down payment is required for government-backed mortgages.

Finally, responding to a cautious banking sector, the government has enacted programs to provide access to financing for consumers, households, and businesses. The government has not replaced private lending but, rather, is working in a cooperative effort with financial institutions to encourage lending and provide a network of guarantees.
 
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October 2, 2009

Credit Now Available From The Federal Government

A person needs oxygen to survive. A business needs credit. Even in the most difficult of times, the flow of oxygen remains uninterrupted. Not so, however, with credit.

Many a business has seen its line of credit be reduced or cancelled over the course of the last year. Financial institutions, seeking to reduce risks on unsecured or unstable credit lines, have made obtaining funds ever more difficult. This move has dealt a crippling or death blow to many small businesses in Canada.
Under Canada’s recent Economic Action Plan, designed to stimulate and strengthen the Canadian economy, the Federal government is sponsoring a program that will work with financial institutions in the private sector. The Business Credit Availability Program (BCAP) will provide loans and other forms of credit support to creditworthy businesses. At least $5 billion has been allocated in loans and other forms of credit support for business enterprises with viable business models but, for various reasons, have limited or no accessibility to financing.

The BCAP is a joint venture between two financial Crown corporations and private Canadian financial institutions. The steering committee is comprised of senior representatives of all sponsoring parties whose experience and commitment have establishes a program with initial promising results. Similar to credit issues, discussions are also being conducted to examine ways of providing accounts receivable insurance.

Business owners and entrepreneurs seeking assistance through this program to support their established operations and preserve jobs should contact their financial institutions to discuss their needs and eligibility. Your financial representative can advise you which program is best suited for your particular situation.
 
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September 29, 2009

Small Business – Less Tax

However you dissect the finances of a business, specifically a small business, cash is the primary component of the bottom line. The more cash in the coffers, the more flexibility the business has.

The current global recession has dealt extremely harshly with Canadian small businesses. Reduced sales and credit restrictions have pummeled the cash flow of many worthy enterprises.

The Canadian government, seeking to ease the plight of this important and large sector of the country’s business community, has established several stimulus programs through its Economic Action Plan to provide much needed economic relief. Realizing that continued growth of small business is dependant upon available cash, the federal government has passed legislation that increased the amount of small business income eligible for a reduced federal tax rate of 11 percent. Effective January 1, 2009, the eligibility cap was raised from $400,000 to $500,000. Canadian-controlled private corporations that claim the small business deduction are eligible for this credit. By increasing the eligible income by 25 percent, the federal government is helping small businesses retain more of their hard-earned cash. This, in turn, will help stabilize the business community, create new, much-needed jobs, and promote economic growth throughout the nation. It is estimated that this reduced tax rate will cost the country more than $120 million over the next two years. However, with nearly half a million Canadians out of work, it is a wise investment and money well spent.
Canadian businesses can obtain detailed information from the applicable federal government agencies.

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September 9, 2009

To Buy the Competitor or Not to Buy

Although the state of the economy is still uncertain, this should not affect whether a company should pursue acquisition of a competitor, if that is its intent. Rather, one should be somewhat more prudent and disciplined in how one evaluates the potential purchase.

During these recent difficult times, the markets have naturally focused their attention on companies in distress. This should not translate into a belief that the entire business sector is in ruins. However, as the competition may be in dire straits due to the present financial crisis should not be a reason to abandon ideas of purchasing that company. Careful assessment of the competitor is crucial. Seek to understand why that company is losing money. Will your investment merely save a struggling enterprise that was on its way to closure anyway or are there other factors at play that will make this a worthwhile purchase?

It is important to dissect the company and understand how it works. Were there management problems? Did the company mismanage its relationships with its customers and suppliers? Were the employees mistreated and, therefore, did they not perform well? Is the machinery sub-standard, thus affecting the product? Examining the company with a fine-toothed comb will allow you to make an effective decision as to whether this company can merge with yours. Similarly, it is important to do a proper evaluation of your own company. Are you in a position to absorb this company? Do you have the management capabilities for this merge? Will your staff cope with the additional production and sales? Will you need capital to overhaul machinery? Similarly, examine your goals. Perhaps you are only interested in expanding your customer base. In that case, go directly to the competitor’s customers, rather than affecting a buyout.

Research is your best business ally.

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September 6, 2009

Introducing CanNor, Canadian Northern Development Agency

Following promises made in last fall’s election campaign and, more recently, in last November’s throne speech, Canadian Prime Minister Stephen Harper revealed that the headquarters for the new Canadian Northern Development Agency (CanNor) will be built in Iqaluit, capital of Nunavut.

The Prime Minister’s announcement was made during a recent tour of the North, his third tour of the region this summer. CanNor will deliver funding for economic development, advocacy, and research. The newly established agency will receive $50 million in federal funds over the next five years.

The decision to locate the new agency’s headquarters in Iqaluit has been met opposition from several senior government officials, stating difficulties finding enough housing and staff. Mr. Harper responded that challenges such as these are exactly the reason for establishing an economic development agency and, therefore, the government must place the agency directly where the challenges are the greatest.

CanNor will also have satellite offices located in Whitehorse and Yellowknife, as the agency is designed to work cooperatively with all the Northern territories. The new agency will take over some existing federal programs and will develop new programs adapted to the territories’ realities.

As several other nations have their sights on the resource-rich northern territories, the Harper government is determined to concretize Canadian sovereignty over the region. Establishment of this stand-alone regional economic development agency will allow the Federal government to work with the region to help it reach its full potential, both human and economic.

The Premiers of both the Yukon and Northwest territories welcomed Mr. Harper’s announcement but added that additional key economic developments are crucial to their respective territories in order to strengthen the entire Arctic region.
 
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September 3, 2009

Promoting Your Business on Social Networks

“The times they are a changin”. Bob Dylan wrote these words nearly 45 years ago. He must have been predicting the future.
It used to be quite common that people assembled at social events and exchanged ideas, recipes, political viewpoints, and suggestions on where to shop for the best value. The 21st century has not replaced the traditional social gathering. However, it has augmented that with the modern and very powerful equivalent – the social media network.

Marketing studies have shown that recommendations from friends and family have the greatest influence on what people purchase. As millions have become attached to various social networking sites that connect people with similar interests worldwide, the circle of influence grows much larger.

While most social media sites are not designed as shopping venues, marketing specialists know that exposure on these sites can be extremely valuable. A prime example is Facebook. Facebook has more than 200 million subscribers worldwide. Members enter their profile on the site. Generally, this includes your demographics, preferences and, often, your occupation. Marketing pros at a company will post an attractive profile for their product or service. As soon as a Facebook member visits that company’s profile, they are identified as a potential customer. Most Facebook members openly display their friends’ networks. This enables the same company to view this circle of friends also as potential customers. Moreover, as the company can obtain a substantial amount of personal information about its online customers, this information can be extremely helpful in future marketing strategies and product development.
Businesses have discovered that social networks afford exposure to their companies that otherwise might not occur. However, it is wise to keep in mind that these are social networks and acceptance of a commercial presence will require imaginative marketing, rather than mere technical placement of corporate material.
 
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July 16, 2009

Green Light for Organics Part I

Filed under: business Opportunities,nutrition,organic food business — corpcentre @ 4:31 pm

Topping the Pizza

Matthew Von Teichman’s wife was expecting, and in a move to introduce a more healthy lifestyle she decided to buy an organic pizza for their supper. They were both largely unimpressed. But this spurred Mr. Teichman, the experienced entrepreneur, onto a new venture to offer people a good range of more than palatable organic food products. Life Choices Natural Foods, which now has expanded across Canada and the U.S., was born.

Now sporting nine product lines that are certified organic, featuring breaded chicken, mac and cheese and the newest one, multigrain perogies; their first product offer was indeed pizza.

Von Teichman notes the organic industry’s explosive sales growth rate of 20% recently, compared to that of most non-organic products that only goes up by 1 or 2% per year. This can be attributed to consumers’ greater awareness of health-related issues as well as improved access to research on organic science via the internet. Von Teichman sees the interest as being due to people’s demand for nutritious foods and their demanding to avoid dangerous substances like chemical residues. The main selling points of organic products, including food, health-care products and vitamins are that they are generally not genetically modified and they don’t contain antibiotics, herbicides, hormones, insecticides or pesticides.

Is Organic Truly Better?

Apparently, there is no definitive proof of organic food being more nutritious or healthier than its non-organic counterpart. According to Professor Rena Mendelson of Ryerson University who is also chair of the Canadian Council on Food and Nutrition, a variety of farming conditions makes it difficult to pinpoint the nutritional levels or their sources. But she feels that there is a difference in terms of the impact each type of food has on the environment. A reduction in pesticides would make all farming more organic and put those foods ahead of nonorganic produce in that regard.

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July 12, 2009

Profit from Businesses Likely to Grow in Hard Times

Filed under: business Opportunities,entrepreneurs,recession,starting a business — corpcentre @ 5:45 pm

Even as demand for exports decreases and consumers spend less in this recession, there are several industries in the U.S. and Canada that are looking to be thriving.

Five sectors that did well in previous recessions, according to economics professor Jack Carr of University of Toronto are food and beverages, health and well-being, telecommunications, business consulting and business-process outsourcing. This time they are expected to do well again.

Cheap Food

Campbell’s Soup‘s sales have done well in other difficult economic times as people look to save on comfort foods. And in 2008 McDonald’s saw an increase in their sales figures at a time when other companies saw decreases. Their sales grew 8.2% in October 2008 from October 2007, and by 6.9% the previous year.

Companies that produce food would do well to sell more in the way of basic staple foods to supermarket chains and attempt selling to lower-end family establishments. During the recession, most people are less interested in experimental cooking or luxury-type foods, says marketing professor Alan Middleton at York University.

Health Food and Fitness

“Right now, I’d be looking to invest in anything that helps people have healthier, happier lifestyles,” says Arlene Dickinson, CEO of Calgary-based marketing agency Venture Communications and a resident investor on CBC-TV’s reality show Dragons’ Den. Though people might not be able to currently afford expensive gym memberships, they may have more time to focus on exercise and purchase less expensive equipment and workout clothes to use at home as well as healthy, inexpensive foods.

Must Stay Wired (and Wireless)

Solutions Research Group, based in Toronto, has determined that Canadians will not be willing to give up their cellphones or net access and will be the among the last things to go when cutting down on non-essentials in their personal budgets. The BlackBerry Bold and Apple iPhone look like they will continue to be top sellers, as well as their respective accessories.

IT and Consulting Support

Like we said in a previous post (See “Bank on Opportunities from Big Firms”), as big corporations cut nonessential staff they may look to outsource certain needs like IT support and other types of consulting. Firms that specialize in Web conferencing and other communications alternatives to travel are also poised to succeed in this economy. These and other types of business-service providers would do well to push their services as being available at a decent rate for temporary solutions to corporations that need them.

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