Category: News

Arvati’s Pizza Offers Free Food For Next Year

News

Elgin, IL – A new pizza restaurant in Elgin is offering free food each week for the next year to the first 50 people to walk through the door Saturday morning March 19 at 10am. Arvati’s Pizza is located at 1350 East Chicago Street near Shales Parkway on the east side of Elgin.  Owner Pat Useni says that he has been promoting this deal in the Elgin area and has received positive feedback.

The Courier News reports that “…the fortunate 50 will be handed a coupon booklet. Each booklet will have 52 coupons, one to be used each week for a year and for a variety of items. One week it might be a pizza, then next a salad, Useni said. And the idea is to get coupon holders to bring friends with them who will pay for other items.”

Original story: http://couriernews.suntimes.com/business/4384998-420/mama-mia-free-food-giveaway-saturday-at-new-pizzeria.html

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Business Impact Of Japanese Earthquake And Tsunami

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Unless you have been living under a rock since Thursday, no offense to those of you who actually do live under a rock, you know about the huge 9.0 earthquake that rocked Japan. If that was not bad enough, the earthquake was followed by a major tsunami that flooded much of Northeastern Japan. The events impacted most of Japan and will have a major impact on the Japanese government and economy for some time in the future. But how does this affect you and your small business?

Before I get started, I don’t want to overlook the human toll. I feel for the people of Japan and I hope that anybody who can be rescued will be, and that things will get back to normal as soon as possible. I also extend my condolences to anyone who lost a loved one in Japan.

Impact on Oil and Commodities

Most small business people put gas in their car and buy commodities like food (wheat, corn) and paper (wood).  Japan is a big importer of oil and buys many raw materials from other countries to produce electronics, automobiles, and heavy machinery.  The near term impact of this disaster is that many businesses in Japan are off line and will not be buying raw materials.  This is likely to bring down costs of commodities in the very near term.  Hopefully this means that gas and food prices will go down in the U.S.

Having said all of this, I would expect commodity prices to also swing higher, perhaps much higher, as Japanese industry comes back on line.  Companies elsewhere will try to keep up with demand for items that are traditionally Japanese, and once Japanese companies start buying commodities again, this will produce an above average demand.

Impact on Japanese Imports

It is likely that there may be shortages of goods produced in Japan and that the costs of existing inventory and replacement products will rise.  Many finished goods may be impacted, such as automobiles, computer accessories, industrial equipment, engines and parts, semiconductors, machine tools, and telecommunications equipment (http://www.worldsrichestcountries.com/top_us_imports.html).  There may be US-based manufacturers that try to keep up with the demand, but we may see some near-term shortages and price spikes.  Longer term we may see an oversupply of finished goods as Japan begins supplying the market again.

Impact on Nuclear Power

Many countries talk a good game about wanting to end nuclear power use, but when it comes down to it, it is hard to generate enough electricity for a world population that demands more and more.  The near term effect may be to slow or stop existing projects, or especially in the case of the US, prevent starting new projects in the near term.  People’s memories are short though and eventually nuclear power projects will start up again.

The near-term impact may be to companies involved with the nuclear industry and an increasing demand for energy alternatives for nuclear, such as solar and wind.  Unless something changes though, solar and wind will not create enough supply.  Natural gas may help somewhat but with increasing demand for natural gas, we may eventually find ourselves short on supply with rising prices.  Eliminate nuclear and it will put increasing pressure on fossil fuels, raising prices, until it makes economic sense to find more supply or spend more money on research and development for alternatives.

So in the near term we may see nuclear fade away, but in the longer term it will be back to try to quench our unquenchable thirst.

The General Economy In The Midterm

With the Japanese disaster, I see countries spending more to help rebuild Japan, which can only be a positive impact on the world economy.  Countries tend to reset their priorities after a disaster of this magnatude, until the bill collector knocks at the door again.  If the United States helps without offsetting the spending through cuts elsewhere, we could see rising taxes now or in the future.  I think government likes to go after company profit and tax it like crazy much more than going after the income or spending of individuals.  In either case rising taxes will have an impact on our economy for the negative, unless the government can also pay down debt.  Decreasing debt could see an increase in business investment especially with the aging population, as long as deficit reduction is attained mainly through spending cuts.

Of course spending cuts is somewhat bad for the economy as it affects jobs and programs.  Pushing jobs out of goverment and into the private sector may see an increase in overall productivity… so ultimately, who knows?

What do you think our economic future will look like after the Japanese earthquake?

Other Opinions:

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Does Our First Amendment Still Matter?

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Hopefully you follow the regular news sometimes. I read a lot of business news but every once in a while I take a peek at the regular news. The last handful of weeks Wikileaks has been talked about, and at first I was a little outraged that Wikileaks has been publishing our government’s secret documents. I am not a fan of private correspondence between politicians and diplomats being plastered out on the internet for the world to see. Much of it is extremely embarrassing but also probably necessary for our government leaders to access what’s going on in the world.

The information should have never leaked. We had a government employee, perhaps in the army, download a bunch of classified and secret information. The person who leaked the information is in trouble and being prosecuted, as he or she should be. As a requirement for his or her position and access to secret information, he or she is not allowed to disclose that information. So we have leaked information that should have never leaked. Who’s fault is that and what can be done about it? I believe our government should take steps that it never happen again.

Now back to the publishing of the information. Can and should Wikileaks be prosecuted for publishing the information? Our first amendment of the constitution guarantees freedom of speech and freedom of the press with exceptions, as written into law. One law that is still legitimately on the books is The Espionage Act of 1917. “It prohibited any attempt to interfere with military operations, to support America’s enemies during wartime, to promote insubordination in the military, or to interfere with military recruitment.” (Wikipedia) It might be possible to prove that Wikileaks did break the law under The Espionage Act, but this would have to be done in open court and certain things would have to be proved. Our government has declined prosecuting Wikileaks to date.

Instead, our government put pressure on all kinds of vendors who do business with Wikileaks. Companies like Amazon, Paypal, Mastercard, Visa, and various other U.S. companies that help internet users find Wikileaks and contribute to Wikileaks. It appears that other governments might have gotten into the act with Switzerland closing a Wikileaks bank account. This is where I’m rubbed wrong. There may be nothing to prosecute Wikileaks on, but our government can still take away it’s funding and make it difficult for our citizens to see. That amounts to censorship and economic prosecution of free speech and freedom of the press, and our government could use the same tactics on any press organization they find objectionable. Even my blog here. As far as I know, it is legal to do what our government is doing, but it breaks the spirit of the first amendment.

So what can we do about all of this? I certainly am not advocating any illegal action in response to this attack on free speech. However, we can legally show how we feel about our free speech right by voting with our ballots in the next election, and with our wallets by avoiding companies that disregard the first amendment.

References:

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Mud-Slinging And Other Political Mistakes

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I saw a ton of mud slinging in the past week as the elections wrapped up.  “My oppoent is doing or will do this wrong…”  I mean, come on, don’t you know the one major rule of advertising?  You don’t advertise for your competitor by mentioning them.  Most people are smart enough to look beyond the rhetoric and see what is really going on.  And some people will vote for the name they hear the most.  So you have to find some way to promote yourself without comparing yourself to your opponent.

It’s soooo easy to fire back if you’re attacked though.  As hard as it is, you need to continue to promote yourself without directly responding to the mud-slinging sent your way.  Sure, you can indirectly respond to accusations.  But never, ever sling mud back.  Again, you are promoting your opponent at that point and you are making yourself look bad.

Politics in this way plays a roll in business also.  You are attacked by a competitor and you need to respond.  But before you do, take a look at Honda.  Never do they mention a competitor in their advertisements, even though other car companies mention them.  In this kind of an advertisement the other car companies are saying, without meaning to, that Honda is a car worth comparing ours too.  It creates an interest in Honda.  And by not mentioning competitors in Honda’s commercials, Honda is saying that they are beyond compare… that there is nothing like them.

The thing I’ve also noticed about the politics last week is how freekin much money is being spent for advertisements.  Each contender is trying to outdo the other.  I think they would do much better cutting back to a reasonable amount of advertising and let their opponent sling mud at them.  I am not a political specialist, maybe you need to sling a little mud to get elected, but I can tell you that you can’t really buy votes, you have to work for them.  Just like you have to work for customers.  Advertising does have a point of diminishing returns so you might be able to do better with less.

Personally, I’d love to see a contest where politicians have good original ideas that make sense.  Wouldn’t you?

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Education Really Is The Key, It Really Is

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I hear politicians right now talking about the jobless recovery and what can be done to stimulate job growth.  Sort term, there is probably nothing that can be done, especially since government itself is now letting workers go.  Our federal government cannot afford to employ all the unemployed people so the only solution is private sector job creation.  And are you going to go poof and create jobs?  No, the truth is that no matter what you do, business will not hire people they don’t need.

In this country, we need more skilled workers.  The ranks of the unemployed are nearly all unskilled or trades people.  There are many, many more openings for people with math, science, and technology skills than people to fill them… perhaps not as many as in the past, but there is still a need that is not fillable.  And I understand that you can say “Here in Detroit (or Houston, etc.) there are no jobs of any kind”, and you might be right.  But as a whole, the US has jobs for skilled workers that cannot be filled.  If we had more skilled workers and less unskilled, we would be closer to having a match between jobs and workers of all kinds.

There might be a difficult time retraining older workers for various reasons, and maybe those barriers need to be defined and broken down.  That’s one place where government could possibly help.  But even more importantly, we need to make sure that all graduating seniors that want to go to college get the opportunity to go without being burdened by a lifetime worth of debt.  More kids going into college in 2011 means fewer looking for a full time job, and more openings for older adults who need jobs.

Ok, nothing is solved in September 2010 by increasing college attendance in 2011, but it could help the unemployment rate next year a bit.  If there is really an effort to increase post-secondary education over the next few years, we might yet again achieve full employment in the United States, with the unemployment rate down around 4%.  Right now we’re near 10%.

If our federal government is going to throw money around and not help more kids go to college, shame on them for overlooking the one, and probably only, area that can be helped by government.

Please note that I have a child in college now and another one going next year, but I really don’t think I would be helped much directly by new education programs.  My thought is to help our society as a whole by making positive changes with education.

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How To Help Small Business Create Jobs

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Several things have to happen for me to decide to hire: 1) I have to have the business to support the new employee, 2) I have to have work for that new employee to do, 3) I have to be able to know that the employee is doing an appropriate amount of work, 4) I have to be able to find a qualified person, 5) I have to have no other choices.

I have to have the business to support the new employee. For my consulting business, I need a new project that I can place an employee at, that I probably cannot take on myself with my current workload.  There may be a day when I hire to support the consultants in the field, but right now it’s about getting business that a new consultant will do.  Getting this business may be about proper marketing and sales, and I am not sure what our government could do to help me get new business except for overall growth in the economy.

I have to have work for that new employee to do. Today this means getting that new project.  Tomorrow it may mean supporting the business by answering telephones, filing, paperwork, and billing.  There has to be some need to fill.  Government is not going to create needs within my business to fill unless they make things more complex for me, meaning that I am hiring to do things that will not add value to the business.  Adding value makes me more money, adding complexity and administration ultimately helps nobody.

I have to be able to know that the employee is doing an appropriate amount of work. People are different.  One may love to work and will get tons done and another may have many distractions and will do little for you.  While you don’t need to crack the whip, you need to be aware of what value employees are adding to the business, or if they are just dead weight around your neck.  They do not have the motivation (profit) that you do, and there is nothing you can do to change that.  Even something like profit sharing will mean nothing if the employee does not feel that they contribute to profit.  They can and often do, but that can be difficult to communicate.  So employees do need to be managed.  In my case, I might just call them regularly to see how everything is going or follow up with the client.  Not sure what government can do to help me manage employees.

I have to be able to find a qualified person. As much as some people would disagree, it can be extremely difficult to find the right person to fill an opening.  In the past few weeks I have been trying to create a network of people I am willing to work with and I have asked for resumes of potential consultants for projects.  I have gotten one resume.  I have also asked people flat out, people I know are being cut from their position soon, if they would be interested in doing consulting for my company.  I have actually gotten very little interest in return.  I tried to fill a marketing position with an independent consultant and spent weeks trying, and finally I found somebody but why is it so hard?  It might be my particular small business that is not appealing.  However, with 10% unemployment in this country you would think people would be jumping at a potential job… and note that I have been extremely negotiable on salary or rate… The problem is that there is a shortage of qualified people for knowledge jobs.  Government can help by getting more American citizens trained.  There are so many people who want to go to college, or to be trained in other ways, but they are frightened by the costs.  And they should be.  Who wants to wind up with $100,000 in debt for a BS?  We need more of our population educated, and not loaded down by all kinds of debt.

I have to have no other choices. I am not going to hire a person where I can easily do the task myself.  Or maybe I’m overwhelmed by admin today, but I can improve my situation with technology.  I don’t want to spend money for an employee to do things that can be handled a different way.  Even at $10 per hour, an employee ultimately will cost at least double that with employer-side taxes, unemployment insurance, benefits, office space, computer, etc.  So if software means that I don’t have to hire, software it is.  Spending $5000 on software to avoid a hire will pay for itself very quickly.  Because of technology in the past 20 years, many manual jobs have been eliminated.  And businesses have benefited in productivity.  Goods of all kinds are much cheaper than they used to be because technology has helped us squeeze out costs.  This is all good except for the people who have not been retrained for doing thinking jobs rather than muscle jobs.

As I said last week, complexity is business’s enemy.  But the enemy of the American economy and the reason for high unemployment is the severe lack of skilled workers and the overwhelming numbers of unskilled workers.  We need to do much more for the individual who wants to be educated so they can get what they need and not be burdened with a lifetime worth of debt.

One thing that might help is if more (or all of an education) could be paid with Stafford loans with their current rules.  We could even eliminate subsidized Staffords.  With income sensitive repayments, students are only on the hook for 15% of their income over poverty for 25 years with the remainder of the loan forgiven.  If somebody is extremely successful, the loan is repaid.  If not, they are not overburdened.  It’s really not about helping the individual student, but about helping business, society, and the American economy become stronger.

What do you think can be done to improve conditions for small business now or in the future?

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Small Business Person *not* Making $200,000 Per Year

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I am a small business person now.  I have my own consulting practice and two clients.  I live comfortably and make enough money, although I could always use more.  I make nowhere near $200,000 per year in realized income.  If I did, I really wouldn’t mind sharing more of my income with the federal government, as long as they were using it wisely.

Realizing or showing a $200,000 personal income usually means you’re spending too much.  Your fixed expenses are high.  Maybe you’re living in a million dollar home with a big mortgage.  Maybe you have an expensive car you’re paying for.  Something is causing you to spend a lot of money.  Because I know that if you don’t need to realize a high income you won’t.  You can put as much as $42,000 year year in a 401k.  You can hold money in your business if it is a corporation (and pay corporate taxes on it), unless you have a subchapter S corp.  Even still, you have so many business expense choices to keep you from realizing an income as high as $200,000.

The real killer to the small business person is administration time, the stuff we don’t know, and the stuff that could change.  If you want to do me a favor, get rid of the complexity so that I don’t have to spend so much time working on my business administration and trying to figure out what the tax laws really say.  Do I really need to put an attorney on retainer or use a tax accountant?  I cannot possibly afford either’s fees, so I have to do it myself.  And that takes time away from billing my client and making more money for my business.  This brings down my income much more than a tax increase would.

So to the politicians who say that the small business guy making $200,000 can’t afford a tax increase, you’re probably right.  But it’s his own fault that he can’t afford it.  Otherwise he wouldn’t be realizing that much income.  The vast majority of small business people, though, make nowhere near this.  Some are by choice but most are because they are struggling to get by.

If you really want to help the small business person, the ones who provide most jobs to the economy, make it easier for us to do business.

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Some Other Things I Like – An Update

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Taking walks in the park with your hand in mine
The long evening talks when we’re feeling fine
Getting to the top on a challenging hike
These are just some of the things I like

I know it might seem work is always on my mind
And my writing in the evening when I’m way behind
They are a means to an end not a reason to fight
It’s only one small part of what I like

I liked golfing with you the other day
Calling you up and saying hey
Driving out to my mom’s and dad’s house
Thanksgiving turkey and Mickey Mouse
A day without sun just doesn’t seem right
These are some other things, that I like

Chasing your dreams just takes some time
But I don’t see forever as a 5 to 9
Sometimes I can take a break and break out the bike
Riding with you is one thing I like

It’s hard to be together and just be alone
We’re always interrupted by the telephone
As hard as we try when it doesn’t go right
Still being with you is one thing that I like

I liked holding your hand the other day
When your dad said grace and we all would pray
I know there’ll come a day when we’ll be alone
It’ll be quiet when the kids are all grown
I know we’ll need each other and it wouldn’t be right
If my music, was the only thing that I like

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You Don’t Need Wings To Fly

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You’ve got a big dream, it seems impossible
Just take a step at a time, and climb the mountain real slow
If your mind can imagine it can be done
Take the leap and touch the sun

You look up at the sky, you think it’s too high
But don’t you know, you don’t need wings to fly
Your dream can turn into your dance
All you need is faith and perseverance

Start your own business, be your own boss
Being on your own, doesn’t really have a cost
Stop selling your time and your dreams
You know you gotta take that leap

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Gotta Do The Admin

News

My weeks are filled with billable hours
Even my evenings I’m on the computer workin
I try to do fun things sometimes
But when I’m free, I gotta do the admin

I left my job a couple weeks ago
Since then I’ve hardly seen my kids
Work all hours and when I’m not
I gotta do the admin

I never thought I’d be so busy unemployed
There’s so much to do for my client accounts
I hardly have time for myself
But it’s a good problem to have right now

So I sleep at night, work hard all day
Play hard at times for my mental health
But the quiet of an early Saturday morning
Is when I do the admin, I gotta do my admin

I never thought I’d be so busy unemployed
There’s so much to do for my client accounts
I hardly have time for myself
But it’s a good problem to have right now

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