Saturday, November 26, 2022

Giving Season is Here!

It is giving season, with Giving Tuesday coming up after the long Thanksgiving weekend. Now is the best time of the year to reach out to your Donors and make sure that they are thinking of you as they give thanks for the year and give donations into the end of the tax year.  GivingTuesday.org  #GivingTuesday

First, it is a busy week starting on Thanksgiving.

Friday, December 31, 2021

Misery Index (and Pain Index)

The Misery Index hasn’t been talked about much since the 1970s when unemployment was really high and inflation was double digit. The argument is that high unemployment is painful, and high inflation is painful, so when you add the two together you get a good measure of the misery throughout the economy. Both presidents Ford and Carter had average Misery indexes of 16, but Carter when out of office in 1980 leaving a Misery Index of almost 20 to Ronald Reagan.

Pain Index

Wikipedia does a great job of organizing information and trends related to Misery Index by country over time. The article presents 2013 as an example year, just a couple years out of the worldwide Great Recession of 2007-2008. Several countries had Misery Indexes of 60 or more (Venezuela, 79.4 and Iran, 61.6).  The US had a Misery Index of 11 in 2013, predominantly because of persistently higher unemployment, inflation was below 2%.) High inflation, or even hyperinflation, is usually associated with an unstable economy.  In 2019, Venezuela had a Miser Index that was basically unmeasurable because of inflation that was 1000% or far higher.

Wednesday, September 8, 2021

OZ, by any other Name, could be a Profitable Opportunity!

Qualified Opportunity Zone Map for USA
Opportunity Zones present a hidden opportunity for Real Estate (RE) investment that should be widely utilized across the US. Why not? (View Interactive HUD Map here.)

There’s a spectacular investment tool that was associated with tax cuts of 2017 by the Trump administration. Along with the massive tax cuts, there was a non-partisan tax break to funnel private investments into underdeveloped communities around the nation.

Saturday, April 3, 2021

Is Trade Secret a Good Strategy? A Trade Secret Assessment

The most widely identified Trade Secret is, of course, Coke Cola. (The original formula included caffeine and cocaine – thus the name – but that is a different discussion!) In 1903, cocaine was removed, leaving caffeine as the sole stimulant ingredient, and all medicinal claims were dropped. But the Coke-a-Cola trade secret lives on. Sections below: 

Monday, March 15, 2021

The Patent KING: IBM for 28 years

IBM is again the leader in patents issued. That's 28 years and running.  IBM had 9,130 patents issued in 2020, compared to the next highest, Samsung with 6,416.  There's about 15 electronic and manufacturing companies with 2,000 to 3,000 patents issued. Note that all the top 10 are electronics and/or chip makers.  Forbes has a nice article by Roberts about the top 20 patent recipients of 2020

Apple, the largest company by market cap ($2.1T), is 8th with 2,792 patents. Apple is starting to get serious about batteries and autos.

Tuesday, February 9, 2021

Stop Gaming GameStop, Robinhood. Hold em, or Fold em?

What’s up with the Stock Market(s)? Feb 8, 2021 the various stock market indexes all hit all time highs. Wow. First off, Trump was very business friendly – some would argue too business friendly (at the expense of the environment and labor. But the market has chugged happily upward based on the likelihood of a Biden win and the certainty of it after the election. Markets don’t like uncertainty, and Trump has been a wildcard on many things like trade and certain industries. But historically the markets have gone up after a presidential election no matter which party wins. Of course, there are sector winners (renewables) and losers (oil, coal and gas).


Thursday, December 31, 2020

Invest in the Future of Self-Driving Cars and EVs

When you look at the future of cars (and trucks) there’s a couple things that you can learn from the Jetsons. Yes, the cartoon characters of the future. Self-driving. Not limited by Gravity. 

There are several things that would be reasonable to expect in the future of autos:

1.     1.      Huge computing capabilities.
2.       Mountains and mountains of data.
3.       Lots of sensors.
4.       Vehicles that can talk to each other, directly and indirectly. Kind of the Internet of things on (mobile) steroids.  (If the traffic ahead is stopped, it would be good to know before you get there.)
5.       Electrification on the way to sustainable/renewable transportation.
6.       Self-driving
7.       New vehicle uses and business models.

Monday, November 9, 2020

Putting Pen to Paper with Patent Innovation

When you think about images of the first writing instruments, you envision charcoal, paint brushes and quill pens. The image of Shakespeare dipping a quill pen into an ink well come to mind. The ink smeared, it blotched and it took time to dry. You know the sign of a writer by the ink all over their hands (and their poverty, of course). The poverty part is still true, about the starving writer, right?

There are many key inventions related to the pen, but none so significant as the ball-point pen. The most significant developments involving the ballpoint pen can be traced to Hungarian inventor László Jozsef Bíró. Stephen Brackman provides a great history of ball-point invention and the patent history at IPWatchdog.

Wednesday, October 7, 2020

Strategic Planning for Small Businesses and Non-Profits

Every business needs to do planning and reporting. The trick for each organization is to do the right amount of planning. You can’t spend all your time planning, and you can’t completely avoid planning. Ideally you should work the planning process around the reporting and accounting that you have to do anyway: mainly tax reporting that culminates at the end of the tax year. The approach visualized in Figure 1 organizes your year so you can build a corporate calendar and activity checklist that matches your needs.



Even though an annual planning process, with a calendar and checklist, is important, occasionally things will happen that require instant and immediate planning. You might have developed contingency plans for certain possible events, like a hurricane disaster recovery plan, but occasionally the world will dramatically change around you such that you are thrown into a situation where everything – and even the existence of the organization – is thrown up into uncertainty. The COVID pandemic is such an exogenous event. All aspects of the long-term direction of the organization must be revisited, and the near-term approach for survival needs to be mapped. Survival Planning will be addressed later.

All organizations have a similar process that they should execute, a process that spreads the planning out over the year. It is often easiest to break the major planning activities into four quarters. That doesn’t mean that you work all quarter on a specific planning activity, just make sure you do it during that quarter. For example, you might have a summer weekend retreat for brainstorming new products and services.

Unfortunately, most small organizations, especially small non-profit organizations, do not take the time, or schedule the time, to do the most critical planning. In the worst case, they may miss critical deadlines (IRS filings, for example) and even jeopardize the continuity of the organization. Think of this as non-compliance, i.e., not doing the things that are required of any business or non-profit organization.

Large companies use the corporate strategic planning process as a tool to continually focus on their goals and objectives, to understand where they are going and to engage employees in building the business.  Normally conducted on an annual basis, the process takes several months from initial data collection to the completion of the corporate business plan, annual report and budget.  With few exceptions, if it isn’t in the plan and the budget, it won’t get done. 

Figure 1 depicts a general planning process and how the planning activities for the next year begin soon after the operations of the current implementation year has begun in the first quarter. Smaller organizations can simplify this process somewhat, but still should do similar activities.

Here's how the planning process would work on a quarter by quarter basis. Assume that the business operates on a calendar year with December being the last month of the year, and January being the first month of the next year.

·        Qtr 1, the implementation quarter. The 1st quarter of the implementation year is when all the planning and budgeting from last year needs to be implemented. This is a very busy time, hiring people, buying stuff, launching initiatives. In short, there is no time for planning during the implementation quarter, it is time to start executing the business plan approved and funded during the prior planning year that culminated in an approved business plan and budget.

·        Qtr 2, Spring Strategic Outlook, is a good time for brainstorming: to do longer-term planning and new product development. Are there new products or services that need development efforts in order to be considered this planning year for launch next year? This is a good time to do a Strengths-Weaknesses-Opportunities-Threats (SWOT) analysis if the environment has changed significantly since the last SWOT analysis. Consider a rapid planning and prototyping process like LEAN Canvas.

·        Qtr 3, Business Performance Assessment. After 6 to 9 months of the year, the organization should know how things are going. Is everything on budget? Are changes working out? You should now be able to accurately estimate the full year. This is the time to develop a proposed budget for next year, especially for those things that are going as planned this year and should continue uninterrupted next year. New products or major purchases for next year’s budget consideration should be narrowed down and refined.

·        Qtr 4, Business Plan Development and finalized budget. Quarter 4 is the major planning and reporting quarter. That is when the best information of the year will be available. The full year numbers have to be organized, reports to IRS completed, employment filings completed, etc. Therefore, the end of the year is when the best information is available. As part of that process is full financial statements and a proposed budget for next year. The board of the organization needs to approve the budget for next year and the plan that goes with it. (Note that the required reporting is not due on the last day of the quarter, December 31 in this case, but all the past years numbers should be very close if not exact, so federal and state reporting in the first few days of the new year will be easily accomplished before deadlines. Consequently, some of the final stages of the planning process described for the 4th quarter might not be completed until the first few weeks of the new year.)

·       The next Implementation year begins with the new plan and budget, so a scramble ensues to implement the plan and have a successful new year.  

Links and Resources

Several organizations and books provide resources and checklists for people who are planning to launch a business. They generally don’t distinguish between a for-profit and a non-profit because every organization needs to do the same types of things: draft a business plan, accumulate startup funding, incorporate, etc. Each year you should revisit this checklist to see what needs to be updated. The planning process described in Figure 1 helps with updating the business plan, the goals/objectives, the past financials, and the proposed budget.

Here are several links of startup checklists/resources and also compliance checklists for Non-Profits.

·        Small Business Administration Resources: www.SBA.gov

·        Small Business Administration 10-Steps to Start a Business.

·        SCORE’s Checklist for Non-Profit Organization Startup.

·        Indiana (IN.GOV) Best Practices Checklist for Non-Profits.

·        WildApricot’s Compliance Checklist for Non-Profits.

·        Cullenan Law’s Year-End Checklist. (5 categories)

·        RocketLawyer’s How to keep your Non-Profit in Compliance: a Checklist.

·        Wayfind’s startup table/checklist (long but comprehensive).

·        BoardEffect’s Checklist for starting a Non-Profit.

Metrics

All businesses need to have clear metrics. How do you know that you are being successful? Revenues and net profits are always good metrics, but you want to have more than that. For example, you have to get the customers before you get the increased sales. There should be a pipeline of customers. You can identify early if your pipeline is showing leaks by various types of customer satisfaction checks. For non-profits, there may not be “customers” but there will be key constituents; you don’t technically have profits and net income; however, if you still need more money coming in than expenses to maintain operations.

You may want to issue a certain number of new products/services ever year, so you could look at the new products and how well they are received.

Non-profits (NPs) have special challenges. Many NPs sell products and services, even if they are frequently discounted or subsidized compared to the full costs. They also may have donor funding, grants, etc. And they usually have volunteers, sometimes a massive number of volunteers compared to a few employees. Keeping a good accounting of the volunteers, volunteer hours, and approximate savings from volunteers is important for reporting and justification of how far you can stretch funding from donors and grants.

As a Non-Profit, think about those factors that influence people to select and donate to a cause. Organizations that have high administrative expenses will have much less money to contribute to the actual cause. Donors (and volunteers) who are reviewing the causes that they will support look to see how charities are ranked and rated. People visit these key sites, among others, to make charitable giving decisions:

·        CharityNavigator.org. This site ranks charities within particular categories. This is the most important site for someone considering which causes to select for charitable giving.

·        GuideStar.org. This site does a deeper dive into the non-profit, reporting, officers and programs.

·        Give.org, by the BBB Wise Giving Alliance, provides a Better Business Bureau type of list for complaints about Non-Profit organizations. Use this source carefully. A very large national or international organization might have thousands of complaints but only a tiny fraction of all customers served.

·        IRS.gov has a searchable database of charities that qualify for charitable tax deductions. Since most people like the added benefit of a tax deduction from their charitable giving, Non-Profits must remain vigilant in maintaining their tax-exempt status as well as their qualifications as a charitable organization.

·        An excellent article in  Forbes by Nancy Andersen discusses these important online resources for someone selecting a charity, and therefore, critical to the non-profit charity as well.

·        Social Media, especially FaceBook and LinkedIn pages, for the charity will have followers, likes and even ratings that will offer clues as to the quality of the organization and the services provided. Many charities have blogs and resource pages as well.  

We wish you the very best with your endeavors and hope that this brief article on planning will jump start a quick and efficient planning process for you and your organization.

This article is adapted from the introduction from a 2017 book by Hall and Hinkelman on Strategic Planning and Patent Commercialization (the first in the Perpetual Innovation™ series). All rights reserved. Visit our bookstore: http://www.lulu.com/spotlight/SBPlan

Based on the reception of this article, Hall & Hinkelman may develop a book for small businesses and non-profits in the Perpetual Innovation™ series. 

Hall, E. B. & Hinkelman, R. M. (2018). Perpetual Innovation™: A guide to strategic planning, patent commercialization and enduring competitive advantage, Version 4.0. Morrisville, NC: LuLu Press. ISBN: 978-1-387-31010-4 Retrieved from: http://www.lulu.com/spotlight/SBPlan

Hall, E. B. & Hinkelman, R. M. (2017). Perpetual Innovation™: Patent primer 4.0: Patents, the great equalizer of our time! An overview of intellectual property for inventors and entrepreneurs.  Morrisville, NC: LuLu Press.  ISBN: 978-1-387-07026-8 Retrieved from: http://www.lulu.com/spotlight/SBPlan
 [Amazon v4.0e  ASIN: B074JJCDHG Retrieved from: http://www.amazon.com/dp/B074JJCDHG

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Wednesday, September 2, 2020

Who will beat Amazon in the New-Abnormal

The COVID pandemic creates winners and losers. Will it simply accelerated some winners and some losers. As with any recession, it creates destructive innovation. In the sad carnage of the pandemic should lie silver linings. Telework is one. Winners are ZOOM, losers are office buildings. We're spending some time on this concept trying to estimate how permanent this shift to remote work will be and the massive savings (time, fuel, traffic, etc.)

But the focus of this discussion is on the Amazon effect. The death of the department stores in favor of buying online and having a shipper like Amazon deliver to your door. The Forbes article, Amazon has Finally Met its Match, by Stephen McBride got me started on this topic. Even though Amazon is BIG, you can't call it a monopoly because anyone can do it, kinda. They are simply big, the gorilla in the room.

How much has Amazon (AMZN) subscription services (prime, music, unlimited, etc.) increased related to the covid shutdown, how much has Amazon online purchasing increased, and what percentage of that online purchasing will dissipate once things get back to normal. Since we don't think that things will ever go back to "normal" we refer to the post-COVID world of the future as the "new-abnormal". Amazon has more than doubled in a year, reaching an all time high Sept 2, 2020 of $3,552 per share, a market capitalization of $1.8T. Wow!

Amazon became famous in the Intellectual Property (IP) world with the one-click patent.Look away from your screen for just a second, and you could find that you accidentally bought the item(s) you were scanning. That patent expired in September of 2017 allowing everyone to accelerate the purchase process and reduce shopping cart abandonment. Amazon still has had more that 13,000 patents granted (many have expired) and 1,259 applications (according to Justia). That's a pretty significant war chest.

Walmart (WMT) was not doing a good job to compete with Amazon, so they took an extreme measure in 20016 of buying an upstart name JET that was developed from the ground up to compete with Amazon. In 2016 Walmart bought JET for $3B (more discussion here). Walmart has the unique advantage that you can return online orders to the store. An advantage for Walmart is that people who return something at the store, will likely spend that money and more before leaving. Walmart has 1,237 patents and 820 patent applications as of August 2020.

In the August 2020 Forbes article, McBride thought that there would be several winners in the Amazon space. Etsy (ETSY) is a wonderful place for customized products, arts and crafts. Etsy and the artists who utilize their online marketplace excel in this area where Amazon cannot. 

The last one is Shopify (SHOP) a software platform for small and medium sized companies that integrates all of their business. Businesses that have online, storefront and mobile businesses find Shopify works well to bring all the pieces of the business together. Since most small(er) companies have very little online presence, Shopify helps them jump over the intermediate stages of going online and managing all the sales' processes. Shopify hit its all time high Sept 1, 2020 of $1,147, up from its low in November of $282. That's more than a 300% increase! Wow!

Shopify had zero (0) patents in 2015 and only maybe 32 today. Etsy has about 25 patents; many are interesting in the use of fuzzy logic and categorization of products. The stores that use Shopify and Etsy need to build their own intellectual property protection including trademarks, copyrights and patents.

Who do you think will be the winners in the new-abnormal world? Big boom for AMZN, of course. But what about these Amazon competitors in the move away from brick: SHOP and ETSY? And what about the ultimate click-n-mortar: WMT?

#Invest #Stocks #patents #ecommerce #NewAbnormal