Individuals and companies alike, no one loves to file for a Chapter 11 or Chapter 7. Any entity that thinks of this is rubbished as a negative thinking moron. That said, situations at times just don't favor the healthy survival of companies resulting in them filing for bankruptcy. Surely, companies like GM, Lehmann Brothers (Both huge companies in their own right), wouldn't have bargained to be called bankrupt companies!
On proper analysis of the situation and taking all the facts into consideration, I believe the three reasons mentioned below drive companies to file for bankruptcy.
1. High salary costs - Any company that pays a salary having more than 50% in fixed component to all its employees, is flirting with danger. Not only does this increase the costs of the company, but it also puts the company in a predicament when it starts experiencing a loss in business. Fixed salaries work for a certain time, but for the company to evolve itself and keep excelling, the compensation must have a high degree of variable (Pay for performance) initiative.
2. High overheads - Establishing spanky new offices was surely the trend for the companies in the late 90s moving into the start of the millennium. These places just don't come for free, do they? Chances are that companies would have been paying a lot of money as rent. This again is feasible when the going is good, but when it turns sour, every penny spent comes back to haunt you bad.
3. Diligence in business practices - Seriously, I need convincing that banks (and reputed ones) managed to slip into Chapter 11! After all, they are the ones supposed to lead the way in the economy. Shortsightedness showed by not one, not two, but all banks has led to a potentially despairing situation for people as well. And yes more and more banks are coming up with the notice "bankruptcy filed".
Companies may have good bankruptcy plans. They call it restructuring plans. But the question is - Was bankruptcy avoidable anyways? If yes, who was responsible for it? Companies blame the economy, lack of credit etcetra, but how many of them actually look inwards and take the blame.
Not many, I would believe!
Tuesday, June 2, 2009
Monday, June 1, 2009
GM Bankruptcy - Reasons demystified
As the world's most admired car-maker and definitely the pride of America files for Chapter 11 bankruptcy, one needs to ask this question, "Why GM after all?" Insiders who have been following the fortunes of this company ever since the economic downturn ever started claim that this day was pretty much on the anvil.
Yet, something would have gone horribly wrong for GM to file bankruptcy.
GM Bankruptcy is a clear case of three factors
1. Spiralling costs of labor
2. Increase in fuel prices
3. Credit Freeze
4. Drop in the purchasing power of the average American
After all, GM with 92,000 employees on its board and serving a 100-year old rich history of producing top-quality cars was doing well until quite recently. It really was a lethal concoction of all these three factors that resulted in General Motors Bankruptcy.
Let's understand how each of them contributed in their own way to GM Bankruptcy
1. Labor costs - The protesting workers' unions at GM have been for long, protesting against the management to provide them lifetime retirement benefits to their members. GM agreed, and experts believe this was their first foot on the axe. At the time of filing for Chapter 11, GM, in honoring its commitment, was paying wages to people who were not even a part of the company.
2. Increase in fuel prices - With gasoline prices touching new highs almost every other week, people did not feel it worthwhile to buy any car, leave alone the GM car. Of course, some needy people still bought cars, but such people were far and few between.
3. Credit Squeeze - In these economically challenging situations, imagining banks to lend credit to any flagging company is unthinkable. Thus, when GM was running short of funds and when it was expecting a short bailout from the Government, the Government and institutions cited lack of credit and tough market conditions for them not being able to provide financial assistance.
4. Drop in purchasing power - The recession definitely has done its bit in bringing down the purchasing power of Americans. The same GM car that were affordable units some years back, are now considered to be out of reach for a lot of people. Over the last few years, this has been one of the reasons new sales of cars taking a beating.
GM Bankruptcy really means two things
1. It doesn't matter how big as a brand you are. If your Sales drop and if your costs shoot up, you will be amongst the bankrupt companies, sooner than later.
2. Brand name is important, but managing the brand is critical.
The fact that GM pays about $1,500 per car as extra benefits to people, who don't even work with GM anymore, is the final nail in the coffin.
GM Bankruptcy definitely is a sledgehammer for the auto industry in the US, which is already reeling heavily under the onslaught of unfavorable market conditions. It remains to be seen how their competitors fare against these messy times.
Yet, something would have gone horribly wrong for GM to file bankruptcy.
GM Bankruptcy is a clear case of three factors
1. Spiralling costs of labor
2. Increase in fuel prices
3. Credit Freeze
4. Drop in the purchasing power of the average American
After all, GM with 92,000 employees on its board and serving a 100-year old rich history of producing top-quality cars was doing well until quite recently. It really was a lethal concoction of all these three factors that resulted in General Motors Bankruptcy.
Let's understand how each of them contributed in their own way to GM Bankruptcy
1. Labor costs - The protesting workers' unions at GM have been for long, protesting against the management to provide them lifetime retirement benefits to their members. GM agreed, and experts believe this was their first foot on the axe. At the time of filing for Chapter 11, GM, in honoring its commitment, was paying wages to people who were not even a part of the company.
2. Increase in fuel prices - With gasoline prices touching new highs almost every other week, people did not feel it worthwhile to buy any car, leave alone the GM car. Of course, some needy people still bought cars, but such people were far and few between.
3. Credit Squeeze - In these economically challenging situations, imagining banks to lend credit to any flagging company is unthinkable. Thus, when GM was running short of funds and when it was expecting a short bailout from the Government, the Government and institutions cited lack of credit and tough market conditions for them not being able to provide financial assistance.
4. Drop in purchasing power - The recession definitely has done its bit in bringing down the purchasing power of Americans. The same GM car that were affordable units some years back, are now considered to be out of reach for a lot of people. Over the last few years, this has been one of the reasons new sales of cars taking a beating.
GM Bankruptcy really means two things
1. It doesn't matter how big as a brand you are. If your Sales drop and if your costs shoot up, you will be amongst the bankrupt companies, sooner than later.
2. Brand name is important, but managing the brand is critical.
The fact that GM pays about $1,500 per car as extra benefits to people, who don't even work with GM anymore, is the final nail in the coffin.
GM Bankruptcy definitely is a sledgehammer for the auto industry in the US, which is already reeling heavily under the onslaught of unfavorable market conditions. It remains to be seen how their competitors fare against these messy times.
Sunday, May 31, 2009
How to do a good business write in your Press Releases
A press release is often the best way of promoting your business. Well, you can't really call it promoting, because when you read guidelines to writing press releases, you will understand it is a different kind of a business write-up. The first thing you should know about a press release is - It is a kind of news releases, which is acted upon by journalists.
Straight to the point - In the past, I have seen some press releases, which are straight in-your-face kind of advertising material. On the other hand, I have seen some press releases being submitted to top PR directories like PR Newswire, that have tens to thousands of errors. Gets me to think - Do people even know how should they be writing press releases?
When the answer, I found was a vehement No, I get to write this. So read below, if you wish to write press releases, and good ones at that.
1. Start with a bang - Pay close attention to your headline and opening para. If the headline does not grab the reader's attention, probably your press release won't. Open strong and you win half the battle.
2. Cut the junk stuff - So, all you advertisers and hardcore sellers - Writing press releases may just not be your cup of tea after all. Don't write press releases with an eye to sell or promote your product. Your press release should talk only of news about your company and how it can benefit people, in general.
3. Watch the words - If you don't have time, journalists have even lesser, and trust me, when people read newspapers, they just don't read it fully either. In such a label-go-lucky world, you obviously want people to read what you wrote. Value your words. No point writing 1000 word fiction novels, as people would in all probabilities end up trashing it.
4. Exclamation points - People think it is fancy using ! in press releases. Definitely not, and what are you anyways getting excited about. Reserve this for the articles at best. Even if you wish to use them in your Press Release, use a single ! mark. Don't use (!!!!!!!) or something like that.
5. Finally have your company boilerplate at the bottom of the Press Release. Even if your release is good, it would go waste if you don't tell people how to contact you.
These really are the basics of writing press releases. In my next article on the subject, I will talk of a Sample press release template and the common mistakes you should avoid in a press release. Until then, happy press releasing!!!! (I can use this because it is an article, not a PR)
Straight to the point - In the past, I have seen some press releases, which are straight in-your-face kind of advertising material. On the other hand, I have seen some press releases being submitted to top PR directories like PR Newswire, that have tens to thousands of errors. Gets me to think - Do people even know how should they be writing press releases?
When the answer, I found was a vehement No, I get to write this. So read below, if you wish to write press releases, and good ones at that.
1. Start with a bang - Pay close attention to your headline and opening para. If the headline does not grab the reader's attention, probably your press release won't. Open strong and you win half the battle.
2. Cut the junk stuff - So, all you advertisers and hardcore sellers - Writing press releases may just not be your cup of tea after all. Don't write press releases with an eye to sell or promote your product. Your press release should talk only of news about your company and how it can benefit people, in general.
3. Watch the words - If you don't have time, journalists have even lesser, and trust me, when people read newspapers, they just don't read it fully either. In such a label-go-lucky world, you obviously want people to read what you wrote. Value your words. No point writing 1000 word fiction novels, as people would in all probabilities end up trashing it.
4. Exclamation points - People think it is fancy using ! in press releases. Definitely not, and what are you anyways getting excited about. Reserve this for the articles at best. Even if you wish to use them in your Press Release, use a single ! mark. Don't use (!!!!!!!) or something like that.
5. Finally have your company boilerplate at the bottom of the Press Release. Even if your release is good, it would go waste if you don't tell people how to contact you.
These really are the basics of writing press releases. In my next article on the subject, I will talk of a Sample press release template and the common mistakes you should avoid in a press release. Until then, happy press releasing!!!! (I can use this because it is an article, not a PR)
Work Freelance - Getafreelancer review
Owned by Plendo Sweden AB, Getafreelancer is a leading freelance website that has seen a record number of subscriptions to it (Providers and Members). Known for their easy interface for projects and excellent supporting features, Getafreelancer, also known as GAF to people, is steadily climbing the charts of popularity.
Getafreelancer (Hosted at www.getafreelancer.com)
Advantages
1. Gold Membership for providers - Any provider (new or old) can purchase the Gold Membership with this site, which comes for $12. On purchasing the Gold Membership, you are allowed to bid on 150 projects in one calendar month. This allows you to bid on a lot of projects and win some work for yourself.
2. Very easy Search Interface - With this freelancing website, you wouldn't have a lot of issues locating a project related to a specific skillset.
3. Low commissions - Getafreelancer.com charges relatively low commissions for regular providers. Importantly, if you are a Gold member with this site, you don't need to pay any commissions to the site when you win a project.
4. Regularized payment process - They pay regularly and on time. Some freelancing sites don't even pay on time, and considering this fact, it is a real advantage for sure.
Disadvantages
1. Low billing projects- Buyers often post projects in this freelancing website at atrocious project fees. Imagine you seeing a project for writing 20 500 word articles for a total of $10. Worse still, projects like these form a major chunk of all the projects in Getafreelancer.
2. Ridiculously low closure rates - If you apply for 100 projects in Getafreelancer, you could hope for 7-8 projects to be closed in your favor. Now, this is a bad conversion ratio, even if you consider the highly competitive domain of freelancing.
3. Bad customer support - Of all the freelancing websites in the domain, Getafreelancer.com is considered to have the worst customer support. Your queries will often go unresolved.
4. Bad dispute redressal mechanism - Their dispute redressal mechanism may seem like being one of the best, but this mechanism finds its way only through to the paper. The measures seem hardly ever implemented.
Final Thoughts
It can be a good website for you, if you want to earn some bucks (Not big bucks). With most projects here hardly finding the top tier of the billing rates, you definitely can't look at earning a lot of money.
Getafreelancer (Hosted at www.getafreelancer.com)
Advantages
1. Gold Membership for providers - Any provider (new or old) can purchase the Gold Membership with this site, which comes for $12. On purchasing the Gold Membership, you are allowed to bid on 150 projects in one calendar month. This allows you to bid on a lot of projects and win some work for yourself.
2. Very easy Search Interface - With this freelancing website, you wouldn't have a lot of issues locating a project related to a specific skillset.
3. Low commissions - Getafreelancer.com charges relatively low commissions for regular providers. Importantly, if you are a Gold member with this site, you don't need to pay any commissions to the site when you win a project.
4. Regularized payment process - They pay regularly and on time. Some freelancing sites don't even pay on time, and considering this fact, it is a real advantage for sure.
Disadvantages
1. Low billing projects- Buyers often post projects in this freelancing website at atrocious project fees. Imagine you seeing a project for writing 20 500 word articles for a total of $10. Worse still, projects like these form a major chunk of all the projects in Getafreelancer.
2. Ridiculously low closure rates - If you apply for 100 projects in Getafreelancer, you could hope for 7-8 projects to be closed in your favor. Now, this is a bad conversion ratio, even if you consider the highly competitive domain of freelancing.
3. Bad customer support - Of all the freelancing websites in the domain, Getafreelancer.com is considered to have the worst customer support. Your queries will often go unresolved.
4. Bad dispute redressal mechanism - Their dispute redressal mechanism may seem like being one of the best, but this mechanism finds its way only through to the paper. The measures seem hardly ever implemented.
Final Thoughts
It can be a good website for you, if you want to earn some bucks (Not big bucks). With most projects here hardly finding the top tier of the billing rates, you definitely can't look at earning a lot of money.
Work freelance - Scriptlance review
The sudden spate of job layoffs and no jobs has allowed a lot of people to take up to work freelance as an option. Now, staying at home, freelancers can think to make a whole lot of money. In fact, early results seem to indicate that freelancing job is soon being treated as a way people could establish their online business. Surely, they are worth a look.....errr... a listen, definitely!
Freelancing often means you approaching work to your clients on an independant basis. Assuming you work from your home, apart from your electricity and Internet bills, your cost overheads are considerably low. This is, thus the time, for you to know which one is the best Freelancing site around. Well, I deal with this in two parts. In part 1, I would talk of various freelancing sites, their advantages and possible drawbacks. Of course, I would look at it from a neutral view because I have been a member with most of these sites for the last 3 years now.
So, here we go!
1. Scriptlance (Hosted at http://www.scriptlance.com/)
Advantages
1. User-friendly interface for you to post projects and invite bids from candidates or freelancers.
2. You could post your project on any domain (Writing, programming, Website designing)
3. Safe escrow feature that allows you to minimize your risks in dealing with programmers
4. User rating system that allows both parties to review their work relationship on a scale of 10.
5. Forum, which allows you to voice your concerns and share your opinions.
Disadvantages
1. Scriptlance has received a lot of negative reviews due to their unfriendly customer service. See their reviews submitted by users and buyers at http://www.xomreviews.com/scriptlance.com.
2. High commission fees - Scriptlance deducts 5% of project fees as commission for the project. This is a bit high compared to other freelance work sites.
3. Account suspension - Scriptlance is not known to be a provider-friendly site. See the reviews at http://www.xomreviews.com/scriptlance.com and you will know of the many instances when the site has been accused of stealing money off people.
Final Thoughts
This site has about 3600 active programmers on the site, over the last 7 years since it ever started. A good place for you to approach work on low-billing projects! It though has to prove itself on high-billing projects, especially when it comes to releasing monies to programmers.
In the next article, you would read the review of Getafreelancer, another freelance site.
Freelancing often means you approaching work to your clients on an independant basis. Assuming you work from your home, apart from your electricity and Internet bills, your cost overheads are considerably low. This is, thus the time, for you to know which one is the best Freelancing site around. Well, I deal with this in two parts. In part 1, I would talk of various freelancing sites, their advantages and possible drawbacks. Of course, I would look at it from a neutral view because I have been a member with most of these sites for the last 3 years now.
So, here we go!
1. Scriptlance (Hosted at http://www.scriptlance.com/)
Advantages
1. User-friendly interface for you to post projects and invite bids from candidates or freelancers.
2. You could post your project on any domain (Writing, programming, Website designing)
3. Safe escrow feature that allows you to minimize your risks in dealing with programmers
4. User rating system that allows both parties to review their work relationship on a scale of 10.
5. Forum, which allows you to voice your concerns and share your opinions.
Disadvantages
1. Scriptlance has received a lot of negative reviews due to their unfriendly customer service. See their reviews submitted by users and buyers at http://www.xomreviews.com/scriptlance.com.
2. High commission fees - Scriptlance deducts 5% of project fees as commission for the project. This is a bit high compared to other freelance work sites.
3. Account suspension - Scriptlance is not known to be a provider-friendly site. See the reviews at http://www.xomreviews.com/scriptlance.com and you will know of the many instances when the site has been accused of stealing money off people.
Final Thoughts
This site has about 3600 active programmers on the site, over the last 7 years since it ever started. A good place for you to approach work on low-billing projects! It though has to prove itself on high-billing projects, especially when it comes to releasing monies to programmers.
In the next article, you would read the review of Getafreelancer, another freelance site.
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