ETD: 836 New business how-to; KMart-Eddie Lampert - the new
Warren Buffet; RFID will help strengthen the 'Secure Economy'
E-Tailer's Digest
etd_post at gapent.com
Thu Nov 18 03:51:46 GMT 2004
E-Tailer's Digest --- Everything for the Retailer
Issue #0836 November 18, 2004
George Matyjewicz, Moderator mailto:georgem at gapent.com
Published by: GAP Enterprises, Ltd. http://www.etailersdigest.com
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CONTENTS
[1] Greetings
[2] New business how-to
[3] Eddie Lampert - the new Warren Buffet
[4] RFID will help strengthen the 'Secure Economy'
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[1] Greetings.
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Hi All:
We started launching a new venture, and I reported some of the process
today. Obviously some of you are trying the same thing, or seeking help in
how to start a business. So, I thought we could come up with thoughts on
how to start or expand a business. Let's get your input.
I assume you read about the KMart/Sears merger which created the third
largest U.S. retailer. I recall we discussed such a merger a couple of
months ago. Psychic eh? ;-). What's more amazing about this is the guy
who put it together - Eddie Lampert. Keep your eyes on him - he's going to
be the next Warren Buffet, and KMart will be the next Berkshire Hathaway,
RFID is in the news again. They are looking at using it to track
shipments. They need to find a way to use RFID on all shipments by truck,
ship or plane. I have a colleague who is logistics manager for a major
home building supplier and he has a major issue trying to locate his trucks
around the U.S., They all have the Qualcomm units on the back of each
vehicle, but it doesn't help them know what is where. So RFID with GPS
(global positioning system) would be ideal.
37 days until Christmas - less than 6 weeks! And 8 days until Black
Friday. Are you ready? What are you doing this year to increase business?
Tell us about your business which will remain for posterity at
our "Members: Who Are You?" site. Anything to do with the retail world,
i.e., supplier, retailer, consulting,
etc. http://etailersdigest.com/resources/members/index.htm And we have a
form there for you to tell us about you. As I said when I first proposed
this idea, we have "known" each other for a long time, yet we often don't
know anything about each other. So, tell us who you are and what you do.
Now, let's get to everything for the retailer.
Sincerely
George Matyjewicz, PhD
Chief Global Strategist, GAP Enterprises, Ltd.
mailto:georgem at gapent.com
http://www.etailersdigest.com
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[2] New business how-to
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As I said on Tuesday, I came up with a brilliant idea for a new product,
guaranteed to have global appeal, and a consumable item, which guarantees
ongoing sales. It came quite by accident, and takes into account a
different use for an existing product.
So, my first step is Business Research. I started by asking experts and
common everyday folks who would use this product what they thought. There
were some issues, which gives me input to what is needed to sell. I also
got an idea of what they would be willing to spend.
Next, I arranged a meeting with a manufacturer and will try to get a deal
on private labeling. Of course, this also means I run a risk of theft of
the idea. So I consulted my son the lawyer who gave me a non-disclosure
agreement to be signed by the two companies.
Then I will meet with this manufacturer to see what kind of deal we can
make. I don't want to spend a fortune, and he won't want to develop
something that is too costly. So we need a meeting of the minds.
Once the supplier is lined up, the next step is to determine the logistics
needed to deliver the goods when orders come in.
Then we work on a marketing campaign, where I'll call in my other son the
Ad Agency VP and his wife the PR specialist.
Interesting to note this will take 1-2 days of time and the business is
rolling.
What do you think? Any ideas for this or any other startup?
In the spirit of learning, let's identify what needs to be done to start a
new venture:
A. Business Research
B. Legal and Product Protection
C. Sourcing Suppliers
D. Marketing
E. Fulfillment
F. Warranty
G. Accounting
So, let's try an exercise to see what we need to do. I've setup many
ventures in the past, so before I offer my solutions, I'd like to hear from
you. Are there other major areas to consider? What are the details under
each?
George
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[3] Eddie Lampert - the new Warren Buffet
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This week, Business Week had an excellent article on financier Eddie
Lampert who turned once-bankrupt KMart into a $3 billion cash cow. Will he
build it into a new Berkshire Hathaway?
Then yesterday the news came on the merger between K-Mart and Sears to
create the third largest retailer in the U.S. trailing WalMart and Home
Depot. In the article, Eddie talked about Sears and other ventures. The
companies said Sears Holdings will be the nation's third largest retailer,
with approximately $55 billion in annual revenues, 2,350 full-line and
off-mall stores, and 1,100 specialty retail stores.
The announcement followed a published report indicating KMart chairman
Edward Lampert might soon significantly increase his stake in Sears in a
move to possibly merge the companies.
Lampert's investment company, ESL Investments Inc., owns a 52.6 percent
stake in Troy, Mich.-based KMart. ESL is also Sears' largest shareholder,
with a roughly 15-percent stake.
Analysts speculated recently that Lampert would act to increase the value
of his underperforming Sears investment. Sears is suffering from the
nationwide decline of shopping malls and, unlike rivals such as Target, has
failed to adapt to changes in customer preferences.
Sears stock shot up earlier this month after Vornado Realty Trust disclosed
it had purchased a 4.3-percent interest in the department-store chain.
Experts say opportunistic investors like Lampert or Vornado Chairman Steven
Roth might be able to make more money by selling Sears' poorly performing
but well-located stores to other retailers.
Lampert already has experience in selling off KMart properties. Shares of
KMart have more than tripled this year as Lampert sold 50 stores to Sears
for $575 million and 18 stores to Home Depot Inc. for $271 million.
So, not only should you watch the Sears Holdings venture, but keep your eye
on Mr. Lampert and ESL. And, it may make sense to follow ESL's lead when
they purchase in a company, like many do with Warren Buffet
George
Links:
http://online.wsj.com/article/0,,SB110068961640976558,00.html (may be
subscription)
http://cbs.marketwatch.com/news/story.asp?guid=%7B078CA0F8-DE4C-49BE-8ABC-6BCBA922A280%7D&siteid=google&dist=google
http://www.freep.com/news/latestnews/pm1408_20041117.htm
http://www.businessweek.com/@@1vw7AGYQQM5wUBMA/premium/content/04_47/b3909001_mz001.htm
(may be subscription)
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[4] RFID will help strengthen the 'Secure Economy'
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Radio frequency identification (RFID) and other wireless technologies will
play a major role in helping enterprises meet the security needs of the
21st century economy, says a new report from Deloitte & Touche USA.
Deloitte has dubbed this new environment the Secure Economy. "The secure
economy is global by nature," said John Greaves, global RFID leader at
Deloitte. "RFID and wireless technologies can improve distant connectivity
and total asset visibility."
"The 'Secure Economy' is defined by greater vulnerability, increased threat
awareness, regulatory compliance, and rapid response to change," said Greg
Pellegrino, global managing director of Deloitte's Public Sector practice.
"There has been a fundamental shift in the marketplace from the traditional
economy and the volatile dot.com economy. The emerging economy is fast
moving with even more threats of disruption."
New security initiatives such as the Customs-Trade Partnership Against
Terrorism (C-TPAT), FDA regulations on food traceability and requirements
for advanced manifesting through U.S. Customs are forcing many industries
to upgrade security. Deloitte estimates that private sector homeland
security spending will range from $46 billion to $76 billion annually.
According to a report from the National Foreign Trade Council, in the past
two years, American businesses lost more than $30.7 billion because of
delayed or denied visas for foreign business travelers.
But these new initiatives can increase efficiency in the supply chain, as
well as improve security--as long as companies take a proactive view.
Several companies and governments are experimenting with "smart containers"
to secure shipping containers. Most of these combine RFID with Global
Positioning System (GPS) technologies, and sensors to detect radiation,
motion, temperature changes or dangerous chemicals. Data from RFID and
sensor technology could be used in conjunction with electronic ordering and
shipping data to improve shipment accuracy and speed, as well as prevent
unauthorized tampering.
"New security technologies will eventually allow cargo to be cleared more
quickly through customs," said the report. "Once electronic devices can
demonstrate that a shipping container remains in its original intact
condition from the time it's packed and sealed to the time it's delivered
(and we're still a long way away from that point), then customs officials
could conceivably clear the container before it even arrives at port,
enabling it to be delivered without delay."
Such technologies could also prevent fraud and theft in the supply chain, a
$30 billion to $50 billion annual problem.
For more information on the study, "Prospering in the Secure Economy,"
visit Deloitte's Web site www.deloitte.com/us
Details at...
http://www.frontlinetoday.com/frontline/article/articleDetail.jsp?id=133668
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