27 Aug

Marketing for small business is different


Posted by: Kimberly Walker

Marketing for small business is different Mary Teresa Bitti, Financial Post · Tuesday, Aug. 24, 2010

One of the biggest mistakes small business owners make is to view sales and marketing as the same thing, says Steve Gedeon, director of Ryerson University’s Entrepreneur Institute. “The typical narrow view of marketing is that it’s the stuff you do to convince people to buy your stuff. They tend to think of marketing as advertisement. But the broader and more appropriate view is that it is about getting yourself into the headspace of your customer.”

It is an important distinction. “Most marketing textbooks and university courses focus on big, established companies with multimillion-dollar budgets and healthy marketshare,” Mr. Gedeon says.

“That doesn’t work for small businesses. Marketing for small business is very different than what is taught. As a result small business owners tend to think of marketing as a luxury they can’t afford. Advertising is a luxury they can’t afford. Running around and hiring brand management consultants is a luxury they can’t afford. But thinking through what you should be doing is something you can’t afford not to do. Half of all companies die in the first five years. And if nobody knows about you, that could be you.”

Mr. Gedeon offers some advice on how to think about marketing and promotion:

Marketing is about analysis. It dictates who you sell to, what you sell to them, how you sell it to them, how much you sell it to them for and the way in which you organize yourself to deliver what you’re selling. Done right, it is far and away the most important aspect of a business.

Marketing should be front and centre. It is very rare for an entrepreneur to stumble across a new product, work on it and then as an afterthought figure out how to sell it and be successful.

Marketing is about the customer. The more you get into their headspace, the easier it is to determine where they hang out, what types of things appeal to them and how they are going to use your product or service. Most products and services are not used in a vacuum. Rather they are used in collaboration with other things. They are not sold in a vacuum, either. They are sold in association with other products. Marketing research will help you make those connections.

The level of marketing analysis needed to drive sales is determined by the business. For example, a restaurant in the theatre district will require less analysis than a software developer making enterprise resource planning solutions. In the latter scenario, you have to understand in detail who within your client’s company will be using the software, what they are using it for, and how they interact with other employees and customers. In other words, your software has to be deeply embed into the lives of your customer’s employees.

Promotion and sales are a subset of marketing. Promotion feeds the awareness stimulating need/desire in potential clients and hopefully leads them to purchase. Marketing will point you to where and how you should be placing your product. Promotion will help you close the deal.

Read more: http://www.financialpost.com/small-business/advice/Marketing+small+business+different/3436088/story.html#ixzz0xnu4LIGT

26 Aug

Top 6 most indebted countries (and why)


Posted by: Kimberly Walker

Top 6 most indebted countries (and why)

by Michael Sanibel, Investopedia.com

The recent financial  crisis and recession have been a worldwide occurrence. The events in the United States since 2008 have garnered most of the headlines because the U. S. has the world’s largest economy and national debt, but the reality is that many countries in Europe are in worse financial shape and continue to deteriorate.

There are various ways to rank indebtedness, such as debt per capita and deficit or debt as a function of gross domestic product (GDP). This ranking is based on cumulative debt as a percentage of GDP and is limited to an analysis of the 25 largest economies. It is further limited to “external” debt, which is the portion of the national debt that is owed only to foreign creditors. The source for the debt and GDP amounts is the Central Intelligence Agency World Factbook most recent numbers from mid to late 2009.

   1. Ireland – Debt/GDP: 997%
      The days of Ireland enjoying one of the fastest growing economies in Europe are over, at least for now. The story is all too familiar, as easy credit fueled a housing bubble that burst and damaged consumer confidence.

      After recording budget surpluses in the prior two years, the economy reversed course in 2009 and contracted 7%. This eroded tax revenues and sent the annual deficit to a record 14.3% of GDP. The European Union set a target for Ireland to reduce that figure to 3% by 2014, but the International Monetary Fund has indicated that the deadline will be missed. Moody’s has subsequently lowered its bond rating.

   2. Netherlands – Debt/GDP: 467%
      The national debt in the Netherlands has reached record levels as a result of the world financial crisis and recession. Much of the added burden was caused by significant government support for the country’s banking sector. The increase in debt per capita is second only to that experienced in Ireland.

      The Netherlands joined the eurozone with a hard guilder a decade ago, but its current debt would likely disqualify it for membership.

   3. United Kingdom – Debt/GDP: 409%
      Investment bank Morgan Stanley fears that Great Britain could face a severe debt crisis in the near future if it continues down its current path. According to the bank’s report, this is a case of not putting aside sufficient reserves when the economy was sound. During the peak of the boom, it still ran a budget deficit of 3% of GDP when other European countries were running surpluses exceeding 2%.

      Like many other countries, Britain bought time during the financial crisis by implementing massive fiscal stimulus and forcing the public to fund losses in the private sector. Without the restoration of fiscal credibility, there is a significant danger of a government bond sell-off, pound weakness and a flight of capital.

   4. Switzerland – Debt/GDP: 273%
      Generally regarded as having one of the world’s most stable economies, Switzerland has taken its budget crisis seriously. When the national debt began to escalate in the last decade, the Swiss voted to approve a constitutional amendment forcing the government to balance expenses and revenue during each economic cycle. While annual deficits may still occur, this has instilled discipline in the process and lowered the country’s borrowing costs as investors rushed to safety.

      This so-called “debt brake” was implemented in response to increasing debt stemming from a slowdown in economic growth. Deficits climbed as spending rose for unemployment benefits and tax revenues declined. While government expenditures were cut across the board, rising revenues have not been sufficient to pay down the incurred debt.

   5. Portugal – Debt/GDP: 228%
      With last year’s deficit coming in at 9.4% of GDP, the Portuguese government has instituted a growth and austerity program with the objective of reducing that number to 2.8% by 2013. These measures have sparked strikes in the public sector including postal and transportation services. Those events have been further propelled by unemployment above 10%, the worst in 40 years.

      The root problem has been low productivity and virtually no economic growth in the past few years. Portugal ranks last in GDP growth among countries that adopted the euro as a common currency. Demand for goods and services has stalled, along with innovation and business momentum. In addition, Portugal’s exports have been undercut by cheap labor in countries such as China. (For related reading, see The Economics Of Labor Mobility.)

   6. Austria – Debt/GDP: 214%
      The recession and government assistance to banks have contributed to the budget crisis in Austria. The finance minister has rejected the notion of higher taxes in favor of administrative reforms to cut spending. He has predicted that the annual deficit would grow from 3.5% to 4.7% of GDP between 2010 and 2012 before starting to decline. That peak would be the third-highest since 1976 when such data were first recorded.

      Rising unemployment has resulted in increased expenditures for unemployment compensation and other government benefits. In addition to the reduced payrolls, tax reforms have driven down overall tax revenues.

The Bottom Line
While the U.S. and Canada have large economies, their respective debt-to-GDP ratios are 93% and 62%. The U.S. gets most of the attention because of the size of the numbers that comprise the ratio – $13.5 trillion debt (June 2009) and $14.4 trillion GDP (2009 estimate).

By comparison, China and India have ratios of 7% and 20% respectively. Their economic growth rates have also exceeded the western nations over the past few years, thereby keeping their debt ratios relatively low. If the western nations don’t implement policies to reduce their debts, they run the risk of jeopardizing future economic growth and prosperity. http://ca.finance.yahoo.com/personal-finance/article/yfinance/1785/top-6-most-indebted-countries-and-why

25 Aug

Top 6 ways to ruin your retirement


Posted by: Kimberly Walker

Top 6 ways to ruin your retirement

by Mark P. Cussen, Investopedia.com
  provided by

Despite the plethora of websites, books, magazines, advisors and other financial information and services available for retirees, there will always be a contingent of people who fail to make their retirement savings last for the rest of their lives. There are many ways to avoid this, some of which are more proactive while others are reactive in nature. But none of them are particularly difficult; all any of them really require is discipline and common sense. Here are a few ways you might be endangering your retirement.

   1. Too Much Risk
      You worked and sweated for years to accumulate enough money to be able to live a comfortable retirement. Therefore, this is probably not money that you want to use to start trading commodities futures contracts unless you are very experienced with them. Derivatives, small cap stocks and other high-risk ventures should be approached with caution and used judiciously as part of a well-thought out investment strategy.

   2. Too Little Risk
      This mistake can be every bit as costly as the previous one; those who invest their portfolios too conservatively may find that their expenses are outgrowing their income. Treasury securities and CDs can be great foundations for any retirement portfolio, but virtually all retirees need to have at least a small portion of their assets invested in either equities or real estate in order to provide themselves a hedge against inflation.

   3. Retiring Too Early
      Early retirement has become something of a status symbol among the upper-middle class. However, early retirement can be disastrous for those who are not adequately prepared for it. For every five years that one wishes to retire early, at least $100,000 of additional assets should be saved (assuming a payout of $2,000 per month and a rate of 6%).

      Those who choose this path should therefore be prepared to accept a reduced payout and a smaller government pension check every month if they have not done this.

   4. Failure to Plan for Long-Term Care
      Nothing can destroy a retirement portfolio like having to pay for the cost of a nursing home or other long-term care without any kind of insurance protection. Nursing home care can easily cost up to $60,000 a year, depending upon various factors such as the level of care needed and your geographic location. Medicare seldom if ever pays for long-term care expenses and Medicaid is not a reliable source of aid for this either.

      There are “spend down” plans available for those who wish to follow their rules, but these plans can be substantially disruptive to daily living in most cases. Purchasing a long-term care insurance policy is usually the preferable alternative for those who can afford it. Other alternatives include annuities and cash-value life insurance policies with long-term care riders.

   5. Retiring All at Once
      For some people, the radical adjustments that come from retirement are too much to absorb all at one time. It may be necessary to work another, lesser job for a time, such as a part-time job with an employer in a field in which you have an interest. A few years of this type of work may allow you to “gear down” sufficiently to total retirement at some point. This strategy can also help to stretch an insufficient retirement portfolio a long way.

   6. Living beyond Your Means
      As obvious as this is, those who spend more than they have in retirement will find themselves in dire straits at some point. Run the numbers carefully before you buy that 54-foot yacht or that vacation home. These items often fail to fetch their purchase prices if you have to sell them, so think twice before you plunge into a major pleasure purchase that will eat up a material chunk of your savings.  





24 Aug

Clients are like partners you dated before marriage


Posted by: Kimberly Walker

Mark Evans  Globe and Mail Update

One of the realities in the consulting business is that projects eventually come to an end. The work gets done, the client is hopefully happy, and then everyone goes their separate ways.

But just because the project has been completed doesn’t mean the relationship should come to an end. The client may need to have some more work done down the road, it may know someone who needs your services, or it could provide you with a valuable referral or reference.

It makes sense to maintain a healthy relationship with all of your clients. But how do make it happen without coming across as too pushy or clingy?

One of the keys is to keep a regular connection and provide value even though you have already been paid. It takes time and effort but it’s the right thing to do to demonstrate your interest in their business.

For example, I’ll e-mail blog posts and newspaper articles to former clients that they might find interesting or useful. I’m not trying to sell them anything, I’m simply looking to be someone interested in passing things along.

I’m also happy to help former clients with any questions or problems they might have, provided it doesn’t take a lot of time or effort. By making yourself available, it’s not only the right thing to do, it helps build goodwill.

In my world, clients are like the girls you dated before getting married. They were very nice and attractive but the relationship only lasted for a period of time before you broke up.

In an ideal world, the split was amicable and friendly, which means if you happen to see them again, it is a happy occasion. Who knows, maybe you still send them holiday cards. When you “break up” with a client, the maintenance of a good relationship is something you should focus on.

Sure, there are financial motivations because getting more business is important. As essential is nurturing a healthy and vibrant client community that can become a corporate asset and, in time, produce lots of benefits.

18 Aug

Mortgage scam prompts warnings


Posted by: Kimberly Walker

Mortgage scam prompts warnings

Latest mortgage scam prompts warnings from real estate board


The uncovering of the latest mortgage scam and that mortgage fraudsters are active in Calgary is not a surprise, says Diane Scott, president of the Calgary Real Estate Board.

“I started in (the real estate business) 1983 and this is the second or third round of this,” says Scott, who urges all buyers to do their due diligence to avoid being sucked into a scam.

“We have to watch for red flags such as a numbered company on the contract or high-ratio mortgages.”

CREB offers to the following tips to protect yourself against mortgage fraud:

Employ a licensed mortgage broker registered under the Real Estate Act in Alberta.

Licensed mortgage brokers are required to conform to a code of conduct enforced by RECA. Contact RECA at 403-228-2954 to ensure your broker is licensed.

Before you buy, have a realtor show you the listing history on the property.

Check the number of sales, price ranges and community prices.

Use a realtor or other independent representation for your purchase.

If the seller objects, something is wrong.

Get a comparative market analysis of the property.

Additionally, you may want to include, as part of your offer to purchase, the option to have the property appraised by a designated or accredited member of the Appraisal Institute of Canada.

Ask for a copy of the land title search.

Make sure your deposit is being held in a trust account.

For more information go to RECA’s website at http://www.reca.ca/consumers/ and search for ‘mortgage fraud red flags.’




17 Aug

China’s economy now world’s second largest


Posted by: Kimberly Walker

China’s economy now world’s second largest By Tomoko A. Hosaka

TOKYO — China has eclipsed Japan as the world’s second-biggest economy after three decades of blistering growth that put overtaking the U.S. in reach within 10 years.

Japan is still far richer per person after confirming Monday that economic output fell behind its giant neighbour for the three months ending June 30. However, the news is more proof of China’s arrival as a force that is altering the global balance of commercial, political and military power.

Analysts are already looking ahead to when China might match the United States in total output — which the World Bank and others say could be no more than a decade away.

“This means the world will pay more attention to China, especially when most Western countries are mired in the bog of debt problems,” said economist Lu Zhengwei at Industrial Bank in Shanghai.

Unseating Japan — after earlier passing Germany, France and Britain — caps three decades of breakneck growth that has cemented a dramatic change in China’s place in the world over just the past five years.

State-owned Chinese companies have emerged as major resource investors, pouring billions of dollars into mines and oilfields from Latin America to Iraq. Chinese pressure helped to win a bigger voice for developing economies in the World Bank and other global institutions.

On a human level, China’s rise has allowed hundreds of millions of people to work their way out of poverty and sent a flood of students and tourists to the West. Its consumers are so avidly courted that companies from Detroit automakers to French handbag producers now design goods to suit them.

Still, China’s rise has produced glaring contradictions. The wealth gap between an elite who profited most from three decades of reform and its poor majority is so extreme that China has dozens of billionaires, while average income for the rest of its 1.3 billion people is among the world’s lowest.

By contrast, Japan’s people still are among the world’s richest, with a per-capita income of $37,800 last year, compared with China’s $3,600. So are Americans at $42,240, their economy still by far the world’s biggest.

According to Monday’s report, Japan’s nominal GDP was worth $1.286 trillion in the April-to-June quarter compared with $1.335 trillion for China. The figures are converted into dollars based on an average exchange rate for the quarter.

World stock markets mostly fell on the news that Japan’s economy grew just 0.1 per cent in the second quarter, far short of expectations and well below the 1.2 per cent growth in the first quarter. The report follows signs last week that both the U.S. and Chinese economies are not growing as fast as earlier in the year.

In the midst of the global crisis, stimulus-driven Chinese growth that hit 11.9 per cent in the first quarter this year before easing in the latest quarter helped to propel the world out of recession. Chinese demand for raw materials and other imports buoyed economies from Australia to South Korea to Africa.

China uses more than half the world’s iron ore and more than 40 per cent of its steel, aluminum and coal. It passed the United States last year as the biggest auto market and Germany as the biggest exporter.

“We are at the point now where China is overtaking the U.S. to be the engine of growth in consumption,” said Amar Gill, a researcher for brokerage CLSA Asia-Pacific Markets.

China could match the U.S. in total output as early as 2020, said a World Bank forecast in June. America’s gross domestic product was $14.26 trillion last year, nearly three times China’s.

A more serious concern for communist leaders is China’s income per person, which the World Bank said ranked 124th in the world last year — more on a par with impoverished nations like Angola, Tunisia and El Salvador than Japan, which ranked 32nd, or the U.S., ranked 17th.

As a result, becoming the second-largest economy “isn’t something to add to national pride,” said Zhang Bin, a researcher at the Chinese Academy of Social Sciences, a government think-tank.

“I care more about GDP per capita,” Zhang said. “People in small countries like Switzerland lead a much wealthier life.”

Despite slipping in the rankings, Japan still enjoys Swiss-style health, wealth and comfort. Tokyo has more Michelin-starred restaurants than Paris.

By contrast, China faces a huge and politically explosive gap between an elite who have profited from reform and a poor majority. The country has launched two manned space missions, but families in remote areas live in cave houses in hillsides.

“China’s first-tier big cities might look similar to big world cities. But social welfare still has a long way to match Japan, the U.S or European countries,” said Industrial Bank’s Lu.

China’s growth has made it a major importer and consumer of oil and gas and the biggest source of greenhouse gases blamed for changing the climate.

Complaints that surging Chinese demand pushed up global crude prices have made energy a sensitive issue for Beijing. It angrily denied an International Energy Agency report last month that said it passed the United States in 2009 as the top energy consumer.

China’s 21st century rise marks a return to a status it held until the 18th century as Asia’s military, technological and cultural leader. That era ended as European colonial powers expanded and Chinese imperial leaders crushed reformers who wanted to imitate Japan’s embrace of Western technology.

The Associated Press http://news.therecord.com/Business/article/762735



13 Aug

“Fixed and variable rates are once again neck and neck…”*


Posted by: Kimberly Walker

     “…the percentage spread between discounted 5-year fixed and variable rates has tumbled over 110 basis points in the last few months.  That’s reduced the variable-rate advantage markedly.*

      ”Highly discounted 5-year fixed rates are now in the 3.89% range, less than 1/2 point from the lowest we can remember. They’ll probably go even lower in the short term.”*

      “…the 5-year fixed isn’t the only term benefiting from the recent plunge in yields. There’s tremendous value in 1- and 3-year terms as well.”*

      To read more click this link http://www.canadianmortgagetrends.com/canadian_mortgage_trends/2010/08/dramatic-sentiment-shift.html

13 Aug

Falling Real Estate Values


Posted by: Kimberly Walker

Home sweet home: What to do about falling real estate values

 By Harvey Enchin 9 Aug 2010 COMMENTS(1) Everybody’s Business

 Filed under: real estate, housing

I penned this editorial to calm fears that the real estate market in Vancouver was collapsing and I’ve  added some brief comments at the end.

Living in Canada’s most expensive housing market, residents of the Lower Mainland are obsessed with real estate prices and mortgage rates.

And no wonder. The benchmark price for detached homes in Metro Vancouver last month was $793,193. A down payment of 25 per cent would leave the buyer with a mortgage of $594,894, in which case a difference of just one percentage point in the interest rate can vary monthly payments by $500.

In comparison, the average price of a house in the Greater Toronto Area is $420,482. The standard down payment brings the mortgage to $315,316 and the interest rate impact to $260.

Given that a small hike in interest rates can mean the difference between cabbage and caviar, buyers, sellers and those facing mortgage renewal watch housing indicators as closely as equity investors follow stock market indexes.

News this week that home sales in Metro Vancouver plummeted by 45 per cent in July from a year earlier caught many real estate watchers by surprise. Some said the drop signalled a buyer’s market, although a 33 per cent decline in the number of MLS listings last month from July 2009 suggests otherwise. Moreover, the decline in sales year over year is somewhat misleading in that July 2009 was a record for that month.

In the same vein, mortgage rate cuts by major Canadian financial institutions last week are being seen as competitive positioning in the face of a real estate slowdown. Most banks have lowered their five-year fixed rate by 10 to 20 basis points to 5.59 per cent.

But, unlike variable-rate mortgages, which reflect the banks’ prime rates, fixed-rate mortgages are set in relation to yields in the bond market. Bond prices have recently been moving higher, pushing yields lower — there is an inverse relationship between price and yield — so the rate on fixed-rate mortgages has been reduced accordingly.

This all means that buyers have a window of opportunity to buy a residential property at a price below what they might have paid a few months ago and negotiate a mortgage at a slightly lower rate than what was offered a few weeks ago.

Similarly, those refinancing could get a better deal on rates, with several institutions also advertising that they’ll pay the transfer fees if borrowers switch their mortgages to them.

Sellers, on other hand, may have to lower their expectations and either slash the asking price or be prepared to wait longer for an acceptable offer.

For the rest of us, the gyrations of real estate values and mortgage rates shouldn’t keep us up at night. A house is not a stock, to be sold when earnings disappoint or a sector falls out of favour. Most people buy a home to live in it, to raise families, to seek refuge from the rat race, and — as comedian George Carlin once explained — to keep their stuff. Providing homeowners have purchased a property at a price they can carry within their means, and can ride out the ups and downs of interest rates without lifestyle disruptions, the changing market value of their home is largely irrelevant.

To anyone buying, selling or refinancing, good luck. To everyone else, relax, fire up the barbecue and enjoy the rest of the summer.


So there it is. If you can comfortably make the payments, I don’t see anything to be gained by walking away from a mortgage that’s underwater. If you do, you’ll not only lose the money you have invested in the house to date, you’ll damage your credit rating. That being said, it might be a few years, perhaps a decade, before real estate prices return to the heady levels of 2007. But there’s a good chance they will. They long term appreciation of Vancouver homes is roughly eight per cent. That’s better than the long-term return on stocks. 

However that might be too long to wait for some folks who need to downsize, move to a new job or sell for whatever reason. Time then to talk to a financial adviser or lawyer about the available options.

Your comments are welcomed.

13 Aug

10 things to check before you buy a new home


Posted by: Kimberly Walker

 10 things to check before you buy a new home

The process of buying a new home—especially if it’s your first time—is incredibly intimidating. And while there are certain things you may know you’re going to want to change upon moving in (like paint colors or retiling), if you’ve never gone through this before you may not know what else to watch out for before you sign the dotted line (just because a home is gorgeous on the outside, it’s not impervious to having a bunch of costly-to-fix issues that go way beyond the surface—remember The Money Pit?). Here, via apartmenttherapy.com, a handy checklist of all kinds of things a potential buyer should be mindful of:

1. Check the drains to make sure they’re not backed-up. To test, do a load of laundry, fill up the tub and sinks, and try to drain them all at the same time.

2. Open all the windows all the way to make sure they’re able to open and shut completely—fixing them is not only a pain, but a financial drain.

3. Turn on all the faucets and make sure they’re in working order.

4. Light a fire in the fireplace. While cleaning them is pretty easy (just call a professional chimney sweeper), you should also make sure they draft correctly.

5. Taste the water. Even if the city you live in has great water, if you’ve got old pipes, they may send out debris into yours.

6. Flush the toilets. Make sure that the toilets are able to flush toilet paper.

7. Open the electrical panel. Watch out for loose wires or ones that simply don’t connect to anything, which could be a sign of live wires inside!

8. Turn on the heat/air. Not only do you want to ensure they turn out, but check to see if they heat/cool to their designated temperatures.

9. Pull the carpets back. Peel away a corner of the carpet to verify what’s underneath (often there’s hardwood under there) and to make sure it’s not mildewing.

10. Basement moisture. Check for signs of dampness, not just on the walls, but near things like dehumidifiers, which suck water out of the air.


11 Aug

Bond Yields Falling – Rates Remain Low


Posted by: Kimberly Walker

Bond yields are falling.  They are down 7 bps this morning already to 2.16.  There’s still lots of time left today for them to reverse course, but there is reason for the decline:


  • The Federal Reserve in the US yesterday told the world the economic recovery in the US will be slower than they initially thought.
  • Today’s report on trade showed Canada’s trade deficit unexpectedly widened in June on falling sales of gold, energy and automobiles.


So the markets are shaky and less confident in our growth prospects.  Good recipe for continued low fixed interest rates.