Chinese Checkers (and everything else)

My end-of-the-year rant.

Earlier this week several local newspapers carried  an AP story by William Foreman on China’s booming economy. He begins by pointing out that hundreds of US manhole covers were stolen all over the country and sold on the black market to be made into steel for Chinese skyscrapers. Thank goodness! I didn’t think we were exporting anything to China anymore.

Foreman points out that China is one of the biggest investors in Africa.  Of course we all know that the Communist nation holds billions of dollars of US debt ($800 billion in Treasury securities) which may prove to be disastrous sooner, if not later.

China’s telephone company has more than 1/2 billion customers and 338 million Internet users, more than the entire population of the United States (307 million).

China’s new-found prosperity has led it to become the biggest polluter on the planet.  The article points out that 16 of the 20 worst cities for air quality are located in China.  So while the United States is looking to spend billions of dollars cleaning up the air, both here and in developing countries abroad, China just keeps on polluting and taking American jobs in the process.

Meanwhile our insatiable desire for the cheapest price on everything continues to fuel the Chinese engine while our own is sputtering to a stop.  Will the two giant Chrysler plants in suburban Saint Louis ever reopen?  Probably not unless a foreign (possibly Chinese) company buys them.  Have we passed the point of no return?  I hope not but a lot of things are going to have to change pretty quickly.

People (American people, that is) have got to learn that it’s not cheaper to buy a cheap Chinese product that doesn’t work properly and doesn’t last.  It’s more expensive in the long run and that’s just in out-of-pocket expense.  It doesn’t take into account the loss of jobs and the selling off of the American dream that’s taking place today.

It’s pretty obvious that we can’t count on our government to help us.  In fact any kind of tariff on Chinese goods could cause them to retaliate which wouldn’t be good.  (Remember that $800 billion in Treasuries that they hold.)  So, while an official boycott may not be in order, there’s nothing stopping you and me from individually avoiding their stuff.

No, you and I are the answer.  Don’t buy cheap Chinese crap! Spend an extra buck and get American-made quality.  Of course the real problem lies in the products that are no longer made in the USA.  The list is quite long.  Try to find an American-made sewing machine.  Let me know how that works out for ya.

But we have to start wherever we can.  Buy American cars (while you still can).  For crying out loud, if the Chinese attempt to penetrate the US automotive market (which they probably will very soon) don’t buy one! Even the Chinese don’t like Chinese cars.  Anything else you buy, look for an American label.  If you can’t find one, ask the retailer why not.  We’re all in business to satisfy our customers.  If there’s a demand for American-made widgets then the market will satisfy the demand.

I don’t want go on too long and I don’t want to give the impression that I think things are hopeless.  Far from it!  We’re about to begin a new year and a new decade.  It’s time for all of us to stop being selfish and/or foolish and recognize that this is the greatest country in the world and we can overcome anything.  We just have to get of our backsides and make something happen.

Thanks for putting up with my rant.  Here’s wishing you a very, very

Happy New Year!

2009

2010

Come back tomorrow and I’ll wrap up the year by telling you about my experiences in buying Chinese.

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“Black” Friday

Saint Charles, MO, "historic main street"It’s unfortunate that the media have chosen this particular name for the day that often makes or breaks an American  retailer’s year.  It is the day when many retailers bottom line changes from red ink to black, but the term still has a negative connotation for many people.  In fact, depending on the outcome of today’s business, it may really be a black Friday for some.

Of course, we hope it’s a great day, especially for small business.  Personally I will avoid the malls like the plague.  But my lovely and talented wife and I will spend the afternoon and evening shopping the independent shops on Main Street in Saint Charles, MO.  It’s a “tradition” that we started last year.  The crowds are smaller, and much friendlier, than the rampaging mobs that started surging through the chains as early as midnight this morning.

There are just as many bargains to be had, and the gifts tend to be much more personal, some even personalized, compared to the “Made in China” stuff found elsewhere.

So, here’s hoping that it’s a good day for all of our independent retail friends and the beginning of a successful Christmas shopping season.  That’s all for now.  I’m off to do my part in boosting the economy.

See the USA in Your ????

Chinese Chevy DealerHere in Saint Louis, a local car dealer, Frank Bommarito, often buys full page ads in the dead-tree newspaper to comment on business topics. He recently did a nice comment piece on the death of his competitor, Dave Sinclair.

But today, in a piece on China’s economic recovery, he made some comments that frankly, scare the hell out of me. Unfortunately the ad doesn’t seem to be available online, but here’s what he said in bullet points:

  • China’s economic recovery is progressing nicely. The one weak spot is manufacturing.
  • Chinese auto makers have been waiting for the right time to enter the US market. Our weak economy has held them back.
  • There are ten thousand US auto dealers who lost their American car franchises in the recent cutbacks by the “big three.”
  • These dealers will be lining up at the National Auto Dealers Convention in Orlando, more than happy to take on a Chinese car line.

After many years in the import business there are two sure things I can tell you about Chinese manufacturing.  One is they can undercut any American manufacturer based on their huge labor pool and cheap raw material prices.  The second is that they will build in as little quality as they can get away with.

American car dealers with no cars to sell will be very tempted to jump in bed with the Chinese.  Many of them will be eager to be pioneers in this new business.  At some point they’ll find out that undependable deliveries and inferior products will put them in a very difficult situation.  Trust me.  Been there; done that.

Of course, the high dollar value of a vehicle and the thousands of cars and trucks that will be brought in initially will further tip the balance of trade between the US and China, putting our fragile economy in even more trouble.

Hopefully Bommarito’s prediction will turn out to be wrong.  Hopefully our friends and neighbors who have lost their livelihood due to the mismanagement of American car manufacturers won’t be sucked in by the promises that the Chinese car makers are sure to make.  (Again, been there; done that.)

I sincerely doubt that our current administration  would dare take any steps to stop this disaster before it occurs, especially since we’re so deeply in debt to the Chinese.   In the midst of all the other turmoil in our capital, this whole thing could slip by under the radar with no one even noticing until it’s too late.

This might be a good time to write to your representatives and senators, voicing your objections to any more erosion of the US manufacturing base by Red China.

5 Tips for Shopping Local

[picapp src=”7/0/4/5/Steamboat_Winter_Carnival_2966.jpg?adImageId=6860296&imageId=3461828″ width=”234″ height=”154″ /]Thanks to Phil Reed of  Vacuums and More in Lincoln City, OR for sending me the link to this article from MSN City Guides.  It’ s directed toward your customers.

The article, by John Rossheim,  begins by appealing to shoppers’ civic pride and their desire to help their fellow citizens.  If that doesn’t move them, Rossheim points out that $68 of every $100 spent with local merchants stays in the community compared to just $43 out of $100 when you spend it with a national chain.

The article points to a few “buy local” programs including my personal favorite, the 3/50 Project.  Here are the five tips:

Visit an independent before heading for a big box. The article suggests that the shopper think of one item that could be purchased locally and to scan local advertising before heading out to shop.

Patronize local merchants who add value. Shoppers should consider more than just price when they purchase.  Professional guidance may not be necessary when you buy laundry detergent or toilet paper, but in other cases the expertise of the merchant often more than offsets a slightly higher price, if the price is actually higher.  Often it isn’t.

Hold the plastic and pay cash. The author throws this on in even though he fails to cite an advantage to the shopper.  Of course there’s a big advantage to the merchant if the customer opts to pay cash.

Beware “local-washing”. Some national merchants pretend to be “local” though I can’t imagine anyone would actually fall for it.   If there’s a competitor in your market doing this, I wouldn’t hesitate to point it out both in-store and in my advertising.

RIP Dave Sinclair

Back in July I wrote a post (Salesmanship Part 1) about a Saint Louis car dealer, Dave Sinclair.  Rather than repeat what I wrote in July, I’ll just let you follow the link.

Sadly, Sinclair has passed away today after a long bout with cancer.  I never bought a car from him, but I’ve admired his direct, no b.s. way of selling cars for a long time.  He was never what you’d call politically correct and I imagine that cost him some sales over the years.  Here’s an ad he ran recently that reflects his style and his thoughts on buying American.

He will be missed.

Are There Limits to Buying Locally?

This rather lengthy post originally appeared on February 24, 2009

A regular reader and former coworker emailed me over the weekend with an interesting question about buying locally.  He asked, “At what point is price an issue?” He cited a couple of recent instances where he paid more to buy something locally rather than buying it online.  The price difference wasn’t enough to be a problem, but is there a point where price trumps doing business with a neighbor? It’s not unlike the question, “Can you be a little bit pregnant?”

The question raises still more questions!

Aren’t some mail order businesses run by independent business people? In the past I have written good things about Heather Gorringe and her “Wiggly Wigglers” online gardening business. (A Small Business Owner Who Knows How to Use Social Media. A Big Award for Wiggly Wigglers) You can’t lump her into the same category as Amazon.com.  I’d buy from Wigglers if I were into gardening (and if she weren’t in England, making shipping very expensive.)  It’s a global mom-and-pop operation, something that would have been impossible just a few years ago.

What does “local” mean? Here in Saint Louis, at least until last year, Anheuser-Busch was a local business.  Was I supporting local business by buying Budweiser?  Yes I was.  But what about local micro-breweries?  Wouldn’t drinking a beer from Schlafley (a local micro) be more in line with a Buy Local philosophy?  And what about Guinness which is unique and only brewed in Ireland?

Then there’s the issue of determining what’s local and what’s not.  McDonald’s is a national chain, but the individual stores are locally owned. Then again, all of their raw materials come from McDonald corporate.   On the other hand, there are some similar operations, like White Castle, where the company owns all the stores.  How many people know that?  How do you know which is which?  Given the addictive taste of a White Castle burger, and their low cost, does it really matter if I eat there?  Like Mickey D’s, they bring the stuff in from out of town.

Does buy local trump buy American? Chances are that you’ll be more likely to find American-made items at your local hardware store rather than at Lowes or Home Depot.  But, what if you don’t?  What if the chain has an American-made drill and everything at the local True Value is made in China?  Which is the better choice?

What about unique items? Again, the local merchant is more likely to have the really unique items, but not always.  Books are a good example.  Sometimes the only place to find an off-beat book is at Amazon.com.  Let’s say that the local book store (if you can find one) doesn’t have the book, but can order it for you.  It will cost $50.00 and take two weeks.  Amazon can get you the same book in two days and it will cost you $40.00 (including shipping and handling).  And you need the book for an important project that’s due in a week.

This one is pretty easy.  You have to go with Amazon because of the deadline.  But what if there is no deadline.  What if you just want to read the book?  Is it worth ten more dollars and twelve more days to support the local business?  Nobody said this was going to be easy.

Buying locally takes some effort.  But it’s worth it.  You wouldn’t be reading this if you didn’t have a vested interest.  If you want your friends and neighbors to do with business with you, you have to do business with them.  It’s as simple as that.  That’s the short-term answer.

Long term, if you want to have a neighborhood hardware store to answer your questions, and to have the part for your twenty-year-old lawn mower in stock, then you’d better do your part in keeping them around.

A lot is being written and said about economic stimulus.  I’m not an economist, but I do think that stimulating the national, and even the world, economy starts with stimulating the local economy.  We all know that small business is responsible for the lion’s share of jobs in the United States.  A sign of a healthy economy is a lot of “help wanted” signs in the windows of our local stores and restaurants.  We can make that happen.

I just realized that I’ve written quite a bit, 698 words and counting, and haven’t answered the question, “At what point is price an issue?” First, I think you have to look at value rather than price.  And value includes the services and potential services that the local business offers.  What looks like a better price may not be.  In the case of on-line purchases, have you considered shipping and handling?  What about the hassle of receiving the merchandise (for example, taking off work to be home when the package is delivered) and the possible hassle of returning something that isn’t right?  Can you trust the vendor to deliver the product as ordered?  All of these come at a price.

If you’re comparing a local store versus a chain, are you comparing apples to apples.  The big guys often have products that are built to their spec, which may not be your spec.  An items that’s ten percent cheaper but wears out twice as fast as a similar one isn’t much of a bargain, is it?

If an item requires assembly or technical knowledge to operate, who’s going to help you out if you have problems, the “helpful hardware man” or the guy in the blue smock who just started to work yesterday?

To wrap this up, you have to make up your own mind what you value and what you don’t.  Everything has a price.  You get what you pay for.  (Insert your own cliche here.)

As a business person you might want to do unto others as you would have them do unto you.  But what about your customers?  How do we get them on the “buy local” bandwagon?  It’s all about education.  Show them why your product is worth more than your big box or out-of-town competitors.  Use in-store signage, advertising, your web site, and your presence on social media (you are on social media, aren’t you?) to tell them why it’s in their best interest to buy from you.  Because, when all is said and done, people do what’s in their best interest, not yours.

I’d especially welcome comments on this important topic.

The WSJ on Buying Local

3_50 project smallIn case you missed it, here’s a link to a recent Wall Street Journal article featuring the 3/50 Project.  Frankly, the article isn’t that great, but it does highlight the experience of one small business owner’s success with her “buy local” efforts.

We don’t have the resources of our larger competitors when it comes to advertising and PR, so it’s important when any “buy local” program gets national exposure.

Of course, 3/50 works because it appeals to the consumer’s needs as well as the merchant’s.  Pick three local businesses that you couldn’t live without and help them stay in business.  It’s a win/win.  Contrast that approach with the Chicago pen dealer’s personal plea.  He got a brief bump in sales but it was short lived.  Let’s be honest, it’s one thing to spend $50.00 that I was going to spend anyway to ensure that my local hardware store or diner is going to stay around.  It’s something else to ask me to buy a $300 pen to support a store that sells $300 pens.

Check out the article and if you haven’t already, check out the 3/50 Project web site.  There’s a permanent link to it in the left hand column of this page.