GK Men

Companies find bigger returns in smaller spaces

Wed, 22 Feb 2012 21:02:14 +0000

By Joyce Smith, The Kansas City Star, Mo.

Feb. 22--To Neng Yang, the Best Buy box store in Independence is just too overwhelming, so much so that she only shops there once a year, at the holidays.

So when she needed a new cellphone, she bypassed the 55,000-square-foot store with its many departments -- appliances, big-screen TVs, computers, cameras, car audio, video and music. Instead, she stopped across the street at the Best Buy Mobile store.

The slimmed-down 850-square-foot sister store, in Independence Center, concentrates only on mobile devices.

"I ask about a thousand questions, and this is more personalized, more one-on-one attention," said Yang, of Blue Springs.

Yang bought a white Droid Razr, and her brother, John Yang, picked up a black one.

Bigger is not always better. Just ask the biggest retailers in the country -- and their customers.

The recession and the growth of online shopping have conspired to cut chains down to size. One strategy they've employed has been to close underperforming stores. But Best Buy and an increasing number of companies are trying another strategy, too -- going smaller.

Among the retailers testing smaller concepts are Blockbuster, Ann Taylor, the Gap, Kohl's, Lowe's and Sports Authority. RadioShack is trying a "store within a store" format in several OfficeMax stores in California.

Restaurants are also thinking small, including Leawood-based Houlihan's Restaurants Inc.

Lower square footage makes for lower construction and remodeling costs, and that also tends to make them easier to finance. The smaller locations have less overhead costs and can be staffed by fewer employees.

The small size also gives the chains more flexibility in locations, allowing them to squeeze into heavily developed urban centers, and compact spaces in airports, college campuses and strip centers. If the location isn't successful, the chains can close the sites with less financial fallout.

"For a decade it was 'Build it, and they will come,'" said Candace Corlett, president of WSL Strategic Retail in New York. "It's definitely a correction for retailers as well as restaurants, a direct result of consumers not having as much to spend on the extras. The strategy has to be to reduce your costs to offset less traffic. Usually that means less rent, shrinking retail and restaurants."

Stimulus a mixed bag for Ashtabula County

Wed, 22 Feb 2012 21:00:20 +0000

By Carl E. Feather, Star Beacon, Ashtabula, Ohio

Feb. 22--ASHTABULA -- Three years ago the Obama Administration rolled out its $831 billion stimulus plan to help lift the nation out of recession by putting Americans back to work.

A sliver of the money from that plan, formally known as the American Recovery and Reinvestment Act (ARRA), trickled down to Ashtabula County agencies, school districts and "shovel-ready" projects. Overall, Ohio received about $8.6 billion, and it would appear that about $75 million of that was committed to the county. The largest single project, $28.7 million for repairing and paving Interstate 90 between Kingsville and Conneaut, is just getting started. But in most other areas of investment, the money has been spent and the recipients are left with the question of how to replace it in order to continue the programming it funded and keep its employees working.

When the ARRA was announced three years ago, there were 42,200 Ashtabula County residents employed. In December 2011, there were 42,300 employed (Ohio Labor Market Information). The unemployment rate did fall, but only because the number of residents who were counted as unemployed decreased.

"It was a good shot in the arm, but it needs to continue," said John Rubesich, superintendent of the Ashtabula County Educational Service Center (ESC). "It was one-time money."

The ESC received more than $1.5 million, which it funneled into local school districts. Superintendents turned to the fund as a way to keep teachers in the classrooms when state funding dried up, he said.

Individual districts also received grants of ARRA funds -- Ashtabula Area City Schools received more than $7 million, but it was not "new" money in the sense it allowed the districts hire additional teachers.

"The ARRA money comes from the federal government and the state basic aid was reduced by the same amount ... the net result was no increase to the district," said Superintendent Joseph Donatone.

Worse, when the ARRA money ended, the state did not replace the aid it had supplanted. Money from another federal program, the Education Jobs Bill, served as stopgap funding, but that also is being withdrawn.

"The bottom line is that next year we will eliminate 47 positions because the ARRA money is gone, the (Jobs Bill) money is gone and state basic aid (remains decreased)," Donatone said.

County targets job growth with development strategies

Japan is a lot more open to acquiring firms in India than China

Tue, 21 Feb 2012 21:00:17 +0000

By Harini Subramani, Mint, New Delhi

Feb. 21--In his first trip to India as the representative director and president of Ernst and Young Transaction Advisory Services Co. Ltd in Japan, Kenneth G. Smith highlights the increasing focus of Japanese companies on emerging economies including India.

In an interview, Smith said Japanese companies are now exploring acquisition opportunities in the rest of Asia and seem more open to investments in India than China. Smith is in the country for internal meetings and to discuss hiring for the increasing transaction activity between India and Japan. Edited excerpts:

Japanese companies have turned acquisitive, especially in the last five years. How did this evolve?

This is the second wave. The first wave was in the mid-to-late 1980s when Japan faced its initial bubble, primarily fuelled by increasing land prices, which had led to overseas investment primarily in real estate and also banking. What's happening now is that there is a strong yen. There are other things happening at the same time. There is a decreasing and an ageing population, a hollowing out of the manufacturing base.

While Japanese multinationals like Toyota, Hitachi and NEC expanded even during the relatively slow years, the mid-tier companies are joining the fray and going overseas. With the strong yen, everything is 20-30% cheaper than it used to be 18 months ago.

How do you classify the mid-size companies?

So, there is no real cut-off and it depends on the industry. In the 1990s, less than 40% of the Japanese companies' revenue came from outside Japan, with some anomalies. Now, around 50-60% revenue is from the overseas markets. For some companies it's closer to 80-90%. So that's the shift. Automotive guys expanded earlier. Food and beverage companies like Kirin, Asahi and Sapporo, the three large (domestic) beer companies, had gone overseas. But there is a size below that, between say $500 million and above $1 billion in terms of turnover. These guys (beer manufacturers) were (earlier) okay serving in Japan alone. But with the ageing population and with what consumers want, they are looking for greener pastures overseas.

Which sectors are seeing consolidation in Japan?

Savannah Morning News, Ga., Adam Van Brimmer column

Mon, 20 Feb 2012 21:01:15 +0000

By Adam Van Brimmer, Savannah Morning News, Ga.

Feb. 20--Republicans will congregate this afternoon to quietly toast what they believe is the last Presidents Day with Barack Obama holding the office.

Those imbibing in something other than spiked Kool-Aid will no doubt ponder an all-too-familiar presidential primary conundrum: Heart versus head.

When voters go to the polls on Super Tuesday, March 6, the ballot will list the candidates' names. But for many, the choice will be between voting for the man they believe has the best chance to defeat Obama in November or for the man who best personifies their ideals.

The problem is not specific to the Republicans. Presidential elections are often decided by American voters who consider themselves either Independents or party moderates -- the so-called "swing voters" -- not by the loud-and-proud conservatives and liberals.

The Independent ranks range in size from 20 percent of registered voters to 40 percent, depending on the survey. So the wisdom of picking a nominee who appeals to those less interested in ideology than Sheen-ology ("Winning"), especially in a race against an incumbent, is sound.

Yet choosing pragmatism over principles seems as difficult for Republicans as shopping at the outlets versus the mall is for a budget-conscious fashionista.

"A lot of Republicans feel they'd be better off in November with Mitt Romney as the nominee, but they're not ready to fall in line behind him and are holding out for a conservative champion," said Kerwin Swint, a political science professor at Kennesaw State University. "It's a real oddity. I struggle to remember the last time a major party was running this far away from its frontrunner."

Election or referendum?

The current Romney vs. "conservative champion" contest puts the GOPs in an overripe pickle.

The party base seems reluctant to shake Romney's hand, let alone embrace him.

They make the label "Massachusetts Moderate" sound like a mama insult.

They make fun of his pressed blue jeans.

So will the party loyalists hold their noses and vote along party lines if Romney is the nominee?

Or will they stay in bed come Nov. 6, blankets pulled over their heads, effectively negating the votes gained in nominating a candidate more palatable with the Independents and swing voters?

GM posts its highest profit ever: $7.6 billion

Fri, 17 Feb 2012 21:01:08 +0000

By TOM KRISHER

DETROIT - Just two years after it was rescued and reconstituted through bankruptcy and a government bailout, General Motors Co. cruised through 2011 to post the biggest profit in its history.

The 103-year-old company, leaner and smarter under new management, cut costs by taking advantage of its size around the globe. And its new products boosted sales so much that it has reclaimed the title of world's biggest automaker from Toyota.

GM may have a hard time breaking this record in 2012 because it is losing money in Europe and South America, and U.S. sales growth slowed in the last three months of 2011.

But the company's performance in North America and Asia still helped it earn $7.6 billion for the year, beating the record of $6.7 billion set during the truck boom in 1997.

The profit won't stop the debate about spending $49.5 billion in taxpayer dollars to save GM. But it did drive up the company's stock price, which could help the government get more of its money back.

The bailout of GM and Chrysler Group LLC, begun by George W. Bush and finished by Barack Obama, remains a major issue in this year's presidential campaign. It's so politically charged that even a Super Bowl ad celebrating Chrysler's rebirth caused arguments.

GM, which released its earnings Thursday, performed best in its home territory, posting a $7.2 billion pretax profit in North America. The numbers were so good that 47,500 blue-collar workers will get $7,000 profit-sharing checks, the maximum allowable under their new union contract. International Operations, which includes Asia, made $1.9 billion before taxes, but that was down from 2010.

GM's cost cuts, and its outlook for this year helped to push up the stock price by almost 9 percent to $27.08. The company said it trimmed costs by $500 million in the fourth quarter alone mainly by consolidating advertising agencies and engineering operations. A prediction that costs wouldn't rise this year wowed investors, especially since other automakers have forecast rising costs, said Itay Michaeli, an analyst for Citi Investment Research.

"That was a very pleasant surprise," he said.

GM also was optimistic about sales and revenue. It sees its global market share holding steady at 11.9 percent, and if global auto sales rise as expected this year, GM's slice of that would also increase.

Upbeat forecast for Silicon Valley commercial real estate

Thu, 16 Feb 2012 21:02:13 +0000

By George Avalos, Contra Costa Times, Walnut Creek, Calif.

Feb. 16--Silicon Valley's technology-powered surge of expansion is only in its early stages, and this should be another robust year for leasing activity, according to a report released Wednesday by realty firm Colliers International.

"We are seeing a huge impact from social media," said Jeff Fredericks, managing partner with the San Jose office of Colliers International. "Anything that can replace porn as the No. 1 activity on the Internet must have something going for it."

Activity should be strong enough that occupancy for office and research space in Silicon Valley should increase by 5 million square feet in 2012. That would come on top of an increase in net occupancy of office and R&D space of 3.5 million square feet in 2011, figures released by Colliers showed.

The predictions and analysis were part of Colliers' annual market forecast for Silicon Valley.

The biggest local cloud over commercial real estate this year could come from the large chunks of empty industrial space in Fremont resulting from the implosion last summer of Solyndra, a defunct maker of solar panels.

Experts who made presentations at the Colliers gathering in downtown San Jose said that the upswing in the region is being driven by companies in an array of tech sectors. Among the strongest are cloud computing, mobile applications and social networks, said Andy Zighelboim, a senior vice president with

Colliers.

"These are real technologies, with real profits and with real business plans," Zighelboim said.

At the end of 2011, the research and development vacancy rate in Silicon Valley was 13.7 percent, down from 16.2 percent at the end of 2010. Office vacancies were 16 percent at the end of last year, compared with 20.2 percent the year prior.

The South Bay's optimistic prospects have a solid foundation beneath them, the experts at the gathering said. They noted that total jobs in the region grew by 3 percent last year, tying the area with Houston for the nation's fastest rate of growth among large urban centers.

"Like everyone else, we are on the lookout for bad news," Zighelboim said. "But today, we see a lot more good signals. We are super bullish."

GM records its highest profit ever: $7.6 billion

Thu, 16 Feb 2012 21:01:18 +0000

By TOM KRISHER

DETROIT - General Motors earned its largest profit ever in 2011, two years after it nearly collapsed.

Strong sales in the U.S. and China helped the carmaker turn a profit of $7.6 billion, beating its old record of $6.7 billion in 1997 during the pickup and SUV boom.

GM is a vastly different company than it was back then. It's smaller, has less debt and its contract with the United Auto Workers is less costly. But it took a $49.5 billion government bailout and bankruptcy protection in 2009 to cut its bloated costs. The company earned huge a profit even though U.S. sales of cars and trucks were near an historic low of 12.8 million.

In 2012, GM expects to increase its revenue as global sales grow and it charges more for models.

Its ongoing effort to cut costs and take advantage of its global presence are also paying off. In the fourth quarter, costs fell by $500 million. It saved $100 million by cutting some of the dozens of advertising agencies and media managers it uses. It also saved $100 million by centralizing engineering.

"We will build on these results as we bring more new cars, crossovers and trucks to market," CEO Daniel Akerson said.

GM's stock price rose $1.70, or 4 percent, to $26.01 in early afternoon trading.

That's good news for the U.S. government, which still owns 26.5 percent of the company and needs the stock price to rise significantly before it can recoup all the bailout money. The bailout and GM's performance already are contentious issues in this year's presidential campaign.

Still, problems emerged for GM late last year. Its fourth-quarter profit fell 8 percent and missed Wall Street expectations. Europe and South America reported losses. And sales growth in the U.S. slowed even as more Americans bought cars and trucks.

This year, GM expects to make less money per vehicle as the mix of sales shifts to cars from trucks, which have bigger sticker prices

Still, last year was a big success for the company.

Revenue rose 11 percent to $150 billion. Its per-share profit was $4.58. GM made the bulk of its income in North America, where its pretax profit totaled $7.2 billion. International Operations, which includes Asia, made $1.9 billion before taxes, but that was down.

NK Auto plans overhaul

Wed, 15 Feb 2012 21:01:12 +0000

By Santan Santivimolnat, Bangkok Post, Thailand

Feb. 15--NK Auto Group, a leading dealer of pre-owned Mercedes-Benz and an independent importer of the marque, has restructured its organisation and automobile business to raise brand awareness.

NK Auto Import was recently established to handle new Mercedes-Benz imports, while newly established NK Auto Service is responsible for car servicing.

NK Car Plaza, the existing company started in 1968, remains responsible for sales of used Mercedes-Benz.

The group plans to invest over 200 million baht this year.

It wants to launch new Mercedes-Benz models, as well as marketing campaigns at department stores, community malls and motoring events.

Another goal is renovation of its showroom and service centre on Kanchanaphisek Road in Bangkok, building one of the country's largest one-stop Mercedes-Benz facilities.

Renovation will start in May and be completed by year-end, said Pitinun Krisadatanont, the group's managing director.

"There will be a search engine directory for Mercedes-Benz models and a car catwalk display using 3D-mapping technology," said Mr Pitinun.

The service centre is being constructed and is 40% complete.

It will be equipped with state-of-the-art tools to guarantee the quality of all new and used Mercedes-Benz.

Mr Pitinun said the group sold 654 Mercedes-Benz in 2011, a 5% increase year-on-year.

Of the total, 261 units were used cars, down 40% from 2010, while 393 units were new cars, more than double 2010's total.

C- and E-classes were brisk-selling models last year.

The group aims for sales of 700 units this year, up by 7% from 2011, with 60% going to new car imports.

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33% of Saudi firms ‘definitely hiring in the next 3 months’

Mon, 13 Feb 2012 21:01:16 +0000

By Arab News, Jeddah, Saudi Arabia

Feb. 13--RIYADH -- The latest Job Index survey conducted by Bayt.com and YouGov has shown that Saudi Arabia's hiring expectancy in the coming months is slightly lower than it was in the fourth quarter of 2011. Most jobs in the coming three months will be for junior executives in the private sector, with a preference for computer science, commerce and business management qualifications across the region.

Of the 58 percent of companies in the Kingdom that are "definitely" or "probably" hiring in the next three months, the majority (43 percent) will be looking to hire less than five people, while 24 percent will look for 6-10 new employees. In a year's time, the figures are slightly more positive with 68 percent of companies "definitely" or "probably" hiring.

Across the region, the majority of survey respondents (31 percent) equally prefer candidates with the following experience: Strong computer skills, and the ability to manage a team with a prior experience in a managerial role. Sales and marketing experience followed next (26 percent). Meanwhile, in terms of skill sets, the ability to communicate effectively in both English and Arabic is considered to be the most important skill in a job-seeker, according to 51 percent of respondents. Other skills that employers look for are the ability to be a flexible, helpful and cooperative team player (45 percent), overall personality and demeanour (43 percent), and trustworthiness (42 percent).

In Saudi Arabia specifically, computer skills is the most desirable experience that a candidate can have according to 35 percent of respondents, followed by managerial (33 percent), and sales and marketing experience (30 percent). On the other hand, the three most desirable skills for KSA employers are good communication capabilities in English and Arabic (69 percent); the ability to be a flexible team player (48 percent) and overall personality and demeanour (44 percent).

Meanwhile, the top five academic qualifications that are most sought-after by KSA employers are computer science (25 percent), engineering (24 percent), jointly commerce, business management and administrative qualifications (22 percent each), information technology (16 percent) and electronics (13 percent). Employers are mostly looking for junior executives, executives, coordinators and senior executives.

Quarter of Lebanese firms will be hiring soon

Mon, 13 Feb 2012 21:01:16 +0000

By The Daily Star, Beirut, Lebanon

Feb. 13--BEIRUT -- Around 24 percent of Lebanese firms will "definitely be hiring" in the next three months, according to a poll conducted by regional job search website Bayt.com and consulting firm YouGov.The percentage is forecasted to significantly increase to 68 percent within a year, the study showed.

But it added that hiring expectancy in the coming months would be slightly lower than it was in the fourth quarter of 2011.

Of the 54 percent of companies in Lebanon that are "definitely" or "probably" hiring throughout the next three months, the majority (42 percent) will be looking to hire less than five people, while 25 percent reported that they will look for 6 to 10 new employees.

Across the region, 31 percent of respondents prefer candidates with strong computer skills and prior experience in a managerial role.

In Lebanon, team management proved to be the most sought after experience to 36 percent of the corporate respondents, followed jointly by computer skills and sales and marketing experience, according to 25 percent of the respondents.

The survey highlighted the three most desirable skills for Lebanese employers as the ability to be a flexible team player (50 percent); good communication capabilities in English and Arabic (44 percent) and the ability to work under pressure (43 percent).

The top five academic qualifications most desired by local employers are business management (34 percent), computer science (24 percent), engineering (23 percent), administrative qualifications (22 percent) and information technology (20 percent).

"Employment trends are relatively similar across the region, with roughly a quarter of MENA companies considering hiring new staff in the coming months, and in a year's time," said Bayt.com vice president Suhail Masri.

The data for the survey was collected online from Jan. 2 to Jan. 24, 2012. Results were reported on a base of 9,238 respondents.

Countries that participated are the UAE, KSA, Kuwait, Oman, Qatar, Bahrain, Lebanon, Syria, Jordan, Egypt, Morocco, Algeria, Tunisia and Pakistan.

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