Volume 51 - A Potential Female Vice-President

I would never have guessed that I would be writing this piece fully admitting that the changes of me ever voting for a female for one of the two highest offices in this country were slim to none!





But up to two weeks ago that was true. The selection of Sarah Palin has now changed that scenario, for now there is actually an opportunity to vote for a true conservative that speaks and acts on what she believes no matter the response from the 'elite' press and political operatives that actually think they run this country or speak for Main-Stream America.




Go Girl!



Having stated the above, this entire 'selection process' and its abhorred reaction deserve just a few commits/questions: How is it that the 'Media' demands total accessibility to the selection process? How, in fact, does the 'Media' demand anything; isn't their job to simply report the news? Who the hell cares whether some reporter from the NY Times or Washington Post needs to put their approval on any candidate? And, how is it that theses same reporters refuse to not only have 'no limits' to their absolutely rude and ingenuous questions but also refuse to ask the 'other party,' and more so, in particular, to 'Men' the same type demeaning and sexist questions? How is it that Sarah Palin's husband's DUI of twenty years ago is relevant when Obama's 'coke' use isn't relevant? How is it that Gore's son's DUI was of no consequence but Palin's daughter's pregnancy is of major importance? How is it that Palin's degree from a non-Ivy League school is of importance because it is not an Ivy League degree? How is it that Palin's so-called inexperience is a 'monumental factor' when neither Obama nor Biden have ever 'run' anything other than their 'mouth' and have sat in Congress for up to thirty years acquiring a 14% approval rate when Governor Palin has a 83% approval rate? The questions are never ending as the 'Liberals' show their distaste and disrespect for all that is not stamped with their mark of bigotry and bias.




But more importantly, and actually more tragically is the fact that the so-called 'Glass Ceiling' is not, nor has it ever been, protected and guarded by men; but rather - and here is the tragedy - IT IS PROTECTED AND GUARDED BY WOMAN! Woman have not progressed in the workplace or in other endeavors equal to men not because of men, but because the majority of women are, unfortunately, unable to work and judge without pettiness and jealously seeping through their pores with regards to their other 'sisters.' We are seeing it today with reference to Sarah Palin, with female bashing by females. Incredible.



Here we have a bright, intelligent, seasoned politician, conservative, pro-life, Governor of the Great State of Alaska who has demonstrated within a two year term of Governor that reform is possible for the benefit of people without big government and YET the biggest criticism is from FEMALES, and in particular FEMALE reports of the elite media. Well ladies, here is an opportunity for the ages. The ball (or balls) is in your court. Lets see if you really want to break the 'Glass' ceiling.



Thank God for women the stature of Cindy McCain and Sarah Palin

Volume 50 - i.2 series of Hotel Entrance Locks

Starting a full-line private labeled architectural door hardware company serving the North and South American commercial construction market is difficult enough without extending the line to include a private labeled Hotel Entrance Door Lock series to compete with the 'established giants' in the Hospitality Industry. Independence2, LLC with our i.2 series of private labeled architectural door hardware has again 'stepped up to the plate' with a full line of Hotel Entrance Door Locks.


One of the interesting things that we've found concerning Hotel Entrance Door locks, aside from it being controlled by only a few manufacturers, is that the United States market is and has been sold on an old process, the Magnetic strip card. For those of you that travel or have stayed in a Hotel room in the last 50 years, this is no surprise. What would be a surprise is if your 'room key' turned out to be an Intelligent Card (chip) or a RFID (proximity) type card. The amazing thing is that everywhere else in the world the Magnetic Card is 'old-school', with poor security and being replaced by either the IC or RFID type card. These newer type cards can store information, have a higher lever of security, and can be used throughout a property for more than simply opening a door.


The main reason that your Hotel Room Door has a lock on it is to make sure that the access control function is used only by you. Simple enough; but unfortunately not only is your room accessed by staff and security, magnetic type cards are easily duplicated; therefore, access control must be a managed process. Aside from the Hotel Industry this new technology can be taken to much higher levels of security such as with Schools or Businesses where graphics and photos plus higher degrees of biometrics can even personalize the card in this managing access process.


With regards to the Hotel industry, the smart card technology enables only approved personnel and or guest to either full or limited access to a facility, at certain times of the day or week or 'stay' during one's hotel visit. The control can also automatically terminated upon a certain length of time; can be used for not only full-time staff but also temporary employees or vendors requiring access to the facility. Even more important, in today's 'Green Environment' with folks finally understanding the importance of saving energy not only for the 'planet's' sake but for sake of the 'bottom-line.' Going 'Green' is not only a positive environmental decision, but one that truly makes 'dollars and sense.'


Energy costs in guestrooms are one of the most expensive capital expenditures a hotel can incur. With the i.2 series of Hotel Entrance Locks, we address this issue, not as an option, but as part of our product offering. All of our Hotel Room Entrance Locks come with an energy saving device. It has been stated that 65% of the time hotel guests are not in their room; so why heat, cool, or light the room when the room is unoccupied? With our Entrance Room Locks, our Smart Cards and RFID Cards turns 'on and off'' the energy within the hotel room as soon as the guests enter or depart the guestroom.


We at i.2-Independence2, LLC now have ready for the market place a full line of private labeled Hotel entrance door access devices including the standard Magnetic strip card, but also the more secure I/C smart card and the RFID card with all the associated card readers, integrated software systems, energy saving device, and even perimeter access controls for side entry with either the Smart Card or the RFID card access control systems. The hardware is exquisite with many designs and finishes along with the added security from a company that understands the needs of the customer.


We are continuing our R & D to the next level which will include higher degrees of Biometric access. For those locations and applications that require higher security, development is taking place with a retinal scan device as well as voice recognition system, understanding that, at this time, these systems are in the much higher price bracket as well as requiring more personal information from the user. Along with this technology is the combination hardware/software systems that will use a RFID proximity card and a video recognition system. This system involves calling up a profile in a video system and a facial recognition test comparing prepared data to a live image. This control/video system and in particular the facial recognition aspect is still an evolving technology but one that is rapidly advancing.

The i.2 series of architectural door hardware - Where Architectural Door Hardware meets Value and Design meets Imagination

Volume 49 - China: collaboration or confrontation

It has been almost two years since my first trip to China, where I spent three weeks visiting manufacturing sites, talking with perspective manufacturing partners, covering a variety of subjects ranging from quality and inspection processes, pricing, lead-times, specifications, etc. for our private labeled architectural door hardware company and the i.2 series of product, along with attempting to start a business relationships in a very short amount of time in multiple locations. These locations covered Beijing, Guangzhou, Zhongshan, Dongguan, Shanghai, Suzhou, Taipei and Hong Kong. As difficult a travel schedule as I had ever arranged, aside from all the business introductions and discussions, the attempt to assimilate a culture 5,000 years old with unheard of economic impact just over the past 20 years, was equally as difficult.


As I've stated in previous blog writings, Volume 28-29-and 30 of The 2am Talk Radio Show blog series, I didn't witness an emerging market, I witnessed a country that already has emerged. I witnessed a nation that has been undergoing a huge commercial and creative upheaval, entering the world market. I witnessed a country emerged in a spirit of entrepreneurship that reminded me of what the United States was before we paid workers to sit on their 'butts' without working. I witnessed a 'pay as you go society'; if you couldn't pay, you worked until you were able to (purchase).


I witnessed construction cranes that worked seven days a week, in the creation of breathtakingly spectacular skylines that rival New York, Chicago, Miami and Los Angeles. Construction involving high rise office buildings, apartments, airports, hospitals, malls, and Hotels. The creation of jobs for millions of people that earn them a spending power they have never known and are eager to exercise.


I also witnessed terrible air pollution, driving conditions that makes the '10' and '405' in Southern California look like sensible highways. I also saw many small motorcycles, occasionally with three people on one vehicle. President Bush is absolutely correct by stating earlier this week at the G8 summit that without China and India making resolutions to help with the environmental impact, it won't make much of a difference what the G8 determines without those two industrial nations. But I also saw people working in factories that smiled when you made eye contact, no dirt floors, no armed guards, and none of the 'TV' conditioned 'Chinese factory.'



I've even written that economic prosperity/doctrines is more important than a democratic form of government; and that economics, and economic doctrines/principles determine the level of living standards, the degree of educational process, the laws of a land, and the future existence of people, rather than a form of government or politics. Is it not true that democracies have a life span of less than 300 years? As you can already tell from everything that I've written thus far today, and in the past regarding Emerging nations as China (Asia), and Economies in general, as well as subjects as Globalization, I'm not always well accepted by even close friends of mine. Therefore, the point of this Blog: Starting this evening on the Discovery Channel there is a four-series starting at 10 p.m. EST hosted by Ted Koppel that "shows changes in China."



The advertisements regarding this series state:



"What's going on in China will make a big difference in the U.S."



"We're going to be competitive with these people, and whether that competition is resolved by collaboration or confrontation is really the big question for the next 20 years."



"More Buicks were sold in China last year than in the U.S., and Ford increased its sales in China last year by 30 percent."



"The mistake that some people make, I think, is that they assume capitalism is a political doctrine," Koppel said. "It's not. It's an economic theory. You can have a totally capitalistic society, which China is rapidly becoming, and still not be one step closer to democracy."



Hopefully, this 4-part series does both our countries justice as to Fact, not Fiction.

Volume 48 - A Great Story

Memorial Day has been over for a few days, but as a tribute to all the men and women who have served with honor, in protection of our 'taken for granted freedom.'

It happens every Friday evening, almost without fail, when the sun resembles a giant orange ball and is starting to dip into the blue ocean. Old Ed comes strolling along the beach to his favorite pier. Clutched in his bony hand is a bucket of shrimp. Ed walks out to the end of the pier, where it seems he almost has the world to himself.



The glow of the sun is a golden bronze now. Everybody's gone, except for a few joggers on the beach. Standing out on the end of the pier, Ed is alone with his thoughts....and his bucket of shrimp. Before long, however, he is no longer alone. Up in the sky a thousand white dots come screeching and squawking, winging their way toward that lanky frame standing there on the end of the pier. Soon, dozens of seagulls have enveloped him, their wings fluttering and flapping wildly. Ed stands there tossing shrimp to the hungry birds. As he does, if you listen closely, you can hear him say with a smile, "Thank you. Thank you."



In a few short minutes the bucket is empty. But Ed doesn't leave. He stands there lost in thought, as though transported to another time and place. Invariably, one of the gulls lands on his sea-bleached, weather-beaten hat - an old military hat he's been wearing for years. When he finally turns around and begins to walk back toward the beach, a few of the birds hop along the pier with him until he gets to the stairs, and then they, too, fly away and old Ed quietly makes his way down to the end of the beach and on home.



If you were sitting there on the pier with your fishing line in the water, Ed might seem like"a funny old duck," as my dad used to say. Or, "a guy that's a sandwich shy of a picnic," as my kids might say. To onlookers, he's just another old codger, lost in his own weird world, feeding the seagulls with a bucket full of shrimp. To the onlooker, rituals can look either very strange or very empty. They can seem altogether unimportant ....maybe even a lot of nonsense. Old folks often do strange things, at least in the eyes of Boomers and Busters. Most of them would probably write Old Ed off, down there in Florida. That's too bad. They'd do well to know him better.



His full name: Eddie Rickenbacker. He was a famous hero back in World War II. On one of his flying missions across the Pacific, he and his seven-member crew went down. Miraculously, all of the men survived, crawled out of their plane, and climbed into a life raft. Captain Rickenbacker and his crew floated for days on the rough waters of the Pacific. They fought the sun. They fought sharks. Most of all, they fought hunger. By the eighth day their rations ran out. No food. No water. They were hundreds of miles from land and no one knew where they were. They needed a miracle. That afternoon they had a simple devotional service and prayed for a miracle. They tried to nap. Eddie leaned back and pulled his military cap over his nose. Time dragged. All he could hear was the slap of the waves against the raft. Suddenly, Eddie felt something land on the top of his cap. It was a seagull! Old Ed would later describe how he sat perfectly still, planning his next move. With a flash of his hand and a squawk from the gull, he managed to grab it and wring its neck. He tore the feathers off, and he and his starving crew made a meal - a very slight meal for eight men - of it. Then they used the intestines for bait. With it, they caught fish, which gave them food and more bait......and the cycle continued. With that simple survival technique, they were able to endure the rigors of the sea until they were found and rescued. (after 24 days at sea...)



Eddie Rickenbacker lived many years beyond that ordeal, but he never forgot the sacrifice of that first life saving seagull. And he never stopped saying, "Thank you." That's why almost every Friday night he would walk to the end of the pier with a bucket full of shrimp and a heart full of gratitude.



(Max Lucado, In The Eye of the Storm, pp.221,225-226) PS: Eddie was also an Ace in WW I and started Eastern Airlines back in the 30's.

Volume 47 - Manufacturing losses - USA today article

Early in March, a friend of mine sent me an article that appeared in USA TODAY titled: Manufacturing losses weigh heavily on Ohio, By David J. Lynch


Having grown up, been educated, lived and worked in Ohio for my entire life this shouldn't have been a total surprise to see an article on such a subject, unless of course you happen to have been the President/CEO of that company during the years of 1996-2001.



"After more than 60 years in business, their employer, Amweld Building Products, announced in October that it was closing two local plants and shipping the work to Monterrey, Mexico. Some workers got the news when armed security guards swarmed the assembly line and ordered them away from their machines."


Pathetic! If anyone believes for one second that these plants, those workers, due to their wage scale had anything to do with moving this plant to Mexico, or that they were such a threat as to have armed guns "swarm" to the factory floor, 'Santa' and the 'Easter Bunny' will continue to live in mystical belief.


The article goes on to say "Ohio's Mahoning Valley once was emblematic of industrial America, thickly populated with auto and steel plants, employing men whose strong backs and high school diplomas were their chief credentials." What does that exactly mean? Every give a thought to that statement; I happen to believe that it is, at best, condescending and at worse an absolute insult. "strong backs and high school diplomas," is that supposed to mean that other parts of this country or the world are more suited for good paying jobs, or is it supposed to mean a handicap of some sort?


The fact of this particular matter is that whether these skilled factory workers, even if they all had college degrees, had nothing to do with this plant closing. The closing of these two Amweld plants had nothing to do with NAFTA. The closing of these plants (and the Johnson Rubber plant) are so far removed from the presidential elections as to be comedic the way the political parties are chasing such a story. The closing of these plants happened because of past and present ownership who caused the downfall of that particular company through greed and absolutely poor decision making processes over the past six years; decisions that adversely effected both the employees and the customer base.


The truth as stated by in the article, "These are not the first comforting election-year promises these men have heard," nor others in the Mahoning Valley during election years, "for experience has taught them to be skeptics." As one of the workers, Craig Plant stated, referring to the politicians, "It's just a smokescreen for we're pretty much not going to do anything." Yet we have candidates making the following statement to "renegotiate NAFTA's terms with Mexico and Canada, add tough labor and environmental requirements to any new accords and re-orient trade policy from the needs of Wall Street's moneyed elite to the protection of hard-hit workers."


I'll again state that the moving of Amweld to Mexico had absolutely nothing to do with anything as reported; and, I take it a stand further, and state that if the other plant closings, mentioned in that article, were investigated the closings would have occurred because of greed, theft, money laundering, poor management, fraudulent accounting practices, inventory fraud, and many other reasons other than what the politicians have stated and puppeted by the media.


The worker's understand why this happened, and when it started down this disastrous trail. As stated, and correctly so, the company "....had outsize ambitions befitting the age of globalization, saying it aimed to become 'the Pepsi-cola of steel doors', the workers say." The company claims that it had been unable to extend existing factory leases; but failed to say that the previously ousted owner, still owns the property. The company then blamed rising costs for energy, health care and workers' compensation for the elimination of jobs, yet from 1996-2001 it was a 'money machine' turning gross profit margins unheard of in the Steel fabrication industry. This idea of plant closings, loss of manufacturing jobs, and all the other 'bullshit' that goes on through politicians and the media is simply 'off base'; the devil is in the detail of such moves, and not in trade agreements, nor wages of other countries, nor in the wage rates of good jobs here in the Mahoning Valley, and certainly not on the backs of those 'high school diploma workers,' who are simply the very best in the industry, and certainly will always have my total respect. It was my privilege to have been the president of that company, because of the men and women that worked the factory floors.


As stated by Bob Ulrich, past Union President, "it's just sad;"but, let us, at least, get to the truth.

Volume 46 - Hotelier's dollars lost, never seen

Here is a dirty little secret about Hotelier's dollars lost but never seen; it's hidden in Division 8 of the Master Construction Division of the Construction contract. Within Division 8, the realm of Architectural Doors, Frames and Door Hardware, making up 2-3% of the entire project; ask any Hotel owner from the smallest of properties, a 22 room Super 8, to the giants of Intercontinental or MGM, what they pay for door hardware, or even more specifically a Grade 1 type door closer or a Grade 1 exit device, and your answer, 100% of the time, will simply be "I don't know."



This cost, as stated, only makes up 2-3% of the project, and... "we are simply to busy with the large portions, electrical - mechanical - concrete portion, of this project," so it gets buried in some sub-contracting section. Pathetic!



Not only should $5,000, $25,000 or $50,000 be of importance, regardless of one's size, it is irresponsible not to be more involved into a project, simply not accepting some architect's 'twenty year old' specification, written by a spec writing representing a specific manufacturer. Remember the Fox in the Hen house story? The Architect is an employee of the owner-builder-developer; the check is still written by 'ownership'.


It is easy to say that in today's society, with an economy that is in a recession, a volatile stock market, $110 barrels of oil, bread (seemingly) at 30% daily price increases, etc. etc. etc. that one should be watching every 'Penny' spent, either at home or on the job. Isn't running a business not only about 'Sales' but also about 'Cost?' Isn't it the responsibility of ownership, or ownership's representatives, to 'always' watch 'cost'; good market or poor? Learn to know what real costs are and where they exist; pennies and dimes add up to serious money that sometimes are never seen.

Volume 45 - Locksmithing - Just a service industry?

In September of 2001, I wrote an article that was published by the Doors and Hardware Magazine entitled "Can Independent Entrepreneurs Survive Industry Consolidation?" In this article I spoke about the fragmentation of the Hollow Metal Door Industry and the various types of integration that was taking place and would take place over the next decade. I also illustrated the importance of the Contract Hardware Distributor in this Industry and in the supply chain attempting to show that regardless of what happens with consolidation, a well organized and operated distributorship would always be a profitable company.


In the Magazine, Locksmith Ledger, December '07 issue, a very similar article was written, "In a World of Merger Madness" stating that no matter what happens within an industry, individual businesses should keep their eye focused on their businesses always looking towards improvement within the Industry."


Interestingly, I wrote an article not accepted by the Locksmith Ledger stating those similar sentiments regarding the business of Locksmithing. The following is that article that asks a very serious question: Locksmithing - Just a service industry?


As a business entity, the Locksmith Industry is being pushed further and further toward the 'service provider of 'install only' direction versus the 'selling of products for revenue' direction. As an owner of this type business one should be asking the following questions: 'How is this present supply chain adversely effecting my business?' and What are my options in attempting to control my own destiny and profits?' Understanding the 'Supply Chain' and the implementation of its consequences, as well as individual segments equates to volumes of information and debate. This article is simply meant to stimulate thinking on possible solutions to combating the problem of limiting revenue streams.


It is common knowledge that the Locksmith Industry must compete with the 'Big Box Houses' and preferred distribution, where a great many hardware manufacturers sell direct not only at pricing advantages but also availability advantages, since most locksmiths have to purchase through pre-ordained distributors or wholesalers, thus limiting their 'selling revenue stream.' This predetermined supply chain is an obvious goal of the Manufacturing Industry to limit distribution, yet increase sales and profits of their products. Obviously, this means the 'Big Box Houses' or other types of large distribution that can purchase large quantities of product, as this is really the only criteria by the manufacturers of products, work at a huge advantage.


This selection theory further states that certain manufacturers, in fact, intend upon even further limitation of product in their future plans, regardless of Anti-Trust legislation. Disruption of the supply chain, or specific modeling of this supply chain, although an interesting issue, is really of little importance to a respected industry like 'Locksmithing,' being further pushed into a service arena by the large manufacturers of door hardware products with specific intent. No matter how respected and vital one might think this Industry is to both the new construction as well as the aftermarket construction industry, combating this trend is the subject matter and vital concern of ownership.


The Locksmith Industry however has many options today that didn't exist even a few years ago. The Global Supply Chain today offers availability of product, along with fair market pricing to compete with anyone. This 'Open Supply Chain Market' is far better than that of a controlled and limited chain, thus opening up choices and options the basis of all business growth. With Globalization, one has a choice, the same as a Fortune 500 Company, to participate according to your business plan, and not according to someone else's business model.


Remodeling of this current Supply Chain should be of great interest to the Locksmith Industry, if one is to combat this squeeze to simply become a 'service type provider.' It is of vital importance to this industry to understand your 'value added' service within the commercial, as well as the residential, construction market; this must include new construction as well as the aftermarket construction segment. The time is now to formulate a business model that involves access to different revenue streams, rather than simply attempting to find a 'middle-ground' or compromise situation due to the restraint of trade and pricing issues. Being timid about your business is simply not acceptable. It is time for this industry to realize that for the first time in history, the Locksmith Industry is not captive to large corporate door hardware Industry dictates. There is no longer such a thing as 'business as usual,' unless you choose to remain a single revenue stream business. Single revenue stream business plans, regardless of how the business was pushed into that corner do not make fiscal sense. Industry shifts, mergers and acquisitions only emphasize the importance of this business model readjustment.


With regards to the question of "What are my options in attempting to control my own destiny and profits?" It is really all about how one 'frames' the problem. The ability to properly frame an issue or problem will go far in the ability of those who choose to tackle an obstacle, in avoiding the typical pitfalls that limit one's ability to reach a solution; such as Locksmiths being forced into being a service company, due to some anonymous corporate boardroom's model and goal of limiting distribution of product for control of a supply chain. The Locksmith Industry has to seriously think about its future and survival, beyond a service company, and to act by investing thought into a vision that includes multiple revenue streams.


Thus, we arrive at 'basic business 101', which states the ability to purchase at attractive pricing is directly proportionate to ones revenue possibilities tied directly into one's cost structure. The ability to purchase products at a fair price directly from the 'source' is simply necessary to sell product as another revenue stream, complimenting the service side of the business. This entails the ability to purchase a quality product with superior guarantees/warranties that meet or even exceed those offered only to 'preferred customers.' This also means being treated as a business partner with the source manufacturer, something which is now offered within the 'Global Economy Model' versus the 'Standard Operating Model.'


From the purchase side of this equation to the Sales side, simply states: there are only three ways to increase sales:

(1.) Increase the customer base

(2.) Increase the amount of goods or units that your present customer now purchases

(3.) Increase prices


Anyone that has been in business for any successful length of time realizes that increasing prices has become more difficult, mainly due to the restricted supply chain thoroughly analyzed previously. This option, however, becomes more feasible for the Locksmith when purchasing 'direct' enters the equation. One can actually continue to sell at present price points, while increasing and having a positive impact on the bottom line by being more prudent on the purchasing side of the formula. This ability to purchase direct also provides you assistance to more easily defend your regional 'turf' or regain your historical client base needed for your businesses future growth. One can then choose to concentrate on expanding out to new markets, new customers, or possibly utilizing 'add-on' benefit extras in order to build out from your established core expertise. However, until this step is made, your Locksmith operation will be forced to compete at the lowest levels of the Supply Chain 'playing field' other than the service side.



If you are willing to work on a continuous improvement of your service capabilities, process, product offerings, cost reduction programs and monitoring, added to your ability to communicate your company's unique value package, then your customers will inherently be able to differentiate why you are better than the rest of the growing options and competition that exists with the marketplace. This will allow you to establish a new or larger customer base, such as more 'negotiated' work, or even 'bid' work depending upon your organizational structure or your own personal future growth goals for your business.


In order to accomplish better pricing, with warranties/guarantees equal to the 'big boys', one has to find a reliable source of product with pricing that adds to one's bottom line; as stated, a strategy established to sell to new customers, as well as more product offerings to one's present customer base. Possibly a source that can introduce your business to potential sources of revenue as was recently accomplished at the construction of a new student center at I.U.P.U.I., Indiana University-Purdue University Indianapolis; the University of North Carolina (UNC) Genetic Center in Raleigh, North Carolina; the Pontchartrain Convention Center, Metairie, Louisiana; or the Stowe Mountain Lodge, Stowe, Vermont where introductions were made not only to Locksmiths and the Contract Door Hardware Distributors, but also Millwork Finishers, all by a Source Manufacturer that understands the value brought to the market place by the Locksmith Contract Door Hardware Industry.


When was the last time one of your Manufacturers/Suppliers brought business to your doorstep? When was the last time you evaluated the model on which your company was established?

Volume 44 - Congress and Major League Baseball

What the hell is Congress doing investigating whether Roger Clemens is telling the truth or if a known drug dealing ex-cop, Brian McNamee, has now decided to become a truthful witness? This TV media show, also known as a Congressional hearing, reminded me of a scene in the Godfather, where a Congressional committee was hearing testimony from a known racketeer, with the same results!


This circus media show involving Congress and a 'known celebrity' started before Martha Stewart, but it now seems 'standard operating procedure' not to solve a crime but to find someone who has lied to a federal investigator. Defined by Webster, a "lie is an assertion of something known or believed by the speaker to be untrue with intent to deceive." Talk about having the 'Fox in the Hen' house; why don't we just add a couple 'used car salesmen' to the committee, convene daily during the 'Soaps' or maybe Jerry Springer's Show, sell advertising and at least make it a profitable venture!


If Congress had any balls (no baseball pun intended), they could 'clean up' baseball in less than it would take to play 'one inning.' Simply, tell the owners to solve the (drug) problem or they (Congress) would repel the Anti-Trust favoritism shown to Major League Baseball, with a time limit of one year. After delivering this message, Congress could go back doing whatever other nonsense they do; for it is probably too much to ask for proper legislation concerning issues as Immigration, Health Care, Social Security, Taxes, Education, etc. let alone solving the problems of the FDA, FAA and Homeland Security; unfortunately, it just has become to easy to blame the President.


Baseball is 'Entertainment' as is all major sport. At the rate we're going, next week's program scheduling might even have the New England Patriots, and the adventures of 'Spygate.' I read that there are even scheduled hearings on thoroughbred race horses and the use of steroids! If 'entertainment' is the focus of Congress, I can't wait for the Music Industry to talk about their HDH and steroid use; or maybe even their coke, H, or meth use; look out Soaps!


The NFL, MLB, NBA, NASCAR, PGA, NHL, etc. is Entertainment. If anyone is still naive enough to think that these people, professional athletes, are anything other than entertainers, god forbid the concept of 'heroes', who should be controlled by their respective leagues and owners, then Santa and the Easter Bunny are well secured in mythological history.

Volume 43 - Antitrust Laws

The following is a summary of the Antitrust Laws' relevant provisions as I see them pertain to the Commercial Door Hardware Industry, and in particular Division 8 of the Master Format Specification System. It becomes very evident that many people walk a 'slippery slope' within the commercial construction industry and the manufacturers that supply product through distribution to this industry.


The first statement of United States antitrust law was embodied in the Sherman Act, which was enacted in 1890. The Sherman Act has two major provisions:


1. Agreements between two or more persons to restrain trade or commerce are illegal. The Sherman Act's first section prohibits unlawful agreements or conspiracies between two or more entities to restrain trade. These agreements do not need to be in writing. In fact, most are not. Although the terms "restraint of trade" are not defined in the statute, over the years, courts have considered many types of restrictions between competitors and have ruled that certain restrictions or limitations on free enterprise clearly violate this section. Nonetheless, three elements must be established to prove a violaation of Section 1: (1) the existence of a contract, combination or conspiracy among two or more separate entities that (2) unreasonably restrains trade and (3) affects interstate commerce.


2. Monopolizing trade or commerce is illegal. The Sherman Act's second section involves monopolization. This section is violated by the action of a single entity - it does not require an agreement. To violate this section, two elements must be present: (1) a corporation must possess monopoly power in the relevant market; and (2) a corporation must have willfully acquired or maintained such power by imporper or illegal means. These elements are not defined in the law and, therefore, are complex. There is no market percentage threshold that automatically creates an illegal monopoly. Traditionally, the courts have said that a company is a monopoly if it possessess the power to control prices or to exclude competition from a market.


The Sherman Act was supplemented in 1914 by the Clayton Act, and in 1936 by the Robinson-Patman Act. These two acts contain some basis prohibitions as:


1. A seller may not discriminate in price between purchasers when the effect may be substantially to lessen competition.


2. A corporation may not sell a product upon the condition that the purchaser will not use or purchase the product of a competitor when the effect may be substantially to lessen competition.


The Federal Trade Commission Act originally enacted in 1914 supplements the Sherman and Clayton Acts by broadly prohibiting unfair or dcptive activities.


Along with the Federal Trade Comission Act there also exists many State Antitrust Laws with over 48 states having such legislation. Such as in Ohio with the Valentine Act which specifically prohibits combinations or agreements to: (a) restrict price, (b) restrict production, (c) boycott customers, and (d) allocate markets. In addition, some state have price discrimination statutes that are similar to the Robinson-Patman Act and cover purely intrastate price differentials.


With respect to dealing with 'customers' or 'suppliers', resale price maintenance, certain boycotts, and tying arrangements are per se violations of the Sherman Act. Other areas regarding customer or supplier dealings in which antitrust problems may arise include the following: (1) Arrangements with Distributors - "Distributors" are those customers that purchase products for resale and who take title to the goods, bear all resale credit risks, and are independent entities. A manufacturer, acting alone, can select any company or person it wishes as its distributor or agent. It is also often permissible for a manufacturer to appoint a distributor as its "exclusive" distributor in a specified geographical area.


Although reasonable restrictions on territories and custromers is permissible, it is still unlawful for a manufacturer or seller by agreement, threats, pressure, persuasion, or coercion to restrict, limit, or require a distributor to use certain prices, terms or conditions upon reselling the manufacturer's products. It is also unlawful to require distributors to handle your products to the exclusion of similar products made by competitors when the effect may be a substantial lessening of competition or tendency toward monopoly. Under this test, the total number of distributors thus restricted and their size, considered in relation to the total number of similar distributors so restricted, is the key to determining legality or illegality. It takes only a very low ratio of restricted distributors to make exclusive dealing unlawful.


(2) Price discrimination - The heart of the Robinson-Patman Act which makes it unlawful for a seller to discriminate in price between the purchasers of commodities of like grade and quality where the affect may be substantially lessened competition with the seller himself, or with the favored purchaser or with customers of the favored purchasers. Price discrimination is any difference in price, no matter how small, between customers. When products are sold at substantially different prices to competing distributors for resale, a probable injury to competition between the purchasers may be presumed. The statute also prohibits "indirect" discriminations in price. Such "indirect" discrimination could occur when differing terms or condiditons of sale result in a lower price to certain buyers. For example, rebates, credit, allowances, or services provided as incidental to the original sale to some buyers that are not provided to other competing buyers would be "indirect" discrimination.


The Robinson-Patman Act also forbids a buyer from knowingly inducing or receiving discriminatory prices or services. If the seller grants an unlawful discriminatory price or performs a service not made proportionally available to competing buyers, the buyer who receives such favored treatment may also violate the law. Thus, if a buyer knows that it buys in approximately the same quantities and by the same methods as its competitors and knows that it has received substantially lower prices than its competitors, the buyer will be presumed to have violated the law. Even if the buyer purchases in larger quantities, or by different methods than its competitors, if it know that the discounts it receives are clearly greater that the seller's probable cost savings, the buyer may be held liable for receiving discriminatory prices.


This section of the Robinson-Patman Act further states with regard to discrimination between customers that it is unlawful for a seller to furnish one customer with services or facilities in connection with the processing, handling, or sale of its products, unless such services or facilities are made available on porportionaltely equal terms to the seller's competing customers. Furthermore, a manufacturer who engages in "dual distribution," by selling to wholesales and also to direct-buying dealers, must take steps to insure that services, facilities, or allowances furnished to direct-buying retailers are also made available to distributors/wholesalers who compete with direct-buying retailers.


A summation of Antitrust Laws, old laws on the books and enforceable - possibly some Federal and State attorney general employees should busy themselves to present practices within the commercial construction arena, with particular attention toward those 'playing' in Division 8.

Volume 42 - 'Tis the Season...or, is it?

It is certainly the Holiday Season, with Christmas, Hanukkah, and Kwanzaa, and with certainly New Year celebrations scheduled all around the world. The grandkids are on Christmas vacation, and the gift shopping has certainly hit its peak. Decorations abound, travel is on the increase, the clerks are 'grumpy', over extension of money is as common as ever, the marketing of the holidays has reached a new level, but something is still different and it has nothing to do with the bustle of the Holidays or anticipation of 2008. There has been an astonishing negative progression toward the loss of Etiquette in the business world within our great country, as compared to other parts of the world.

Etiquette is made up of significantly more important things than knowing which fork to use at lunch with a client. In today's global world, the perception of others could make or break a relationship. As in every other business decision, the devil is in the details. If one cannot return a phone call or respond to an email communication, as a simple example, it is an easy transition to feel that one can't be trusted or have the necessary self-control to be good at what one does. Is everyone just too busy to respond? I doubt it.

Unfortunately, the lack of business etiquette, or even etiquette in general, has gotten lost with a generation of people. From the days (long ago) of teaching your children to say "Yes Sir, No Maam, etc" to the present day of simply no teaching within the home to encouragement of slang terms or tolerance of 'mere grunts' to school systems that simply go through the motions of discipline and the teaching of respect. From vendors to Manufacturer's Representatives to (unfortunately) customers and prospective customers, it just seems that no one is committed to a mutually beneficial relationship, but only committed to their own singular purpose.

Basic phone and email business etiquette has more to do with 'respect' than with right or wrong. It isn't difficult, even for selfish people who think their value is more than it's really worth. Always return calls! Even if you don't have an answer to a caller's question. Call and explain what the current situation is pertaining to the initial call, or direct the caller to the appropriate place to get it. If one is going to be out, have your office phone state that fact with a return date, or have someone pick up your calls. Make sure your voice mail system is working properly and doesn't tell the caller that the mailbox is full, transferring them to nowhere or ringing indefinitely.

With regards to emails, make the subject line specific! (a lesson learned from our Operations & Marketing Partner) Just think of the many messages you're received with generic subjects or no subjects. Don't forward messages with three pages of mail information; delete the extraneous information. Do respond in a timely manner.

Reflect on your business etiquette for this coming year; become 'old-fashion' with regards to how you return calls and respond to emails.

Have a great 2008!

Volume 41 - Veteran's Day Tribute

To my Verteran Friends, who have given us so much.


"It is the VETERAN, not the preacher, who has given us freedom of religion.

It is the VETERAN, not the reporter, who has given us freedom of the press.

It is the VETERAN, not the poet, who has given us freedom of speech.

It is the VETERAN, not the campus organizer, who has given us freedom to assemble.

It is the VETERAN, not the lawyer, who has given us the right to a fair trial.

It is the VETERAN, not the politician, Who has given us the right to vote.

It is the VETERAN , who salutes the Flag, It is the veteran ,who serves under the Flag, MAY THEY REST IN PEACE. "

We can be very proud of our young men and women in the service no matter where they serve, and all those that went before. I SALUTE YOU ALL!

Volume 40 - Business Double-Speak!

TV Station 21 WFMJ News Now

Broadcast at 11:00 p.m. news 10-31-07, quotation is taken from their website WFMJ.com

"Amweld Workers Get Bad News by Phone

Amweld in Niles is closing its doors officially today, a full two months earlier than expected.

Earlier this month Amweld officials announced plans to close plants on Niles and Garrettsville, sending those 250 jobs to Mexico.

The company also said at that time that it would negotiate the official shutdown date with its union whose contract expires in December.

Then, employees were called Wednesday, and were told to pick up their checks today, because the plant would be closed.

April Brooks, the wife of an Amweld worker says, "It's a shame. They got handed a letter on the 8th of October, and they were told that they would work a couple more months. And it's not even been 2 1/2 weeks and they locked the doors."

Employees say they're still uncertain about their pension and severance issues."



Another example of Business 'running-a-muck' and feeding the public with 'Double-Speak'. Another story about alleged foreign competition and 'market-place necessity' due to labor rates.

Another story about losing jobs to off-shore manufacturers but yet simply another excuse that hides ownership/management/'over capitalization flaws' brought on by greed and stupidity.

It's simply amazing what the topic of 'Globalization' can hide, for behind the curtain is the truth, and like the Wizard in the Wizard of Oz, just human error and greed.

Fact: When companies get over-capitalized, paying for something not worth the value expended, the cost factor never gets balanced

Fact: Labor is still a percent of overall cost; as in the case of McDonald's it's 15%, as in the case of Amweld, seven years ago, 12%. And, even if it were 20% there remains another 80% to be managed correctly

Fact: All other material costs, such as steel, have been spot market buys for decades which actually evens the 'playing field' to all participants

When arguing 'Globalization', make sure what the argument is exactly about, 'peel back the onion' to expose the truth rather than simply attempting to 'double-speak' the real issue away.

As so correctly stated by Forrest Gump, "Stupid is as stupid does"

Volume 39 - "If passion drives you, let reason hold the reigns."

Previously, Volume 35 - Passion and the i.2 Brand, I've discussed the 'passion' necessary for the survival and growth of a company, and woven in those layers, the delicate but vital part the entrepreneurial owner-partners play in that overall pattern. As one 'peels the onion back' further, looking more into the depth of that discussion, one finds that the 'decision making processes' based on 'reason' is as a difficult proposition, and arguably more important, as driving the company with flaming passion.


It has always been interesting to observe the door and hardware industry from the viewpoint of an observer and consider how different manufacturers, within the same industry, serving the same market segments, paying the same wages, and recruiting from the same labor pool, with virtually the same product can have such extraordinarily different levels of service, respect (or lack of) for their base customers, and the arena which they operate.


So why is it that people at some manufacturers/suppliers make the choice of customer excellence while people elsewhere choose to be average or simply mediocre? I believe that it has as much to do with 'the decision making process' as much as 'individual passion.' The decision making process, regardless of the importance of the individual decisions, is a direct factor of overall culture that starts with ownership and management and is reinforced daily on 'good' days as well as 'bad.'

Owners, anyone with any % of the company, must be willing to invest in the physical product and the systems necessary to facilitate service efficiency, and in the case of a 'start-up' this action doesn't have to take place at the same time (reasonable decision making) based on a multitude of various factors, such as cash flow; nevertheless, both 'decision making' and 'passion' remain the driving force in the implementation of a successful enterprise. It is hard to deliver excellence in service and product when one is selling a customer a sub-standard product, and/or unable to satisfy long-term type customers without the proper technology systems. It is however impossible to deliver anything near excellence without a decision process that applauds not accepting the status quo, and challenging the stupidity of 'this is the way it has always been done.'

It is just as important, or possibly more so, to be able to make decisions that affect people through this same sort of process. For example, it is very easy for me to give an 'OK' to a question regarding any area of our business without regard for the total picture and implications in a 'passing' type conversation. It is very easy for me, as the managing partner, to answer a question without regard to what decisions are going to be made because of my response (again, without regard to the total picture - again avoiding 'the decision process'). I believe this not to be unusual. I'm very action orientated; have little or no regard for time-consuming projects or analysis. 'The ball must be driven down the field at any cost mentality,' and yet then wonder why the project wasn't up to established standards or wonder why the end result had so much collateral damage attached to it.

The fact of the matter is that as much as I personally detest organizational structure, individual growth and end results are in jeopardy by not following correct 'decision making procedures', challenging the status quo, and the 'quick' response answer to simply get onto another subject. One will inadvertently extinguish the 'passion' when not holding to 'reason' and due process. Reason mixed with total openness and collaboration ignites 'passion.' One can still maintain a great deal of flexibility, freedom, and speed with the right mixture of 'decision making process' and reason. Executed correctly this mixture will dilute the old ways of business ( 'this is the way it always has been done'), simply an excuse for not performance. A 'fresh set of eyes,' pushing the envelop and asking 'why' must be cultivated and part of that cultivation involves not suppressing 'reason' and a correct process for decisions other that 'shooting from the hip.' Difficult to admit from one of the original OK corral gun fighters.

Volume 38 - Consolidation within our Industry

Chrysler was ‘bailed-out’ for billions, ‘laid off and cut back’, sold to Daimler for 36 billion, and proceeded to loose a similar amount of money, and was recently separated back out for 7 billion by a private investment group. Hewitt-Packard and Compaq decided that it was in the best interest of ‘stockholders’ to merge and ‘be acquired’, as well as Alamo & National, and now, in my favor sport, NASCAR, with the merging of Fenway-Roush, Ginn and DEI, and just last week, Gillette and Evernham, one should be getting the picture that M&A, along with Consolidation, is the way of the world, for 'good or evil', 'better or worse'.

One has to wonder as to the state of our industry and its outlook for the future. What follows is a look at consolidation and its impact on the industry, customers, manufacturers and distributors based on my two decades of experience in the door and hardware industry, and now founder of a private labeled architectural hardware company.

There are essentially three types of integration that have been taking place over the years: 1) financial-driven integration, with financial companies buying door and hardware companies to wit no successful outcomes have occurred over the long run, just more good money following bad money to keep the 'house of cards' erect; 2) door companies that are buying distributors and other door companies to wit another ‘blood trail’ of financial losses; and 3) hardware companies that are buying more lines of hardware, as well as door companies, to wit smaller more defined lines of distribution, and more control of pricing for the ‘giants’, with less opportunity for the Independent Entrepreneurs attempting to survive industry consolidation.

Financial-driven integration started several years ago when a couple of financial consolidators entered the marketplace and recognized the high degree of fragmentation, particularly at the distribution level. Not unlike a lot of players within many other industries, these businesses initiated a rollup campaign to raise capital market funds.

The whole strategy was premised upon building critical mass as quickly as possible and using it to improve purchase discounts and leverage their buying power with suppliers; today taking place with the ‘Giant from London', Stock, using both the residential and commercial distribution channel as their vehicle. Profitability was enhanced by consolidation functions such as sales, general and administrative costs (SG&A), manufacturing overheads, purchasing and engineering. Several of these financial companies, which started seven years ago when the capital markets were much more receptive, have proven to be flawed exercises. Not only did the capital markets turn a cold shoulder to these types of endeavors, regardless of what industry they’re in, but additional problems arose while integrating the former independently run companies with the door and hardware industry into one cohesive operating unit.

The flaw in this structure is now and will always be, if one of the businesses in the portfolio is doing well in creating equity value and another business is not doing well and detracting from equity value, the overall value of the company is neutralized. The result is a conglomeration of companies which, in return, have tended to create significant cultural strife; the value of horizontal integration versus vertical integration.

As I’ve state in previous articles, and is now realized by some door companies, simply rafting together a mix of door companies to be a dominant player with cost savings isn’t enough. It takes more than that in today’s “value added” competitive marketplace. This would be true of consolidating any type of distributor for the sake of simple consolidation.

It seems that the so-called successful consolidators, particularly at the manufacturing level have done little to nurture the entrepreneurial spirit of the acquired company; and, certainly have failed in their attempt at creating a variety of products and services while matching up corporate cultures. With regards to the distributor side of the coin, they have only limited and, in most cases, disrupted the independent distributor network. This is now becoming a market of not only captive distribution but limiting distribution with skeptical pricing practices with regards to large projects. This is becoming more apparent everyday with large hardware companies buying specialty brand hardware lines, and then limiting the distribution of specific products within the distribution channels as to not only product but price.

Unfortunately, the end-user (including the Owner-Developer-School Board-Architect-Specifier-Designer-Builder), as well as the most important link in the supply chain, the ‘expert’ that actually adds value, distributor (Locksmith and Contract Door Hardware house) have diminishing values to the large manufacturers and consolidators. It has ALWAYS been the ability of the distributor, contract hardware house or locksmith, to take a product, add value to it, keep the customer in focus and build the relationship.

This should not be a surprise. The key to the successful future of our industry is, and will continue to be, independent, entrepreneurial distributors who can take product, of their choosing at competitive pricing, add value to it, maintain a customer focus and build relationships. Too bold a prediction at a time when the M&A pace has quickened? Not at all, because, contrary to the others who view the distributor as the last step in a necessarily “evil” process, our business always has been one of strong distributor-customer trust relationships; and, a successful future holds the same whether you are a locksmith or a NASCAR team.

Volume 37 - Watch how you vote!

It seems to me highly ridiculous that we are involved in national elections, over a year before actual voting takes place. Everyday on the 'nightly news' we are bombarded with 'who has raised the most millions' in this run for the "House". We're repeatedly filled with alleged facts and figures of how all of 'our problems' can be solved (again) from national health care (including paid health care for illegal immigrants) to taxing the rich, to the end of the war, to a 'chicken in every oven', from the ridiculously to the sublime.

The last time I looked we were the strongest, richest most influential nation in the world (although now 16th world ranking in education with declining high school graduation rate, with a dwindling post graduate rate in math and science) with less than 5% unemployment, more availability of food, entertainment, clean water then any nation in the universe, a record Stock market, productivity (still) 'second to none', the most freedom in the world, as well as the most opportunity available to those who desire to work and 'risk'; still, due to media hatred, our President is recognized as 'stupid' with a rating lower than any other president in history, and the rest of the world viewing us as 'spoiled brats' that have nothing better to do than too complain. Chicken Little is alive and well with these political aspirants, and yet on major issues, as in the aforementioned Education comment, protection of our Borders, a workable foreign policy, cooperation with emerging nations, and the firmness needed in dealing with the real threat of terrorism, we hear nothing of substance from them. And, maybe above all, we have already forgotten 911, and in no way are prepared to fight terrorism on our soil as we will have too!

We have forgotten the 63 lives taken in 1983 at the US Embassy compound in Beirut. We have forgotten the 241 US servicemen killed at the US Marine Corps headquarters in Beirut only six months later. We have forgotten the attacks at the US Embassy in Kuwait the same year and the attack the following year at the US Embassy in Beirut and the 1985 restaurant bombing in Madrid, and the 1985 bombings at the US Air Force Base at Rhein-Main where 22 died. We have forgotten the 1985 Achille Lauro hijacking where an American in a wheelchair was singled out and executed. Somehow we have forgotten the TWA Flight 840 bombing that killed four and the Pan Am Flight 103 that killed 259. In case you have forgotten, in 1993 two CIA agents were shot and killed as they entered CIA headquarters in Langley. World Trade Center 1993 six killed and over a thousand injured. 1995 US military complex in Riyadh, Saudi Arabia car bomb killed seven service personnel. 1996 truck bomb US military compound in Dhahran, Saudi Arabia that destroys the Khobar Towers, a US Air Force barracks, killing 19 and injuring over 500. US embassies in Kenya and Tanzania are attacked leaving 224 people dead. October 2000 the USS Cole is bombed leaving 17 US Navy Sailors dead.........and, I haven't even got to 911!

Therefore, a little story as I remember our past history, where we as a nation used to act decisively, as some emerging nations now do...so, read both stories, sit back and think, then act.


The Story: ANT AND THE GRASSHOPPER

PART ONE: THE OLD VERSION (USA 50's, 60's and some of the 70's)

The ant works hard in the withering heat all summer long, building his
house and laying up supplies for the winter.

The grasshopper thinks the ant is a fool and laughs and dances and
plays the summer away.

Come winter, the ant is warm and well fed.

The grasshopper has no food or shelter, so he dies out in the cold.

MORAL OF THE STORY : Be responsible for yourself!


PART TWO: UPDATED VERSION (USA past three decades)

The ant works hard in the withering heat all summer long, building his
house and laying up supplies for the winter.

The grasshopper thinks the ant is a fool and laughs and dances and
plays the summer away.

Come winter, the shivering grasshopper calls a press conference and
demands to know why the ant should be warm and well fed while others
are cold and starving.

CBS, NBC, PBS, CNN, and ABC show up to provide pictures of the
shivering grasshopper next to a video of the ant in his comfortable
home with a table filled with food. America is stunned by the sharp
contrast.

How can this be, that in a country of such wealth, this poor
grasshopper is allowed to suffer so?

Kermit the Frog appears on Oprah with the grasshopper, and everybody
cries when they sing, "It's Not Easy Being Green."

Jesse Jackson and Reverend Al Sharpton stage demonstrations in front of the ant's house where the news stations film the group singing, "We shall overcome." Jesse then has the group kneel down to pray to God for the grasshopper's sake. And Rev Al works on getting the Ant fired from his work.

Nancy Pelosi, John Kerry, and Senator Harry Reid, Senate Majority Leader exclaim in an interview with Larry King that the ant has gotten rich off the back of the grasshopper, and both call for an immediate tax hike on the ant to make him pay his fair share.

Finally, the EEOC drafts the Economic Equity and Anti-Grasshopper Act
retroactive to the beginning of the summer. The ant is fined for
failing to hire a proportionate number of green bugs and, having
nothing left to pay his retroactive taxes, his home is confiscated by
the government.

Hillary gets her old law firm to represent the grasshopper in a
defamation suit against the ant, and the case is tried before a panel
of federal judges that Bill Clinton appointed from a list of
single-parent welfare recipients.

The ant loses the case.

The story ends as we see the grasshopper finishing up the last bits of
the ant's food while the government house he is in, which just happens
to be the ant's old house, crumbles around him because he doesn't
maintain it. The ant has disappeared in the snow. The grasshopper is
found dead in a drug related incident and the house, now abandoned, is
taken over by a gang of spiders who terrorize the once peaceful
neighborhood.

MORAL OF THE STORY : Be careful how you vote!!

Volume 36 - Price Fixing and Collusion

It seems to me that there is a great deal of collusion within the writing of specifications, the 'special pricing' of manufacturers, and the selectivity of 'who can and who cannot' bid projects with those special pricing numbers. And, if that is not 'collusion and price fixing' then someone ought to explain the concept to me.

The owners and developers of projects, practically all size commercial construction work, have a difficult time understanding, why the pricing of certain divisions, within the construction industry, have such high cost numbers (by the time the owner pays for them) and so very few people bidding their project. Well, let me explain a 'dirty little secret' that exists in Division 8 between the architects, specifiers, and certain manufacturers, that 'limitations' are built into the process. For example, a small 150 room hotel in South Bend, Indiana, only three bids were accepted, division 8 steel and wood doors and door hardware, all from three distributors carrying the very same door hardware product line. Another in Orlando, Florida when a manufacturer selectively gives out 'special pricing' only upon request and only to the 'chosen few', delaying any other requests or lowering discounts points for other interested distributors. Free enterprise exhibited at it's best. One has to give Assa Abloy and IR credit, they have spent hundreds of millions of dollars limiting the playing field.

It reminds me of a letter I received from Mr. David R. Nolan, Nolan Door & Hardware Company, Inc., on September 17, 2002 (If it weren't framed and hanging in our lobby, I would have scanned it into this blog) that states, and I quote after the greeting:

"What a week we just had! The story starts more than a year ago and is somewhat involved but, I'll share with you the short version. A year ago we were buying and selling Falcon locks, LCN closers and so forth. Ingersoll-Rand (actually Andrew White) approached us with several 'buying programs' involving Schlage, none of which were acceptable to us. Our objections were based on the pricing structure and the exclusivity; we were to give them all of our lock, closer and panic business. We found this repugnant to say the least and, as you probably know by now, told them to take their I-R package and....!

We were concerned then, and more now, by their insistence on monitoring all that we bid and sold. We are appalled at their unabashed disdain for distributors and their new posturing to sell institutions directly. Since we cannot condone that marketing strategy, we cannot support them anymore by purchasing their products.

It seemed that Assa-Abloy was the way to go, specifically Yale. While there was no stated requirement to buy the whole line, there is an ambitious annual purchasing goal. We accepted their buying program and went on our way selling their locks, your panics, your hinges and your closers. From time to time, mostly because of specifications, we would use their full line.

Late last week, we received a fax informing us that our buying program had been changed and, not in our favor. The stated reason, when I asked the representative what was going on,, was that our volume did not warrant the previous discount structure even though we have been opened up with them for less than one year. As the conversation continued, the real reason for the change in our program had more to do with the suppliers that we have chosen for our panics, closers and hinges. It was not stated that our program would be reinstated and/or improved if we were to change to all Yale but, that was the feeling that we were left with.

We refuse to be forced into buying from anyone. We believe in free enterprise and will continue to practice that. We also still firmly believe in the concept of loyalty to suppliers who have brought us this far even though in today's business world, this seems to be somewhat archaic.

The point of all of this is simply that we no longer have access to a lock line at competitive prices. Our cost on a Grade II cylindrical lock has increased by 80% in the past twelve months.

Do not, for a moment, think that this is about Nolan Door & Hardware Company; it's about all of us! We will have to rely more heavily than before on you to keep us a viable source of commercial and architectural hardware in our marketplace. I don't want to sound to 'Knute Rockne' but, it is indeed up to us to face this challenge in our industry.

It is my belief that we can and will but no one's going to do it alone. I am putting my complete confidence in you and our ability to continue to work together.

Hopefully yours,

David R. Nolan"

I often read that letter in attempting to understand our industry, and the importance that the distributor plays within the commercial construction arena, especially within Division 8 products. Independence2, LLC, with it's i.2 trademarked private labeled architectural hardware, is where door hardware meets value, where the distributor will always be respected, and where we have as much interest in their 'bottom line' as in ours, for they are the true key to this industry's long-term success and to the end user's satisfaction.

Volume 35 - Passion and the i.2 Brand

As Charlie Staples says "I add an extra cup of love, that makes my barbecue sauce something special." At the corner of Rayen and Belmont Avenue in Youngstown, Ohio houses a little barbecue joint, owned and operated by one Charlie Staples. His "secret sauce" is his "cup of love", just like "good too the last drop" is Maxwell House's, as well as hundreds of other sayings and slogans to make the customer's experience special.

It isn't any different in the world of Business to Business, when the end user is one step removed. As a private labeled architectural hardware supplier using various revenue streams, in which our product is then resold to the end-user, it still matters that our company enhances 'passion and the brand.' In fact, it could be argued that without these ingredients one would not succeed. Even if a product is technically sound and 'works' (that is expected, so no 'applause' for that achievement), it's the 'passion', drive, energy, attitude and resourcefulness of the people associated with the 'brand' that counts.

Hanging on my office wall is a autographed picture of the guys that made up the resourceful advertising agency DMB&B. The article that was signed was a story (about them) entitled "It Ain't The Meat, It's The Emotion." Done in the early 80's, the guys who worked on the Burger King account strived to do it 'like you wouldn't do it.' But they turned out to be the best dudes for fast times! It truly is about the Emotion, Passion and Drive that separates companies. For those that manage companies that have this unique style, it might also be the ingredient that drives the managing partner 'over the hill', but let the people run; let them solve there own interactive problems, let them know they have the support to experiment, to achieve, as long as individual respect is maintained, and the team is always intact. Connecting these people to the brand in a positive way is the essence of an effective brand, which, 'when it works', is as tangible an asset as brick and mortar. Mix this concoction with a product that works, a marketing program that is innovative, always watching and understanding the cost structure, and the outline of a 'money machine' is in place.

Having stated all of the above, don't be so naive to think that its implementation is the equivalent of a 'walk in the park'; more like the climbing of Mt Everest in the winter! Look at all the really successful companies that exist. Not the ones that grow through M & A, then bubble and explode through 'top number' stupidity, but the ones that really understand and grasp the ability of an individual, and the courage to let them 'run'. Legendary brand builders have focused on building a culture and an internal brand that will sustain profitable growth for decades.

I like to think that we are in the process of creating this environment within i.2, even at this early stage of development, not only with our group of 'owner partners' but with the standards in place for others to join our organization; certainly not 'business as usual'. A 'greenfield' or start-up from a 'clean sheet of paper' concept certainly has its moments, but the ability to construct the functional benefits of a product that consistently works with the emotional benefits produced only by an extraordinary group of people marks the path of a formidable brand.

Volume 34 - Virginia Tech

With the terrible tragedy that took place last week at Virginia Tech, one of our talented members, a former Virginian, Ms Bonnie Buchanan, Operations & Marketing Member-Partner, sets to pen her thoughts of that massacre. Thank you Bonnie for the permission to print your poem, and thank you for your passion and concern.

With Courage and Perseverance,
With Pride and Determination,
I can only watch and admire the strengths in young hearts,
As, I sit in silence a weeping witness and I morn the loss,
I do not morn the loss of anger, hate and violence,
I morn the loss of innocent lives just beginning,
I morn the loss of potential inventors, senators, mothers,
I morn the loss of the lines of lives saddened and shattered,
The lives which will never be…

I morn the loss of fellow Virginians,
A State in which I no longer live, but, which will forever be a part of me.

Do You remember, your college days,
Do You remember, exploring your own ways,
Do You remember all that you learned and tried,
Can You imagine if You had not lived, but died?

What in Your life, would You have missed out on?
Does Your list include triumphs and joys,
Does Your list include loves deep and true,
Does Your list include others, who forever influenced what makes You, You?

Take a moment, stop and breath,
Take a moment and enjoy the simple sight of a Tree,
Take a moment and listen to the laughs of Your children and friends,
Spend a heart beat or two for those who have passed,
Spend a brief moment in time and reflect on the losses of a Virginia Tech Class.

By: Bonnie L. Buchanan
April 17, 2007

Volume 33 - i.2 Series Launch from Independence2, LLC

After two years of research and dedication, the private labeled architectural hardware company, Independence2, LLC, launches the product line of i.2 series for the commercial construction market. This launch represents further credibility for this start up company that has developed specially designed and innovative products with specifically targeted revenue streams within this fragmented market entailing the commercial construction arena.

Independence2, LLC with it's i.2 (trademarked) series of products has all the ingredients not only to be a successful enterprise, but to make a 'mark of difference' within this 'top-dog - bottom feeder' industry. That's because this company is being created on a strong financial foundation within a professional infrastructure and atmosphere, an outstanding marketing plan with a foundation of 'respect for the customer' in an industry not noted for customer responsiveness nor innovation, but only one of 'giant pigs among cheap imitation'.

The hope is, and in fact the outlook is bright, that we can fill revenue slots that make the stocking distributor the focal point within those several revenue streams. Unlike our competition, we respect the customer (stocking distributor) and have individual track records that prove that point. We don't sell to 'Big Box' houses like our competition, whether using their name or under some concocted name with a hidden agenda. We don't sell to manufacturers under one name and then attempt to sell through distribution. Our revenue streams are highly defined and bring our stocking distributors through to the 'end user'. We understand and comprehend the term 'globalization'. We don't hide under some phony pretense, we bring only honesty and integrity to the marketplace.

In a market and industry where products and business are all too undifferentiated, even boring, successful branding and associations can have a significant impact on not only our profit margins but also our stocking customer's profit margins. When was the last time one of your suppliers provided you with an opportunity? With us, just check our website, http://www.independence2.com/, to view our latest project in which we brought distribution through to accommodate a high visibility project. Our branded products not only promises reliability and consistency for its intended purpose and application, but are backed by our word; not some slogan or meaningless number.

We believe that the customers, our stocking distributors, want a supplier with with a 'soul' and a 'character'; they want personality and not an unfamiliar voice. We have taken years to launch for we know that this is a very time consuming and expensive effort. It cost money to communicate the values our brand conveys; it is an evolutionary process. We have discovered that this undertaking is not a static undertaking but rather a dynamic activity that requires constant attention to detail. We know that successful product branding is more then just the sum of its logo and name; it is the intrinsic values that not only the brand but the company conveys and believes in that counts. It is the values and benefits that the distributor remembers, not only the functional purpose, but the 'ease of doing business'. Our series of products, i.2, is an emotional brand that evokes strong emotional feelings just like all its members. Contrary to conventional wisdom, 'emotion' and 'passion' does count.

As with all businesses and products, when all the facades are stripped away, the ultimate question is where do the customers, within this supply chain, get the best deal? We at Independence2, LLC with our 1.2 series of products believe that it is imperative to have an equitable system that promises, and guarantees, the best pricing across the entire spectrum of product line thereby balancing single product companies, the 'bottom-feeders', and the controlling forces of the 'giant pigs'. It is this pricing spectrum mixed with our brand specific knowledge and our proprietary knowledge that is the differential factor. Our ability to define 'relationship' that is mutually enhanced with our stocking distribution not only within the confines of the States, but (hopefully) internationally. Our value isn't in the price of a hinge, but in that total spectrum of not only product, but providing service with style and substance.

Our goal is now to develop this recognition and image and thus the clear discernible identity to balance with our strategic direction. Our true value position will be defined in the years to come as a company that redefined industry standards and norms. And although will we always be service oriented, as my personal history clearly shows, as well as product driven with constant Research and Development, we will move toward a 'ease of doing business' unheard of within this industry.

Volume 32 - It's Finally Race Day

As I watch the Daytona 500, although it’s 17 degrees with another 4” of snow from last night and from the outside of my windows the view is Antarctica, I realize that Spring is somewhere ‘around the corner’. Five crew chiefs suspended for cheating, 'comments' from a distinguished car owner, the entry of Toyota into the Nextel Cup Series, the saga of DEI, and the likes of Juan Pablo Montoya. Great upcoming season is upon us!

From the business angle, one of the most prestigous car owners, Jack Roush, just sold 50% of Roush racing to Boston Red Sox owner, John Henry, head of Fenway Investment Group to form Roush Fenway Racing to "raise more money to race." This move will also certainly line the pockets of Jack personally, and will draw tremendous funds into the developmental side of racing. Don’t be surprised if this turns out to be the first IPO for the racing industry. Isn’t Capitalism great! I certainly think so, and it is one more reason why it was such a surprise to hear Jack Roush complain again about the entry of Toyota into the Nextel Cup Series.

Roush, the loudest critic of NASCAR’s decision to allow the Japanese automaker to enter the Nextel Cup series this season, has stated such idiotic statements as 'Americans shouldn’t buy foreign cars because it hurts the economy.' Another example why an engineer should stay within his world of expertise, pocket his money, create great racing endeavors, but certainly keep stupid remarks to himself. Jack, for the record, your Ford Fusions as well as the Dodge Chargers are made in Mexico; the Chevy Monte Carlo’s are made in Canada; and therefore, the only American made car in the Daytona 500 is the Toyota Camry, made in Kentucky!

The entry of Toyota has certainly created more pressure to break the rules; five crew chiefs suspended, hundreds of thousands of dollars in fines, and certainly some embarrassment for Toyota as a manufacturer. After millions of dollars into this venture, Toyota had better reconsider who is in charge of development and factory assistance both in operations as well as marketing. Only 4 of 8 cars into the big race with controversy surrounding them doesn't bode well with those results. Sponsorship of the two ‘Red Bull Teams’ should also be screaming bloody murder with neither car being able to qualify. Without some strong leadership infusion into this project, Toyota will face a very long disappointing year.

The drama continues with DEI, Stepmother with ‘Star’ son; but doesn’t take a genius to figure out that Junior will win this messy battle for control. Dale Jr. will do it himself with his own team or, more likely, it will be someone like RCR who will help Junior, with his own team development, as well as pay this talent a super figure that will lead to a Cup championship.

The new talent base of NASCAR is one of it’s greatest assets so, with the addition of individual like Juan Pablo Montoya and other open-wheeled athletes, this is going to be a great season; can’t wait to have a few ‘brews’ with friends of mine at the track!