Made in USA vs. Made in China: More Actions Needed

Several months ago, I wrote an article about phenomenon of made-in-China products and its impacts on the U.S. economy and the U.S. people’s life. During the research, I was faced with a website named MadeinChina.com which guides businesses around the world to outsource to China and import China products. Some days ago, I ran across website named MadeinUSA.com which is designated to “educate the American consumer on the importance of buying American made products” (MadeinUSA.com, 2011). Examining the looks of these two websites, I have a feeling that we have got problems to encourage Americans to buy made-in-USA products.

The first problem relates to the attractiveness. As you can see in the picture above, MadeinUSA.com website is dominated by words and words. It is easy for an average American to understand what these words means but how can we explore this website furthermore when we guess that there will be nothing interesting other than letters and words? Take a look at MadeinChina.com website, you will have a feeling that there are a variety of contents to explore on it: pictures, numbers, letters and colors. It is true that Americans love reading but they prefer something more than that.
Second problem relates to the contents. On MadeinUSA.com, what the visitors can do include only registering and a patriot, seeing why they should buy Made-in-USA products, exploring the list of registered visitors and learning the purpose of this website. They cannot take more practical actions like ordering a made-in-USA product or even see where made-in-USA goods are available. On the contrary,  MadeinChina.com shows visitors a list of product categories. Image, price and the virtual cart are available as well. Before register to this site to participate in made-in-China movements shown at the bottom of this site, people have already been able to buying made-in-China products as a way to support these movements.
The third problem relates to target audience. If you click on the button named “Company Registration” on MadeinUSA.com, you will notice that this site aims at American businesses who wish to promote themselves by uploading logo, company name and advertisement to this site. Ironically, many businesses may wonder why they should pay $10 or $40 monthly to present on a website whose traffic is ranked 752,144th by Alexa. Meanwhile, MadeinChina.com’s taget audience is much more various: manufacturers, sellers, retailers and buyers. That can explain why this site is ranked 12,525th at the same time.
It is apparent that Americans prefer made-in-USA products to made-in-China ones because they are of high quality, safe and durable, and indirectly supportive to their employment too. Nevertheless, it is hard for them to search for made-in-USA goods in physical store as well as in online store. Therefore, it will be much more helpful if MadeinUSA.com diversify the features of its website to make it a place where buyers and sellers of made-in-USA products can meet each other comfortably.

New Rules Target U.S. Citizens With Accounts Abroad and Noncitizens With Deposits at U.S. Banks

Financial institutions around the world are bracing for new U.S. tax regulations that are prompting some foreign banks to ditch their customers and their American counterparts to worry that they could lose crucial deposits. 

The rules--one of which is being phased in, while the other hasn't been finalized--are aimed at reducing tax evasion by making banks report more details about income earned by customers who keep deposits in countries other than their own. 

Overseas, some banks have alerted customers that accounts will be closed at the end of the year. 

U.S. banks, meanwhile, are trying to quash a proposed regulation that would require them to report interest income earned by non-U.S. residents to the Internal Revenue Service, which could then pass the information to their home countries. Banks in Florida, Texas and California are fighting the effort, saying that it could drain the coffers of banks that rely heavily on foreign deposits. 

Together, the regulatory changes could affect hundreds of billions of dollars worth of deposits in accounts across the globe. While it isn't known what customers will do with the affected funds, some could shift their money to countries that have looser rules on reporting income earned on deposits. 

"The policy objective is to have transparency so that governments can work together to avoid offshore tax evasion," says Manal Corwin, deputy assistant secretary for international tax affairs at the U.S. Treasury Department. 

The new rules are already affecting U.S. residents who keep accounts in overseas banks, which will soon face stricter rules on reporting income earned by those customers. The regulations will be phased in gradually over the next several years, but certain requirements take effect in 2013. 

The rules are part of the Foreign Account Tax Compliance Act of 2010, which applies to individuals and financial institutions as part of an effort to rein in offshore tax evasion. 

Some banks are cutting off their customers. 

Munich-based HypoVereinsbank, a subsidiary of Italy's Unicredit SpA, has sent letters to between about 1,000 and 2,000 clients, advising them that at the end of the year, it will terminate securities services for customers who live in the U.S., as well as for U.S. nationals who live abroad. In the letter, the bank blamed increasing U.S. regulatory pressure, including "heightened reporting and supervisory obligations." 

"The effort just got too huge," a bank spokeswoman said. 

Unicredit and its other subsidiaries haven't done the same, said a person familiar with the matter. 

Bank Leumi in Switzerland sent a similar letter to securities customers last month, saying the law "requires substantial changes in the reporting regime for banks with respect to accounts held by U.S. customers." A spokeswoman for the Israel-based bank declined to comment, saying, "As a matter of bank policy, we do not comment on questions about our clients, individually or in the aggregate." 

This summer, Deutsche Bank AG cut off all service to U.S. citizens with securities accounts after a growing number of regulations made the business a hassle, according to a person familiar with the matter who said the move affected a "small number" of clients. 

In the U.S., banks are fighting a proposed rule from the IRS that would require them to report interest paid to noncitizens living in the country. No final rule has been issued, but banks say they worry that it could drive deposits away from U.S. institutions. 

"This is just a bad, bad idea," says Alex Sanchez, president and chief executive of the Florida Bankers Association. He estimates that Florida banks hold about $80 billion of deposits from non-U.S. residents, representing about 20% of the state's deposits. An IRS spokesman declined to comment. 

Across the U.S., banks held roughly $2 trillion in deposits from foreign companies and individuals as of June 30, according to the Treasury Department. The agency doesn't provide figures on individuals' aggregate holdings. 

Bankers in Florida, Texas and California say that the proposed rule could be devastating for institutions that rely on those deposits. They also contend that many customers keep their money stashed in the U.S. because they are afraid to disclose financial information to their home countries, particularly in Latin America. 

"This is not the time to be looking at these types of proposed rules because it would have negative impact on many financial institutions," says Gerry Schwebel, executive vice president at International Bancshares Corp. in Laredo, Texas. Roughly one-third of the bank's $7.8 billion of deposits would be affected by the rule. 

Ms. Corwin of the Treasury Department says that the proposed rule doesn't represent a significant shift because the IRS already has the authority to request the information from banks. If the change goes ahead, banks would have to automatically provide the information to the IRS, which could then share it with countries that have tax treaties with the U.S. In Latin America, only Panama, Venezuela and Mexico have such agreements. 

"It's a little bit hard for the U.S., which has been at the forefront of the transparency battle, to have this kind of resistance to these regulations, which should not be a problem for people who are properly reporting their tax information," Ms. Corwin said. 

Matthias Rieker and Laura Saunders contributed to this article. 

Credit: By Robin Sidel and Laura Stevens

Black Friday May Not Be so Important as Thought

In a recent article entitled “Black Friday Sales Important to Retailers”, Tucker, Navera and McMacken (2011) stated that Black Friday “can account for 40% of a store’s sales for the year”. This estimate proves that Black Friday has been a decisive source of revenue for years since its existence. However, I am wondering what would happen if Black Friday did not exist, and whether this event is that important to retailers or if it simple that shopping habits of Americans are the key driver of holiday sales in the country.
At the beginning of this research, I listed down some shopping habit of Americans. First, Americans tend to go shopping more before Christmas. They buy a variety of goods, wrap them as gifts for Christmas celebration and give it to their loved people. That must be the reason why retailers’ sales increase in during the holiday season. Second, because they are gifts, they must be durable goods. These goods are available at department store like Best Buy, Walmart, Macy, Target and so on. They are not at food store like Cubs or Kmart. That is why Best Buy, Walmart and Macy are usually ranked at top in holiday sales. Third, Americans tend to buy what they want, rather than what they really need. Clint (2010) argued that “The more television you watch, the more magazines you subscribe to or read, the more money you want to spend on things you don’t really need.” and “Marketers are taught that success comes from selling to wants not needs.”
I am continuing my research on the impact of Black Friday. Americans know that they can buy products on big sales on Black Friday and this can help them save a significant amount of money. Giving gift means spending money and it is never a bad idea to buy goods at lower price. Hence, it is all right to get up at mid-night to queue in a long line in cold. A recent research by Khazan (2011) published on Whasington Post called Black Friday shopper “gift-buying” people. Moreover, this research points out four reason for which people go shopping on Black Friday. However, these four reasons are centered around two emotional factors: togetherness and deal hunting. This means that it is not easy for us to classify Black Friday as an event or just simply a shopping habit.

Adapted from Census.gov

Going through the retail sales statistics from 1992 to 2010 and doing comparison with those of 1967 when Black Friday began it popular, you can see that there is no significant difference in trends of retail sales over the years. Ultimately, I doubt that the Black Friday’s impact on shopping habit of Americans is not as considerable as many may think.

A Bright Future for Green Products

Researches indicate that attitudes of U.S. people toward sustainability issues continue to be improved. In a research entitled U.S. Consumer Attitudes on Green, Richard Matthews (2011) states that U.S. consumer’s awareness of sustainability concept has been improved by 15% from 2007 to 2010. This research also points out that 10% of customers “consistently make green buying decisions”. Before that, a survey by Cone (2009) reveals that 35% of Americans are more interested in environmental issues that they were a year ago. Whereas, a research by Experian Simon (2009) unveils that “65% of adults are making a conscious effort to recycle and more than two-thirds believe that they have a personal obligation to the environment”.

One of the factors that help improve the green attitudes is the enhancement of green technology. In a research entitled The State of Green Business, Makower et al (2011) confirm that investment in green technology has increased by 7.6% in 2010, reached nearly $4 billion. Significant portion of this investment is in energy efficient products, solar energy and bio-based products. The research also shows that clean-energy patents filed with the U.S. Patent and Trademark Office increased by more than 67% in 2010 to 1,882 patterns (Makower et al, 2011).

Thanks to the improvement of green attitudes and green investment, green products are getting more various and available in the market. In the research entitled Measuring the Green Economy, U.S. Department of Commerce (2010) applied green product and service definition to over 22,000 product codes listed in 2007 Economic Census. This means that green products are getting more various in the market.

To distribute green products to customers, retail giants such as Wal-Mart, Target, Menards, Home Depot and hundreds of online stores are now including green goods in their product offerings. Nonetheless, no green retailer or distributor is recognized as dominants of green market. Rather, each seller has its own market place more or less related to its store location and current accounts. This means that green market is still fragmented in terms of distribution.

Higher adoption and higher availability of green product make green business more and more promising. Packaged Facts (2010) estimate that the U.S. green household cleaning sales in 2009 reached $557 million. This market is also expected to approach $2 billion by 2014. Meanwhile, Pike Research (2010) estimates that energy efficient home improvement market was over $38 billion in 2009 and this market will surpass $50 billion by 2014. In the personal care market, Kline Group (2011) estimates that green product sales was about $3.5 billion in 2009 and will approach $6 billion in 2014. Ultimately, all estimations indicate that green business will continue to grow by double digits in the next five years.

Even though these trends and forecasts are subject to change, it is reasonable to conclude that green products have a bright future.

Talk or walk?

My career hit a roadblock when I decided to immigrated into the US in 2009 though I had well prepared for the change. I had finished an undergraduate program in English Linguistics and Literature in 2008 with a plan that it would be helpful for both my dream graduate program and my emigration. Also, I had changed my job to work for a multinational corporation in market research and consulting industry in order to add a good experience in my resume which I hoped to increase my change to get a good job when I migrated. My English was not very good but it was enough for me to get my job done excellently at my new workplace. Moreover, it was good enough for me get all straight A's in my master program. I graduated with high honors early this fall and began seeking for jobs.
Many people might wonder why I had not worked during the graduate program to get some more experience and earn some money to cover a part of expenses. The answer is that I got some project to do for my previous employer and some small translation project to work on which brought me a sum of money that I could help my parents in my home country and buy this laptop to use so far. After that, I decided to spend the latest one year on my schoolwork to overcome the language barriers and absorb all the knowledge that the program offered. There is no wonder why I always received the good remarks from all the instructors in twelve courses of the program. When I had free time like quarter breaks, I learnt something I thought it would be useful for my career such as Excel 2010 and Marketing Research by Alvin Burns and Ronald Bush. I mentioned this two resources because I have strong interests in working with Excel functions and other features, and marker research has been my choice of career since 2002 when my career began. I did plan that I would continue to work on them and some others like SQL or VB. However, I have not carried out my plan because I have to work on the so-called decisive thing, which is resume writing.
From my graduation ceremony to the present, I have applied for over five positions of market analyst. GFK, Nielsen, NPD Group, Target, Blue Cross Blue Shield are familiar names. Unfortunately, I have received no reply from these companies at all, so far. I have done some checks and found that some positions have been filled, some are continued to be advertised while I am still unemployed. I guessed that my resume was too bad to be considered by the employers. Therefore, I have done some searches to see if there was any excellent samples for the position of market analyst. I have found some good ones and done some changes accordingly, and submitted it on CareerBuilder.com, Monsters.com, TheLadder.com and so on. Then I received a horrible critique from TheLadder.com which describe my resume as one the worst ones in the world and offered resume writing service at a price. Of course, I have not paid for that kind of service. Meanwhile, I have downloaded a material from it site which analyzed strategy in resume writing, and I found some useful tips in it.
Nevertheless, while reading the material, I felt a deep sadness that instead of spending free time to learnt something practically useful to the dream career, job seekers is now investing in resume writing. This reflects the fact that career opportunities are now just for people who talk, not for people who truly walk.
Continuing to work on resume writing...

SWOT Analysis on the Domestic Operations of GM

Strengths

The largest market share is apparently a prominent strength of GM. The company has been holding the largest market share in U.S. automobile market for decades. This can translate to the trustworthiness and brand recognition that the company has in U.S. customers.

Wide range of products is also an advantage. Currently, GM is offering a variety of products under the brand names of Chevrolet, GMC, Cadillac, Buick, Pontiac, Saturn, Hummer, Saab, Daewoo, Opel, and Holden. The wide range of products can translate to high brand awareness and perception.

Weakness

One of the weaknesses of GM must be the decline in market share. In spite of holding well its 1^st position, GM’s market share has kept declining since 1984. As such, the gap between GM and its competitor especially Ford and Toyota has been significant reduced. This may result in losing its position as the largest automaker.

Quality problem is another weakness of GM. Some mass recalls of more than more than 1.5 million vehicles and the Government investigation of over 6 million vehicles of the company for quality and safety reasons in 2010 make it difficult for the company to improve the brand image.

Opportunities

The recovery of the U.S. automobile industry must be great opportunity of GM. After years of decline, the statistics in 2010 indicate that the U.S. automobile industry is recovering. As the leading manufacturer in the industry, this can be translated to opportunity for GM’s sales growth.

Environmental concerns also offer other opportunity to the company. The event that GM’s Chevrolet Volt, a hybrid car of GM, is named North America Car of the Year would be an indicator of the company’s innovation that help the company improve its brand perception in coming years.

Threats

Intensive competition from overseas automakers would be the outstanding threat to GM’s position. Detroit Three used to dominate the U.S. automobile market. However, majority of the market is now shared by seven biggest automakers including Detroit Three and four overseas manufacturers. The presence of overseas automakers in top seven signals increasingly fierce competition and predictable threats to GM’s position.

High cost of healthcare is another noteworthy threat to GM. It is known that cost of healthcare for each vehicle produced at GM is much higher than that at its competitors. Unless the company implements appropriate reform, this practice will undermine GM when facing price competitions.

Porter’s Five Forces of Competition in the U.S. Automobile Industry

Customers

The bargaining power of customers in U.S. automobile market is strong because the market is very competitive and customers have a lot of information. Although U.S. vehicle buyers are pretty loyal when they come to automobile brand, they are willing to consider shifting their brand preference due to quality and fuel economy issues. In this relation, automakers have a weak supplier bargaining power over their customers.

Suppliers

It is understandable that the bargaining power of suppliers is weak in the U.S. automobile industry. Despite of considerable decline due to the global recession, automotive part industry in the U.S. is very competitive because of the presence of European and Asian suppliers. As of 2010, there are about 5,000 U.S. based suppliers and nearly 1,000 foreign suppliers in the country. Thanks to the pressure that foreign suppliers exert on domestic suppliers, competitive price is offered and U.S. automakers can take advantage to reduce costs and provide customers with vehicles at better price to compete with foreign automakers. In this situation, automakers have a strong buyer bargaining power over their part suppliers.

Current competitors

The intensity of rivalry of competition in the U.S. automobile market is strong as many automakers from all continents are now present. The market is now shared by about 20 automakers. Detroit Three (GM, Ford, Chrysler) and four foreign companies include Toyota, Nissan, Honda and Hyundai is dominating the market with 83.4% market share. The market tends to be fragmented since Detroit Tree automakers no longer dominate the market.

New entrants

The barriers for new entrants are moderate. As a result of high priced fuel and economic concerns, car buyers are more price-sensitive and quite open to overseas carmakers. However, the price and fuel economy are not a stable factors to form the barriers as U.S. automakers are improving their drawbacks. Moreover, recent recalls by Toyota and Nissan are changing people view over overseas automobile brands. Hence, the barriers to new entrants is getting firmer.

Substitute products

There are few substitute products to automobile in the U.S. market. In metro areas and crowded cities, public transportation services such as buses, trams and trains are available. Nevertheless, due to the drawbacks of these services including time control and unreliability, the pressure they may exert on automobile market are insignificant.

Obstacles to the Implementation of High-level Strategies and Resolutions

All businesses have their own strategies which may base on cost leadership, differentiation or focus. However, implementing a strategy is not always successful because there are some obstacles during its operation. Poor internal communication, pressure from short-term results and uncertainty of external factors are among the top obstacles that hinder the implementation of high level strategy.

Poor internal communication is the number one obstacle to the successful implementation. If the communication in an organization is not effective, various ways of understanding the strategy, poor collaboration and varnished feedbacks will restrain or even damage the implementation of the strategy. For example, if a company’s strategy is speed-based, unnecessarily strict accounting processes imposed by accounting department will lower the speed of supply purchases and thus increase time for the product to be distributed.

Another obstacle is the pressure from short-term results. Because high-level strategy often needs to be executed in a long term to help the organization achieved its long-term objectives, it usually requires some tradeoffs in a short term. Therefore, the emphasis on short-term will easily result in the failure of the strategy. For instance, if a company wants to cut costs to improve sales to keep up with its competitors in the current year while its strategy is differentiation-based, this tactics will damage the strategy.

A strategy is often developed upon analyses on internal and external factors. In addition, an organization is always more or less dependent on external factors that it does not have full control. As a result, the uncertainty of external factors is noteworthy obstacle to the implementation of its strategy. For example, the increase of gasoline price and the growth of environmental concerns have barred Chrysler from its differentiation based on powerful minivan.

Amongst the obstacles, the uncertainty of external factors is almost uncontrollable. However, by clearly understanding of the real reasons that cause the poor communication and pressure from short-term results, companies will be able to resolving them, limit the uncertainty of external factors and implement their strategy effectively.

Poor communication may be caused by some reasons. Problems in empowerment system, too many levels in organizational structure and the presence of conservativeness are the top causes of poor communication. An inappropriate empowerment system may make some individuals or subunits more powerful than others. Thus, less powerful peoples or subunits will not be able to communicate openly with the more powerful ones. Poor collaboration and poor quality of feedbacks will follow. Too many levels in the organization also cause poor communication by distorting the message from one level to another. Meanwhile, the experienced people and powerful ones will become conservative, protect their position, reject criticisms and deform feedbacks. As such, to establish effective communication, the organization must develop an optimum empower system, get the structure flatter and employ continued training to minimize the conservativeness. Effective communication also improves the responsiveness of the company to the changes of external factors.

Companies sometimes stray from its strategy to pursue its short-term results which pressure different departments in various forms. Sales department always pressured by sales volume. Financial department is pressured by profit and related measures such as EPS, ROI…. Marketing department is pushed by brand awareness and customer satisfaction. If one department is over-pressured by its short-term performance measures, the focus on these measures will harm the company’s strategy. To deal with this obstacle, the management must institutionalize the corporate strategy and puts all tactic maneuvers in line with it. Especially, the compensation and reward systems of the company must be aligned to support the strategy instead of evaluating individuals and departments based on their short-term performance measures.

Undoubtedly, though planning a strategy is tough enough, implementing it is much tougher because many obstacles will present. By identifying the root causes that the obstacles derive from and employing appropriate resolutions to eliminate them, companies will be able to implement their strategies effectively.

A Discussion on Six Building Blocks of Customer Centricity

Customer centricity has been a hot topic for discussions in books, business reviews, articles and forums for years, especially for latest 5 years. Customer centric initiatives have been embraced by a number of organizations in some industries among which retailer, ICT and service industries are the most outstanding.

In term of marketing, focusing on customer is not a new concept as great deal of marketing books have been written about how businesses should respect their customers and how the customer loyalty would help the profitability of companies. For instance, in a books titled ‘In Search of Excellence: Lessons from America’s Best-Run Companies.’, Thomas Peters and Robert Waterman Jr. proves that “the excellent companies are better listeners” and these companies are tailoring their products and services to meet the customers’ needs and wants. George Day also shares the view point as he supports the “market-driven strategy”. According to Day, “competitive advantages are rapidly eroded in today’s environment, connections to customers are more dynamic and enduring if they are well developed and maintained”. Apparently, customer satisfaction is always the center of all marketing efforts and, thus, customer centricity is the highest level of market driven strategy.

As customer centricity is said to be a must in global competition, this initiatives has been witnessed at major organizations around the world. Best Buy, IBM, Amazon and Citybank are among the best practices of customer centric innovation. However, customer centricity is not a status. It is more likely a process because there are some levels of this innovation. In a book entitled ‘Designing the Customer-Centric Organization: A Guide to Strategy, Structure, and Process’, Jay Galbraith advocates three level of customer centricity: low, medium and high. These three levels reflect how well a company integrates its products, services and processes to service its customers by meeting the ten criteria related to scope/scale and integration. Similarly, Francey Smith, president of Francey Smith & Associates, puts forward four degrees of customer centricity. These are getting started, beyond the basics, customer driven and fully integration. No matter what level the customer centric innovation at a company is, it consists of elements that the company must develop to become customer centric.

Read more: http://www.bukisa.com/articles/415290_a-discussion-on-six-building-blocks-of-customer-centricity#ixzz180Ie0Jag

How the US Automakers Are Losing their Home Market

When Nissan recalled more than 2.5 million cars in the US in Oct 2010 after some-hundred-thousand-car recall before, many analysts thought of a an opportunity for the US automakers to regain their home market after a decades of decline in market share. Despite a lot of expectations and suggestion, there is not a remarkable signal from the market which can convince people that the US automakers are regaining what they have lost for decades.

A Predictable Takeover

Ward’s Automotive data shows that combined US market share of GM, Ford and Chrysler has been shrinking for consecutive 16 years, from 72.9% in 1993 to 43.66% in 2009. This shrinkage also means that of Japanese and European automakers has kept increasing during that time. It is very likely that this trend will be continues in 2010 and some years to come and regaining the expected position will be a challenge for the US automakers.

Read more: http://www.bukisa.com/articles/407808_how-the-us-automakers-are-losing-their-home-market#ixzz16nd8Dpel