Foreign Perspectives

Archive for the ‘Business’ Category

Much as we would like to have been able to leave the bathroom well alone after our last experience with a plumber, it’s starting to look like we’ll have to undertake a more major upgrade to the bathroom and possibly something really major will be needing done to the kitchen as well.

That being the case we’ve started revisiting the bathroom faucet issue once more. Although we had all of these replaced earlier in the year if we’re needing to redo the whole bathroom this time then we’d be wanting to take a little more time over the issue rather than going for the quick fix option that we did the last time around.

Regardless of the work needing done in the bathroom, the kitchen is definitely going to need some quite major work done on it over the next few months courtesy of the leak (or, probably, leaks) that we’ve developed. Quite where we’d start on that though is an issue for another day!

Let’s face it, many people would love a job where they could sit out on the beach and claim that they were working.

Whilst it’s clearly not an option for everyone, there’s getting to be quite a growth in information jobs which would let you do exactly that. Well, in principle anyway: as always, it’s rarely so simple as it might appear.

If you consider the very popular route of blogging, you’ll find that the vast majority of blogs don’t make any sizeable amount of money. Why? Well, the normal route of using adsense doesn’t work particularly well with sites with dynamic content as it usually takes adsense a couple of days to get the keyword targeting right by which time your blog will have moved on and a different set of keywords would be relevant. Secondly, you need major traffic or very well targeted traffic for affiliate schemes to work.

However, there is the option of doing sponsored posts which can be profitable even with relatively low traffic volumes. Typically you can make around $20 per day on a site with PR2 or above by writing three or four articles each day of, usually, 50 to 200 words each. If your blog gets to PR5 or over you can do really well with this option.

Other potential options are selling e-books or charging for subscriptions which are popular with some making money online blogs. There’s even SubHub which might eventually evolve into a worthwhile venture for the participants although at the moment it’s mainly an article repository for Internet business articles with a sideline in running up and hosting custom blog templates (at a rather exorbitant price).

Naturally, you don’t need to choose one single route to making money online. Personally, I do sponsored posts on blogs and also have a range of adsense funded sites with subscription options.

We’ve lived for decades, centuries even, in an era when prices are, on the whole, expected to increase year after year for the vast majority of goods.

The only category of goods where we are familiar with the effects of deflation are electronic goods and in particular computers so it’s helpful to examine how we treat those. For these there is the expectation that each year will see computers that are a little bit better than their predecessors and additionally they’ll be cheaper. What happens therefore in our buying decision is that we wait until we actually need a new computer before buying one. Now in respect of computers “need to buy” is slightly different from normal products in that there is innovation in the software too which forces us into purchases that would otherwise be un-necessary: that would be unlikely to happen with a normal product.

On the other hand, in an inflationary environment we buy a car now rather than next year because we can be confident that the car will be more expensive and so it is with pretty much everything.

You can even see the effect yourself by considering petrol prices. Until a month or two back I filled the car as often as possible on the basis that the price was rising quite sharply and could be expected to continue doing so. Then things changed as prices started going down very sharply indeed. The approach then was to fill the car only when absolutely necessary as that would be likely to get me the lowest price overall.

In fact, deflation might be a good thing to have but the snag is the period of adjustment that would be required would be extremely painful for everyone. The change from a “buy it now” attitude that’s relevant in an inflationary environment to a “buy it later” attitude appropriate for deflationary times means that factories build up stockpiles and therefore need to cut back on production and the jobs associated with it ie unemployment jumps. At a more personal level, house prices drop dramatically both because of the increased unemployment and because people are moving to a “buy it later” mindset.

One side-effect is that innovation is forced upon many industries which is usually a good thing to happen. However, it’s not an option for a considerable number of products: when was the last time that there was a really innovative potato?

On the whole, it probably is a good thing, it’s just that the transition period would probably be far too painful for governments in general to accept that.

I run a series of interlinked holiday accommodation listings sites which started as something of a sideline for me but which is slowly becoming a significant income generator for me.

Now, in the early days it was quite clearly a straight listing service. I typed up the entries as they came in and they were displayed on the site as a great big list. Nice and simple if somewhat time-consuming.

As it grew, I figured that a database was the way to go and in the second year that went live. By then the original 20 properties had grown to over 100. Mark 1 of that simply replicated the original hand-produced site and a version of that is still around to this day because the hand-produced format is much more effective in SEO terms than a written for database site is for various reasons.

With the dramatic reduction in the work required from me to actually add the information, I broadened the amount and variety of information that the property owners could add. That increased so much that I figured after a while that I should write a new-generation version of the original site to run alongside the original version but targeted at a different market. The increase in information meant that properties now had a little website each with several pages on it.

Interestingly though, I’ve recently come across a free accommodation property site that has come at the problem from the opposite direction. What they do is get the property owners to add a whole lot of information and they produce a little website for them which gets listed by them.

What’s clear is that we’ll both likely meet in the middle several years down the line as I’m in the process of souping up the mini website that my listing service generates and already some people are quoting that address as “their” website address which presumably will become more common as time goes on. In fact, it’ll become more and more of a website generation facility over the months to come as that’s my main area for development this year.

The question next year though will be: how do I promote it to the owners? The listing service aspect will clearly remain but there’ll also be the aspect of building almost custom websites for the owners (surprisingly easy to do). In fact, thanks to the recent change of hosting service I’ll even be able to let each owner use their own domain to point to their “mini” website (which will potentially be larger than many “proper” websites).

We were all assured just two months ago that we’d seen the last of the building society emergency takeovers with the demise of the Dunfermline but now it seems that we’re starting on yet another round of emergency takeovers as West Bromwich seems to be in its final days as an independent society.

The snag now is that Nationwide appears to have more than enough on its plate already and notably declined to take over all of Dunfermline which was a change to its previous approach of absorbing troubled societies in their entirety and merely took on the savings and regular mortgage parts of the society, leaving the part that caused the trouble well alone. Whatever society takes over the West Bromwich that seems likely to be the approach that they will take as otherwise those problems could well pull down the new owners as well.

Aside from the Nationwide which is probably too busy trying to integrate the societies that it has already picked up, the obvious choice would appear to be the Coventry although that seems likely to involve a number of branch closures over time given the similar geographic spread of the two businesses. The other problem is that the societies have a similar number of branches thus a takeover would pretty much double the number of branches to be looked after which could stretch the management a little bit too much in what are already difficult times. My bet is that, if it is a building society takeover, it will be a toss up between the Chelsea and the Yorkshire who will do it.

But what about the remaining building societies? Falling foul of the recent downgrade were West Bromwich, Chelsea, Britannia, Coventry, Nationwide, Newcastle, Norwich & Peterborough, Principality, Skipton and Yorkshire. Of these, only Chelsea appealed and Britannia is currently being taken over by the Co-Operative Bank.

As always, the safest place for your money remains National Savings.