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Vol. 26, No. 9 ● September, 2008

If . . . . . . . . you’re reading this newsletter - and you’re not a customer of Freeman-Spicer - why aren’t you?

Profiles In Pilfering . . . . . . . . Risky borrowing and lending aren’t the only way companies rack up losses. U.S. employers will lose about $994 billion to fraud this year, suggests a recent study by the Association of Certified Fraud Examiners. More than half of the 959 white-collar crime cases analyzed were discovered by accident, the study says, despite the post-Enron focus on ferreting out such crimes through systematic examination. And 46% of all cases came to light because of a tip. Who are the likely fraudsters? Most are in their 40s, with men outnumbering females 2 to 1. And most have worked for more than five years at the company where they did their filching. Not surprisingly, the perpetrators are often those with the best access to the corporate lock box: those in accounting (29%) and upper management (18%). Looking for telltale signs? Dishonest employees often start living beyond their means. They may also refuse to go on vacation (a time when their replacement could get a look a their transactions). And since personal financial stress is another breeding ground for fraud, says John Warren, the association’s general counsel, companies should be aware that 2009 could be another banner year for fraud. “In this economic climate,” he says, “there’s a temptation.” (Nanetter Byrnes in BusinessWeek)

What It Takes To Live A Really Long Time . . . . . . . Here’s how the longevity odds stack up for the average 40-year-old American man and woman. (Remember that these are averages; it’s therefore wise to plan for a longer life span.) Also included: how much money that 40-year-old would need to amass by an age-65 retirement to live comfortably to each age, assuming he or she spends $75,000 a year (in today’s dollars).

Notes: Amount needed at age 65 if you’re 40 now. Numbers are in future (2033) dollars. Assumptions: Nothing is left to heirs; inflation is 3%; asset allocation is 60% stock, 30% bonds and 10% cash; and there are no Social Security or pension payouts. (Society of Actuaries; T.Rowe Price in Money Magazine)

It’s Almost The 4^th Quarter . . . . . . Hopefully, you have been getting a free credit report every 4 months. There are three different credit agencies - Equifax, TransUnion and Experian. If you request just one of these reports every 4 months - you can keep track of your credit all year long and never have to pay for a report. I’ve said this over and over again - please go to:

http://www.annualcreditreport.com

A Lady . . . . . . . . about 8 months pregnant got on a bus. She noticed a man opposite her was smiling at her. She immediately moved to another seat. This time, the smile turned into a grin, so she moved again. The man seemed more amused. When, on the fourth move, the man burst out laughing, she complained to the driver, and he had the man arrested. The case came up in court: The judge asked the man (about 20 years old) what he had to say for himself. The man replied, “Well, Your Honor, it was like this. When the lady got on the bus, I couldn’t help but notice her condition. She sat down under a sign that said, ‘The Double Mint Twins are coming’ and I grinned. She then moved and sat under a sign that said, “Logan’s Liniment will reduce the swelling,’ and I had to smile. Then, she place herself under a deodorant sign that said “William’s Big Stick Did the Trick,’ and I could hardly contain myself. BUT, Your Honor, when she moved the fourth time and sat under a sign that said, ‘Goodyear Rubber could have prevented this accident,’ . . . I just lost it!” “Case Dismissed!!” (Dunbar)

Motor: Follow the Leader . . . . . . . . . The mission of a motorcade is simple: Deliver the package safely and on a schedule. That means avoiding everything from rush hour to dirty bombs. And, not surprisingly, there’s some science to optimizing the armed caravan, whether it’s a 40-vehicle convoy carting the president or a drug lord’s four-SUV private platoon dodging the DEA. Here is the feng shui of motorcade layout.

1.         Sweepers: Local police, motorcycles and cars act as pace-setters and guides with two directives: Keep moving and monitor suspicious activity. The cops also provide intel when planning the route, which should avoid railroad crossings and minimize bridges and overpasses. And with total control over municipal traffic lights, the police keep the procession traveling fast.

2.         Watchtower: For high-profile targets (prime ministers, dictators, hip hop moguls), a rig tricked out with sensors and scanners can perform a moving sweep for hazardous substances and jam radio frequencies. Excessive? In 2003, a radio jammer saved Pakistan President Pervez Musharraf when it blocked a signal being transmitted to bombs under a bridge.

3.         The Package: The VIP is placed securely in the middle of the fleet. Ideally 250 yards behind the front vehicle. Standard procedures for political leaders is two or three identical limos. They play three-card monte along the route to keep would-be assassins guessing. The Ride: The Feds prefer “made in America” Cadillac DTSs, but most of the world’s dignitaries ride in Mercedes 5600s and BMW7 Series. All have enough armor to stop a high-powered rifle round.

4.         Armored Division: Immediately behind the VIP are blacked-out SUVs loaded with artillery and your trench coat-clad security agents of choice. The firepower follows the VIP so it can move forward to surround the limo if needed. Zimbabwe’s Robert Mugabe is a little less ostentatious, filling Nissan pickups with local infantry, but the orders remain the same worldwide. Shoot to kill.

5.         Extras: Ambulances, reserve SWAT teams, and staffers trail the big guns for support.

6.         Media: The reporters following newsmakers travel like a high school volleyball team; usually crammed into a white van. After all, if something goes wrong, someone has to be on the scene to report it.

7.         Rear Guard: another set of police cars covers the back of the motorcade to ensure no one launches a sneak attack from behind. (Wired Magazine)

 Testimonials . . . . . . . What’s the best way to use testimonials? The absolute best way is in video format at the end of a sale as proof to the customer that you are credible. That’s the simple answer. But if you become a testimonial-based seller, which I believe is the most powerful form of sales, you can get testimonials for every element of your sales cycle. If you have a prospect who won’t give you an appointment, put a CD in the mail of a customer saying, “For two years, I would not give this guy an appointment. What a mistake!” If you can’t get an appointment after that, you suck. You can use testimonials to answer questions, to overcome price objections, to overcome “I’m satisfied with my present supplier” - nearly anything you can think of. (Little Red Book of Sales Answers)

My Wife and I . . . . . . . . . were sitting at a table at my high school reunion, and I kept staring at a drunken lady swigging her drink as she sat alone at a nearby table. My wife asked, “Do you know her?” “Yes,” I sighed, “She’s my old girlfriend, I understand she took to drinking right after we split up those many years ago, and I hear she hasn’t been sober since.” “My God!” says my wife, “who would think a person could go on celebrating that long?” And then the fight started . . . . . . (LaFree)

How Big Is A Trillion? . . . . . . . A trillion is 1,000 x 1,000 x 1,000 x 1,000. But the number is meaningless to me. I've never experienced anything that can tell me how big it is. I certainly can't imagine what a trillion dollars is worth. About the biggest amount of money I can visualize is $100,000. I know what a $100,000 house looks like. I've seen lots of them. And, I suppose I can comprehend a million dollars. If I picture a city block with ten houses, each worth $100,000, that's a million dollars. So how many blocks would I have to fill with these $100,000 houses to make a trillion dollars. Would it be the whole neighborhood? The city? More? If someone built block after block of $100,000 houses, ten houses to a block, ten blocks to a mile—that's a hundred blocks per square mile—how big would the project be when it reached a trillion dollars in value? It would be 10,000 square miles—that's bigger than the State of Maryland. And how about the size of the national debt? How much land would we have to cover with $100,000 houses to equal the $7 trillion debt? Picture Missouri. The 275 miles from St. Louis to Kansas City—covered with houses. The 325 miles from the Arkansas line to the Iowa line—covered with houses. All the farms, all the lakes, all the rivers—covered with $100,000 houses. That's what 7 trillion dollars looks like. I still can't comprehend it. (J.C. Adamson, 2008)

Marketing . . . . . These days, the average supermarket stocks 40,000 items, but the average family gets 80% of its needs from only about 150 of them, which means there’s a good chance the other 39,850 items will be ignored. With so much competition, markets today are driven by choice; customers have so many choices that you have to stand out or get lost in the pack. Indeed, companies must address differentiation in three key ways:

•          If you ignore market changes, your differences can become less important.

•          If you stay in the shadow of big competitors and never establish your differences, you will always be weak.                       

•          If you try to be everything for everybody, you very quickly undermine what makes you different. (Differentiate or Die)

Sincerely,                                                                                                                     

Edward C. Levy

President