Seeing the fierce competition from Chinese EVs especially BYD, Musk plans to exit the EV industry and instead move into the fuel cell technology. Which would be less polluting and more eco friendly. Probably too because of the shortage of the battery material the production of which is polluting and not so environmental friendly
Monday, June 17, 2024
Musk to exit EV market and in 2026 come out with fuel cell cars
Every generation needs a revolution - an entrepreneurial revolution
Why is outsourcing/offshoring such a good business idea
Every generation needs a revolution - an entrepreneurial revolution
BPO has been a great business driver in the Philippines for the BPO business itself office buildings for the BPO, transportation, rental housing units for the workers, for leasing companies (for computers and office equipment) and real estate companies.
Many of the billionaire companies have huge office complexes for the BPO especially RLC and SM
Why, what are the benefits for BPO
1. Lower cost as much as 100% cost reduction for labor. A P20,000 starting pay for call center agent is less than $400.00 at P58+ exchange rate
2. The one outsourcing is freed of the increasing cost of labor: health insurance, retirement
3. It can focus on its core business.
4. It frees up real estate in the expensive properties for other more value added activities. For example
in a hospital, a laundry room will be used for board and lodging if laundry was outsourced
5. Above all, it window dresses the ROI as per Du Pont Formula
Net income/Sales / Total sales/Total Assets x Total Assets/Total Stoch holders Equity
As you can see, reducing the total assets increases the quotient for Total Sales/Total Assets
Resulting in over all ROI
The method for the asset reduction would be something like this
An FMCG company just bought a computer system worth $300 million. It sells back the
computer to the supplier and enters into long term contract to outsource the computer work
at an X amount per transaction say $050 or $1.00.
How much increase in ROI (the Du Pont formula would result if $300 million were removed from
its books. It would be $300 million wealtheir
How would this affect the analysts perception of the company? How would it affect the valuation
of the company if it was cash rich
Most important formula in business...
Every generation needs a revolution - an entrepreneurial revolution
It is sales - cost = Gross Profit
Your goals in every step you take: are increasing sales and reducing cost/expenses.
All other tasks are of secondary importance.
Investments projects loans should result in any two of these: sales, collection. Thus it is crucial that that efforts and resources should be invested here. One wonders why some companies neglect these two items
Cost reduction is marketing/selling in reverse. You save the revenues that will generate the GP needed for the expenses.
Lower priced products sell better than higher priced products
In his book Mind of Strategist by Kenichi Ohmae, he listed
How to Increase Sales: 1. Increase number of units sold
2. Increase the number of sellers
\ 3. Increase the value of the product
4. Increase geographical area of coverage
5. Increase advertising support
6. Increase the number of channels
How to reduce cost 1. Reduce material cost by VA/VE
2. Reduce cost of utilities
3. Reduce labor cost by automation or offshoring
4. Reduce labor time
5. Reduce the number of steps in production
Subscribe to:
Comments (Atom)