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PAUL SULLIVAN, On Friday June 24, 2011, 1:03 am EDT

WHEN I started writing this column almost three years ago, one of my goals was to figure out what the wealthiest Americans knew and pass along those lessons to middle- and upper-middle-class readers.

Recently, I put that idea to the test, spending the afternoon in a Manhattan town house with eight wealthy men who are all members of an investment club called Tiger 21. I was there to hear an unvarnished critique of how my wife and I save, spend and think about money. Continue reading →

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While economists continue to debate whether we’re truly rising out of the recession or entering into a double-dip, one thing is clear: The employment sector is still in a slump. The strongest job growth seems to be in the small business sector, which has accounted for 65% (or 9.8 million) of the net new private sector jobs created in the US between 1993 and 2009, according to the Small Business Administration. The small business sector has actually seen a surge in activity: Research from the Kauffman Foundation indicates that the number of American businesses created in 2009 marked a 14-year high, surpassing the number of businesses created during the 1999 and 2000 high-tech boom.

If you’re thinking about starting or joining a small business in this economy, here are seven traps to avoid:

1. Don’t let the economy get you down. While many workers view precarious economic conditions as a time to hunker down in their jobs and try to weather the economic storm, others see it as a window of opportunity. Starting a business in a weak economic environment can have several clear benefits: The cost of doing business can decline because suppliers and partners may be more willing to negotiate on pricing and conditions, and the opportunity cost of lost income from a traditional job may be lower. Access to capital is also improving: The Small Business Administration’s Office of Advocacy reports that in mid-2010 commercial banks started easing lending conditions while levels of venture capital investments increased.

Of course, there are also precautions to starting a business in a weak economy: Discretionary spending is down, so businesses selling goods or services that appeal to budget-minded customers may have an easier time gaining new customers in this economy than sellers of full-priced luxury items. Similarly, do-it-yourself services and low-cost substitutes may fare better than full-service or premium alternatives. For example, self-service storage and organizational retailer Organize.com saw a greater than 10% increase in year-over-year sales from 2007 to 2008 and again in 2009. Explains Terry Shearer, CEO of Organize.com, “Even in a recession, people want to improve their homes, but they want to do it inexpensively. Buying good home products from a reasonably priced online retailer is a much less expensive way to improve your home than, say, hiring a construction team or designer.”

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By: Joey Concepcion of Gonegosyo.net

With the current crisis in the Middle East and in Japan; and with the prices of commodities and oil going higher; what is in store for SMEs? I asked Romy Bernardo, one of the country’s top economists and a former Finance top official who is also an Independent Director of the RFM Board, about his views and this is what he has to say:

The BSP recently reported that pessimism has substantially increased among Filipino consumers, amidst continued price increases and unrest spreading in the Arab world. The confidence index (CI) weakened from -8.5 percent in Q4 2010 to -23.1 percent in Q1 2011, indicating that the number of pessimists increased during the quarter relative to the number of optimists. Households polled during the 3rd week of March cited continued increase in the prices of petroleum products, the high cost of goods and services, and the rise in household expenses as the reasons behind their weaker outlook. The outlook was aggravated by the tensions in the Middle East and North Africa.

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I just learned this lesson today that when you close down your business, you need to inform the city government so that you will not be billed on the succeeding years.

I’ve got this process from the DTI website…

Department of Labor and Employment (DOLE)
•Service of a written notice to the employees and the DOLE at least one (1) month before the intended date of closure/cessation
•The closure or cessation of business operations is bona fide in character.
•Payment to the employees of termination pay amounting to at least one-half (1/2) month pay for every year of service, or one (1) month pay whichever is higher, per Philippine Labor Code mandate.
Bureau of Internal Revenue (BIR) Application for Closure of Business/Cancellation of Tax Identification Number (TIN)
Tax Form
BIR Form 1905 – Application for Registration Information Update

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From the book: A Path to Entrepreneurship

(a book written to tell the story of Mr. John Gokongwei’s life).

9 Rules to Business & Life:

1. Change is inevitable and flexibility is the key.
- For someone to survive and prosper, one has to be flexible and adaptable to change and adversity.

2. Personal stakes in the company encourage everyone to work hard.
- Each person in the company should have personal stake to work very hard for its progress.
- Hiring the right people and at the same time providing them the right benefits. And for deserving people, a stock option to have a part-ownership of the company. This will drive everyone to the same goal of making the business a success.

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I have been invited to share my thoughts on Asian conglomerates and the global economy, and why they have been successful in many ways.

The best way I can share my thoughts with you is to recall some of my own experiences in starting and growing JG Summit Holdings. Embedded in these experiences are some lessons learned in making businesses successful not just in their domestic markets, but also in a more international arena of competition.

Entrepreneurial passion

I believe that the first element of successful conglomerates is the ability to sustain the entrepreneurial passion of their founders. A common thread that I have observed is that many Asian conglomerates were started by immigrants who engaged in business as a matter of survival. Entrepreneurial skill was not an option; it was a necessity!

In our case, I was the eldest son of a Chinese businessman who settled in the city of Cebu in the Visayan Islands.

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