profitable

I have been harping for at least a year on the benefits of the United States going back to a manufacturing economy and I don’t think it is too late for us to pull it off.  The important things to have to materialize the situation are:

1.  Positive Government Environment – That means that we need tax incentives to jumpstart the battery of our local economies.  Don’t be fooled, we have plenty of talent and creative souls who are waiting to start, or in some cases jump back in, to their respective businesses but for them to be profitable, they will need to have the support of the state and local governments.  As of now, I see that sporadically in some states and sadly, California is lagging behind like the zebra that is falling away from the herd.  That means that lions and predators in the form of unemployment and continued financial Depression can gnaw deeply into our delicate bones.  Internally, some cities like San Diego are making a play to get more motion picture industry business into their area.   We are dropping the ball in the Los Angeles area and we need to not only pass legislation to keep whatever entertainment industry is left but to also get other businesses to start opening shop here in Los Angeles.  I get it that the city is underfunded but we need to get people to stay in the city and county and work legally so they can be taxed at a reasonable rate and they can grow.  At the current time of this entry, businesses are fleeing the Southland and even the US.    Folks, please write our Congressional leaders, the President, the Governors and get them to cut our local laws some slack to encourage business to stay and not flee.  I am not saying that we give away the farm in terms of tax breaks because I love paved highways, clean waterways and running water as much as the next person.  I am saying that we shouldn’t tax the poor businessman or woman to death just to raise revenues.  There are other ways of getting money and we really need to float more bond issues.
2. Limited Robotics and Local Labor Employment – Most of manufacturing on a large scale, like the automotive business, is done with robots.  That does not employ a heck of a lot of humans so the type of work that we need to generate has to be a mixture of machines and men.  We may not have to go the pure Chinese model route, where you employ only human beings to hand make goods though that is an excellent way of working towards full employment.  The downside is that it isn’t efficient and employers would go broke with salary and hourly payrolls that they wouldn’t need if they had automated production for some of their work.  Pure robotics doesn’t work because they won’t get the average person working and making money.  Another factor when it comes to robotics is that they need servicing and you are going to need to have some local support in case your machines break down.  You will need to invest in local mechanics or have your staff trained so that they can be in a position to handle programming upgrades, repair robotic arms, fix wiring breakdowns and all of the little things that can and do go wrong with repetitive motion.
3. Remember basic economics, gang.  You need people to make money so they will have it to spend.  That in turn will get people to start hiring and create even more jobs and create an upward spiral instead of the downward one that we are in right now.  Size doesn’t matter in what you are producing – Whether you are making socks by hand, pencils, or high tech circuit boards, the important thing in my mind and heart is for you to be manufacturing something.   Manufacturing of goods produces something in a very physical sense that cannot be stolen virtually and if it is something that people need and can afford at a decent price, you will be set.  There are plenty of companies who have been making pens and pencils for generations and they will continue to do so even though foreign competition has tried to undercut them.  If something is made of good quality, people will pay a little more for it.  In this case, it is worth spending fifty cents apiece for a pen rather than five cents if the pen will last a few months versus crapping out and drying out within two days of usage.  One of the biggest issues with a lot of Chinese made goods is that they were falling apart.  It was profitable to go ahead and buy them only until you realized that you lost money because you had to replace them sooner.  It never is a good idea to go with the lowest bidder if you constantly have to replace products.  It just doesn’t make good financial or common sense.
4. Good relations with your business community and any chambers of commerce- It pays to make friends with the people in your community.  That is an important part in working with people to get them employed, getting permits to start your business and having the local climate work for you in getting your manufacturing business going rather than have it slog along and having to deal with committees trying to approve this and that for your gig.  You also can’t buy go word of mouth relations with your business because that kind of response spreads and helps the community and the world see what kind of great guy or gal you are in terms of doing business with, working for or buying goods from.  Even though the book value of good will tends to be over-valued, the real life value of the situation is that it makes life easier for you, your clients and the world at large if you are a decent, fair businessperson.
5. Limited liability insurance if need be with your product.  In today’s society,  people are stupid and greedy.  They will spill a hot cup of coffee on themselves and try to sue the restaurant they bought it at because they scalded their privates.  You will need to protect yourself as best as you can with insurance.  The good news is that policies for certain things run cheap and as long as you have good training, good safety skills – especially if you have heavy machinery, you will be okay.  Take a tip from old factories and post signs that show how many days you had without any accidents.  Encourage and reward good business practices.  You can always punish the people who don’t practice safety by firing them or let them cut their own fingers off.  I am just kidding about the second half of that last sentence.  Seriously, don’t let your staff lose digits or limbs. 
6. Make sure that you have a clear direction and a business plan for your product.  This should be the number one thing that you should be working on prior to spending a dime on your plans.  Have you looked at all the licensing and reporting requirements?  If there are food packaging issues, have you contacted the appropriate certification agencies or boards?  The last thing you want is to start up a great food manufacturing plant and have it shut down because you didn’t get the appropriate form filled out.  That sucks. 
7. Hire and train people of all ages.  If people are in good shape, willing to work, don’t discriminate against them because they are too old or too young.  You get experience with older workers who will work without giving you grief and you will get energy and enthusiasm from younger workers who are trying to make a buck to buy their cars and houses.  Well, you probably have older employee candidates who are trying to do the same thing but you know what I am yapping about.  It makes for a better workplace than keeping it cliquish.   There is also a great benefit for getting people across multi-generations and groups excited about your business and your product.  There is a reason you see so many ethnically balanced web sites with people of many colors and religions.  We are all different and want to be respected.  If you can get a person’s respect, they will want to do business with you and purchase your stuff.
8. Look for places to open up your factory where you can run all night if you have to.  You may have extensive automated machinery that needs to keep running all night with a skeleton crew.  If some of it is a little on the noisy side, look for parts of the community where you won’t hear the echoes of commerce at 3 am.  Where I live it is so quiet we sometimes hear the trains that run literally miles away.  Canyons and valleys echo like crazy.
9. Use local manpower.  There is a lot of talent in every community.  I may be yakking too much on this but there is no shortage of trained and willing workers here in the United States, here in your state and here in your local city.  Get them working.  They will reward you with good, productive efforts and they will have the money to spend to keep things going in your neighborhoods.
10. Scream to the world with press releases, Internet entries, celebrity parties, etc that you are doing business.  Get people to know that you are out there and you will make sales.  Your local chambers of commerce should help you get the word out and if you can get local celebrities or sports people to come by (especially for free or if they owe you a favor because you loaned them money when they were first starting out) you can create buzz.  Make sure whatever it is that you are selling works.  If you are making shoes, make sure that they don’t fall apart or off of your feet.  There isn’t a profitable thing about watching an attractive celebrity have her shoes fall apart for your business though the hilarity and Internet Youtube hits will make your company infamous for a few weeks.

So get busy.  Keep me posted as to how things are going and we can do this.  Approach your local banks for money with your successfully written business plan and start going with your gig.

Hey, don’t go anywhere yet.  Having some tax issues or tax questions?  Any problems with trying to make it through the financial Depression we are in that is making you depressed?  Please read on.

I am expanding  my practice and taking on new tax clients.  If you are interested in having somebody who is a successful businessman and tax professional with integrity review your returns discretely and see if your tax guy or gal is doing a good or goofy job, please drop me an email or post a comment with your contact information and time.

I have experience in international business, small businesses, partnerships, multi-state tax returns (they can get complicated) and anything else you can probably think of.

I also do business consulting and have ran several businesses (still running a few) myself so you are in good hands.

If you are looking for a day job, part time work, suggestions for saving money or investing, please check out my book, Practical Money Making, that is listed right after his paragraph in this very post. There are some great suggestions and ways to survive the Depression we are in.

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Kim Isaac Greenblatt

 Make Small or Make Big?  It Doesn’t Matter Just Make Something