Monthly Archives: February 2010

Where Traffic Tracking is Concerned, Can We Trust Anyone But Google To Do No Evil?

After reading this recent article on TechCrunch which asks How Does Compete Get Its Web Traffic Data?, which followed Jason Calcanis’ rant on Why We Should Boycott Comscore, and after noticing that my Alexa, Ranking, and Traffic Estimate Rankings bounce up and down on the string of a yo-yo despite the fact that my traffic has been non-decreasing since day one (as it’s always holding steady if not steadily increasing), I’m starting to wonder. (Quantcast is still pretty good, though sometimes it seems that it’s gone from reporting over 60% to missing slightly over 60%*, but that’s about it.)

What do you think? Is there anyone we can trust anymore, or is the new model of business e-bribes? And can we even trust Google?

* This could be as much my choice of blogging platform and the fact that where I have to embed the tracking code in the page compared to where they recommend you embed the code to maximize traffic capture and minimize the chance of cashing, as caching poses a problem as well as browsers that disable or block certain types of scripts.

“You’re Lucky to Have a Job” is NOT a Talent Retention Strategy

While reading The Talent Game (membership required) Panel Discussion transcript, I was horrified to read that one participant said that many employees are being told they are lucky to have a job — that is one form of retention. Simply put, it’s disgusting. Not only does it show an utter lack of respect for the employee, but it also shows an utter lack of competence in talent management.

Even if you recently went through a layoff, presumably the employees you retained are those employees who were best at the jobs you needed done. These are, by definition, the same employees your competitor would also keep in the same situation. And since these are the best employees, these are the employees that companies who didn’t have the same talent pool to draw from before the recession are desperately seeking in an economy where they need a workforce who can do more with less. Maybe your employees are lucky to be making a high salary, or to be receiving above average benefits, or to be working at a company that challenges them on a daily basis in a job they like, but they are not lucky to have a job. Even if she has to make a sacrifice in pay, benefits, or flexibility, a good employee can always find a job.

So if you still think that your employees are lucky to have a job, you better wake up and smell the coffee before they do. Otherwise, you might find that your best employees are leaving for your competition as soon as the economy recovers.

Supply & Demand Chain Executive Helps You Get a Better Deal

You can use a recent article on the top 10 margin-killing myths about B2B pricing in Supply & Demand Chain Executive to get a better deal from your vendor. Just like B2B companies must aggressively counter the closely held beliefs that are holding them back, B2B buyers must aggressively counter the closely held beliefs that are holding them back as well. Dispel the corresponding buyer myths implied in the article and you’ll be on your way to great deals.

  1. Myth: The Market Controls the Price
    You Control the Price. The vendor sets the list price, and you decide whether or not you’re going to pay it. The market doesn’t set the price, the contract you sign does.
  2. Myth: You Have More Important Things to Worry About
    Whether or not you buy a solution should ultimately boil down to expected annual ROI, which, simply, is your expected annual savings divided by the annualized software cost. If the price is too high, then the ROI will be too low, and you should not buy.
  3. Myth: Commodity Solutions Can Not be Price Differentiated
    Since different solutions can be expected to return different ROIs depending on how well they integrate with your business and how effectively they tackle your biggest problems, you should expect to pay less for a solution that offers less value.
  4. Myth: Price Improvement Puts Savings at Risk
    Remember, it’s not “savings” until you actually save the money. And if you spend more on software then you save from its application, there are no “savings” at all. While you shouldn’t quibble needlessly about a price that gives you an expected 20X ROI if it’s in market range, you should definitely negotiate hard on a price where you only expect a 2X ROI.
  5. Myth: Experienced Buyers Know How to Price
    Not necessarily. They know how to negotiate. Not how to price software, and definitely not how to get the best deal from an unfamiliar vendor. That’s why you have Deal Architects.
  6. Myth: Compensating on Technology Savings Ensures Good Buying
    It’s not about how much you can save on the IT budget, but about how much you can save using the IT you buy. Not buying an industry leading strategic sourcing decision optimization suite which can save you an average of 12% above and beyond the best reverse auction because it costs an extra 100K is just stupid if you spend over 100M annually. The software will pay for itself on your first big sourcing event!
  7. Myth: Pricing Has to Be Simple
    No, it has to be such that value is delivered. And sometimes, per CPU hour is the best price you’re going to get if you don’t use the software extensively for long periods of time between major buys. And thanks to modern software, it’s simple to calculate.
  8. Myth: Strict Compliance to Buying Rules Ensures Good Pricing
    And bad software. Comparing two software suites is often like comparing apples to oranges. It can be done, and you’ll find similarities, but there’s often a qualitative aspect to a preferred solution that can’t be quantitatively measured.
  9. Myth: New Solution Buys Require the Most Attention
    Really? So you’re going to stand for 22% maintenance on your ERP shelfware?

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Think Halifax Can’t Handle Your Ocean Freight? Think Again!

As per this recent news release from Materials Management & Distribution, Halifax has broken ground on its $35 million berth project that will see the port’s berth become the deepest on the eastern seaboard of North America. Once complete, the South End Container Terminal will be able to simultaneously service two full-sized post-Panamax vessels (and Panamax II type vessels can carry up to 12,000 TEUs). 24,000 Twenty-foot Equivalent Units is an awful lot of freight.  (It should be enough to make Halifax a top 10 North American port at the very least!)

And this is just the beginning. Over the next five years, the Halifax Port Authority — which has invested more than 100 Million in cargo-related infrastructure improvements in the past five years (in addition to 250 Million in investments from the private sector), will invest more than 225 Million dollars in port and infrastructure improvements.

If you’re wondering how you can take advantage of these improvements and leapfrog your competition (as Halifax is the closest port to many overseas locations in Southeast Asia), you could always contact the World Trade Center Atlantic Canada or Nova Scotia Business Inc. They’d be happy to help. And as I pointed out, Halifax is The Best Place to Do International Business in Canada.

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Are You Being Hit with the “Double Payment” Problem in Your Shipping?

Logistics Management just ran an excellent article on Logistics and the Law: Don’t Pay Twice, by Brent Wm. Primus, J.D. of Primus Law Office that I think is a must read for anyone responsible for global shipping.

When a shipper engages a broker or when a shipper or a broker books a load with a carrier, they expect to be billed and to pay for the charges for moving the freight. What they don’t expect is to have to pay the charges twice. Unfortunately this does happen and, in the last few years, has happened with increasing frequency. This emerging issue is called the double payment problem.

As the article points out, there are three variations of this problem:

  1. The going-out-of-business broker.
    In the last weeks or month of its business life, a broker continues to book loads and collect payment for carrier charges, but fails to pay the carrier.
  2. The double-brokering carrier.
    A load is tendered to a carrier with the understanding that the carrier will be providing the actual transportation, but, instead of providing the transportation itself, the carrier uses its broker authority and tends the load to another carrier, which it fails to pay.
  3. The fraudulent broker.
    A fraudulent broker solicits loads that it then tenders to carriers with every intention of collecting from the shipper but with no intention whatsoever of paying the carrier

With respect to the first two variations of the problem, two competing legal theories have developed. The first theory is the well-established principle that under the traditional bill of lading contract, the consignor has primary liability for payment of the charges on “prepaid” shipments, and if the consignor fails to pay, then the consignee must pay. For “collect” shipments the consignee has primary liability and if the consignee fails to pay, then the consignor has to pay (unless the no-recourse provision of the bill of lading, known as “Section 7”, has been signed).

But what happens when the consignor or consignee has fully paid an entity under a good faith assumption that the entity is the carrier or paying the carrier? In this situation, a legal principle known as “equitable estoppel” has developed and applies in situations where Courts have held that it would not be fair or equitable to ask a party to pay twice. However, there are situations, such as Freight Lines, Inc. v. Sears Roebuck & Co. where the principle, though it had merit, was not applied by the courts.

With respect to the third variation, which has become a more significant problem as of late, typically no money ever reaches the carriers and you, as a shipper, will likely end up with full responsibility for the payment unless you can demonstrate that you had a reasonable expectation that the company was legitimate (and thus use the equitable estoppel argument). This of course means that you have to do your homework, and unless the company in question has hacked US Government Systems to make it look like they are affiliated with reputable companies (like Viacheslav Berkovich and Nicholas Lakes did), it might be hard to demonstrate a reasonable expectation of a reputable enterprise, especially if the broker is relatively new.

So what should you do? Especially when there is no sure fire way to eliminate the risk?

According to Steve Fernlund, the Executive Director of the Freight Transportation Consultants Association (FTCA), always know who you’re doing business with. Check payment practices and credit rating agencies to make sure there is minimal risk that the carrier and/or broker will default on its obligations. Have a standard procedure to qualify carriers and brokers and follow that procedure in every transaction. The latter will help you in the construction of equitable estoppel arguments should you ever find yourself in one of the first two situations, especially if the standard procedures cover everything you can be reasonably expected to do.

Furthermore, as the article points out, you have to monitor the carrier to ensure they are complying with the terms of the contract as some carriers will sign a contract and then ignore the prohibition against tendering to another carrier through their brokering authority. (This includes a spot check of delivery receipts to see if the carrier named as the delivering carrier is the one with whom you have a contract.)

When you’re using a broker, have a written contract that requires the broker have written contracts with its carriers. The broker’s contracts must require that the carrier specifically designates the broker as its agent for collection and that the carrier waives any right to collect from the consignor or consignee if the broker has been paid. Also require that copies of all contracts with all carriers the broker intends to use be forwarded to you for review and confirmation.

And, finally, if you truly want absolute protection, you could require that any broker you do business with post a surety bond greater than the amount of business you expect to do over a six-month time period. However, this will eliminate many brokers from consideration as most sureties require 150% collateral, which many smaller brokers will not have. It may also increase your brokerage fees, as they might insist that you pay the bond premium.

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