Tag Opinion

Great writing …

CLARITY, PERSONALITY, SIMPLICITY, WARMTH.

Author William Zinsser, in his 1976 book On Writing Well, identified these as the four indispensable qualities of great writing. Why indispensable? Because the best writing is an expression of the writer’s humanity. These qualities allow that humanity to shine through. As a writer, I find Zinsser’s argument persuasive.

Reimagining the convenience store

A Promising Investment Opportunity?

Here is a viable scenario that is based on recent trends (e.g., Macro Demographic Changes, Lifestyle Shifts, Technological Tends, New Business Models, and Intensified Competitive Dynamics):

Reimagining the convenience store. C-stores are uniquely positioned to exploit new demands for convenience and increasing urbanization. They’re already closer to con­sumers than any other type of physical store, but there are still opportunities to improve the experience and assortment.

First, margins and consumer loyalty can be improved by growing private-label offerings beyond packaged goods. C-stores are already starting to more closely resemble quick-serve restaurants in their offerings. For example, Casey’s General Stores recently started offer­ing fresh pizza.

But there is still tremendous opportunity to expand c-store private-label offerings to in­clude more general merchandise, transform­ing c-stores into one-stop shops for modern urban consumers. For example, 7-Select at 7-Eleven in the U.S. includes more than 250 food items from donuts to frozen pizza. But in Taiwan, 7-Select also includes a much wider assortment of general merchandise, including clothing, laundry detergent and light bulbs. And the strategy is paying off, with 7-Eleven’s operator in Taiwan reporting a 27% increase in net income in the third quarter.

And new technologies can also help make the c-store shopping experience easier and faster. For example, retailers could deploy RFID tags to let consumers check them­selves out. Or, U.S. c-stores could take a page from Tesco’s book and build virtual stores. Finally, online ordering and in-store pickup would help make the experience even easier and give first adopters an incredible compet­itive advantage. Retailers to watch: 7-Eleven, Alimentation Couche-Tard, Pantry, Casey’s General Stores and Wawa.

We have worked with all of these players, and know them intimately.

Comments on “A Capitalism for the People”

by Luigi Zingales [2012]

Zingales who emigrated from Italy to the U.S., took his Ph.D. at MIT and is now a tenured professor (of finance) at the University of Chicago. He offers in this book an interesting perspective on manifold ills in the American economic system that, left unaddressed, will likely send this nation into a long-term decline not unlike what much of Southern Europe and South America, for example, have experienced. Just to mention a few, these ills include “crony capitalism,” growing corruption, creeping socialism, lessening competition, more rent seeking, greater wealth redistribution, more systemic risk, decreasing global competitiveness, winner-takes-all rewards allocation, diminishing trust, mushrooming regulatory complexity, growing government share of economic activity, etc. Zingales offers suggestions for a new economic framework, or at least an approach for reestablishment of meritocracy and competitiveness that fostered the individual, corporate, and societal success during America’s past. Note: Rep. Paul Ryan is among those who have read this book.

Big government is essential for socialism and crony capitalism to thrive. In 1900, federal government spending equalled 3% of U.S. GDP. Since then, the proportion has grown about eightfold. Power to tax and redistribute trillions is what drives hundreds of millions in election campaign spending. The state enjoys an “ultimate monopoly.” In the past, state monopoly power extended to the likes of the East India Company. More recently, it extended to Fanie Mae and Freddie Mac, for instance.

Elizabeth Warren was right about one thing—the system is rigged. Perception of rigging is enough to undermine the free market system, to discourage participation, risk taking, hard work, etc. Zingales notes that over half of Americans trust government little or not at all, and only about one-sixth trust large corporations. The number and size of taxpayer bailouts of corporations since 2008, LIBOR manipulation, and other developments have further eroded public trust.

This book is informative, entertaining, and instructive. A holistic view of America’s present state is just what the doctor ordered. Chapter 2 is titled “Who Killed Horatio Alger?” Many have said, as with Julius Caesar, many have blood on their hands.