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Thursday, January 29, 2009

Motel schmotel...

While driving halfway across the country yesterday (to help my girlfriend move into her apartment at her new university) I noticed something which I had never seen in South Africa before: a real motel. Now before you start clamouring that I’m mad, and think that I’m some kind of hermit, let me explain…

I’m fully aware that there are plenty of motels scattered around the country. I’m in the transport business, enjoy driving cross-country, and have stayed in dozens of them. This one, though, was slightly different, and it struck me enough to write about it. It was in Sedgefield, a small coastal town in the Garden Route here in the Western Cape, and its sign stated proudly that it was the Motor Inn. What made it different to all the other motels that I’ve seen and stayed in was how it was designed. Many local motels tend towards being small stand-alone bungalows clustered in a circle or a few rows; and those that aren’t are semi-detached and staggered slightly diagonally, with each one having its own character – almost as if the building has been added to as the demand has grown for more units.

The Motor Inn in Sedgefield, however, was built as if it had come straight out of the middle of the USA. For those of you who’ve ever watched a movie from the US (which means all of you), you will have seen a version of the archetypal US motel. You know the type: simple single-storey building; office in the middle or at one end; each room with a parking bay outside the door; one big window per room, facing onto the parking lot. This is where the term ‘motel’ came from – motor hotel – where weary travellers could drive their vehicles right up to their room, instead of parking them in a central hotel parking lot and going up to their rooms. They are spread out all over the US, and have been a landmark of the vast open spaces for decades. The reason for their popularity is simple: they’re cheap; functional; have what you need (bed, shower, toilet); and, most importantly, they’re right there – in the middle of nowhere when you just can’t face driving another mile for the day.

What I’ve never understood about the design of ‘motels’ in SA is the way that they are built, with the units often separate. To me, building them the way they do in the US is much more logical. By having multiple units in one structure, you save a fair chunk in building and maintenance costs: the units have a common wall; they share the same roof structure; you only have one window per room; plumbing, electricity and ventilation are simpler. It’s also quicker and easier to clean units that are uniform in their layout. All in all, this means that the owners of the motel lay out less up front to build them, and can maximise their profits by not having to spend unnecessarily on maintenance. In fact, motels are very often owned by retirees in the US – they use their retirement package to buy the motel, and then live off of the income it generates. It’s a simple business to run, with minimal effort required day-to-day, and can provide a decent, liveable income. I feel that SA motels, though, have opened themselves up to higher building and maintenance costs, using the layout that they do.

It was thus quite refreshing to see a motel in SA working off a proven ‘model’ – one gets the feeling that the owners have put some thought into it, and I wish them the best of luck with their business. Interestingly enough, our ultimate destination yesterday was a postgraduate village in the university town where my girlfriend will be doing her Master’s degree. From what I had been told, I was under the impression that my better half would be staying in an apartment block. On arrival, though, I was pleasantly surprised to find that her room was a free-standing unit in a little cluster complex, surrounded by similar units arranged in rows. And what had it been used as before the university purchased it? A motel…

Saturday, January 24, 2009

25 years on, and Virgin Atlantic still flying high...

While trawling the Web earlier, I came across a blog post by Richard Branson on his official blog page (http://entrepreneur.virgin.com) mentioning how they have recently celebrated 25 years since the first Virgin Atlantic flight. I am a MASSIVE Branson and Virgin fan - I've read all his books on multiple occasions and follow his businesses as closely as I can - and thought I'd share what I remember about how Virgin Atlantic Airlines came to be...

While on his way on holiday, or en route to a business meeting (the exact details are sketchy in my mind), Richard was due to catch a flight on one of the existing airlines at the time. At very short notice, the flight was cancelled, and he, together with most of the other passengers, were basically stranded as there was not much space on any other airline. People were just milling around in the airport, waiting for news or an update, but Richard decided to do something about it. After realising that there was not much that the airline staff could do (or were willing to do) he walked around the airport, and found where the charter services operated from. He asked how much it would cost to charter a plane to their intended destination, and got a price out of them. He then borrowed a writing board, and went back to where the stranded passengers were waiting around. He set up the board, wrote the cost at the top of the page, and then divided it by the number of people on board, to come up with a cost per person. Pretty much everyone bought into the idea, and they went ahead and chartered a plane. Obviously, everyone was extremely thankful for his efforts, but what must have been a real spur to his entreprenerial spirit was when one of the passengers (an elderly woman, if I remember correctly) went up to him after they'd touched down, and said something along the lines of: "The flight was fine, dear, thank you. Put in some in-flight service, though, and you could even make a business out of this." The cogs in his head must have started turning then and there, and so it all began...

Not only is the story a heart-warming one, but it also summarises a number of the traits that have made Richard Branson (and other great entrepreneurs) so successful:

- Firstly, the do not simply accept what they are told - they question and enquire to find answers. He could have sat there and waited for the airline to make a plan, but he decided to make some enquiries as to alternatives.
- Secondly, they are proactive and realise that action is what counts. He proactively went out and found out what it would take to accomplish his goal; he didn't mention the idea and then sit around.
- Thirdly, they communicate their ideas simply and clearly. He went to where the passengers were, explained what he wanted to do, and displayed it on a board for all to see.
- Fourthly, the know when they are onto a good thing. He didn't just take the compliment as a thank-you for what he'd done - he realised that there was potential for people to use a service like that, who'd be prepared to pay for it.
- Fifthly, they aren't afraid to take risks (after doing some homework). It's not mentioned in the story above, but he had no idea of how to run or start an airline when he decided to give it a go. He believed in himself, though, and was prepared to take a risk and put in the often super-human time and effort required to get it going.

The difference between the entrepreneurs out there, and those not that way inclined, is that the latter group would have simply seen the story as a heart-warming tale with a happy ending. The entrepreneurs among you would have recognised some of the traits mentioned, before I even spelled them out... Which type are you?

Finance Coach - Vol. 5

Here's a copy of my latest message from my Facebook group - Finance Coach (by Gareth Cotten)...

Finance tip: Income

Dog-walking. This is the first of the suggestions for making extra a little extra cash on the side. It's extremely simple: You go around to your neighbours, or people in your area, and offer to walk their dogs for them. It's a very necessary service, as many people are too busy to walk their own dogs, and feel guilty about not exercising them. You can walk a couple of dogs at a time, doing it in the evening after work, and only work on the days you want to. The extra money is not to be laughed at either - if you're organised, you could create a pretty serious income stream (there are many people in the US who do it for a living, and support families on the income). And best of all, you're getting that much-needed exercise and fresh air, while being paid for it!

Business tip: Staff/Operations

Get staff input. Don't ever be afraid to ask your staff for their input on an idea. Some business owners feel that it's a sign of weakness to not dictate every last thing to their staff, but this is a complete fallacy. There could well be an area or function of your business that has been performed one way for years, but is not very efficient. The breakthrough for streamlining it could lie in the mind of one of your employees. Or there could be a business problem that you just can't seem to solve. Your employees could have a different view on it. Ask them if they feel there's a better way to do something - it could save them time or effort, make them more productive, and save you money. Not everything they come up with will be practical or useful, but you don't have to implement everything they suggest. Pick those ideas or suggestions that make the best business sense, and implement them. Even if they don't come up with a master-stroke idea, they will appreciate being consulted, feel more empowered and part of the business, and work harder for you.

Friday, January 23, 2009

SA's top-selling cars for 2008

For those of you interested in who buys what, see if you could have guessed the results of the best-selling cars in SA for last year...

For passenger cars, the list is as follows (with the number sold in brackets):

1. VW Polo (29 476)
2. Toyota Yaris (26 102)
3. Toyota Corolla (24 714)
4. VW Citigolf (15 878)
5. Mercedes C-Class (15 124)

One must congratulate Volkswagen for managing to beat Toyota to the top of the pile - a position the Japanese company has frequently occupied in recent years. For me, the Polo coming in as No. 1 was no surprise. It's good styling, street appeal, and relative affordability (backed by the VW badge) have meant it's been snapped up by everyone from students to 'black diamonds' to busy grannies. The Yaris is a solid choice for second, being small, nippy, cute and going on a whiff of an oil rag. I was quite surprised to see the big gap drop-off between third place, and the evergreen Citigolf, though. This must be a symptom of the much wider variety of cheap, get-you-from-A-to-B vehicles on our shores in the last 2-3 years - meaning that there are other options out there for cash-strapped students and starter-families.

The light commercial market standings were as follows:

1. Toyota Hilux (29 481)
2. Opel Corsa Utility (21 297)
3. Toyota Quantum (20 601)
4. Isuzu KB (17 191)
5. Ford Bantam (11 879)

These positions were quite unexpected from my side. The Hilux coming in victorious is a real coup for Toyota, as I would have expected the Corsa and Bantam to be best-sellers. The latter two are smaller, granted, but they are relatively light on fuel, and very popular with the small-business and student market. I would definitely have put the Corsa ahead, purely on its looks (with it's chunky, agressive lines and colour schemes - yes, I'm a guy) but I didn't expect such a big gap between the two, as they are both relatively affordable little runners. Even though it's not the most fuel-efficient or comfortable vehicle, the Hilux has obviously traded off of it's tough, reliable legacy (goodness knows we needed a haven of reliabilty last year!); and it's well-constructed marketing campaign, emphasising these characteristics, has paid off to win it gold. Toyota's other big baby, the Quantum, can thank the taxi recapitalisation project (as badly managed as it is) and positive sentiment about tourism ahead of 2010 for its bull-run into the top five.

Wouldn't be too surprised to see if the trusty old bicycle makes it onto the list this year...

Wednesday, January 21, 2009

It's no Secret...

Over the last few years, there's been a huge stir caused by the book and DVD The Secret, brought out by Rhonda Byrne. Essentially, what it revolves around is harnessing the power of attraction to achieve your aims and goals. The power of attraction is based on the premise that if you constantly think about and visualise a particular goal, you will accelerate your progress towards that goal.

Now, while I think that it's great that a lot of money has been made off of this book/DVD, and the concept has gained currency around the world, the idea behind it is really an ancient one, and I've been using it for many years - well before the book or DVD came to light. I myself read a version of it in a book when I was only a teenager, and used it all through high school, university and in my businesses. What has prompted me to blog about it here, was how powerfully it worked for me recently.

The basic phrase which I took out of this book (I can't remember exactly who it was by, but it could well have been Dr. Demartini) was this: What you focus on expands. It's short and punchy (thus seeming like a sound bite) but it's really so much more. Basically, what you spend your time and energy on gains more momentum and 'power', for lack of a better word, and becomes more and more real in your consciousness, until eventually it manifests itself physically. I'm not going to get too 'new age' on the whole thing, but wanted to share how it worked for me recently...

At the beginning of this year, I sat down and thought through what I wanted to achieve this year. I had specific goals in the personal, financial and business spheres of my life, and wanted to commit myself to them. To do this, all I needed to do was write them down. This simple act turns an mental idea into a physical reality - the goals you've set are now on that piece of paper in front of you, staring back at you. A goal or dream not written down is only a wish. Now, one of my financial goals was to up my monthly earnings to x amount of money. It was a figure substantially higher than my current level of earnings, and I imagined it would take me a good 6-9 months to reach it. Accepting this, I started working towards it straight away. That same day, I wrote down several different ways I could reach my goal. I could grow my businesses, take on consulting work, start some new businesses I have in the pipeline, or even take on a full-time job working for someone else. My goal was fixed, and I was open to any opportunity to help me attain it, no matter how different it was to what I was currently doing.

Here is where the power of attraction comes into it. If I'd been like most people, I would've simply sat and daydreamed about earning that much money. But I knew that if I focused on it, it would become a reality, so I did. I focused on it both mentally and physically. Mentally, I would sit quietly and picture myself already earning that amount, and what I would spend it on and invest it in. Physically, I started researching other businesses that give relatively fast returns; I got stuck into even more books about successful businessmen and companies; I started looking on jobs sites for the first time in years - anything that would bring me closer to my goal. I even posted my goal in the public domain, by putting in on my Finance Coach group on Facebook. By doing all of this, I was telling myself, and others, that I was serious about attaining this goal. Through all my reading and trawling, I came across a job on offer (in a publication I wouldn't normally read). I applied, was asked to come for an interview, and was offered the position 7 hours later! I've since accepted the position - it seems to be a good challenge, and should allow me to still run my other businesses - and my goal will be accomplished. With the salary from this new job, I will now be earning 500 bucks more than the x amount I had set as my goal.

Now, just think about that. I set a goal based on an arbitrary number, and after focusing on it intensely, I will now be earning almost EXACTLY that amount. Within a month from start to finish! Now, some out there will say I'm just lucky; but I know that because I focused on that goal, and committed myself to being proactive about it, it expanded and expanded until it became a reality. Now THAT is the power of attraction...

Tuesday, January 20, 2009

Finance Coach Vol. 4

Here's a copy of Monday's message from my Facebook group - Finance Coach (by Gareth Cotten)...

Finance tip: Debt

Debt reduction. If trying to pay off various types of debt, make sure to take note of the different interest rates being charged. Generally, store cards, personal loans and credit cards will charge the highest rates, with mortgages and vehicle finance being at the lower end of the scale. Then, to make the biggest savings impact, aim to pay off the debt with the highest interest rate first. So, while, maintaining the minimum payment on all your other debt, put everything extra into paying off the most expensive debt. Once that's paid off, take the money saved from no longer having those particular repayments, add it to the extra from your other debt repayments, and then pay off the debt with the next highest rate of interest. Keep doing this until they're all gone! This way, once each respective debt is paid off, you have a large chunk of extra cash to pay off the remaining debts, and they get paid off faster and faster.

Business tip: Marketing

Email marketing. One of the most difficult things today, with the amount of spam and junk-mail being sent around, is to get potential customers to actually open and read your emails, rather than just binning them as they come in. You can get a much higher read-rate by taking a few extra minutes to work on a compelling email subject line, as well as a heading or headline for your email. For your subject line, using the word 'you' has a strong effect, as the reader feels that the email is specifically addressed to them. Words that inspire action include 'exclusive', 'exciting' and 'introducing'. Also, keep the subject line short, or you risk losing your reader's attention. Now, a good subject line will get them to open the email, but it takes a great headline or heading to get them to read the whole thing. Use exciting adjectives, or action words, to really inspire them to continue reading. Also, ask yourself if the reader will know what's being offered if they only read the header and skipped the rest - is it explanatory enough, while still being punchy?

Monday, January 19, 2009

Education - always a good investment

In yesterday's Sunday Times (one of the biggest Sunday newspapers in SA), I noticed an interesting trend. Normally, at the bottom of the pages, underneath the larger articles, you would find a variety of adverts. These would generally be a real variety, ranging across every industry and service imaginable. What I noticed yesterday, though, was how many adverts Damelin had, all throughout the different sections of the paper.

In short, Damelin is a privately owned college, that specialises in distance learning. Their course selection ranges from short, multi-week certificate courses all the way through to full diplomas taken over multiple years. They have a variety of courses that cover pretty much everything.

Now, distance-learning colleges are nothing new, and generally not that noteworthy. What was interesting to me was how pervasive their advertising was, throughout such a major Sunday publication. It's not cheap to advertise in that newspaper (although they probably would have been able to pressure for a good deal as newspapers ad revenues are taking a hammering - but that's a story for another post), so their campaign is costing them a pretty penny. I personally think it's a very smart move on their part, though...

Around the world, people are having their jobs cut out from underneath them left, right and centre. Those that are managing to keep theirs, are generally the ones who have made themselves indispensable to their companies. These days, having worked for the same firm for 40 years does not make you indispensable - being a multi-skilled multi-tasker does. And this is exactly where further education comes in. If a manager has to choose between you and your colleague in the next cubicle, where you both have the same history and performance, but you happened to have an extra diploma or certificate in something, chances are you're the one who's bacon is secure. And it doesn't have to be an advanced degree in your field either - even a small certificate or diploma in an unrelated field could play into your advantage. It shows that you are open to other experiences, have exposure to another industry or sector and, most importantlty, that you are trying to learn and improve yourself - an asset for any company.

Personally, I aim to learn something substantial every year. Whether it's a new course, a foreign language, an artisan skill, or how to create a following for a blog (like this year), I aim to constantly expand my horizons and skills base. Not only does it make me a more valuable employee (or business owner in my case), but also a richer person mentally, and hopefully more interesting too! So, my advice for those of you who have lost their jobs recently, or have been battling to find one in the first place: Don't sit at home and mope - get out there and sign up for a course, do some volunteer work in a different industry, learn a skill by shadowing an expert, anything - just get out there and do it.

And this doesn't only apply to entry-level and shop-floor employees - it applies to executives too. A few week ago, I went to a talk for a distance MBA. One of the execs there asked the presenter "I'm already a senior exec, why should I study an MBA?". The presenter replied "To keep your job." Everyone in the room nodded their heads in agreement. He went on to explain that there is a breed of younger, more driven professionals coming through the ranks, with these qualifications under their belts, and no-one's job is safe anymore. This sparked an impromptu discussion amongst the delegates there, with many of them saying that they weren't looking at doing the MBA to leap-frog to the head of their respective companies; they were there to keep their current jobs, and to stop being passed over for promotions time and time again. They'd committed themselves to taking up the challenge of doing the MBA, in the knowledge that it would help them to keep their careers afloat

So, to get back to where I started, I think the move by Damelin to get major exposure (especially at the beginning of the year when many people look to change jobs), is a super-clever one, and they are capitalising on this trend for people needing to study further. If nothing else, maybe they triggered a couple of readers into at least thinking about it...

Friday, January 16, 2009

Nail that interview!

In the spirit of it being the beginning of a new year, which is when most people look to change jobs after taking stock during their holiday, on top of the fact that retrenchments are flying around everywhere, here are some hints and tips on how to increase your chances of impressing at an interview...

1. Arrive early
Always aim to arrive at least 15 minutes before your scheduled interview time. Not only does this leave a good impression, but it also gives you a chance to settle your nerves and prepare mentally before you go in.

2. Dress up
The way you dress says a lot about how seriously you take your work. Even if you are applying for a lowly, manual position, dress smartly and neatly in clean clothes. It's always best to phone ahead and ask if there's a specific dress-code, but if you're still unsure, rather dress too smartly than too casually.

3. Personal grooming
Always look your physical best for an interview. This means being washed, clean shaven, with your hair under control, fingernails short and clean, and smelling fresh. Brushing your teeth doesn't hurt either, but don't overdo the mint smell - it can give people the impression you're masking something.

4. Entering the room
When called on to enter the room, walk right on in. Don't hesitate and knock on the door (you've been asked to come in) - it will make you seem timid and undecided. Walk upright and as confidently as possible over to the desk/table/chair. If it's not a huge desk, lean over and give a firm handshake to the interviewer, with a smile. Tip for the guys: If you're shaking a woman's hand, and worrying about shaking too hard, wait for her to apply pressure, and match the pressure exactly. Then put your briefcase/effects down, and take a seat. Don't fiddle with your case/paperwork too much, rather have it ready at hand.

5. Do your homework
Before going for an interview, do as much research as you can about the company. Visit their website, read their brochures, speak to staff members - absorb as much as you can, and use this knowledge when constructing answers to questions. This will show you have initiative, which always counts in your favour.

6. Body language
When sitting, don't cross your legs at the ankles underneath your chair - it makes you look nervous and juvenile. Rather sit with your feet flat and facing forward if you're a guy, or with one leg crossed over the over if you're a girl. Make sure that your hands aren't fidgeting, or in your pockets - rest them on the arms of your chair or on your legs. Don't slouch, but don't sit like you've got a vegetable up your ass either - you'll look lazy or arrogant (or like a veggie-porn freak). Leaning slightly backwards shows you're relaxed, while leaning slightly forward shows you're attentive.

7. Questions and answers
This one's up to you. Answer truthfully (professionals can tell when you're lying or exaggerating), and don't take too long to answer or fumble over looking for the right word. Try and put your experience into the context of the question/company. Also, don't forget that an interview is a two-way process - you're allowed (and expected) to ask questions about the company or position on offer.

8. Ending the interview
The interviewer will generally make the first move when closing the interview (by saying so, or closing your file/CV). Once they've said their last, stand tall, thank them for taking the time to see you, and shake their hands firmly again (if possible). Pick up your possessions and walk out proudly. If you're choking in your collar, sweating like a pig, or barely controlling your anxiety, keep walking upright and make sure you're well away from the building before loosening your tie or throwing up in a dustbin...

Good luck!!

Finance Coach Vol. 3

Here's a copy of my message to my Facebook group - Finance Coach (by Gareth Cotten):

Hi everyone,

Here's your Thursday instalment...

Finance Tip: Income

Make a little extra. Everybody reading this (and I mean EVERYBODY) could use a little extra cash here and there. While some may think some of the suggestions that will be forthcoming might be below them, others might find them to be just what they need. Whether you use the extra to boost your savings, pay off some of your debt faster, or to save up for a special holiday or treat, the principle of making a little extra is a sound one. Think of something you enjoy doing, but couldn't quite do as a full-time career. Maybe it was how you used to make pocket money as a kid, or you saw someone else doing it and thought "That could be interesting". Focus on things that don't take up too much time, and are reasonably flexible in terms of how often you need to do them. There will be suggestions in future instalments of Finance Coach, so keep a look out. You never know - they could spark a sideline business, or even an empire!

Business Tip: Competitors

Form coalitions. Whatever industry you find yourself in, it's likely that you'll have competitors. They might be bigger, smaller, established, or just starting out, but you'll definitely have one thing in common - competing for market share. In the current business climate, it's quite likely that you're all taking a knock, so why not go against the idea of "competition" and work together? Now, you don't have to share trade secrets, or start a cartel, but there are ways that you work together to benefit everybody. There could be excess demand for one of their/your products which they/you can't fulfill - why not pass it along, rather than lose a customer to the industry? You could collaborate on a marketing initiative to draw customers back to your industry, or share resources to bring down costs. You could work on a commission system, or on a like-for-like basis. You never know - they could be in exactly the same position as you, wanting to reach out, but afraid to make the approach. So make the first move, and open up the possibility of a good, positive relationship, where everyone benefits.

Yours in finance,

Gareth Cotten

Tuesday, January 13, 2009

Sleep your way to the top...

For those who know me well, I am a bit of a stickler for getting my 8 hours sleep a night. Running my own company definitely helps in that regard, as I'm generally able to wake up when I want to if I've been working late into the night. Some people gasp and ask "What kind of businessman are you if you only wake up at 10am?!?" Well, I found an article that supports my thinking on the matter...

A Harvard report has broken down the impact and functions of the different stages of sleep. It is generally accepted that there are 4 stages of sleep. Stages 1 and 2 are light sleep, where we disconnect from the world around us. Stage 3 is known as deep sleep, where brain and body activity drop to their lowest points. Stage 4 is REM (rapid eye movement) sleep, where our brains become particularly active and we dream.

Now, we all know that sleep is important for our brains and bodies to recuperate, but there are actually very different functions that happen during Stage 3 vs Stage 4. Deep sleep is essential for physical recovery and growth - so this is what you need when you've been sick, on your feet all day, working out at the gym, etc. When deep sleep's in short supply, you're more likely to get sick and gain weight. In REM sleep, however, the brain processes memories and emotions, which is crucial for learning and higher-level thought. A shortage of this type of sleep can result in slower mental processing, as well as memory and concentration issues. For business owners or managers, the complex, strategic tasks which make up most of your day become exponentially harder when short on REM sleep.

The report also found that optimal amount of sleep is 7-8 hours a night. Many people brag about being able to manage on 4, 5, or 6 hours a night (psycho's!), but they are actually doing themselves a disservice. When faced with a shortage of sleep, the body chooses to forgo REM sleep and opt for lighter sleep. This means that higher-level cognitive functions (like strategic or out-of-the-box thinking) are restricted, and you actually perform at a much lower level than you are capable of. You can also miss out on subtleties in conversation, making reading-between-the-lines that much harder - which could impact on networking and negotiation skills.

I might sound a touch arrogant here, but I pride myself on being alert and open to stimuli that surround me every day. I absorb a lot of what I see and experience, and try to relay it onto others and their current situations. I can now see that this could be due to my striving to always get a decent 8 hours sleep. It means that I have a better chance of interpreting something which I come across, and perhaps taking it on-board and using it in my business or personal life. Many of my colleagues and peers (in 8-5 employment) miss a lot of what goes on around them, and only realise it when it's pointed out. The report also mentioned that later sleep cycles tend to have longer REM periods than earlier ones. This might be another advantage for me, as I'm quite a night-owl, and rarely go to bed before 1:30-2am!

So don't short-change yourself when it comes to sleep. You're the only loser if you do, and you could be holding yourself back from personal growth, or that next big brilliant business idea!

Sunday, January 11, 2009

New low-cost airline for SA?

In recent weeks, I've been following reports of a new low-cost airline launching this year. Called Airtime, they aim to steal a march on the market by having cellphones as their major medium for ticket sales.

The Operation:

From what I can tell, they are starting out by leasing three Boeing 737's for a period of 6 months. Their ticket and pricing structure is a novel one: instead if using the internet as their major sales channel (as other low-cost airlines do) they are planning on having people buy 'Airtime' through their cellphones. You would SMS a number, specifying how many units of Airtime you want to buy, and it would be added to your cellphone bill. The Airtime that you buy is then exchanged for a flight ticket. The novelty is that you can use your Airtime for any flight on any of their routes. The amount of Airtime required is approximately equal to the flight time of your flight - eg. if you were flying from Durban to Jo'burg, you would need 75 minutes of 'Flytime'. The price of Airtime is then multiplied by the current rate on offer to come out with the ultimate cost of the flight. For example, the usual rate may be R5 a minute. For a flight from Durbs to Joeys, you would then pay R5x75=R375. For higher demand flights, the price per minute, or multiplier, would increase to say R6 or R7, increasing the overall cost of the ticket. Specials or promotions may then come out, offering minutes at R4 or R3 each. From what I can gather, this would allow you to pre-buy airtime when a special offer is on, but only use it later in the year when you needed it. The supposed kicker is that any Airtime you don't want to use is converted back into standard cellphone airtime by your network. They will also have the usual internet and phone-in ticketing options as well.

Based out of Durban (which they say is the playground of SA), they are looking to initially operate the Joburg-Durban route, and then add Cape Town in the very near future.

The issues:

The major one is that they're not operating as a separate entity, but working off a licence of Aquarius Aviation from Lanseria (whom they are also leasing the planes from). Now, while this keeps initial costs down, it is causing problems with licensing and getting authority to fly from the aviation authorities. They have already marketed their flights as commencing in mid-January, but they seem to be hitting some resistance from the CAA (Civil Aviation Authority), who are apparently only due to meet towards the end of the month to decide on granting the licence. This could mean an embarassing backtrack on their promise to be flying, and could dent their credibilty seriously before they even get off the ground. Nevermind how bad it would look if the whole thing gets canned by the CAA!

Also, their marketing reeks of inefficiency and haste. There have been many complaints and comments on bulletin boards on various websites about how their website was not up yet, and no call centre numbers went through (although those were older comments - the website was online when I tried it). Their 'i-Fly' logo is FAR too similar to the 1Time one (with the red tailwing featuring); and, while summarising the service nicely, the whole name 'Airtime' is too easily confused with more-established 1Time's, diluting their brand value immediately. Also, for a company positioning itself as a credible threat to the incumbents in the industry, there's been very little media buzz about their potential entrance (I only happened to spot it as a small mention in a small article in a minor newspaper). This is a symptom of some very bad PR and a mish-mash marketing strategy. If I think back to the launch of some of the other low-cost airlines, they stirred up a fair amount of hoo-hah when they launched. Granted, maybe it's Airtime being cautious, but they could be doing a heck of a lot more...

Also, being based out of Durban is puzzling to me. The other entrants have started on the lucrative Joburg-CT route, and seem to be doing okayish. My first impression is that Durbs is all they could get as a base, but let's see if they prove me wrong.

So, in summary, this could be an interesting time for aviation in SA. I'll be following this one closely, so keep checking for updates, but if they don't jack themselves up soon, this airline could struggle to take off...

Saturday, January 10, 2009

Murphy's Law

Ever wondered where the phrase "Murphy's Law" came from? It actually has a factual beginning...

In 1949, the US Air Force wanted to test out the effects of G-forces on pilots. Edward Murphy, an accomplished pilot who moved into aerospace testing, was involved in these tests. When testing the effects on a volunteer, his assistant messed up applying the sensors to the volunteer's body and, after putting the poor volunteer through much pain and injury, there were no readings to use for his study. Murphy was obviously furious, and this was mentioned during an interview with the volunteer after the experiments, when he said that "Murphy's Law means that whatever can go wrong, will go wrong". The press picked up on the coined phrase, and it gained currency through widespread usage.

Since then, there have been a number of variations - such as Finagle's Law, which states that 'anything that can go wrong will, at the worst possible moment'.

To quote a postcard I bought in Ireland, here are a couple of Murphy's great Laws:

- The other queue always moves faster
- You play your best golf shots when playing alone
- Friends come and go, but enemies accumulate
- The chance of a slice of bread falling butter-side down is directly proportional to the cost of the carpet
- The repairman will never have seen a model quite like yours before
- A short cut is the longest distance between two points

And finally, Murphy' Golden Rule: Whoever has the gold, makes the rules...

Thursday, January 8, 2009

Petrol pump pleasure

Went to put some petrol in my car yesterday (I hesitate to say 'fill up' - see the explanation at the end of this post), and what a pleasure!

Thanks to a sustained drop in oil prices globally, we here in SA have had two substantial price decreases in the prices at the pumps over the last two months. This has meant a drop of nearly 33% since October (from roughly R9 a litre to about R6 a litre), on top of some smaller drops before October.

The real difference is in how people perceive it, though, and everyone will have a different outlook on what a drop in prices means to them. For me, I generally put R250 worth of petrol into my car at a time (2.5l BMW). As prices reached their peak near the middle of 2008, I had resigned myself to the fact that my petrol gauge would only slide up to slightly less than half a tank. The effect of the drops in price really hit home yesterday when, after putting R250 into an unusually empty tank (I don't normally go down to my warning light), my gauge jumped up to the three-quarter full mark! What a beaut! In my car, I get roughly 10km/l, so I was getting 240-260 km's each time I filled up 6 months ago. Now, I should get closer to 400-420 km's per stop at the garage. For me, that's the equivalent of an extra 12 return trips to my girlfriend's house - although if I were to visit her that often, she'd probably throw a fit!

Now, the reason I fill my car up with that specific amount is a sound one. If you only put in small amounts at a time, you are doing yourself a serious disservice - you 'lose' more petrol if your tank is emptier, as there is more space for fumes to form, and you lose a fair amount to evaporation with these fumes escaping. You also spend more of your hard-earned money making small detours to petrol stations as you have to 'fill up' more often. On the other hand, unless you're driving long-distance, it's not advisable to fill your car up to the brim - you lose a percentage of your fuel to increased fuel consumption, due to the extra weight associated with carrying that much fuel. Hence, my happy medium of filling up somewhere between a half and three-quarters of a tank...

Happy driving!

Finance Coach - Vol. 2

Here's a copy of the Thursday instalment of my Facebook group - Finance Coach (by Gareth Cotten)...

Finance tip: Savings

Pay yourself first. The single biggest excuse people use when explaining why they don\'t save is \"I don\'t have any money left at the end of the month\". Well, quite frankly, that\'s doing it the wrong way round. If you are truly committed to saving up a nest-egg, or building wealth for retirement, the first \'bill\' you should pay every month should be your savings. Think about it: By paying your bills first, you\'re saying that you\'re month-to-month expenses are a higher priority than your financial well-being in retirement. If you believe that, then I hope you know how to live off a social grant when you\'re 65! By \'paying yourself\' first, you are committing yourself to being financially secure when you need it most. And what about that extra bill now not getting paid, you ask? If you\'re worried enough about getting it paid, you WILL find a way to make the extra couple of bucks to do so - the human mind has an amazing capacity for innovation when it\'s forced to use it.

Business tip: Strategy

Adaptability. In the previous edition of Finance Coach, I wrote about focus. At first sight, you might think that focus and adaptability are at odds with each other. Well, they\'re not. Whatever type of business you run, you should focus on what you\'re good at, yes, but not to the point where you\'re completely overzealous, and closed to any other opportunities. Always have an eye out for aligned opportunites, close to your current service or product, that have good prospects. Take, for example, the web photo-sharing company, Flickr. When they started out, they were building a program to share photos and messages within a multi-player game. They realised that the program they were building had huge potential as a stand-alone business, and tweaked it to become the huge success story it is today (a multi-million dollar world-wide business). Now, they were focused (they stayed within the program-development sphere that they were good at) but they were adaptable (they weren\'t stubborn about only using the program in the game, and were prepared to make some changes for wide-spread usage). Look at what you are doing at the moment, and ask yourself whether there are any potential adaptations you have thought of, or turned down, recently.

Wednesday, January 7, 2009

How NOT to run a transport company a.k.a. the Roadlink mess

For those of you who haven't been following the story in the news lately, here's some background: Roadlink is one of the larger cross-country bus services operating country-wide here in SA. They have had a few high-profile accidents, scattered around the country, in the past few years, but they've managed to get past them (it's bound to happen every now and then, sadly) and carried on operating. In the lead up to the Christmas season, though, they started having a number of incidents which made the headlines - partly due to the increased traffic enforcement on the national roads at that time of the year.

This culminated in their operating licence being withdrawn in the province of Kwa-Zulu Natal, meaning that their vehicle were not allowed on the roads at all. This was due to a number of accidents (with fatalities) involving their buses, as well as a number of their fleet being found unroadworthy during spot-checks by the authorities. They cried foul, and appealed the decision, which was suspended until this month, allowing Roadlink to operate during the peak season.

What pushed me to write this was reading an article two days ago about how one of their buses, operating on Kwa-Zulu Natal route, was pulled over and impounded for being unroadworthy. The clanger was that their full load of passengers was left to stand in the blazing sun for FIVE HOURS until another vehicle came to pick them up! Now, I've run a successful transport company since 2003, so I feel qualified to comment on this mess.

Firstly, dealing with the latest article, if you are going to run a transport company (especially a long-distance one) you ALWAYS need to have a contingency plan. Vehicles break down, get stuck in traffic, get re-routed due to roadworks and run off-schedule all the time, and you need to cater for this. Whether this means having one vehicle on standby at all times, or having support agreements with other operators, you have to make sure that your customers are inconvenienced as little as possible. The people using yor service often have somewhere to be, at a specific time, so don't screw them around. This need for a contingency plan actually applies to all businesses.

Secondly, if you run a transport company, why do you have unroadworthy vehicles on the road? Especially if your vehicles are large and passenger loads are generally full or close to it! Do you WANT to have an accident to get your company into the headlines? Now, I fully appreciate wanting to maximise revenue at the peak season of the year (especially when many industries are struggling), but you CANNOT do so at the expense of people's safety. Keep your downtime to a minimum, yes, but make damn sure that your vehicles meet basic roadworthy requirements!

Thirdly, the management is guilty if some horrible PR practices, and herein lies a lesson for all businesses. When the province decided to revoke their operating licences, Roadlink management made excuses and claimed that they were being unfairly victimised, with their vehicles being targeted by the authorities for inspections. Lesson: When under attack, or on the receiving end of criticism, never, never, never play the victim card or get defensive. Your customers already have a negative opinion of you (which is why you're getting criticised). The last thing you should do is get defensive, or you lose any last strand of integrity. Apologise, and clearly lay out how you will fix the problem - don't blame others. Would you rather be right, or in business?

In this case, Roadlink should spend whatever it needs to ensure that every last one of its fleet is roadworthy - even if every vehicle is stopped every time it travels. No exceptions. They should then aim to have an impeccable safety and arrival/departure time record for the next 6 months to a year. This should build back some lost credibility. If they don't do this, it could be the beginning of the end of the road for this bus company...

Tuesday, January 6, 2009

Finance Coach - Vol. 1

Here's a copy of what's on my Facebook group - Finance Coach (by Gareth Cotten):

Finance tip: Utilities

Saving water. One of the easiest ways to save water, and reduce your water bill, is by 'managing' the use of your toilet/s. The average flush can use up to 11 litres of water at a time (picture 5 and half big bottles of Coke), so just imagine how much money you are literally flushing away! For a cheap solution, put a brick in your cistern (the big ceramic thing generally above and behind the toilet seat) - your toilet will fill up less each time it's flushed, and save wastage. If you can afford it, consider putting in a 'two-flush' system, where you have an option of a light flush or a full flush - it will pay itself off pretty quickly if used correctly.

Business tip: Strategy

Focus. It may be tempting to spend most of your time looking at other options for your business, or other industries entirely, convincing yourself that you are focused on growth. This is quite common when a business starts to stagnate, or fails to take off as expected. A trait of successful businesses, however, is focus. They focus and concentrate on their particular industry, products, services and strengths, and aim to consolidate on these. Only once they've achieved this, do they look at growing into other areas. If you feel frustrated with your current business, but aren't actually spending that much time working on it, rather use some of your 'browsing' time to get back to basics on your business - re-look at your business plan, assumptions and business model, spend time on your marketing strategy, get on top of your finances, etc. These simple steps can inject new life into your business, and may re-ignite the passion you once had for it.

Most dangerous things to eat/drink while driving

Apparently, an major insurance company has published a study of the most dangerous things to eat and drink while driving - ie. things that are most likely to cause you to have a smash. These are the top 5, in reverse order:

5. Coffee - This is a pretty obvious one. It's damn easy to spill (even if it's in a flask), and if you do spill it, it's likely to burn your chest/stomach/crotch one-time, causing you to swerve like a drunk judge.
4. Soup - Seriously, people eat soup while driving? Why not rice with chopsticks while you're at it? Apparently, according to the report, the major problem comes in when people try to change gears while holding the soup container.
3. Fried chicken - This told me it was an American study. The issue here is that the inherently oily nature of fried chicken means that your hands are oily, and this is then transferred to the steering wheel, which then makes you slide all over the road and mung into walls/trucks/large women (probably like a drunk judge). I can't personally imagine eating KFC while driving, but hey, pass the corn-bread...
2. Soft drinks - I thought this would've been number one, as it logically seems to be the biggest culprit. People think it's easy to hold a can or bottle while steering, but negate to take into account that it tilts when you turn the steering wheel (and we all know that no car maker makes cup holders that actually HOLDS cups). Results in you sitting in a nice puddle, which is difficult to explain to your boss/client/spouse. So you try and dab it up, take your eyes off the road, and end up through some little old lady's vibracrete wall...
1. Chocolate - Surprising winner. Must be because people think that you can't possibly go wrong with eating a chocolate bar - it's small and doesn't leak. Well, they're wrong. We all know that that one piece of warm, soft chocolate will fall onto your clean white shirt, or your neat, pressed pants, and you'll feel that your clothes are ruined. So, you'll try valiantly to scrub at it (only making it worse), take your eyes off the road for a second too long, and... whammy!

Monday, January 5, 2009

Good showrooms make good neighbours

We've just had some new neighbours move into the house across the street. Now, I know this is not normally the most exciting thing, and probably not something you want to spend time reading about - but it gets better...

Our new neighbour came over on the weekend to introduce himself, and ask us to sign a planning statement as he'd like to do some alterations to his property. Firstly, this struck a chord with me because this is normally the last step in the drawn-out process of doing alterations - most people hate the idea of begging for their neighbours' permission, and some even circumvent the process entirely by bribing city officials to approve it without the necessary consent! What really hit home, though, was when he said he was a classic car enthusiast.

Now, for those that don't know me, I am a complete nut-job when it comes to classic cars, and I have a serious soft spot for spending money on them! The last one I owned was a 1974 Mustang - it was a fully imported left-hand drive, and I just couldn't resist it. I didn't have the money for it, but somehow scraped together a deposit and financed the rest. Now I lost a little bit of money when I sold it (because I'd spent a small fortune redoing the engine), but it was worth absolutely every penny - for the sheer enjoyment I got out of owning and driving it, not to mention the long, envious looks I got from nearly every man (and often the woman on his arm) when driving past.

Anyway, back at the ranch... So, while chatting to the neighbour, he mentions that the alterations are actually for him to build a showroom onto the side of his house - for him to showcase some of his classic car collection! What a guy! Now, we don't live in the semi-rural area on the outskirts of town, or in the commercial hub of the city. We live in suburbia, just as you see it in the movies. And this guy wants to build a showroom for classic cars across the road from our front door! I'm sorry, but somebody up there is definitely looking out for me, and clearly wants me to stay put for the foreseeable future :)

Now, if only all my neighbours wanted to build classic car showrooms - I'd sign the consent forms faster than you can say Shelby GT500...

Sunday, January 4, 2009

A new year, and a new blog

This is my first foray into the world of blogging, so bear with me...

The aim of this blog is to try and write down some of the 25 000 things that tear through my mind every day. By doing so, it might help me distill some of these thoughts, and perhaps organise them into some form of order. Hopefully some part of them will trigger something in you - appeal to one of your interests - and I will be able to expand your awareness and knowledge at the same time.

I don't claim to be an expert on everything that I write about, but I feel I've had a pretty interesting life, and have absorbed plenty into my open mind as I've gone through it. Some of it is useful or interesting, some motivational or 'self-help' in nature, and some of it just downright random. All I can hope for is that some of it appeals to you in some way, because I know it's made an impression on me!

I don't want this to be a blog about the minutiae of my life ('today I had ham for lunch, and then went for a nap'). While I'm sure that they serve a purpose for the people writing them, I can't help but feel that those types of blogs lack substance. I want this blog to be something that people really look forward to reading, and come away feeling that little bit richer as a person - where they never know what they're gonna get on a given day, but they wanna find out anyway. This will be more about my observations of life; or lessons that I have learnt; or stories that I feel need to be told. It could be on subjects that I'm interested and experienced in (like business, entrepreneurship, languages, sports, relationships) or on subjects that I barely know anything about.

I'm sure it will develop its own character as it goes along, so welcome to it...

(And why 'Good Feathers', you ask? Because a client once asked me, after I'd solved a tricky situation for him, "How old are you, by the way?". At the time, I was only 22, and said so, adding "I'm but a spring chicken". His reply, which has stuck with me to this day, was: "You may be a spring chicken, but you've got some good feathers!")