Posts Tagged ‘Home Depot’

Comparing Some of the Big Box Retailers August 31st, 2010

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There are small businesses, and there are big businesses, and really big businesses.  Some of the biggest companies in today’s global economy are the giant retailers such as Home Depot, Lowe’s, and IKEA, also known as ‘big box stores’.  To analyze and compare these three is interesting because both Home Depot, and Lowe’s are U.S.-based, publically traded companies, while IKEA is a European, privately-held company.  In the next few paragraphs, we will look at how these companies stack up in terms of size, revenue, international reach, and history.

First, let’s take a look at who is the biggest retailer when measuring by numbers of stores and employees.  Through this unit of measurement, Home Depot is the largest of the three with 2,200 stores and over 320,000 employees.  Next up is Lowes with over 1,700 store locations and 235,000 employees.  IKEA is last in this leg of the analysis, with over 300 stores and 125,000 employees.

In terms of annual revenue, the 3 chains shake up in their overall order a little bit with Lowes stores tallying up a whopping total of $47.2b in 2009, followed by $41.2b in 2009 for the Home Depot stores, and $28.9b in 2009 revenue for IKEA stores.

In terms of International reach, the European-run IKEA stores are by far the farthest reaching, with their retail outlets spanning 37 countries throughout North America, Asia, Europe, and Australia.  Of the two American companies, Home Depot stores are located in a few more countries than Lowes stores, boasting retail chains in Puerto Rico, the Virgin Islands, Mexico, and China in addition to North America.  Lowes stores are found strictly is the U.S. and Canada.

As far as which giant has been around for the longest, that title would go to Lowe’s, having been founded in North Wilkesboro, North Carolina back in 1946.  IKEA opened their first store in Småland, Sweden in 1958.  Home Depot is the youngest of these three, having been founded in 1978 in unincorporated Cobb County, Georgia.

So given how these 3 big box giants measured up in size, revenue, international reach, and history, which store would you consider to be the most significant in today’s economy?  It’s certainly a debatable question!

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The Chase Platinum Card’s Flexible Rewards Program: How Does It Compare? January 6th, 2010

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The Chase Platinum Card is now offering a no fee “Flexible Rewards” program. The Chase Flexible rewards program is unique in that it provides consumers with the opportunity to choose their rewards from a variety of categories, including travel, cash back, merchandise, and retail gift certificates. However, with the ability to choose your rewards, also comes the task of figuring out how to get the most value out of the points you earn. Here, we will examine the value of Flexible Rewards points when used for each rewards category and compare this program with more specific rewards programs.

Earning points with the Chase Platinum Card is a straightforward process: consumers receive 1 point for every dollar spent. However, the value of each point earned will vary from reward category to reward category. The following are hypothetical examples of how choosing the right reward is the key to getting the most value out of your flexible rewards:

Redeeming points for merchandise rewards with just about every credit card on the market is usually a tremendous waste of points. For example, a $2000 flat screen t.v. might cost 400,000 points. This is generally not a bargain. The same is true in this case. However, smaller merchandise items, such as CD’s and DVD’s, are good redemption deals, as they often require 1500 to 2000 points, or roughly 1 point for every cent that would be spent on the item. Overall, however, the best value usually comes in the form of gift certificates and cash back rewards.

Retail gift certificates generally cost points that are inline with the gift certificate cost. For example, a $50 giftcard would require 5,000 points. With giftcards available from a wide range of major retailers ranging from the Gap to Home Depot, using flexible rewards points to obtain gift certificates can provide solid overall value.

Cash back rewards work very similar to giftcard rewards. A set amount of points, such as 1000, can be redeemed for a cash back reward of $10. Since cash back puts money in your pocket, cash back rewards, like giftcard rewards, are a means to get the most value out of your points.

The final Chase Flexible Reward category is travel. As with most travel rewards programs, the best way to utilize this type of reward is to redeem it towards free airline miles, as opposed to trip packages, which are the equivalent of using your points to buy that flat screen t.v. When you redeem points for miles, which then discount your airfare, you essentially maintain the point value of 1% of every dollar spent.

The Chase Platinum Card with Flexible Rewards offers consumers what it advertises: flexibility in using rewards points. However, credit card “rewards junkies,” i.e., those who use their credit cards for every purchase to obtain the most value for their spending, will likely benefit more from a traditional rewards program. For example, frequent flyers can definitely reap greater rewards with a traditional miles credit card like the Citi PremierPass or American Express’s Blue Sky which offer free miles and bonus mile opportunities.

Those who prefer cash back rewards might be happier with a traditional cash back credit card. Although interest rates have risen on cash back credit cards that offer 5% cashback on everyday purchases, those who use a card like the Citi Dividend Platinum Select or the American Express Blue Cash and pay their bill in full each month can literally “cash in” a great deal more than they otherwise could with 1% in flexible rewards.

Overall, the Chase Platinum credit card with Flexible rewards provides its best value to consumers by offering a 0% interest rate on purchases and balance transfers for up to 1 year, and a lower APR than most rewards credit cards. However, for credit card “rewards junkies,” more traditional category specific rewards cards will reap them the most rewards.

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How to Design a Sound Investment Portfolio July 24th, 2009

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Investors in stock market, especially the new ones, often get jittery over the stock market fluctuations and seek to build a volatility proof portfolio. For them what matters most is not that they should make huge profits, but that they should make reasonable profits without suffering losses. The problem acquires crucial significance during the times when inflation rules the roost and economy comes under severe strain.

In such circumstances, it is always advisable to look for stocks that have a competitive advantage in the market. Stocks of the companies that manufacture daily- use consumer products such as toilet paper, mouth wash, tooth pastes, detergents, laundry soaps, breakfast cereals, soda and so on generally have a greater competitive advantage over industrial products. These are staple necessities of daily use and their demand never dwindles in normal circumstances. Is any one going stop brushing his teeth, washing his clothes or eating breakfast if the economy goes bad?

It is not difficult to find such stocks. They are known as blue chip stocks. The blue chip stocks are usually owned by large manufacturing or supplying companies and they are generally the household names in the country. They make up the Dow Jones Industrial Average. Some of the well known blue chip companies include American Express, Coca Cola, Home Depot, Wal-Mart, Tesco, Proctor & Gamble, McDonald’s, Exxon Mobile, General Electric, 3M, Altria, Johnson $Johnson and so on. You can choose one or two such blue chip stocks for your portfolio.

Then there are companies, which have large share repurchase programs. Companies with large capital base such as Coca Cola and AutoZone regularly repurchase huge amounts of their own shares to sustain the value of their stocks in the falling market. This step also builds the investors’ confidence.

The basic guiding principle in stock investing is that you should invest only the amount that you can easily spare without squeezing expenditure on your daily needs. Do not spend any money into any stock if you need it soon after you invest. You should be prepared to wait for at least two to three years so as to allow the law of averages work in your favor.

Diversification of portfolio is often cited as unfailing age old wisdom. Diversification does not mean only investing in a variety of stocks, but it also means a kind of portfolio, which is comprised of both investment and trading stocks.

Both these kinds of stocks can be further diversified. For example, investment stocks can be classified as long-term investment stocks and short-term investment stocks.

Long term investment stocks have a life time horizon. Examples of these stocks are: Individual Retirement Plans and Education savings plans. Again, these plans too have different categories. For example, in Individual Retirement Plan you can open a Traditional IRA, Roth IRA and Rollover IRA. Besides these there are other retirement plans such as 401(k) or 403(b). They have their own investment options in respect of the time spans, tax benefits and liabilities.

Short-term investment plans span over considerably shorter periods than life term plans. You invest in a good value stock and wait for, say, three to four years and sell it off as soon as you have made a considerable profit. These plans are supposed to substitute fixed term deposit plans. Since there is an element of risk in stock investments, they generally yield better returns than investments in securer deposits.

Besides the investment plans, there are stock trading plans. They are not ‘plans’ in the sense that the concept of planning involves certain– usually long– span of time. They are ‘plans’ in the sense they involve building strategies to make money through quick stock trades in one day. It is called day trading. A’ quick’ stock trade may be closed within a matter of few minutes to few hours of the trading day– starting from the time the stock exchange opens to the time it closes for the next day.

It must be noted that this kind of stock trading is not meant for new entrants in the stock market. Success in day trading requires long experience, trading expertise and an intuitive understanding of the business of stock trading. You need to have nerves of steel to brave the mercurial fluctuations in stock prices and take decisions in a flash of moment. It must, however, be noted that these instantaneous decisions taken apparently on the spur of moment are generally based upon certain amount of homework and planned strategies.

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Home Depot Discontinues Their Business Rewards MasterCard Issued by Citi Bank July 12th, 2009

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Just the other day I suggested to a client who invests in real estate to apply for the Home Depot Business Rewards MasterCard funded by Citi Bank. It is one of the few cash credit products that doesn’t require a personal guarantee as long as the business has excellent credit. I went to Home Depots website to apply for the card for my client, and I didn’t see the application. Which prompted me to call customer service to investigate. I was informed by a customer service representative that the card has been discontinued by Home Depot. Home Depot stop taking applications for it the first of December, and existing card holders would be transitioned into receiving a Citi Bank business credit card. This is just another example of business creditors changing their lending programs faster than business owners can establish Corporate credit files.

Wells Fargo has made significant changes to its business credit programs. Six months ago Wells Fargo discontinued there secured business credit card. Which is a much needed product for a start up business in this current economy. They also changed the guidelines for their corporate account credit card. Last year a business was able to establish up to 100k line of credit solely in the company’s name without a personal guarantee. Now they require personal guarantees on all their business credit cards. I spoke with a business relationship manager based in California for Wells Fargo on the phone. He informed me that a company would need strong business credit scores from D&B and Experian to qualify. In addition to having excellent personal credit. In other words 50% of the approval is based on business credit scores, and the other 50% on Fico scores.

Bank of America recently established a market in Michigan, and they don’t offer any business lending or leasing in the state of Michigan. A branch manager told me that earlier this year Bank of America was going to roll out special lending programs for start up businesses, but changed their mind several months before the full takeover of La Salle Bank was completed .They still offer a business credit card. However the business credit card had a 35k limit several months ago, and it has been decreased to 25k. Currently Bank of America basis the approval solely on your personal credit report. I find it strange how a bank as large as Bank of America doesn’t check a business credit report. A business could have tax liens, judgments, and behind in all their accounts & Bank of America would never know their making a high risk loan. They also discontinued their 203k program, which was backed by HUD.

If banks keep tightening their commercial lending requirements it’s my prediction they will further hinder the economy from rebounding. We need more small businesses to create jobs, offer services, and innovative products to help the U.S. economy grow stronger. Large corporations like General Motors bullying the Federal government to bail them out because of weak financial management. Strengthens the fact Americans can’t place their financial security in the hands of CEO’s of large corporations.

I recommend business owners to use due diligence when selecting a financial institution. If they don’t support your dreams and goals, why support their bottom line. Credit unions are now starting to cater to business customers. If you can’t find a bank you like visit your local credit union.

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