A reporting from New York Times states General Electric, a multi-billion-dollar firm, had paid zero taxes to the US government in 2010 because the tax department base financials decision on tax deductions and loopholes.  General Electric, however, has overlooked on how much is actually saved from these decisions because millions of dollars is spent on how to avoid taxes when this can be spent on improving the overall value proposition of the company, such as products development.  Marginal Revolution, an external blog, points out that the New York Times based their calculations of profits according to GAAP instead of IRS which then casts doubts on its analysis of General Electric.

The blog user explains difficult concepts and business terms thoroughly which I thought was useful when understanding the situation.  This is an interesting blog post because it is surprising what kind of actions a multi-billion dollar company take on just to dodge away from paying taxes.

As a consumer point of view, even if the New York Times calculates according to IRS, the negative news about General Electric avoiding taxes may consequently lose customer loyalty on its brand because one may question on the business’ ethics.

Innovation has yet again proven to surprise us! From Chelsia’s blog, she discusses the first gold vending machine introduced on the popular Wangfujing Street of China. Due to gold prices constant skyrocketing, there is a demand for this commodity and creates a solid investment to consumers.  To accommodate for this demand, gold vending machines will convenient consumers’ accessibility to purchasing with acceptance to direct cash and bankcard.  After reading the article, I became concerned about whether this invention will change consumer’s value on gold.  Since typical vending machines dispense snacks and miscellaneous items and usually socially overlooked upon and now, by introducing gold to be dispensed from these machines, the value of gold seems to be in question.  My question is whether will this invention have positive or negative effects on the demand for gold.

Micro-finance,an idea proposed by Muhmmad Yunus, a Noble Prize-winning Bangladeshi economist, is to act as a social business solution in developing countries.  However, when decisions about how the poor should receive financial support plunged the microfinance industry into a crisis.  The concerns revolved around the question whether there was a need for a reliance from modern financial institution’s assistance (raise the funding in capital markets) , or support from non-profit sources. C.K. Prahalad, an Indian management guru, suggested that the poor should start up their own business to yield healthy profits, which then can also satisfy shareholders while promoting social development. In great surprise, Bangladesh’s Grameen Bank, which depends largely on donor grants and sustainable repayments, have not been affected from any of these problems.  As a result to the crisis, it has lead to Dr. Yunus’ ouster. It is to one’s wonder whether microfinance is a social sustainable solution since it also brings about to many political conflicts.

According to Angus Todd’s It’s the right time for Coffee, he addresses McDonald’s aggressive marketing campaign of giving away free coffee (about 60 million cups to date) as a wise marketing decision for the company to gain valuable market share. He also addresses Starbucks’ powerful campaign about the necessity of quality over cost and how this company may control a large segment of the market.  Due to the recent economic downturn, however, this has became a setback for Starbuck since their customers’ loyalty shows to decline.  I agree with Angus’ reasoning of how McDonald’s new products have created a competitive edge in the coffee industry.   The economical state has provided an incentive for consumers to seek for a coffee house that offers a welcoming atmosphere while charging for less.  I believe, McDonald has successfully merged into the coffee industry at the right moment to gain its hopeful amount of market share.  Overall, does this marketing decision demonstrates that the majority of consumers value the price of a product more than the quality?

https://www.youtube.com/watch?v=hbV6qsWEESw

Bill Bowerman, the co-founder of Nike, envisions endless human potential possibilities in sports and integrates the idea onto the company’s culture which successfully influences consumers’  value to incorporate Nike as apart of a life, “Nike Attitude”, instead of just a product line.  Over the last two decades, Nike has expanded global recognitions and diversified products to create new markets and new demands. With such expansion, the company has altered production and organization methods.  In 1999, Nike began selling products directly to consumers via its website and allocating resources to manufacture products at minimum cost.  Recently, Nike, as a leading company, takes social responsible initiatives by promoting a new sustainable line, Nike Considered,which reduces waste consumption during the manufacturing process. In my opinion, Nike is considered to be an entrepreneurial company through its innovate progression of a small company to a globalized well-known company we know today.

Most consumers have a negative impression of the idea “sustainability” ; however, Modern Green, a Beijing-based developer, has successfully sold the idea to Vancouver local consumers by constructing accordingly to the principles of sustainability in both materials and designs while maintaining principles of comfortable and luxurious living.  When their first residential project, Yu homes, went to market, Colliers International reported as having one of Metro Vancouver’s most recent high profile launches.  The objective of this project is to establish the company’s first residential outside of China and Australia and develop some 10 million square metres of luxury “green” buildings.  The project began in Vancouver, more specifically the Westbrook Village neighborhood at the University of B.C as the managing director of Modern Green Development Canada, Robbie Zhang, states “We heard the mayor’s 2020 target to make Vancouver one of the most green cities in the world,” This project worked in collaboration with the UBC’s Centre for Interactive Research on Sustainability since the centre’s mission was “to accelerate sustainability [and] to find solutions to the challenges of urban development faster and more effectively than ever before”.  The question then comes to, will this project attract developers to consider incorporating sustainability in their projects?

Walmart, being one of the world’s largest retailers, incorporates with Facebook to interact with customers directly with their local store online. The company’s market is targeted to low-middle-income shoppers on tight budgets and the social network service will inform customers about local products, rollbacks (additional savings) and in-store events. Walmart seeks Facebook to perk up sales growth because Facebook is becoming the top seller of display advertising in the US and have more than half of active adult users following brands. Research firm Emarketer expects $4.27 billion in revenue this year (a double from 2010) in result of 800 million Facebook users.  In my opinion, I wonder if it the expected revenue is a little over optimistic.  The company is already well known to consumers and by relying on Facebook, it will only make consumers more aware of Walmart’s sales and events which does not exactly ensure to improve customer loyalty.

Netflix Incorporation has currently made an unwise financial decision by increasing subscribers’ fees. This plan has consequently caused a loss of a million users and a decrease in the quarter earnings. Piper Jaffrey analyst Michael Olson states that the reduction of subscribers is expected when there is a change in price, but the rate of reduction is happening faster than predicted. He also proposes another major challenge Netflix is faced with: the attraction of streaming videos.  The company has a limited amount of content to offer to consumers and also does not have digital rights to many movies available on DVD.  I was once a Netflix user but when the price increased, it discouraged me to continue subscribing because the site did not have much to choose from and did not have many new movies either.  I greatly recommend Netflix to consider a strategic plan and act fast before the company becomes seriously endangered.

Ikea constructs a strong reputation of a good employer and solid corporate citizen; however, recent ethnical complains from workers have raised Ikea’s brand image to question. Full-time employees in Danville feel racially discriminated because of difference in benefits and working community. The Danville employees resent the unpredictable work hours and high pressure atmosphere while labors in Swedwood, Sweden, receive a minimum wage of about $19 an hour, and an additional government-mandated five weeks of paid vacation. Six of Danville employees have filed discrimination complaints with the Equal Employment Opportunity Commission hoping to seek for equality and fight for their rights and the company responses by settling the discrimination complaints through mediation. I do agree with Ellen Ruppel Shell, the author of the book “Cheap: The High Cost of Discount Culture.”, suggestion about global competitions as a reason to seek out for low-cost sources of production and Ikea is no exception, only that the company is burnishing the image very well.  With this negatively in the news, it does make consumers question about Ikea’s reputation.

Canada’s job market may appear solid, but in fact it is continuing to face economic turmoil as hiring rate expects to slow. Companies have reacted to this volatile environment by trimming budgets and implementing a hiring freeze. The unemployment rates, especially in the finance, insurance, real-estate and leasing sector, have descended down to 7.1 percent (lowest since December 2008). In the financial service, employment is reducing drastically in the real estate and finance industry. Benjamin Tal, CIBC economist, explains the sensitive relationship of real estate to market fluctuations. From his analysis, he predicts a slow housing market slowdown in the next six months, which would eventually level off the pricings of houses and immediately affect job rates. Surprisingly from all the unemployment rates, the youth’s remains at 14 percent, the highest of any demographic group.