I have an unusual vantage point to observe the housing market as the pundits fret about the housing “bubble” they imagine is bulging. I live in a housing refrigerator, Olympia Fields, Illinois. I bought my 3,000 square foot home 34 years ago on a half acre lot within walking distance of the Olympia Fields Country Club, where they played the 2003 U.S. Open golf tournament. There are five beautiful country club courses within a seven minute drive. The suburb is on the Metra train line so I can get downtown in 35 minutes, and I’m five minutes from the interstate.…
Author: Lloyd Graff
One of the good things about buying out my brother at Graff-Pinkert was being asked by lenders to study my costs. What I found out, among other things, was that direct labor costs in the shop comprised a small percentage of my cost of sales, even though we refurbish many of the machines we sell. But the competitive advantage of selling a superior product compared to our competitors (excuse the advertising) is our expertise in upgrading the flawed used machinery. I concluded that I needed to protect this advantage and expand on it. I raised all of our key employees’…
I wrote a blog recently about my reaction to a letter from my landscaper Guillermo’s daughter, which put a face on her father to his clients. I received two comments asking why Guillermo’s daughter wrote the letter. I didn’t answer for a few reasons. First, I don’t know why the letter was written. Ostensibly it was to announce that Guillermo was again taking a week off so his clients should not expect him to come and mow the lawn. But after a friend queried me on the topic yesterday, I started thinking more about the issue and my own response. I am…
Guillermo is from Mexico, or maybe it’s El Salvador or the Dominican Republic. Do we care? He pushes a lawn mower, directs a trimmer, and handles a weed-whacker. He’s the guy who comes to my house with a pickup truck, a couple guys and a few bags of Miracle-Gro. Guillermo’s 20-year-old daughter wrote a letter that put a name to the man who had for 10 years been “that guy who mows our lawn” and sends us a bill. His daughter told us in the letter that Guillermo took his first real vacation, five days in Orlando, just last year,…
I am a hopeless sports romantic, so these next few weeks will be glorious for me. Major League Baseball season starts in less than two weeks, and the World Baseball Classic just finished in San Francisco with the Dominican Republic taking the title for the first time. You missed some terrific games if you ignored this event. The atmosphere in every game was as intense as in a playoff series. The NCAA Basketball Tournament starts this week. I know that there are no great teams this year, but so what? It will be a fantastic event and an unknown school…
Sometimes the absurdity of trying to do business and make money and then pay the appropriate taxes to the Feds and State just about knocks me over. I’m currently doing the annual ritual of getting my taxes and financial statements in order. I am using a good accountant – conscientious and smart – and we are struggling to come up with documents that are consistent with accepted practices and have at least a distant relationship with “Truth, Justice, and the American Way,” as they used to say in Superman intros. After many many years of being involved in this process I am convinced it is…
I bought out my brother Jim’s interest in my family machinery business six months ago. I promised him that I would not write about the breakup, but I want to take a few lines to describe how the post breakup is going for me. The day after our deal closed I was vacationing with my wife, my sister and brother-in-law at the Chautauqua Institution near Jamestown, New York. (We had planned this trip a while before with my sister. That the breakup with Jim culminated at the same time was an odd coincidence.) The four of us were having lunch…
I’ve been doing business for a long time, but I am still shocked by the appalling clumsiness of big organizations. After decades of Lean and Six Sigma, ISO 9000 and all the other baloney foisted upon us by consultants, the big organizations have capitulated to the sloth of the manual. The playbook keeps getting thicker and more clogged with sticky, obfuscating bubble gum. Decision making is becoming decision avoidance. Only after a disaster strikes will companies decide to buy a generator. If a crisis is sitting in the lobby, big companies ask it to leave because they have a meeting.…
Warren Buffett has been trying to buy Heinz, the king of ketchup, for 33 years. He finally got the deal by partnering with a Brazilian firm named 3G that will do the tough managerial surgery on Heinz, which will make it a cash cow for Buffett’s Berkshire Hathaway. I have studied Warren Buffett’s approach to business and I try to apply it to my business and my life. Make the deal. Play to win. The Heinz deal was out there for many years, but nobody could figure out a way to make it work at the numbers Heinz’s Board demanded.…
It feels like we are in a golden period of film entertainment that I haven’t experienced in a very long time. In the last couple of months I have watched the first season of the Showtime serial Homeland, which is absolutely brilliant. Way better than 24, which I loved until it ran out of gas in its later years. I saw Lincoln, Steven Spielberg’s latest, and it was a terrific flick, even though I admit I slept through some of the first hour. I also recently saw The Impossible, a film about the aftermath of the Thailand tsunami in 2004,…