What You Can Learn about Job Searching from the Publishing Industry

When you are job searching, it’s easy to get caught up in the process and overlook the big picture. So, let’s look at the way YOU will look to your future employer by examining the old adage

Remember, this is your leave behind, so in most cases, may be the last thing a potential employer sees. Make sure it gets them excited about what you can do for them.

With your packaging covered, it’s time to get started. Create your list of contacts and your list of companies you’re interested in. These are organic lists, which means they WILL keep changing! Each contact has a network that they can lead you to, the goal is to get the names of decision makers, their titles and their business addresses. Then you’re going to write them a letter. Not an email. Write them a letter.

The letter should say:
I’m this guy, I know this person that you also know. I am interested in your company because … (“It is the top performer in the industry”, “It fits my values and interests,” stuff like that. Just communicate that you know the company.) You’d be interested to know that in my past, I have done these things and would like to help your company do these things. Please feel free to reach me by phone or email at your convenience. Or, I will call your office on this day.

Really, write that stuff? Yes. Employers get upwards of 125 emails a day. They read about 20%. They also return about 20% of phone calls. The question you are answering for them is this:

A Little about Cost Markups: What do Balloons, Movie Theater Popcorn, Snow Cones and Starbucks Coffee have in common? They, along with Cotton Candy and Fountain Drinks are on the list of

But what is a “Markup?” and “What does this mean to us?” Markup, or Margin, is a marketing term for the price that a business puts on a product above what it costs to produce and deliver the good, usually determined as a percentage. In other words: the part that is straight profit.

Certainly there are more expensive items than coffee, cotton candy and popcorn –like porsches, condominiums and golf resorts– so what makes these items special? What kind of a markup would cause such a big deal?

How about this: No matter what a company sells, their price is a combination of two numbers: the cost of making and transporting the good they are selling (COGS) and the margin of profit (Markup).

COGS + Markup = Price

COGS is a set cost determined by the various expenses, fixed—such as overhead and insurance, and variable—such as raw materials and employee wages, that go into producing the product. Companies can do very little to affect this aspect of price, or at least that’s how I see it from the marketing side of the fence. The second part of price, however, the markup, can be shifted easily—this has no basis other than the price your customer is willing to bear.

For most consumer products, the average markup (“Retail”) is about 30%. For commodities –sugar, soap, pillowcases– markup is closer to 10%. But for “Premium” products –retail items aimed at the very rich, or the very demading (this is where we talked about Porsches, but also includes watches, Italian shoes, and vodka)– markups often approach 200% of Cost. And then “Ultra Premium” –products called by names like Mikimoto, Piaget, and Alfa Romeo– enjoy 400 and 500% markups. People gladly paying $750,000 for a car that costs around $20,000 to produce. For more on this, here is a great link.

But these don’t touch the 99.9% profit margins of the products mentioned above– the less than 1/50 of a cent that it costs to produce the .5 grams of a latex balloon that is filled with a burst of helium valued at 1/80 of a penny and sold for $3.00 at fairs and circuses across the US. This equates to a 1000% markup above COGS. Similar equations can be run for cotton candy, snow cones, your super-value bucket at the movie theater and your double iced caramel machiatto.

Imagine paying a 1000% markup on your car or your next burrito. That would be a $20,000,000 Altima or an $850 dollar Carne Asada bowl.

I am going to share with you today’s observation of China. Close your eyes and envision a map of the United States. Okay, now open your eyes and keep reading… You’re going to point on that map to these locations as I list them: New York, Los Angeles, Chicago, Houston, Philadelphia, Phoenix, San Antonio, San Diego, Dallas, San Jose. These are the Top 10 U.S. Cities by Population and Rank. You may have noticed your finger stopped in about every major region of the country and crossed the continent at least 3 times. Further down that list you’d touch Detroit, Memphis, Jacksonville and Seattle at 23.

Now, the Top 10 Cities in China are Shanghai, Beijing, Shenzhen, Guanzhou, Tianjin, Nanjing, Dalian, Hangzhou, Shenyang and Harbin. If you were to do the same mental map-pointing with this country, you’d find your finger never strayed from the east coast. In fact, you’d find that most of these cities, 8 out of 10, cluster like shotgun fire to within 2 hours of each other.

China is a huge country, roughly the same area as the United States, but with more than four times the population. Across such a broad expanse of people and geography, one expects the country to have developed several distinct and unique cities and cultures. In the US, for example, we have Northerners and Southerners, we have City People and Country People, but we also have Suburbanites, Rednecks, New Englanders, Westerners, Mid-Westerners, Snow Birds, Beach Bums, Grunge Rockers, Cowboys, and Californians. There are lots of different lifestyles with different cultures and values, but these groups are dispersed across the length and breadth of the country. From what I can tell, China does not work this way.

In China, the businesses, industries, infrastructure, government, and foreign political influence—not to mention the wealth and leading founts of culture—are all located on a stretch of the country’s east coast spanning from Beijing down to Shanghai, the rough equivalent of the state of California. Meanwhile, the western portion of the country, perhaps 90% of the land area, is occupied by about 60% of the population and responsible for less than 25% of the GDP.

So, why does this strong disparity between East and West exist in China? Similar to that of the industrial North and agrarian South in the antebellum US, the cause is the drastically different cost of doing business in the regions. “The government is doing things to move China west,” said Randy Creel, a logistics expert at a major MNC in China. “The hesitation is the lack of infrastructure and its effect on logistics costs.” Effects on logistics costs that work out to about 200% more investment per mile for companies to run their businesses in Western China. China is on a self-perpetuating cycle of eastern growth and western lag that will require more than government incentives to Western businesses and FDI spenders. It may require an all-out reallocation of infrastructure build-up that the country has never before undertaken. At least not until the 2008 Beijing Olympics. –Shawn Butler

asmallworld.netshawn butler

In spite of Thomas L. Friedman’s best efforts to claim otherwise in his newly revised The World is Flat: A Brief History of the Twenty-First Century, Release 3.0. Just as in his previous books, Friedman showcases his journalistic forte for information gathering, analysis, and insight-laden extrapolation. He supports well his own previous arguments for free trade, market specialization, and classical economic theories regarding absolute and comparative advantage. (Smith, Ricardo, … Reich)

I’ll pause here to acknowledge that I, too, am a strong proponent of globalization. I have seen first-hand the dissolution of geographic and political barriers to trade and the ensuing benefits to the local economy. I find no fault in Friedman’s historical observations, including his 3 eras of globalization, his 10 flatteners, and even his recommendations for new hybrid fields of study he calls “Mash-Ups.” These ideas are spot-on in our global economy of increasing convergence.

But why all the doom and gloom, Mr. Friedman? Instead of telling your readers how the new “flattened” world will make lives better—spurring the economy of our New America into a greater leadership role as the birthplace of ideas and a nation of entrepreneurs—he focuses on the bad. Friedman follows the M.O. of Lou Dobbs, crying wolf over foreign theft of US jobs and a general disappearance of the American middle-class. Rather than pointing to the strengths of our human capital as inventors, creators, and brand builders, he tells readers that the American sky is falling in competition with Indian and Chinese ITs and engineers.

Friedman leans toward the dramatic, but what do you expect from an Opinion Columnist? He opens with this quote from an Indian software CEO: “The global playing field is being leveled… and the US is not ready.” This is followed by other sensational statements of hyperbole. “Today, people in China and India are starving… for your job!” he warns his children. But then, you are given to flights of the inflammatory if you are to make your living as an op-ed writer. The Title The World is Friendlier to International Business because of Improvements in Technology and Transportation doesn’t sell books.
–Shawn Butler