Leadership – the Seth Godin way

CaptureI am taking a short Udemy course from Seth Godin and the first task is to take 10 mins to answer these questions….

  1. One organisation I worked lost a big client 10 years ago and the business lost millions and almost went down. The same organisation lost an even bigger client a few years later and hardly missed a beat. The leader was the same both times – he learnt from the first time to make the second (and no doubt subsequent occasions) much easier. He set a course and rebuilt the organisation to cope with it.
  2. Leadership is when you set a course and take people with you. They come on the journey not because you bully, bribe or cajole them, but because they believe in the vision too.
  3. Yes – leadership is a choice, but it is rarely the easy choice. Most times we revert to following our learned habits and behaviours.
  4. The change I am trying to make is to make online shopping easy for all. Any time, any place, any channel, any where.

I imagine there will be more to follow!

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Traidcraft’s New CEO – the four challenges that they face

Traidcraft is recruiting a new CEO. As a shareholder, company pension scheme member, former employee, former director, former fairtrader, former retailer, occasional fundraiser and life-long supporter, I have more than a passing interest in who is appointed and, perhaps more importantly, what they go on to do.

Worth saying in advance that what follows is some tough thoughts that will not make easy reading for those who support or work for Traidcraft. They are written to start a debate about how we can all pull together to make Traidcraft better at what it does and more able to help those it was set up to help. They are not criticisms for criticism’s sake – they are challengers that customers, supporters, investors, staff and the new CEO need to face head on.

So here are five charts across four themes, that no one starting a new job wants to see about their new employer but clearly show where the priorities need to be for Traidcraft today.

1 UK Market Share

Fairtrade is booming. Thousands of new products have been launched over the last 10 years and 2014 is likely to be the year when Fairtrade certified sales pass £2 billion. So Traidcraft is booming too? Not so much. You could argue that Traidcraft’s UK fairtrade market share has fallen from just under 10% to 0.7%.(1)traidcraft_uk_market_share

Now there are many reasons why Traidcraft(2) has fallen short of the market growth – competition from the major retailers and product brands with very deep pockets, for example – but a more than 10 fold decrease in market share is a pretty poor performance in a growing market.

In previous decades Traidcraft was under funded and struggled to stay in business, but a successful share issue in 2003 put £3 million in the bank. With good credit from the bank and Shared Interest, Traidcraft had between £5 and £6 million to invest in growth. Apart from investing in some aspects of the physical infrastucture like a second warehouse and a new website, there has been little investment from that cash mountain. While that may have seemed prudent, it has left the business struggling for where future sales will come from.

Worth noting that if Traidcraft had grown with the market it would be turning over around £164 million with around £40 million in producer purchases – now that would be an impact.

Challenge: Traidcraft plc has the resources to invest heavily in growth. A good plan could unlock resources from the Regional Growth Fund and new shareholders. There is plenty of debt available to Traidcraft via Shared Interest and via the property assets it has. The property alone could be used to raise £1.5 million of debt to leverage the current equity. Traidcraft needs a plan to use that money in a bold, confident manner that fuels future growth and creates an environment for innovation to flourish.

2 UK Share Price

traidcraft_share_price_2008_to_2015Traidcraft has had several share issues since the first one in 1987. Each issue has been at or around a £1. If you invested a £1 in 1987 you would need the investment to be worth £2.56 for it to be worth same today as it was then. Traidcraft has only paid a small dividend in just four years (I think!) over those almost 3 decades and the share price today is around 22p. So your investment is worth 10% of what it was in 1987 or 20% if you invested in the 2003 share issue.

Oddly this share price is nothing to do with the real value of the business. Currently with around 5 million shares in circulation the net value per share is around 90p – so why are they selling for 22p? The share price reflects the lack of liquidity in Traidcraft shares as there are hundreds wanting to sell, but few people in the market to buy. While the move to list Traidcraft on Ethex will work well if they raise new capital, it seems to be doing little but depressing the share price currently.

Challenge: The current directors, like many before, have their hands tied by lack of distributable profits. They seem happy that Ethex could potentially help existing investors, but the company’s investment news page on Ethex hasn’t been updated for 16 months. Seems like working with Ethex to open new opportunities for existing shareholders is not a high priority. The solution? Once Traidcraft is back in the black – a single year of modest profits would do it – commit to using a proportion of future profits on share buy backs. Any future fundraising will need confidence in a way of selling your shares – growing that trust now and repaying the loyalty of people who have invested in Traidcraft with little return over three decades seems an important priority.

Buy backs increase liquidity in shares, no doubt increasing the share price and creating more value shareholders who don’t want to sell. Seems to be a winning idea all round.

3 Profits

As point 2 makes clear, no profits and your hands become tied over what you can do going forward. And the picture from the last 6 years is not pretty. Looking at the profits in £’000s, we can see the net profits from the last 6 years are around -£200k.traidcraft_plc_profits
I think the business suffers from shareholders who have not driven harder for profits. Within the alternative trade sector, profits are sometimes seen as a dirty word – but a modest profit is key to long term sustainability. In fact, what does it say about fair TRADE if we are trading out of charity rather than to make a fair profit for everyone in the supply chain?

Lack of shareholder pressure to receive even a 2% dividend means that other issues become priorities for the business – most shareholders are very interested in the social dividend – is Traidcraft making the world a better place? The most important proxy indicator of that is purchases from developing country producers. More purchases mean more incomes and producers secured.

traidcraft_producer_purchases

If we look at the two graphs you will see a direct correlation between Traidcraft profits and purchases. The more Traidcraft makes, the better it is for producers.

Challenge: How can Traidcraft’s various stakeholder groups get comfortable with the PLC making a profit? Profits are crucial to fair returns for those who provide the businesses capital, bigger orders for producers and an even better story to other businesses that a fair business is still a profitable business. So time to set realistic profit targets for the next few years and actually hit them.

4 Back the right channel!

which_channelThe current picture of sales by channel is not very promising either. There is no growth or declining sales in every channel.

Fair Traders are slipping back year by year. These sales have been the engine of business previously, but times are tough. Fairtrade items are much more widespread so do you really need to buy them at the back of church on a Sunday? And then there is the fact that church attendance is falling and so churches selling Traidcraft items is falling too. This is compounded as the denominations that are shrinking fastest are the ones where Traidcraft has historically been the strongest.

Tough being a Christian business when Christianity is in decline. But fair trade is not a solely Christian concern. Outside of the obvious detractors like the Adam Smith Institute, there is almost universal agreement that fair trade is a good thing whatever your moral framework. Growing sales outside of the Church is key.

The other surprise is web sales which have fallen in the context of web sales in general growing at 20% year. Traidcraft has many advantages of scale that should make growing on the web easy compared to the biggest and smallest retailers. and yet Traidcraft sales are falling back.

Challenge: There is only one sure fire channel for success – online. Investing in online brings predictable returns and Traidcraft has the resources to invest. Even better is that online has the highest gross margin of teh channels Traidcraft sells in and so the opportunity to increase profits is there too. Of course much effort will be needed on the range to allow new product categories to be tested and supported.

And fair traders? Now is the time to breathe fresh impetus and new life into a great scheme. Time to focus outside of the church – there are organisations that are growing that could be gateways to more sales. The Green Party for example has more than doubled its membership from 20k to 50k in one year with next to no investment. Simply by being clear about its message, people are signing up in droves.

Summary

So with five graphs and four challenges, in my view, there is plenty for a new CEO to do. What Traidcraft needs is an inspirational leader with a sound plan. The loyalty of staff, producers, shareholders and customers is not in question. They are are all eagerly waiting to push hard on a new growth strategy. The relevance of Traidcraft today is more obvious than it has ever been. Corporate ethics and trust seem at an all time low with issues like Rana Plaza and corporate tax evasion showing that having a CSR policy is not enough. Traidcraft lives and breathes a different way of doing business.

Traidcraft often calls itself a pioneer brand to signify that it has veracity and purpose in its history. Isn’t it time to stop looking backwards and start talking about what Traidcraft will become rather that what it has been? The language of pioneer almost sounds like a spoilt teenager feeling usurped when younger siblings start taking the limelight. Time to forget what others are doing and focus on what make will make Traidcraft distinctive tomorrow.

I’d love to know what you think. Comment below and let’s start a debate so that by the time a new CEO has been appointed, we have crowd-sourced a forward looking, ambitious strategy.

 

Footnotes

(1) traidcraft_uk_market_share_tableThe Market Share stats are based on the the total fairtrade certified sales in the UK and Traidcraft’s total sales in the UK. These are not directly comparable as Traidcraft sells many items which are not certified. However, the growth of the fairtrade market has made some big opportunities for the fair trade companies but few have been able to take them.

The raw for this analysis is sourced from Traidcraft plc accounts and the Fairtrade Foundation Annual Reports.
(2) Traidcraft consists of three organisations – Traidcraft plc, The Traidcraft Exchange (a UK charity), The Traidcraft Foundation (a non-trading UK charity that exercises some degree of control over the other two organisations. This article is entirely about the plc. It is the combined organsiation’s engine and and proof of concept. It needs the biggest changes to weather the current storm.

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Veganuary Day 2 and 3 or Vegan fail days

2014-01-02 17.28.01

At least the main meal wasn’t a fail lentil curry with fried mushroom and tomato. Delicious.

So second and third days of Veganuary didn’t go too well from a vegan perspective. It turns out I have managed to slip up twice already.

Slip up number one came from the “surely that must vegan” school of thinking. As someone who has been a vegetarian for the majority of my adult life, there are certain products that you assume will be vegan. One of those is quorn.

Having had quorn mince, burgers, sausages and even fake bacon for years, I naturally assumed that that quorn products would be vegan. They are made out of mushrooms right? Turns out they contain egg – and in some cases milk. Why? I thought the whole point of quorn was that it was free from animal protein. I have sent an email to quorn to ask why as they FAQs are pretty clear that they contain egg and milk.

Slip up number 2 is a little more understandable but no less frustrating. The New Covent Garden soup I enjoyed on New Year’s day has no animal based ingredients or any allergen warnings that they may include traces of them. So I bought  a couple more flavours in the skinny range. Again no animal based ingredients or allergen info. However,  when I email them to confirm they said that only the following soups are vegan:

•       Slow Roast Tomato & Basil
•       Chilli Bean & Red Pepper
•       Skinny Tomato, Vegetable & Green Lentil
•       Tomato & Grilled Vegetables

So the very tasty Skinny Quinoa and Turtle Bean is actually not vegan even though there is nothing to indicate this. Grrrr. I have emailed them back to find out what the problem is.

Fortunately my main meal on Thursday was an reheated and added to version of  lentil curry from Wednesday and as predicted by @thehippychick33 it tasted even better than the first time. Just for you @TheHippyChick33 I have included a photo too.

 

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Veganuary Day 1 – so what did I actually eat?

Skinny-Tomato-and-LentilDecided to skip breakfast mainly due to massive over eating on New Year’s Eve.

Lunch was easy as I had been out and bought a few easy lunches including some new soups from the New Covent Garden Soup Co. Today’s choice was Tomato and Vegetables with Laird Lentils. Oddly the soup is only described as vegetarian on the pack and on their website but there are no ingredients which are not vegan.

So I sent them a quick note to see what the answer was:

Could you let me know which of your soups are vegan? The very helpful allergy advice page doesn’t say which are vegan. Also the new Skinny soups which all would seem to be vegan are not included on the FAQ allergy page.

I’ll let you know what they say.

Evening meal was an old favourite. Lentil curry using red lentils and a few left over bits of vegetables, baked beans and chopped tomatoes. Delicious and even managed to persuade one of the kids to eat it with me.

As terrible snacker not being able to eat the chocolates, Christmas cake and other Christmas leftovers is probably a good thing. I did have a few peanuts as mid-afternoon snack but much less than I would normally eat.

So day one proved uneventful and pretty tasty.

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Welcome to Veganuary

veganuary logoI have decided to go Vegan for January.

Sounds simple enough – avoid all foods with animal products in them for a month.

So far so good – managed to make a cup of tea and put Alpro Soya milk in it rather than regular cows milk.

So why go vegan?

For me there are four reasons:

  • it is better for the environment. Animal production a huge user of this planet’s resources.
  • it is better for me (part 1). I eat a lot of processed poor quality foods. Hopefully I will be cooking more so eating better.
  • it is better for me (part 2). I need to lose a few pounds and cutting out lots of the rubbish I eat will definitely help.
  • it is better for animals. Do we really need to eat them? I think not.

So as middle aged, over weight bloke I am not your obvious candidate for being a vegan but may be that is all the more reason to do it.

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Lobley Hill Mega Highway – Initial feedback from the Highways Agency information exhibition

Not exactly the most effective way to get local people involved?

Not exactly the most effective way to get local people involved?

So 8 months after the Autumn Statement, the good folk of Lobley Hill and Dunston got to see the plans for the proposed changes to A1 from Lobley Hill to Dunston.

The quick recap is that Chancellor announced that he was setting aside £64million to redo the junction to reduce queuing and delays caused by the quick succession of slip roads. £64million for a mile of road? I can only assume it will be paved with gold.

So what was the meeting in Dunston (21st) and Lobley Hill (22nd) actually for?

Well it wasn’t billed as a consultation so I don’t actually know what the official purpose was other than to provide some information to local people. The meeting was organised in some degree of haste which was frustrating given that nothing happened in the intervening 8 months since the Chancellors statement.

The plans presented were a flat schematic set of plans with no model, cross sections, artists impressions or computer visualisations to make understanding the flat plans any easier.

In summary the plan is to:

  • Increase the width of the A1 to become 3 lanes wide from just south of the Lobley Hill junction to connect with recently added 3 lane section from Dunston to the Metro Centre.
  • There will be segregation of local traffic travelling from Newcastle to Lobley Hill and vice versa.
  • There are no new bridges, flyovers, roundabouts or substantial physical infrastructure proposed
  • All of the land for the extra lanes will be created by narrowing the current width of the central reservation and using green space at the margin of the road
  • No land will compulsory purchased and no land currently available for other local use will be taken as the land is currently all owned by the Highways Agency

So what’s not to love? Delays on the A1 reduced. The through traffic will be able to speed past without the usual delays. Local folk will be able to use the road without the risk of ending up parked on the A1 for 30minutes trying to make a 3 mile journey. So should we all be shouting this morning “Hurrah – let’s hear it for the Highways Agency”?

Well I have a large number of concerns about the process and the plans. However, there is so little information that I am having to make a large number of assumptions to even write something coherent.

The process
The process is already flawed as despite having a £64million budget the Highways Agency is by their own admission massively constrained in any how they conduct consultations.

The issues with the process to date are:

  • The meetings were announced late so that even the most interested of people heard about them only 10 days ago
  • While leaflets have been distributed to hotels and service stations from Scotch Corner to Alnwick, local residents didn’t receive anything through the door. A few signs appeared on lamp posts around the area. A leaflet drop to every house in Lobley Hill and Dunston would have cost less than £500 – small price when you want to spend £64million of tax payers money. Housebound folk will know nothing of what is being suggested.
  • The plans had errors on them including the mis-numbering of the most affected houses. Again doesn’t inspire confidence.
  • Despite registering with the Highways Agency website for information specifically on this scheme no email was received. Apparently a technical hitch meant they couldn’t send the emails out.
  • The process has not been called a consultation making it unclear whether the Highways Agency actually want to hear anyone’s views at all
  • The lack of models or cross sections meant that some questions could not be answered or were answered with guesses. For example, one question about a retaining wall on the east side of the project on the corner opposite Chiltern Gardens was met with an answer of aroudn “1-2 metres” for its height. A visual inspection of the line of teh current drawing shows it will 3-4 metres. A wall of this size will significantly affect noise levels in the houses bounding the route.

While I am sure the above is more in the “cock up” rather than “conspiracy” category it does not make you reassured that these folk can spend £64million of our money effectively.

And the scheme itself:

  • The A1 was built for 50,000 car movements a day. Demand surpassed that from day one. Current movements are over 125,000, so why does anyone believe that adding an extra lane will actually make any difference in the short, medium or long term? Demand will rapidly increase once the nice, new shiny road is opened and we will be under pressure to allow it be widened to 4 lanes or wider.
  • This is a road building project in the middle of a large town. Where are the plans for public transport use? Where are the plans to encourage other forms of transport? Where are the bus lanes, cycle paths and additional pedestrian routes? Where are the plans for improvements to the desperate under passes? There is a virtually unused train station in Dunston with 2 trains a day in each direction less than 100 yards from the proposed scheme but it doesn’t feature in the scheme?
  • The hypocrisy in the presentation of this scheme is breathtaking. The Highways Agency has blocked all planning on Team Valley for years unless the developers do a full transport plan showing how they will mitigate increased car journey’s to their development. The Highways Agency present plans and make no mention of how this fits into an integrated transport strategy. Doh!
  • There is currently no information on likely environmental impact, noise increases for residents or implications for the traffic movement changes that will affect local feeder roads to these junctions.

So this scheme fails in every way currently. There is no strategy and integrated approach apart from removing traffic queues with extra lanes. That isn’t a strategy it is merely a short term tactic to improve traffic flow to and from Newcastle from the A1.

The good news is that is no appetite for a legal process or public inquiry so if enough people raise objections the scheme will be canned. So what do you think?

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Then we came to the end by William Ferris

Book: Then we came to the end by Joshua Ferris

Reviewed by Andy Redfern on .

Summary: Nice try but this book is trying a little too hard

I don’t think I have ever read a book but where the majority of the text is written in the first person plural – “we thought this, we did that” etc. To begin with it is a charming device that would have perhaps worked well for short story or for a novella, but for a 400-page novel it proved hard work. Then we came to the end has many neat ideas, but reading it was harder work than it should have been.

The story concerns the fall of an advertising agency in the middle of the last decade. Clients can no longer afford the big bills and the writing is on the wall for the agency staff as the work dries up and they are left wondering who will “walk Spanish” (be laid off) next. We are introduced to a hotch-potch of characters who a little bit like someone you once worked with. Believable and with sympathetic depth we watch as gossip and worry spread like wildfire around the organisation. The book charts its progress as the organisation spirals down.

There are many pastiche scenes that will appeal to anyone who worked in the tech or marketing industries in the last decade. Many of situations and characters are well observed and neatly constructed. And the underlying madness of office rules and convention – everyone’s chair having a serial number for example – are explored at some length. The descriptions of how the vultures descend when someone departs as everyone wants first look at the furniture and tat they have left behind.

Billed as a comedy, I found no laugh out loud moments. There is an underlying farce to the situations and the people, but the final chapters become truly unbelievable and at times a little bit silly. Joshua Ferris clearly knew where he wanted to take Then we came to the end but you are can’t help wondering if he tried a little too hard to make it too clever. The “we” perspective is annoying as you feel like you are never truly inside the heads of the protagonists. And then suddenly half way through there are a few lucid chapters all from Lynn’s – the office boss – perspective, before resorting back to the “we” form again.

Perhaps I am just not hip or trendy enough to appreciate the ironic form of this novel, but ultimately a novel should be a good read as well as exploration of the writer’s cleverness.

Just remember Joshua, no one loves a smarty pants…

Rating: 3.5

Published: Penguin in 2008
Price: £7.99
ISBN: 9781856131575

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A little bit of politics….

“A little bit of Politics” was Ben Elton‘s catchphrase during the 1980s when Thatcher was at her height and Britain seemed a pretty scary place to be. Politics has not been a theme of this blog and I don’t intend for it to become so. But in the week Margaret Thatcher dies it is hard to not touch on matters political. I could tell you stories of marches and demos, MI5 and arrests, strikes and protests in Thatcher’s Britain. But I won’t. No retelling of stories can ever be impartial. So instead let the stats speak for themselves.

Using the World Bank approved methodology for calculating inequality we can see society got 50% more inequitable during the Thatcher years. Trickle down? I don’t think so.  So while we may mourn the loss of a person called Margaret, we must never forget what she did to make Britain a worse place for most people.  Of course, just as guilty are the boys from New Labour who managed to do nothing in 13 years of power to reverse the change she had made.

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Going Mobile? Try and avoid the Cowboys!

Ethical Superstore Mobile Version

Ethical Superstore Mobile Version

Phew! It’s been a long time coming but we have finally finished the mobile version of Ethical Superstore site. You can view the site at Ethical Superstore Mobile  although it only looks any good on a mobile device of if you make your browser window very small.

So what took us so long? The main problem is that the world of mobile sites is full of half baked solutions, agencies that will gouge your eyes out and an approach to doing business that seems closer to the Wild West given how many cowboys are out there. I guess it should come as no surprise that when a new web technology comes along everyone jumps on the bandwagon and starts telling everyone they need an app or mobile version of their site. The tools are still be worked on but everyone wants first move advantage.

Initially we decided to create a version of the site that was completely standalone using an App builder. This turned out to be a fiasco as no one appeared to ahve used the tool to actually *sell* anything given how many bugs we found. We abandoned that route and decided to develop the technology in house. Using excellent libraries from JQuery made life much easier and now we are in business selling via mobile devices.

And the lessons learnt? If you want to be first in a space you’ll need deep pockets. The “bleeding edge” of technology invariably has a few dead ends and blind alleys to reverse out of. Next task is to start rolling out to a few clients and Appifying the whole experience….

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What’s going on in Lobley Hill?

I was awoken yesterday by the news that the A1 was part-closed due to an accident in vicinity of the Lobley Hill Roundabout. It set me wondering about what really ought to put Lobley Hill on the Map? Do we want to be known purely for the ribbon of tarmac that runs through the heart of the community? A number of people suggested thoughts of what we might do but first I thought it would be good list what goes on around here currently.

Below is my mini-directory to the websites that cover something about Lobley Hill.

  • All Saints Pre School– Nursery school for children aged 2 and 3 years old. Information on staff, policies, news and calendar.
  • Angela Marie School of Dance– Dance teacher offering classes in Lobley Hill Community Centre. Details of courses, examinations and events.
  • Beggars Wood Golf Course and Driving Range– Information on opening hours, course and prices.
  • Callender Lead– Specialist manufacturer of ornamental and rainwater lead work. Details of range and styles.
  • Emmanuel City Technology College– Features information on the college and courses, news and events, students work and exam results.
  • Emmanuel House– Offers holistic therapies to those with terminal cancer. Details of opening hours, location and events.
  • Gateshead Presbyterian Church– Evangelical and Reformed church. Details of services, worship, leaders, directions and young people’s activities. Based at community centre.
  • Heaven Scent Florist– Information on arrangements, reviews and history.
  • Hillside Church– Anglican Church serving Marley Hill, Sunniside, and Lobley Hill. Details of services, pre-school nursery, events and location.
  • Lobley Hill– A photographic history of the local area.
  • Lobley Hill Online– Provides information about local services, news and events. Site also incorporates information about the Lobley Hill Residents Association and relevant contact details.
  • Lobley Hill Pharmacy– Details of opening hours, location and services including delivery.
  • Northern Balance Ltd– Supplies and services commercial balances and scales. Includes history, services and details of range.
  • Ravensdene Lodge Hotel– Includes details of accommodation, menu, local attractions, conferences and special occasions.
  • Robson and Partners– Dental Surgeons. Information opening hours, dentists, membership scheme and treatments offered.
  • Rutherford AFC– Community football club offering teams for junior and senior members. Details of teams, fixtures, history and club shop.
  • Train to Teach – Gateshead 3-7 SCITT– A School Centered Initial Teaching Training facility based in Lobley Hill Primary School. Details of course, applications, testimonials and news.
  • Unique Driving Tuition– Driving school. Details of prices, courses, cars and instructors. Also offers driving instructor training.

Did I miss anything? Leave me a message below if I did!

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