SWIFT CHANGE: Gerry Swift, executive vice president of Potomac Floor Covering, was very optimistic when interviewed at Starnet’s Fall Meeting in Vancouver earlier this month. Attending the group’s first Canadian meeting, Swift said, “After a dismal four years, things have begun to turn around. Projects that were shelved are now coming to life. Architects and designers are going back to work. Most of the larger general contractors have become very busy. I’m delighted but still not ready to celebrate. I’ll wait till the end of 2011 for that.” Upbeat but cautious.
SLOW CHANGE: Harold Chapman, president and CEO of Bonitz Flooring Group, was less optimistic and more cautious: “Business has been OK. We have been dog paddling and keeping our head above water. Revenues are down and margins have suffered due to competitors dropping their prices. Also, even the best of customers are looking for a deal. We started watching our costs at the end of 2007 and we are continuing to watch what we spend. As you know, gross margin dictates overhead. Bonitz has great personnel and they have risen to the challenge, and as a result we are doing OK. During tough times, people might not replace flooring but they want their existing floors to look good, so there has been an increased opportunity in maintenance.” Call it a silver lining.
WARREN’S WORDS: I find Warren Buffett exciting and inspirational. The Oracle of Omaha is worth $45 billion and he amassed that fortune by shrewd investing and good business. And he is the first to add other ingredients to the mix—prudence, parsimony. A recent columnist called him a “penny pincher,” albeit with affection. The writer pointed out that Buffett still lives in the same Omaha, Neb., home that he purchased in 1958 for $31,500. Anyway, the Nebraska Nabob has five tips to build wealth and success. Follow the frugal formula and you may wind up with more money than you ever dreamed existed. 1) Live below your means. Being wealthy isn’t just a product of your salary or investment prowess. It’s learning how to save.
THERE’S MORE: 2) Bounce back from defeat. With nearly 15 million workers unemployed in the U.S. right now, it’s easy to get discouraged. Don’t! Most successful and wealthy people have overcome obstacles and failure along the way. Steve Jobs was ousted from Apple when he was 30. Today, he’s a billionaire and a legend. After getting fired, he created another billion-dollar media company, Pixar. 3) Self-promote. Regardless of the profession, the rich and successful tend to have a strong sense of self- worth—key to skillfully navigating an upward career path. 4) Have street smarts. It’s not only the swindlers and con men you have to watch out for. Many times friends and family take advantage of the rich. It’s wise to just say “no” and if you can’t do it, have someone else do it for you.
AND FINALLY: 5) Buy cheap. The rich can afford to splurge but that doesn’t mean they do. John Paulson, a billionaire hedge fund manager, bought his Hamptons “dream house at a bargain basement price,” according to his biographer. The story has it that Paulson spotted the home when it was in foreclosure. Then, on a rain-soaked day, he purchased the home on the Southampton town hall steps. He was the only bidder. And on New York City’s Upper East Side, Michael’s—the consignment shop for women—has been a bargain hunting destination for more than 60 years. Many of the women who shop there can afford to buy at the finest shops in the city but they prefer Michael’s and the savings it offers. The owner says, “Our shoppers recognize that bargains keep people wealthy.”