Best Business and Loans Resources » payday loans http://www.profit-managing.com Manage your credit easily and efficiently Fri, 14 May 2010 08:28:49 +0000 en hourly 1 http://wordpress.org/?v=3.0 Credit is made of individual parts /credit-is-made-of-individual-parts/ /credit-is-made-of-individual-parts/#comments Fri, 16 Apr 2010 17:44:56 +0000 admin http://www.profit-managing.com/?p=129 Partnerships provide value that competitors cannot duplicate. Anyone can reproduce a widget. So don’t bet the family fortune on your product or service. Sooner or later, someone will dissect it, figure it out, and make it better. And where will that leave you? What they can never reproduce is the dynamics created through partnerships. Each partnership is unique, made up of unique individuals, and the interactions between these people cannot be replicated. How do you reproduce genius? If scientists could figure out that one, cloning might become the most prevalent form of reproduction. But we haven’t figured it out because it is so complex and is the sum of so many factors that it can never be duplicated. This is true of partnerships as well.

]]> /credit-is-made-of-individual-parts/feed/ 0 The costs for acquiring a new credit /the-costs-for-acquiring-a-new-credit/ /the-costs-for-acquiring-a-new-credit/#comments Wed, 28 Oct 2009 18:45:47 +0000 admin http://www.profit-managing.com/?p=116 The value chains for telecommunications wireless and electric utilities are examples for noncyclical sectors. Wireless operatorsinteract with equipment suppliers and their biggest cost positions are for subscriber acquisition, advertising and interconnection fees. Their customer base is divided into business clients and individual consumers. The success of a wireless operator will depend on the control of all parts of the value chain. This includes the costs for acquiring new customers, maintaining the existing customer base, the bargaining power with equipment suppliers, network costs and interconnection fees. The earnings situation will depend on the market power and degree of competition.

Fuel costs represent a big cost block for electric utilities hence their profitability depends to a large extent on raw material costs. Electric utility companies can diversify across the business segments generation, transmission, distribution and trading. The customer base is divided as industrial, commercial and residential.

]]> /the-costs-for-acquiring-a-new-credit/feed/ 0 Credit and economic changes of industries /credit-and-economic-changes-of-industries/ /credit-and-economic-changes-of-industries/#comments Tue, 27 Oct 2009 17:03:38 +0000 admin http://www.profit-managing.com/?p=114 Structural economic changes of industries are important in the sector selection process for corporate bond investors because they determine how an industry functions and will allow to make projections about the development of the credit quality of specific industries. It has to be determined whether certain changes in industry dynamics occur which have a material effect on the evolution of the industry structure. Examples of some driving forces for change are:

  • Long-term changes of growth patterns
  • Changes in the customer base (demographics)
  • Changes in production costs
  • Product innovation
  • Changes to production processes
  • Structural changes of supplementary industries
  • Changes of government policy
  • Exits and new competitors.
]]> /credit-and-economic-changes-of-industries/feed/ 0 The fixed costs of your credit /the-fixed-costs-of-your-credit/ /the-fixed-costs-of-your-credit/#comments Sat, 24 Oct 2009 14:04:11 +0000 admin http://www.profit-managing.com/?p=108 Capital goods, paper, and metals and mining companies realize their respective profit peaks at the later stages of an economic expansion as they produce goods and services whose demand is closely tied to economic activity. Additionally business peak cycles are accompanied by inflation as demand exceeds supply and for example, basic material industries experience higher profit margins in this environment because their production costs are not significantly affected by inflation and, on the other side, they can increase prices for the finished products. Industries with a high operating leverage benefit as well because their costs are fixed in nominal terms and revenues increase with inflation. The fixed costs in a company’s operating structure determine the operating leverage. Generally, it can be said that industries with a high fixed cost base and high inventory costs, for example, the paper and the aluminum industry, are always under pressure to keep capacity utilization rates high because decreasing capacity utilization rates will have an immediate adverse effect on profitability.

]]> /the-fixed-costs-of-your-credit/feed/ 0 Corporate spreads of loans and profits /corporate-spreads-of-loans-and-profits/ /corporate-spreads-of-loans-and-profits/#comments Thu, 22 Oct 2009 12:43:24 +0000 admin http://www.profit-managing.com/?p=104 Corporate spreads and profits showed a close relationship during past economic cycles. Deteriorating profits as a percentage of GDP go along with wider credit spreads. Market phases with improving profits are accompanied by tighter credit spreads.

The business cycle sets the parameters for the sector rotation strategy. Sectors with a high cyclical component will outperform at the early stages of an economic expansion while noncyclical sectors will tend to underperform during an expansion phase relative to the market. The cyclicality of a sector allows predictions about the development of earnings across business cycles. For example, the business of IT hardware companies depends on the capital expenditure (CAPEX) plans of other companies. In an economic slowdown when CAPEX is scaled back or postponed, IT hardware companies run a higher risk of being downgraded due to a deterioration of their credit protection measures. The most recent examples are the telecommunications equipment companies Alcatel and Ericsson. Both suffered from the lack of demand by telecommunications companies in 2002.

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