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Thoughts on Pricing

While I would like to avoid being cliché, pricing is often an under utilized and oft misunderstood strategy. So today I wanted to look at contribution margin-based pricing with you in my continued series of business related pieces.

What is contribution margin-based pricing? It is a is a pricing strategy which works without any mention of gross margin percentages. Many people are unfamiliar with it but I had the good fortune to have an amazing professor in college that saw the benefit at looking at intensely at pricing strategies that were not commonly utilized in the US at the time.

The main draw to the strategy is that it maximizes the profit derived from a company's assortment, based on the difference between a product's price and variable costs. You can calculate that by taking the product's contribution margin per unit. Then taking one's assumptions regarding the relationship between the product's price and the number of units that can be sold at that price you arrive at the product's contribution to total firm profit; This is a contribution to the operating income, which is maximized when a price is chosen that maximizes the Contribution Margin Per Unit X Number of Units Sold.

Depending on the level of employment of the strategy, a distinction is made between fixed and variable costs, which together result in the total cost.

We will look at that in just a moment.

However, first let us look at the required contribution, and how the cover can also be derived from the invoice. The contribution per unit sold is based on the net selling price minus variable costs.

Price – Variable Costs Per Unit = Contribution Margin Per Unit

The contribution does not take into account the fixed costs, i.e. the costs required to maintain the company. A contribution to cover occurs precisely when the sales revenue per unit is greater than the variable costs. The contribution to cover is thus the short-term price floor and is used precisely if it is to be decided whether:

Performance or foreign reference:

  • Acceptance of additional orders
  • General pricing policy

In order to reach the profit zone, either the price per unit must be increased or more customers gained through marketing measures in order to increase the net selling price than the total cost ( profit). Depending on the price policy, the price must either exceed the total cost, in the long term at least, or be higher than the contribution to cover; Aware that the short-term applies only to additional orders or the decision in pro/contra own performance. The contribution statement can also be used to inferred the operating result by making the sum over all units sold.

Unlike the commonly applied coverage contribution bill, this is used in connection with the Profit Center to figure out what coverage the Profit-Center bears in the general fixed costs for the company.

In many cases, the contribution statement still takes into account sales proceeds with which this profit center in particular works. In particular, this applies to pricing policy within market structure. So the net selling price is not set, but the gross selling price minus the cabling reductions like discounts.

Otherwise, the bill remains the same.

To put it simply, variable cost is the contribution to cover minus fixed cost, resulting in a profit/loss scenario per unit sold.

Bread and Wine

Something a little bit older landed on my bookshelf the other day; "Bread and Wine" by Ignazio Silone, published in 1936 by the Gutenberg Book Guild or "Vino e pane" published a year later in Italy. The book was republished in 1955 under the title "Wine and Bread," and apparently, in terms of content, it has been modified over the years but remains in print.

From Wikipedia):

Bread and Wine is an anti-fascist and anti-Stalinist novel written by Ignazio Silone. It was finished while the author was in exile from Benito Mussolini's Italy. It was first published in 1936 in a German language edition in Switzerland as Brot und Wein, and in an English translation in London later the same year. An Italian version, Pane e vino, did not appear until 1937.

After the war, Silone completely revised the text, publishing a significantly different version in Italy (in 1955), reversing the title: Vino e pane (‘Wine and Bread’). This updated version is also available in English translation.

I had learned about the author in a documentation that I watched some time ago and decided to try some of his work up. "Bread and Wine" is my first foray into that exploration.

Born in the small village of Abruzzo and died in Geneva in 1978, Ignazio Silone, whose name was Secondini Tranquilli wrote about Italy's poverty in the 1930s and the socialists' struggle against the Fascists, but actually also contains general wisdom for life. He then fled abroad, revised his books, etc.

The book follows the exploits of Pietro Spina, a young revolutionary who is being sought by authorities. To avoid capture disguises himself as an old priest known as Don Paolo Spada.

The story tells a lot about Silone's life, who lost his parents and his siblings early in on and was forced to make due without much schooling; his transition to a revolutionary and journalists were, for a time, under the scrutiny of police spies.

The book is beautifully written and for a work to survive it must be lest it slip into the space in history that is reserved for the forgotten.

Since "Wine and Bread" is still available, you can find some reviews that both provide sound information about the work giving you a good idea of what you are in store for and others. Some of them note downsides, such as "The book is adventure novel and political thriller in one" or "Wine and bread – both appear in the book while the figures consumes them regularly, the title does not suggest the actual content. It is also increasingly political and exciting towards the end."

While I find it good that they read the book it feels like they have missed the point. Neither of the opinions are capable of painting the work in a light that would be relevant to the themes and messages the book covers.

I will avoid going into much detail about the book; Instead it is more important to understand the time in which it was written, the struggles people faced, as well as the understanding that it is truly not a work of fiction but a document of the time.

For instance, the lives of the landless peasants are described very forcefully. Mussolini is all present and is feasible for one to see that people actually had no choice but to join the fascists, because they were mislead through the news, exploited and used to further Mussolini's agenda to receive minimal sustenance and support. For a job as a civil servant, teacher, community doctor one had to sell his soul and the poor students got money for their food rations, but only if they agree.

The book explores the populist rhetoric undermined the fabric of society and fake news was employed in much the same manner as today.

It is a time that we cannot return to.

Beet Risotto with Honey and Rosemary

I love my heavy cast iron pot. I have begun using it almost daily: Bolognese sauce succeeds particularly well in it, all kinds of stewing dishes and also oven risotto*.

That's why I was really pleased when people bring up the topic of "Dutch Ovens."

For those of you who don't know what a Dutch Oven is it is just a fancy name for a heavy, cast-iron pots with lids that are oven proof which you can even put in a fire with glowing coals. Wow…

*I cooked an oven risotto in my Dutch Oven this weekend. The great thing about the pot is that the stirring is actually completely eliminated. I couldn't believe it at first either – but it works flawlessly. At first it seemed like a big risk. I didn't want to end up with burnt rice that needed to be unstuck form the bottom of the pot. But…

The risotto turned out great. Actually better than any risotto we've made on the oven.

Ingredients for 2 people:

  • 360g risotto rice
  • 1/2 red onion
  • 400g red beet about two medium or one large beet
  • 1 tbsp honey
  • 1 tbsp chopped rosemary
  • 500ml vegetable stock
  • 25g butter
  • Salt and pepper
  • 50g goat gouda/-fresh cheese or pecorino (we get ours at Sam's Club)

  • Preheat the oven to 375° F.

  • Finely chop the onions.
  • Peel the fresh beet and cut it into small cubes so that they will soften by the end of cooking. Pre-cooked the beet if you do not want to cut it quite as small. Fresh beets definitely add a nicer color to the finished dish.
  • Add all ingredients, except for the cheese in Dutch Oven and close the lid-

Put the pot in the oven and let the meal cook for 45 minutes you can now dedicate yourself to your other household activities: folding laundry, mowing the lawn, or drinking a small aperitif …

Hungry now?

Remove, stir, season with salt and pepper – it's time to eat. Supper is ready.
Sprinkle with cheese and serve.

Kubrick A Retrospective

For Stanley Kubrick's fans it is apparent he offers us a look into surreal worlds which challenge our sense of being and morality. But his works are richly layered and offer a broader look at both the future as well as a look into the past when they were created.

Now London is home of a retrospective dedicated to Kubrick's work and rich sense of director until September.

The exhibit honors the renowned director, screenwriter and film producer, marking the 20th anniversary after his death. It shows his creative process; step by step, throughout the whole creative process and gives us a look at one of one of the most acclaimed filmmakers of the 20th century.

Many of the objects are on loan, belonging in private collections and and are now shown for the first time. His daughter Katharina Kubrick, said: "It's all our stuff, all of Dad's stuff. We had them at home, he never threw anything away. Everything was carefully cataloged and kept in boxes. When we moved, it all came with us. I don't think he'd envisage an exhibition, but there was a reason he didn't throw anything."

Awards and iconic movie objects like from films like: "2001" or "Clockwork Orange " are on display at the exhibition.

Kubrick, who was born in New York, moved to London at the beginning of the 60s which became the center of cinematographic operations for the director.

For Kubrick it only seemed logical to use it as a setting for all of his films which was also extraordinary for the time. That is why it is was really the only choice for a retrospective were made in London. He was a master when it came time to recreate these worlds audiences enter when they watch his films. It might be a hotel in the Rockies or for battlefields in ietnam, or space, were ever it was he could transport you there.

About 500 objects are included in the exhibition which lasts until the 15th of September at the Design Museum of London.

The Business Side of Networking

I have been working professionally as a consultant for the last fifteen years. Through those years I have been given out between 750-1000 business cards with my contact information on them. Honestly I can’t say how many I give out each year. I only know the upper limit since each year I order that number and I have never had to order additional cards. One year I counted how many I had left and it was around two-hundred and fifty and that seems about reasonable to assume that it holds for the other years as well. It is hard to be certain though since I recycle my old cards once the new ones arrive.

This year my mother made the statement that she would like to get some as well. At first I had to let out a small laugh. It was cute and I couldn’t understand why. After all, she is retired and never had a need in her working years to give them out.

So why would she now be interested in them?

First, let us consider why you need business cards in the first place. Who do you hand out a business card and in what situation?

Sure they are an important advertising tool.

It provides you with a way to make an impression, especially when you provide them with well-designed cards.

While many opt to design their own, e.g. with Word or another word processor, many professionals pick a high-end option that is specific to their industry. While the first option can work for some; My mother is one of those people that could forgo the extra expense, I have always left the design to a professional.

For me it is a question of how I want to present myself. I don’t need to simply drop contact information, that isn’t what they are for. You need to make an impression, it needs to stand out make an impression. It will be used as a gauge of your professional demeanor. If they don’t see that it has been professionally designed they will question your competence. This sounds harsh; It is superficial and has no baring on who you are but it is there so I need to keep it in mind and work within those confines.

Networking is an important aspect of any industry, these small pieces of paper are one aspect that that should be seen as a tool.

Like any tool, it is only useful when you have it on hand and how to use it properly. You should always have a few of your business cards with you, regardless of the situation you will be glad that you had at least one when you needed it. So no matter where you go keep a couple of them in your purse. Regardless of where you keep them it is important to ensure that thy do not buckle or get stains. As I said it has to due with appearances. So that they maintain their form I keep mine in a small case.

Make sure that you never pass on dirty or crunched cards. This seems incredibly unprofessional and could have undesired results. Just recycle the unusable cards and move on.

I have found it works well to add them to letters to my customers. For example, if you send an invoice, you can include a cover letter as well as your name card. Throughout the years I have used several ways to enclose these two additional pieces of paper in the envelope. Currently I use letterhead that has pre-punched mounts included where the address would normally go. Though I have use adhesive strips to fasten them to the cover letter. If you are uncertain if this will work for you use a paper clip to test.

No matter how much we rely on technology I don’t think that we will ever loose the need to have business cards.

When you have appointments with customers and events, you should always have your business cards at your fingertips. For appointments, hand over your business card when you are making introductions. This also has the advantage that your interlocutors do not confuse your name.

A year or two after I began working I learned a lesson that I will share now as a more than little embarrassing story. At that time things felt more overwhelming, it felt like balancing plates on sticks. Needless to say one of the aspects that was missing was organization that comes from experience. Once while at a trade show I had amassed a small collection of cards. To keep them from getting bent they were piled together with mine.

That was a mistake.

While making the rounds I accidentally gave the wrong card out. What is more embarrassing was that it was the card from one of his colleagues in the company. The contact did pay off a year later so it was not a complete failure but at the time my face was red.

The moral of the story?

If you get business cards from others, ensure that you keep them separate don’t put them together with your own – that could lead to confusion.

The way that I am now just filing them away isn’t enough. Whenever I receive one it gets filed aside with note on where I met the person and what we discussed. This prevents confusion and you can go through the stack again at the end of the day and consider who you contact first.

Going back to my mother she felt like they would be a nice way to leave here contact information with new acquaintances.

The idea is sound, the implementation on the other hand, is slightly overdone.

In college one of the students was known for giving them out for the same reason. While I am certain he has found success in his professional life, it was out of place at the time. Social setting dictates when you are safe to hand them out. Under a group of my peers it is not uncommon for them to be passed around or shown off in this setting. When I am invited to a less formal gathering where I don’t know those attending the thought does not cross my mind.

Decide where it is appropriate and when it is sensible to make a potential contact.

On Cleaning the Washing Machines Correctly

Recently, when I emptied or filled the washing machine, I noticed a foul musty smell. Call it wishful thinking if you will, but I tried to rationalize it away. First I pushed it on to the loads of wash waiting in front of the machine. However, when these were washed and cleared, the smell still lingered and I had to become suspicious that it was coming from the machine itself. As a first measure, I cleaned the filter screen, but there wasn't much in it there and as I learned today, that might not be the cause at all.

My half-knowledge about care gleaned from my childhood and the Internet reminded me that frequently washing on cold leads to deposits, which in turn cause odors, as does frequent use of liquid detergents. We like liquid detergent better since it somehow leaves the clothes softer. Still, it does not work as well, which can be seen in test after test it is probably based, among other things, on the fact that bacteria is not killed and the rest, well you can figure that out.

Since we had bought some new towels from the Ikea and we wanted to having the colors run (we suspected that they might run) we washed them with some disinfectant laundry detergent. I assumed that any smell would disappear.

After washing, I opened the washer to get a penetrating smell of the disinfectant, paired with the disgusting stale smell.

Okay, the experiment failed.

The next solution was to revisit the manufacturer's website which said that low temperatures could lead to strange odors and it was recommended to let them send out a specialist (machine cleaner). I refrained from calling one out.

I came up with the idea to look for a manufacturer-independent cleaner for washing machines in the local drugstore. I found one, bought it and threw it into the machine when I got home. During the cleaning process, a strong citrus scent developed throughout the house and if you got too close to the washing machine, you noticed an acidic lemony taste in the mouth. The whole thing was suspicious but I felt like I had accomplished something.

Convinced that everything was fine I once again opened the machine only to be hit by a strong perfume smell backed up with the already well-known stink.

After the series of failed tries I ended up calling the manufacturer of the machine, and for good measure the dealer where we bought it.

And so I now share; for the interested reader, my accumulated knowledge of washing machine cleaning.

The deposits in the machine consist of fat, detergent residues and lime. Fats, dirt and lime require different solvents. Sounds logical and fits my residual knowledge from chemistry lessons. For this reason, the machine cleaner I used could not work, because the cause of the smell is not the fat deposits. Rather in the lime deposits.

Disinfectant only makes sense in very few cases. The frequent use of disinfectants only leads to allergies. Apart from the fact that it is pointless in this case, see above, regarding the source of smell. Most bacterial/viruses etc. die at higher temps and the use of disinfectants is therefore unnecessary, only thanks to the overpowering perfume do you get the feeling of cleaner machine. And furthermore, normal household cleaners kill almost everything, so their use in most cases is senseless.

So, back to the actual subject, how do I get the stench effectively removed.

First, let the machine wash empty at the highest possible temperature. The addition of a cleaner is not strictly necessary, because there are still enough remnants of detergent in the depths of the machine. This can be seen that foam formations occur when it is absolutely idle. I have been able to observe this myself so I know that it is true. With this method one removes the greasy dirt that is stored on the lime.

In the next step, you take a washing machine de-caulker that can be applied at normal temperature, according to the expert. This then dissolves the lime layer, which is probably the main cause of odor formation. You can't take every de-caulker because it depends on the dosage and that should be right for your machine, otherwise, it won't work. Too low a dosage does not dissolve enough, a too high reacts with the aluminum in the machine, I forgot what the exact component is called but will and cause the drum to turn black inside.

Don't take any de-caulker either, I de-caulker in the second drugstore I looked at that is explicitly made for washing machines. The one that I selected instructed you to wash at the maximum temperature when using it.

In the last step, the machine is left to run empty at a high temperature, so that the grease/dirt layer under the lime layer is now removed. I was told that the detergent remains would now be out; it should not produce foam this time, which I can also confirm. The smell was also gone after this step to my relief.

A final comment, one should try to carry out the three steps in order and not squeeze a load of clothing in-between. Otherwise you will add new detergent to the mix which will need to be removed. Deposits will be formed, and if there are deposits of detergent on the lime again, this cannot be removed by picking up where you left off. To avoid this I did everything one evening and finished with the last step in the morning. But if you don't wash, you are welcome to allow yourself a day in between.

I hope I have been able to help someone with the case of the smelly washer.

142 Migrants Rescued From An Abandoned Truck In Mexico

For many Americans it is hard to imagine what it would take to force us to give up all that we have and make a journey to a foreign country, risking our possessions and lives for a chance at a little bit better future. But that is what is happening right now as I am typing, right now as you are reading. And that is why, dehydrated and crammed in the back of an abandoned truck like animals 142 Central American migrants, mainly Guatemalans were rescued by Mexican authorities yesterday.

Among them were dozens of children, some very young, who were saved thanks to an anonymous call that informed the authorities about the presence of the abandoned truck on the edge of a road in Amatlán de los Reyes, a municipality in Veracruz.

Red Cross doctors were asked to assist the migrants, who have then been placed in the hands of the migratory services which will be responsible for their deportation.

The 142 people arrived from Chiapas, crammed in a trailer which measured just forty feet by eight wide, with only a few fans to withstand the intense heat. Once they realized that they had been abandoned, they tried in vain to open the door and shouted for help.

The migratory flow to the United States was swelled at the end of 2018. The repression of the Mexican authorities is increasing, while the migrants are returned to the mafias and traffickers.

The Venice Art Biennial 2019

The Venice Art Biennial 2019 has opened its doors to the public this Saturday and what I wouldn't give to visit it. Not just this year, but generally speaking, sometime.

For those of you who may not be familiar with it:

The Venice Biennale (/ˌbiːɛˈnɑːleɪ, -li/; Italian: La Biennale di Venezia [la bi.enˈnaːle di veˈnɛttsja]; in English also called the "Venice Biennial") refers to an arts organization based in Venice and the name of the original and principal biennial exhibition the organization presents. The organization changed its name to the Biennale Foundation in 2009, while the exhibition is now called the Art Biennale to distinguish it from the organisation and other exhibitions the Foundation organizes.

The Art Biennale, a contemporary visual art exhibition and so called because it is held biennially (in odd-numbered years), is the original biennale on which others in the world have been modeled. The Biennale Foundation has a continuous existence supporting the arts.

This year the Golden Lion for the best pavilion has been for Lithuania by the "Sol y Mar" facility, an artificial beach inside the Arsenal's historic building.

The central exhibition is spread over the old Venetian shipyards and in the Giardini. One of the most shocking facilities is perhaps "Barca nostra ", a ship from Libya that sank in 2015, with more than 700 immigrants and refugees aboard. The Swiss artist Cristoph Büchel's project echoes again this drama, one of the worst shipwrecks of the 21st century.

And it really does have a haunting appeal to it.

"I think it is a good thing that the ship is here, as it should be regarded as a reminder of our present. It is not something that no longer exists, something that can be ignored but something that can happen again and unfortunately occurs almost every day in the Mediterranean," laments Carlotta Sami, regional spokesperson for UNHCR in southern Europe.

Special mention for the Mexican Teresa Margolles has re-envisioned the city's canals as a large concrete wall with concertinas to question the public about the divisions and violence that exists in the world.

The Israeli pavilion takes the appearance of an ER in which the visitor can see with despair that there are still 200 numbers ahead in the waiting room…

If you are lucky enough to be in Venice you will have the chance to visit the Venice Biennial until the 24th of November.

Cuba: The Mobilization Of The LGBT Community Challenges the Regime

A rally in Cuba resulted in at least three arrests. Nearly a hundred LGBT activists marched through the streets of Havana today at a new event.

They braved the ban from the regime to claim their rights, and protested against the cancellation of the pride walk, framed by the authorities, before the police dispersed the procession unceremoniously.

A draft amendment to the Cuban Constitution, which would pave the way for homosexual marriage, faces strong reluctance in public opinion, owing to the increasing influence of the Evangelical Church on the island.

Police Crackdown in Mexico

Hundreds of migrants have been detained in a police crackdown in Mexico, the largest registered against a migrant caravan to date. Among the detainees were many women with their children trying to escape the poverty and violence in Central America.

The federal police and the immigration agents were going up to vans to the migrants who were in the tail of the caravan; made up of about 3000 people, who were advancing under a scorching sun by way of dirt road in Chiapas.

According to the Associated Press, some 500 migrants may have been detained before further deportation.

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