Parking Is a Con, Know Different Ways to Improve Parking Scarcity

Parking areas are continuously growing and the number of vehicles being operated is doubling in numbers. All the areas represent indoor and outdoor parking spaces. The parking lots in the public facilities have now become sophisticated, featuring automated exit/entry system and this includes a cash register with video surveillance system and automated barriers.

Parking areas that are in the city center are the top class parking spaces. In fact, this includes the areas near places of attraction and interest such as places adjacent to theaters, museums, railway stations, holy places of visit, hospitals, clinics, and all such places of importance. These are the places where parking is huge, yet is always under constraint. These parking areas are top class and there are video surveillance systems installed.

Parking areas normally located away from the city center are adjacent to important institutions, convention centers, corporate facilities, administrative units, and so on. These parking spaces also have a registering system and video surveillance installed. Here, the vehicles are parked for a restricted time and the charges are doubled when you extend the parking time.

Generally, there are parking facilities on the city outskirts as well. These are mostly huge spaces and here the users can park their vehicles for a longer time, such as entire day and the charge is not much than the bus rides. Nowadays, parking is done in one huge space featuring elevators to transport vehicles to parking spaces on floors. Such areas have automated machines for payment.

Parking tickets are issued on entry to each visitor and they are expected to pay, while some collect the payment on exit. On weekends the parking is more of a problem. In fact, there are parking spaces allotted for regular visitors and such parking spaces are not assigned to others, even during holidays.

Some of the ways to improve scarcity is by:

Improving pedestrian paths and accessibility enveloping the parking space so that it is convenient to walk to the destination. Thus reducing the parking space inconvenience.
Making appropriate usage of space and the parking management should take good care in making maximum use of public transportation so that it benefits.
The motorists also should be charged the same as other vehicles for space. This will restrict the number of motorists or they will make wise use of the space.
The commercial districts parking spaces should be high-priced to ascertain the space of users.
Progressive prices are helpful as it discourages people from long-term parking. Places that discount for long-term counting should be avoided; instead, they should escalate the parking prices, so that the space is freed quickly.
Time variable pricing should be introduced such that the peak hours charges are high and so its demand.
Monthly or weekly pricing should be allotted for long-term users and they will be residents or employees.

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Diversification: When And How Far Should One Go

Diversification today most executives and boards realize how difficult it is to add value to businesses that aren’t connected to each other in some way. Yet too many executives still believe that diversifying into unrelated industries reduces risks for investors or that diversified businesses can better allocate capital across businesses than the market does-without regard to the skills needed to achieve these goals. Because few have such skills, diversification instead often caps the upside potential for shareholders but doesn’t limit the downside risk. As managers contemplate moves to diversify, they would do well to remember that in practice, the best-performing conglomerates in the United States and in other developed markets do well not because they’re diversified but because they’re the best owners, even of businesses outside their core industries.


Diversification is a form of corporate strategy whereby a company seeks to increase profitability through greater sales volume obtained from new products and/ or new markets. Diversification can occur either at the business unit level or at the corporate level. At the business unit level, it is most likely to expand into a new segment of an industry that the business is already in. At the corporate level, it is generally very interesting entering a promising business outside of the scope of the existing business unit.


Like any other structure, this structure has also lot to offer which needs to be analyzed-


The argument that diversification benefits the shareholders by reducing volatility was never compelling. At an aggregate level, conglomerates have underperformed more focused companies both in the real economy (growth and returns on capital) and in the stock market. Even adjusted for size differences, focused companies grew faster.

From the above graph, it can be viewed that a higher % of conglomerates tend to provide returns in the range of 8% to 18% as compared to focused companies. On the contrary, there are much lesser % of conglomerate companies that offer negative returns and also high growth rate returns.

The answer to these patterns is that in conglomerates there are businesses that offer high returns and others which offer lower returns. Thus the returns are averaged out. But in the case of focused companies, those which are performing companies perform either tend to outperform or underperform as compared to its peers. This is because of the fact that the capital that is invested in these companies is focused and thus there is little leeway available for them to maneuver as compared to the conglomerates which tend to readjust their capital as per the situation.


What matters in a diversification strategy is whether managers have the skills to add value to businesses in unrelated industries-by allocating capital to competing investments, managing their portfolios, or cutting costs.

I. Disciplined (and sometimes contrarian) investors: High-performing conglomerates continually rebalance their portfolios by purchasing companies they believe are undervalued by the market-and whose performance they can improve.
ii. Aggressive capital managers: All cash that exceeds what’s needed for operating requirements is transferred to the parent company, which decides how to allocate it across current and new business or investment opportunities, based on their potential for growth and returns on invested capital are rationalized from a capital standpoint: excess capital is sent where it is most productive, and all investments pay for the capital they use.
ii. Rigorous ‘lean’ corporate centers: High-performing conglomerates operate much as better private equity firms do with a lean corporate center that restricts its involvement in the management of business units to selecting leaders, allocating capital, setting strategy, setting performance targets, and monitoring performance.


Strategists argue that there are generally three strategies that a company can use for achieving success – category growth, market share gains (i.e. world class operators & Portfolio Shaper), or M&A.

1. New core may make sense for three reasons.-

I. The first has to do with profits. When the profitability of a business is in secular decline, a new core makes sense.
ii. The second reason is inherently inferior economics. This becomes more apparent when a new competitor enters with a different cost structure.
iii. The third reason for moving into a new core is an unsustainable growth formula. The market may be reaching saturation or competitors may have started to replicate a once unique source of differentiation.

2. Pros & Cons of Diversification:

-Economies of scale and scope
-Operational synergies can be realized.
-Spreading the firm’s unutilized organizational resources to other areas can create value.
-Leveraging skills across businesses can create value.

Transaction costs
-Coordination among independent firms may involve higher transaction costs.
-Internal capital market
-Cash from some businesses can be used to make profitable investments.
-External finance may be more costly due to transaction costs, monitoring costs, etc.
-Diversifying shareholders’ portfolios
-Individual shareholders may benefit from investing in a diversified portfolio.
-Identifying undervalued firms
-Shareholders may benefit from diversification if its managers are able to identify firms that are undervalued by the stock market.

-Combining two businesses in a single firm is likely to result in substantial influence costs.
-Resource allocation can be influenced by lobbying.
-Costly control systems may be needed that reward manager based on division profits and discipline managers by tying their careers to business unit objectives.

Internal capital markets may not work well in practice.
-Shareholders can diversify their own personal portfolios. Corporate managers are not really needed to do this.
-Identifying undervalued firms may not be as easy as it sounds.

Two other themes became associated with diversification – synergy and core competencies. Synergy dealt with the fit between the existing and new businesses. By moving into a new business, could costs be cut or revenues increased? Core competence referred to the bundle of skills and expertise which an organization had developed over time. Diversification seemed to make a lot of sense when the core competencies could be leveraged and extended to manage the new business.

Benefits may come in various forms – better distribution, improved company image, defense against competitive threats and improved earnings stability. When entering a new business, the firm must be able to offer a distinct value proposition in the form of lower prices, better quality or more attractive features. Alternatively, it should have discovered a new niche or found a way to market the product in an innovative way. Jumping into a new business just because it is growing fast or current profitability is high, is a risk that is best avoided. Indeed, opportunistic diversification has been the main reason for the downfall of several Indian entrepreneurs in various businesses including financial services, granite, aquaculture, and floriculture.

Making Diversification Work:

When the core business is under severe threat, some companies go into denial and decide to defend the status quo. Others try to transform their companies all at once through a big merger or by leaping into a hot new market. Such strategies are inordinately risky. In contrast, the most successful companies proceed more systematically.

Strategists believe that making diversification work in well-managed conglomerates, the mediocre performance of unit managers is not tolerated. On the other hand, in focused firms, the CEO, who is effectively the business manager, is rarely sacked unless the performance is disastrous.

Moreover, well-managed conglomerates tend to have a corporate staff that goes through the annual budgets and long range plans of the operating units with a microscope. In contrast, directors of a focused company often do not spend enough time, going into details. In fact, one strategist puts it: “When conglomerates succeed, it is not because of their strengths. It is in spite of their weaknesses. The hidden reason why diversification can work and often does lie in the operation of the system of governance of independent corporations. Boards of directors are not prepared to improve performance standards in a manner comparable to that required by a corporate management.” If a conglomerate selects able unit managers, energize them with a strong corporate purpose, monitors their progress and provides guidance and support when needed, it can outperform the boards of many independent companies.

In focused firms, the top management’s role must be to understand the industry, make the key operating decisions and run the business. In a conglomerate, on the other hand, the top management must govern, not run operations. Its focus must be on selecting, motivating and mentoring the general managers of individual units.

In short, firms that diversify to exploit existing specialized core resources and focus on integrating old and new businesses, tend to outperform firms that make use of general resources and do not leverage interrelationships among their units. Successful diversification involves exploiting economies of scope that make it efficient to organize diverse businesses within a single firm, relative to joint ventures, contracts, alliances or other governance mechanisms.


We are all aware of the famous saying: “Don’t put all your eggs in one basket.” The same applies to the fact that when the firm operates in one single business it exposes itself to various risks that come with it. When a firm operates in many businesses, the downs in one can be compensated by the ups in another.

On the flip side in the boom period the underperformance of one business unit tends to undermine the high growth of other units and in the aggregate, the whole company tends to underperform as compared to focused companies.

Diversification has its own advantages and disadvantages which are more in control of the management and type of diversification i.e. product diversification or business diversification than to external forces as the skill sets required in a diversified company is totally different than compared to the focused companies.

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The Case for Making Invoice Factoring the First Choice in Business Financing

In the United States, Invoice Factoring is often perceived as the “financing option of last resort.” In this article I make the case that Invoice Factoring should be the first option for a growing business. Debt and Equity Financing are options for different circumstances.

Two Key Inflection Points in the Business Life Cycle

Inflection Point One: A New Business. When a business is less than three years old, options for capital access are limited. Debt financing sources look for historical revenue numbers that show the capacity to service the debt. A new business doesn’t have that history. That makes the risk on debt financing very high and greatly limits the number of debt financing sources available.

As for equity financing, Equity Investment dollars almost always come for a piece of the pie. The younger, less proven the company, the higher the percentage of equity that may need to be sold away. The business owner must decide how much of his or her company (and therefore control) they are willing to give up.

Invoice Factoring, on the other hand, is an asset based transaction. It is literally the sale of a financial instrument. That instrument is a business asset called an invoice. When you sell an asset you are not borrowing money. Therefore you are not going into debt. The invoice is simply sold at a discount off the face value. That discount is generally between 2% and 3% of the revenue represented by the invoice. In other words, if you sell $1,000,000 in invoices the cost of money is 2% to 3%. If you sell $10,000,000 in invoices the cost of money is still 2% to 3%.

If the business owner were to choose Invoice Factoring first, he/she would be able to grow the company to a stable point. That would make accessing bank financing much easier. And it would provide greater negotiating power when discussing equity financing.

Inflection Point Two: Rapid Growth. When a mature business reaches a point of rapid growth its expenses can outpace its revenue. That’s because customer remittance for the product and/or service comes later than things like payroll and supplier payments must take place. This is a time when a company’s financial statements can show negative numbers.

Debt financing sources are extremely hesitant to lend money when a business is showing red ink. The risk is deemed too high.

Equity financing sources see a company under a lot of stress. They recognize the owner may be willing to give up additional equity in order to get the needed funds.

Neither of these situations benefits the business owner. Invoice Factoring would provide much easier access to capital.

There are three primary underwriting criteria for Invoice Factoring.

The business must have a product and/or service that can be delivered and for which an invoice can be generated. (Pre-revenue companies have no Accounts Receivable and therefore nothing that can be factored.)

The company’s product and/or service must be sold to another business entity or to a government agency.

The entity to which the product and/or service is sold must have decent commercial credit. I.e., they a) must have a history of paying invoices in a timely manner and b) cannot be in default and/or on the brink of bankruptcy.


Invoice Factoring avoids the negative consequences of debt financing and equity financing for both young and rapidly growing businesses. It represents an immediate solution to a temporary problem and can, when properly utilized, rapidly bring the business owner to the point of accessing debt or equity financing on his or her terms.

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Key Parts And Areas Of Your Car That Also Have To Be Lubricated Regularly

Lubricants play an important role in the smooth and safe operations of a vehicle. With this car product, friction is reduced in the engine. It also minimizes the amount of wear that happens whenever the car is used. Lubricants also reduce the operating temperatures of a vehicle and minimize the corrosion of metal surfaces. As such, for an engine to work properly and safely for a long period of time, it has to be lubricated at the right time and with a good quality of lubricant.

However, aside from the engine, there are also other parts and areas in your car that can benefit greatly from regular lubrication. Although they may require a different type of lubricant, there is no question that your vehicle will work and look better when certain parts and areas are lubricated regularly.

Below are some of the important parts and areas that will benefit greatly from regular lubrication:

The door, hood, and deck-lid or lift-gate hinges and latches. These are parts that can fall victim to regular wear and tear. If they are not lubricated regularly, they can start making squeaking sounds – sounds that aren’t appealing in vehicles. Automotive experts recommend spraying these parts with spray lithium every three or four months. Avoid lubricant build-up by using a cloth to wipe away the excess oil after doing this task. Experts also advice vehicle owners to avoid using petroleum-based lubricants since a lot of car door latches contain plastic and resin parts that can be damaged when they are sprayed or applied with oil.

Door and deck-lid lock cylinders. These parts are now usually underused and under-maintained since most vehicles have remote entry systems. A lot of car owners only use their hard keys until the car battery or sentry system does not work. If these parts are not used, they will be hard to open and they can even begin to rust. Experts say that the best lubricants to use for these parts are the lock de-icers which can be bought at auto-parts store and gas stations. Spray the door and deck-lid lock cylinders with a small amount of de-icer every three to four months.

Manually operated windows. Lastly, if your vehicle has windows that open and close manually, you and the other passengers can have an easier and quicker time closing and opening them with the use of silicone lube. Simply spray the lube into the channel that the glass runs up and down in. Make sure to treat the area of this channel where it runs down into the door since this will also prevent the glass from freezing shut unexpectedly.

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