The goal for my day was to focus on Germany, and also on the e-commerce presentation for Thursday, however I needed to go in to the office because Mossy was ready to go on with the accounting system, and I did not want him to be delayed because of me. So once I got there, naturally I ended up spending two or three hours on with administrative work, and then did spend some time with Mossy and the accounting system. not that it is up to speed right now, but rather we are working on SOP’s and methodology of how to get all the data from all the different accounts into the system, and how to be able to either outsource it or how to do it in-house.
Mina has been doing a terrific job on working on the costing model forward Germany, and she is definitely in her zone. She put together a beautiful summary of all the information, and leveraged all the teams knowledge to get the put together.
The numbers actually very reasonable in terms of our costs, but in the end its not about the cost, but about deploying these results is to the highest value. I have long decided not to be in a service provider mode, since it doesn’t scale – so whatever I do, MUST scale.
So I spent the evening, looking after the very broad long-term strategy for the German shoe market, and looking to see how it plays out. Anyway, it is quite interesting, because some the same phenomena and I think that happened in the US, where the smaller businesses squeezed out by large Wal-Marts is going to play out in Germany, and from what I see out there is a huge scramble for consolidation between the smaller players, which is definitely a must, as a protection mechanism against some of these large players coming in.
So, I have been looking at how this place for RedStores over next five years, and whether this opportunity is just a safe bet where you make him a few million dollars along the way, or is this one of the place that you can actually go and make him a few hundred million dollars. So, one of the things I think I have been very fortunate about is that I have so many opportunities in front of me, that I can be selective in the opportunities that will create the the biggest value for red stores, and also for the red stores shareholders. So, when evaluating the business opportunities I need to look at the long-term value that a certain opportunity brings to the table
Based on my analysis, I see some opportunity in Germany, some very big opportunities in fact, however, the question is are the partners in Germany willing to change their business model, or perhaps, departs from the traditional way of doing business, to go after the really big story.
So, I am still of the exploration stage right now, gathering the costs, and I am moving everything forward, but I am also looking at the market, at the shifts in buying patterns, then what is happening with the brick-and-mortar, and how that will play three or four or five years from now.
I put together an internal document just for myself, that details some of my my thoughts and some of my ideas, and it was basically meant as a way for me to crystallize my thoughts and to be able to look at it tomorrow with another review, to see are missing any angles.
So, the bottom line it is, that. I think Germany can easily yield nice profit for the business, and it has the opportunity to grow, but the question is does the profit going to be big enough, and is going to grow fast enough, to actually make an interesting play for RedStores.
For purely selfish point of view, I would very much enjoy doing this project, because it is quite challenging, it has a lot of interesting factors, and it would give me something to sink my teeth into. The people involved are great, and I would have a great deal of fun and excitement working this. I think the team would also love working on this also However, from the business point of view, I am not sure if I have the luxury to indulge myself in that way, because if I have to sell this to the board, I would be seriously questioned about the kind of ROI and the kind of multiplier that I would be able to bring to the table in the long-term.
So, the risk here is that I”m over thinking this, and that I may be giving up something that is excellent, and that could yield future business, however at the end of the day am I have been passing along a number of business opportunities already, passing them on to to friends and other people, because they did not fit into my portfolio or my long-term strategy. So, my challenge now is to see how I can make this work so that it meats the German needs and also my long term needs.
Besides all this deep thinking (or whatever you may want to call it), I spend a few more hours this evening on banking, and the looking at cash flows, and preparing for some of the interviews tomorrow. Basically, I am looking for a strong controller that will enable me to get financial visibility across all the businesses. Right now, with the business model that is set up, the reporting and reviewing of all the financial data is actually quite cumbersome, and does require quite a bit of time commitment to get it all set up. However, this is one of my top priorities right now, as to fix this area, because right now I feel like I am in the car that has the windshield slightly flawed, and I am not able to step on the accelerator because I cannot see clearly what is ahead of me. So I need to get this fixed so that I can really step on the pedal and go forward.
I am kind of wishing for a bit more personal time for this week, but I think the weekend will be my time to catch up. I am slowly starting to bring in balance into my life, and one of the things I did today , was to get back into the habit of task management, and scheduling the days ahead.
With those thoughts,it 12:30 AM time for an early night tonight.