Silver Fox Advisors May Lunch & Learn

“The Houston Economy”

Patrick Jankowski

Chief Economist

Greater Houston Partnership

HOUSTON, TX (February 24, 2023) – Silver Fox Advisors announced their May 2023 Lunch & Learn Program, scheduled for Thursday May 25, 2023, will feature the Greater Houston Partnership’s Chief Economist Patrick Jankowski. He will be speaking about the “Houston Economy”.

Houston is a Global City by most standards. In addition to its diversity as a community, Houston offers a well-developed suite of key global industries – including energy, life science, manufacturing, logistics, and aerospace. As these industries digitize, Houston is a hotbed of rapid technological development thanks to our access to customers and expertise.

A thriving international city, Houston’s ties stretch to all corners of the world. The region’s geographic location makes it easy to move both goods and people around the globe. With one of the largest ports in the country and two international airports, Houston connects companies to the world.

Our speaker, Patrick Jankowski is the Senior Vice President of Research at the Greater Houston Partnership. He oversees the research department which provides data analysis and forecasting functions for the Partnership. 

His observations and analysis on the local, regional and U.S. economic trends have appeared in over 200 newspapers, magazines, radio and television broadcasts, including The Atlantic, Bloomberg BusinessCNNMoney, Forbes, NPRPBS Nightly Business ReportReuters, The Wall Street Journal, The Washington Post and The New York Times.

Patrick has worked for the Greater Houston Partnership, and its predecessor, the Houston Chamber of Commerce, for 39 years. He has been married to Olga Jankowski for 40 years. Both have been wonderful experiences.

The Silver Fox Advisors’ Lunch and Learn events are held at the Briar Club, 2603 Timmons Lane, Houston, TX  77027. To learn more about the Silver Fox Advisors’ Lunch and Learn Sessions and to register for this Thursday May 25, 2023 event, visit our Website at (www.silverfox.org).  Seating is limited, and due to the special nature of this very informative session seating will fill up fast, so make your reservation today. Tables of eight are available for $350. Lunch will be served at 11:30 a.m., and the Program will begin at 11:50 a.m. sharp.

Silver Fox Advisors are proven business leaders who advise and consult with, and coach and mentor business owners and leaders, CEO Roundtables, and entrepreneurship programs.

For more information visit: www.silverfox.org

Silver Fox Advisors Present

“Foreign Affairs Issues Facing the U.S. in 2023”

HOUSTON, TX (January 17, 2023) – Silver Fox Advisors announced the February 2023 Lunch & Learn Program, scheduled for Thursday, February 23, 2023, will feature The Honorable David M. Satterfield. He will be speaking about “Foreign Affairs Issues Facing the U.S. in 2023”. In addition, Mr. Satterfield will describe the activities of the Rice University’s Baker Institute of Public Policy.

The Honorable David M. Satterfield is the director of Rice University’s Baker Institute for Public Policy and leads the institute’s Edward P. Djerejian Center for the Middle East. He has more than four decades of diplomatic and leadership experience, including service as special envoy for the Horn of Africa, assistant secretary of state, National Security Council staff director, and ambassador to Lebanon and Turkey, and charge’ d’affaires in Iraq and Egypt.

Satterfield’s extensive bilateral and multinational negotiating background most notably includes the 1995 Roadmap for Israel-Palestinian Peace (with the United Nations), the 2000 withdrawal of the Israel Defense Forces from Lebanon and Blue Line boundary agreement (with the United Nations), and the 2008 Status of Forces Agreement between the U.S. and Iraq. As the State Department’s coordinator for Iraq, he managed the largest domestic staff in the department’s history and directed fundamental reforms to the Foreign Service.

As director general of the Multinational Force and Observers, Satterfield conceived and directed the comprehensive modernization of military and civilian peacekeeping operations and led fundraising efforts with the U.S. Congress and donor governments.

Among other honors, Satterfield is the recipient of the highest Department of State recognition, the Secretary of State Distinguished Service Award, and the highest award for senior federal executives, the Office of Personnel Management Distinguished Federal Executive Rank Award.

Satterfield is a graduate of the University of Maryland and speaks Arabic, French and Italian. He is married to Elizabeth Ann Fritschle, a career Foreign Service officer.

The Silver Fox Advisors’ Lunch and Learn events are held at the Briar Club, 2603 Timmons Lane, Houston, TX  77027. To learn more about the Silver Fox Advisors’ Lunch and Learn Sessions and to register for this Thursday, February 23, 2023 event, visit our Website at (www.silverfox.org).  Seating is limited, and due to the special nature of this very informative session seating will fill up fast, so make your reservation today. Tables of eight are available for $350. Lunch will be served at 11:30 a.m., and the Program will begin at 11:50 a.m. sharp.

Silver Fox Advisors are proven business leaders who advise and consult with, and coach and mentor business owners and leaders, CEO Roundtables, and entrepreneurship programs.

For more information visit: www.silverfox.org

Increasing the Pricing of Your Products and Services

Over the past several years I have written articles regarding product and service pricing and have made recommendations to my clients regarding the pricing of their products and services. These suggestions were based on my belief and experience that most businesses can pass on at least a 2 to 3 percentage price increase in their respective products and services to their customers each year and should do so annually at the same point in time, say January 1st.

Few customers if any will even notice that small an increase. If you are not doing this type of systematic pricing increase, your bottom-line profitability is going to suffer because the costs associated with running your business are increasing. If you don’t increase your pricing, you are simply absorbing the increases in your expenses (wages, insurance, rent, utilities, taxes, office supplies, advertising, and, the list goes on).  

An Example

One example I like to use to demonstrate this point is to take any year-end income statement for your business and add 3.0% to your revenue figure; see what that does to your gross profit margin and your net profit margin. Most business owners I ask to do that exercise will come back and tell me they are amazed, and they all wish they would have done something like that sooner.

What prompted me to write this article about increasing pricing for products and services is the present inflationary market we are experiencing. With the last published inflation rate of 9.1% (a 40 plus year high), if you are not increasing your product and service pricing right now by at least 9.1% your bottom line will be greatly affected in a negative way for 2022. I would almost guarantee you that you are experiencing increases in almost every expense item, like the ones I mentioned earlier.

Avoid the Wait

Further, if you wait until next year to increase your pricing, we could be operating in a much different business environment, perhaps a recession, and then it will be very difficult to pass product and service pricing on to your customers.

I recently heard of one business that decided to do a 25.0% increase in its service fee and add a 5.0% monthly fuel surcharge to its pricing, and it experienced had no questions or complaints.

I know and understand passing a double-digit price increase on to your customers might not be possible in every situation due to differences in competitive environments. But I would guess you could pass the inflationary rate of 9.1% on to your customers as a fair increase.

Lastly, I also know and understand that by increasing your product and service pricing you might feel like you are adding to the inflationary spiral. However, if you don’t increase your pricing as stated above, you will be simply absorbing the increases yourself in the goods and services that you have to pay. A simple saying, I have stated over the years might apply here: “Do you want to pay your mortgage payment, or do you want to pay someone else’s”?

POSITION PAPER ON NON-PROFIT ORGANIZATIONS

Most non-profit organizations’ fundraising struggled in 2020 and 2021 as the Covid 19 economic shutdown forced in-person donor and financial supporter functions to be greatly limited in size and scope or even canceled. Some organizations moved to computer-generated fund-raising events but these events were not as successful in raising money as the more face-to-face get-togethers had been. In addition, many businesses struggled financially just to get their employees paid and their doors open, thus having monies for support to charitable organizations and causes was and is simply just not there.

Further, in Houston, Texas the oil bust of 2020 caused many large companies that operate in the energy sector to limit or completely do away with charitable contributions.

Even prior to these 2020 events there had been a “Trust Crisis” developing regarding non-profit organizations. Ben Gose, a contributor to the Chronicle of Philanthropy, addressed this topic in an article he wrote that was published in the Chronicle’s January 7, 2020 newsletter. This article is very enlightening and worth reading.

fund raising

With all this being said, there were also several very emotional political causes being promoted in this time frame, and many corporations began making contributions to certain groups and causes to show their stakeholders and customers that they are good corporate citizens and are providing support to these groups and causes.

On the Foundation giving side of fundraising, the story was somewhat different in that the stock market provided many Foundations that support non-profit and charitable organizations, increases in their corpora, thus enabling them to have the funds available to make contributions; however, these Foundations are getting more requests than ever before.

Further, Foundations have refined their requirements and giving criteria such that the request process has gotten more detailed and lengthier with committees and/or staff having to evaluate requests more thoroughly and provide the Board with very specific recommendations. Most Foundations today require at a minimum that organizations seeking funding have audited financial statements, which is an added cost burden on these charitable and non-profit organizations. Most Foundations will also check with Guide Star/Candid(1) to see if the organization has filed all the necessary organizational documents, like financial statements and 990 Tax Returns with Guide Star/Candid.

NON-PROFIT ORGANIZATION RECOMMENDATIONS

Richard Hendee/Horizon Associates, Inc. has been working with and assisting non-profit organizations for years. Further, Mr. Hendee has started several non-profits and has sat on numerous non-profit organization boards. He never agrees to serve on any non-profit board if that organization doesn’t have Director and Officers (D & O) Insurance coverage. In today’s litigious environment legal action of some kind is, unfortunately, a given. Even if the organization did everything right and by the book, if a suit is brought against the organization, typically the Directors and Officers are included in the suit, and the expense of hiring an attorney to defend being right can get really costly, an expense most individuals do not want to risk their personal assets for. Having D & O insurance coverage is a must for any non-profit.

Here are some other key recommendations:

  • Run the organization just like any for-profit business would be run. Eventhough the organization has been given non-profit status by the IRS for federal income tax purposes, it is still a business.
  • Develop a well-thought-out (not wordy) Mission and Vision Statement that clearly states the organization’s purpose and future direction.
  • Create an organizational chart that includes position titles and functional areas of responsibility.
  • Identify areas that need specific levels of expertise, like legal, accounting and human resources, and contract with outside service providers to assure all the details are done correctly from the start, like the Bylaws.
  • Set-up the organization with the Secretary of State in the State the organization is located in and make sure updates are filed periodically.
  • Prepare a thorough detailed Business Plan which includes what the organization does, for whom is does it, how it will do it, who are the management team and board members and what are their levels of experience, who are the competitors, how the organization will be marketing what it does, what the organization’s strategic plan is, and the key: how the organization will be funded and what happens if there are shortfalls in the funding.
  • Develop criterial governance policies like code of ethics, conflict of interest statement, whistleblower policy, directors’ roles and responsibilities, gift giving policy, investment policy, internal controls, and record retention policy.
  • Schedule monthly and annual Board Meeting dates and times and hold these meetings using a formal Roberts Rules of Order(2) process. Agendas need to be created prior to the meetings and sent out ahead of time with any related agenda item documents in order that directors may have an opportunity to review documents prior to the meeting. Further, meeting minutes should be taken at these meetings and approved at the next Board Meeting.
  • Create working Committees like Fundraising/Development, Audit, Finance, Nominating, Executive (if needed). Make sure these Committees meet regularly, take minutes, have specific assignments, and periodically report to the Board.
  • Create a Community Advisory Board made up of key visible community leaders, key business executives, and community group leaders who all can be called upon for fundraising assistance, opening doors that may need to be opened and/or providing invaluable information and support about the communities the organization may be servicing. Try to stay away from putting political officials on Advisory Boards.
  • Assure that the organization is properly protected by carrying General Liability Insurance, Hazard Insurance if the organization has a lot of fixed assets, Workers Comp. if the organization has employees, and event riders to these policies for fundraising events like Galas, Hunting Trips, Golf Outings, Trade Show Events, etc.
  • Create budgets and fundraising goals and regularly review and measure actual results.
  • If the organization has real estate, apply with all taxing authorities for a reduced property tax schedule.
  • Hold annual board retreats to develop annual plans and a five-year strategic plan. These plans should be evaluated and adjustments made periodically especially if a major event occurs.
  • Develop a robust communication plan to keep your sponsors, supporters, stakeholders, community groups, and volunteers updated on the organization, events, and developments.
  • Establish a volunteer group that can be available to help with projects, events, manpower shortage, and the like. These volunteers need to be informed and made to feel they are a part of the organization and a valuable resource.
  • Participate in local Better Business Bureau (BBB) non-profit evaluations. Often individual gift-givers check with the BBB to see if the organization has any complaints filed with the BBB.
  • Prepare collateral materials (3) that communicate your messages and what you want others to know about your organization. You want to make sure that your message is in your words to avoid any miscommunication or key details being left out in any communication chain.
  • Develop an annual giving campaign that is geared around some important date related to your organization, like the founding date. You could always use the end of the year date, as some contributors do tax-saving contributions at that time of the year.

Horizon Associates, Inc., founder by Silver Fox Advisor, Dick Hendee, has developed this non-profit organization position paper to provide non-profit organizations some guidance and assistance as individuals set up a non-profit organization and to provide existing non-profits some directional changes or planning ideas if needed Horizon Associates, Inc. does not guarantee using any of this material will result in your organization being able to achieve any specific results.

  • (1) GuideStar/Candid is an information service specializing in reporting on U.S. nonprofit companies. In 2016, its database provided information on 2.5 million organizations. In February 2019, GuideStar merged with Foundation Center to become Candid.
  • (2) Robert’s Rules of Order is the basic handbook of operation for most clubs, organizations and other groups. So, it’s important that everyone know these basic rules! Organizations using parliamentary procedure usually follow a fixed order of business.
  • (3) Collateral material is any media material used to promote a company’s products or services. This includes everything from print materials like posters and flyers to digital content like catalogs and e-magazines. Anything you can use to communicate your company’s brand message is considered marketing collateral.

Alligators in the Swamp

In my office, I have a plaque on the wall that was given to me thirty years ago, and it has helped me over the years to stay focused. The message reads: “When you are up to your backside in alligators, it is difficult to remind yourself that your initial objective was to drain the swamp”.

Too often in business today I see company owners struggling for years with some of the same underlying issues because they never really address the issues that are causing their problems to recur. Let me give you some examples.

“I can’t get good people to stay with my Company”. The underlying issue could be a lack of current well-written job descriptions. Why is this important? If you provide an outdated vague job description to a new employee and that employee does not do the job expected, then whose fault is that? Or, if pay increases, incentive, and/or recognition programs are not in place to reward employees for good or exceptional performance, why would that superstar employee stay with the company when other companies have those types of programs in place? The days of a person staying with a company for an entire career and being happy with a gold watch at retirement are long over.

“I wish I could get my people to do the job right the first time”. This could be a problem of simply not having a well-documented process for those key processes in the company. Some business owners tell me they have a process manual someplace, and when they find it, the dust accumulation is a telling sign of the last time it was opened. Further, in today’s world of messages limited to 144 characters, a longwinded exposition is likely not going be read all the way through, or even understood for that matter. Think about redoing and updating your process manual in a colorful flow chart format with short sentences in boxes and arrows pointing to the next steps.

One last example: “I wish I had better cash flow so I could grow my business”. Being a former banking executive, I have heard this one more often than I would care to remember. Having adequate cash flow to grow any business is so critical to the business it should be paramount in every business owner’s mind. Make and take the time needed to understand and plan cash flow, and study what causes cash flow to increase or decrease.

Without cash flow, the business is not a business for all practical purposes. I will admit cash inflows can and do happen if you are selling something, but the timing of cash inflows and cash outflows is what needs to be understood, planned for, and monitored on an ongoing basis.

If some of these phrases are familiar to you and you think it is time to address the real underlying issues, and you need assistance with your planning, you may want to consider working with an experienced Silver Fox Advisor and business professional. I encourage you to visit our website at silverfox.org to learn more about the Silver Fox Advisors, including their business advice, consulting, and mentoring offerings.

Dick Hendee, Chairman 2020
UPCOMING EVENTS
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