Why did IBM fail at PCs?

Why did IBM fail at PCs?

If you ask why did IBM fail, I assume you mean why did IBM ultimately fail in the personal computer market. IBM is still in business, after all. But its exit from the PC market after 24 years, including a period of dominance in the 1980s, does seem curious. And it raises another question: What does IBM do now?

I experienced IBM’s fall in this market firsthand. I sold computers at retail in 1994 and 1995. IBM’s computers at that time were no worse than anyone else’s, but I had an extremely difficult time selling them. Many consumers didn’t trust IBM and didn’t want to get somehow locked in. There was nothing wrong with those machines, but it sure was a lot easier to just sell them a Compaq.

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Garage sale tips and tricks for buyers

Garage sale tips and tricks for buyers

I am a garage sale pro. Over the course of a decade, I attended thousands of garage sales, saved thousands of dollars buying things for my own use, and made tens of thousands of dollars reselling my loot (yes, I had a business license and declared it on my taxes). Here are my favorite garage sale tips and tricks for buyers.

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Buying that Nook was more work than it needed to be

I drove to the Kmart the 90s forgot–on Manchester Avenue in St. Louis, if it matters–in search of a $70 Nook Simple Touch. I found it in the electronics section, in the very back of the store, in a glass case with a bunch of obsolete stuff. If you need VHS tapes, I know your place.

The price was wrong. That was a bad sign, but I waited until the clerk wasn’t busy.

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Digital distribution, not SOPA and PIPA, is the best long-term solution for the MPAA

Fightforthefuture.org declared victory yesterday, saying that SOPA and PIPA have been dropped. Their e-mail said some other important and interesting things, but most importantly, it made some references to China. Communist China. Totalitarian Communist China.

The distinction is important.
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I hope this new recordable DVD format catches on

In October, LG and its startup partner Millenniata plan to release a new type of DVD, which they claim will last forever. The Navy doesn’t come right out and say it lasts forever, but it does say in its tests that these discs, called M-Discs, do last considerably longer than the traditional DVD-R and DVD+R discs on the market today.

I hope this catches on, but it’s possible it won’t. Why? Cost.

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If you’ve been delaying upgrading your network, keep delaying

If you’ve been procrastinating about deploying 450-megabit (802.11n) wi-fi to your house, I have a reason for you to procrastinate a while longer: Gigabit wireless (802.11ac).

It’s only about twice as fast as its predecessor, which pales next to the 8x improvement 802.11n provided over 802.11g, but if you’re wanting to stream HD media through your house, you’ll notice the difference.
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Tips for running a garage sale

On a forum I frequent, the discussion turned to garage sales, and some people shared some horror stories. As someone who visits a lot of garage sales, I’ve seen the ways people deal with some of the pitfalls. In the interest of encouraging garage sales, I’ll share my tips for running a garage sale.

tips for running a garage sale
Quick: can you spot the common (but very serious) error in this photo of a table at a garage sale? Keep reading and you’ll find the answer. This may be the most valuable of my tips for running a garage sale.

One problem is people showing up at 5 or 6 in the morning wanting to get in early. The best way to prevent this is to be vague about your address. Be specific enough that they can find it, but vague enough that they can’t find it early. What do I mean? Don’t say “2329 Jefferson” in your ad and streetcorner signs. Say “single-family sale, 23xx Jefferson.” Then, when you’re ready to open your sale, put a sign in your front yard and open your garage door. Last of all, have a helper go out and put some signs on nearby major intersections.

The early birds can still show up if they want, but they’ll have no choice but to sit in the car and wait for you, since they won’t even know for sure which house is having the sale. Only the people really, really serious about buying something will, and those are the people you want.

Lowballers are the other problem. I’ll admit, I’ve asked for discounts before when buying large quantities of stuff, but I don’t demand them. I see some people demanding discounts on everything, no matter how low the initial price is. Yes, I know that’s annoying. I’ve actually had people running sales ask me if I’m interested in the same thing they’re getting lowballed on, in hopes of selling it to me instead. Garage sale prices are already pennies on the dollar, but some people insist on squeezing out every last penny.

The best tactic is to lower your prices late in the sale, say, after 10 am. Advertise that prices will be 25% or 50% off at 10 am, and maybe knock something else off at 11 am. When a lowballer tries to play games with you, just say, “no discounts until 10 am.” They can come back then, assuming the item is still there. If they really want it, then they’ll pay your asking price.

Do be realistic about your prices, though. I once went to a sale, picked out 10 items (unmarked) and asked how much. I was expecting $10, maybe $20 at most, based on what I paid at other sales. She asked $60.

What did I do? I went through the pile again. It turned out half of it was stuff I could turn a small profit on at $6 each. Half of it was stuff I couldn’t sell for $6 myself. So I put those back. I reluctantly paid $30 for the other five. I honestly doubt anyone else expressed interest in what I put back. If it ever did sell, I’m sure she didn’t get $30 for it.

If you don’t know how to price something, visit a few sales yourself to get an idea what stuff goes for. Or at least visit your nearest thrift store and see what they charge for the kind of stuff you’ll be selling.

Leaving items unmarked and soliciting an offer encourages lowballers to offer 10 cents for things that ought to be priced a dollar. Or it leads to awkward exchanges like mine, where someone puts most of it back.

Do keep in mind a significant number of people who come to your sale are looking for things to re-sell. They may have a booth at a flea market or antique mall, they may sell on eBay, or something else. You’ll have some bargain hunters and curious neighbors, but most likely the majority will be resellers. Their profit margin isn’t your main concern. But the general rule of reselling is that 3x markup is the minimum that works. If an item sells on eBay for $10, the most you’re going to get from a reseller is about $3. The reason is because eBay is going to take $1.50 in commissions. The government is going to take another $1.50 or so in taxes. So the seller spends $3 to make $3-$4. But of course the seller would rather spend $1, sell for $10, and make $5-$6.

I’ve seen old Marx train cars priced at $50 at garage sales because the seller claimed he saw one just like it go for $100 on eBay. In the cases I’m thinking of, it’s always been a very common car worth no more than $20, so I know the seller was either lying or mistaken. If you think you have something really special, my advice is to attempt to sell it on eBay instead. You’re not going to get eBay prices at a garage sale. Essentially, as a garage sale operator, you’re a wholesaler.

If you don’t want to hassle with eBay, take a name and number from anyone who shows interest.

One tactic I see sometimes (and my family used) is to advertise a sale as a moving sale instead of a yard or garage sale, in order to get better prices. Advertising a moving sale can allow you to get better prices for your highest-end stuff, like furniture or nice electronics or perhaps name-brand clothes in nice condition. But things like used toys and VHS tapes sell for about the same price no matter what you call the sale.

Some people post phone numbers in the ad. Unless the ad runs the same day as the sale, this is a mistake. It’s just asking people to call you and want to see your stuff early. I admit I’ve done it myself. There have been a couple of times that I couldn’t find a sale, the ad had a number, and I called for directions and ended up buying a lot of stuff. But if you don’t want people calling you all hours of the day in advance, it’s probably not worth it. Putting a nearby landmark in your ad is just as effective and saves you the phone calls.

Finally, I’ve seen people take out ads a week or two in advance of the sale. I don’t see the point. Most circuit regulars don’t plan beyond the upcoming Saturday. So placing an ad early just forces you to do a lot of explaining to disappointed people that the sale is next week. The best day to advertise is the Friday before. The day of the sale is often too late, as many people have already made their plans. An ad in Saturday’s newspaper can draw in people who change their plans on Saturday morning, or people who plan spontaneously. But if you’re paying for the ad, Friday is best. If you advertise on Craigslist, run your ad early in the week and refresh it closer to Friday.

Did you catch the mistake in the photo at the top? Arguably there are two, but one of them is worse than the other. Organizing the stuff into logical groups would help it to sell better. The toy cars, the tools, and the electronics ought to all be together, rather than making it look like someone dumped a box of random stuff onto the table.

But the bigger problem is no price tags. The box of miniature light bulbs in the upper right would easily sell for $10 online. Mark it at $3, and it will sell. Unmarked, don’t be surprised if someone offers 10 cents.

And those are my tips for running a garage sale. I hope they help you have a less frustrating, more successful sale.

Best. Documentary. Ever.

Tomorrow is Labor Day. If you’re like me, that means you don’t have to work.

If you need a reminder of what you wouldn’t say you’ve been missing, Bob, then you need to watch Office Space.Haven’t seen it? Don’t rent it, buy it. The VHS will cost you about five bucks. The DVD costs about ten. Trust me, this is a movie you’ll watch over and over. I’m sure I’ve seen it more than 14 times and it never gets old.

Of course reality is usually more ridiculous than this movie. For example, I had to sign a document this week where I basically agreed not to rearrange the icons on my desktop without getting approval from upper management. I can’t do anything without prior approval unless it’s in some policies and procedures document. Of course if you could anticipate everything that could happen with computers and write policies and procedures that cover all of it, you wouldn’t need IT people. High-level executives, insurance representatives, semi-trained monkeys, or other unskilled labor could do the work.

There’s something in the film that’s always bothered me. Bill Lumbergh’s parking spot is second-closest to the building, next to the handicap spot. One place I worked, the executive spots were closest to the door. The handicapped and expectant mother spaces were second and third closest, respectively.

Why don’t you share your best Office Space-like story?

How to make more money, but more importantly, keep more of what you earn

Most GenXers don’t spend their money wisely.

That’s not an insult on my peers; there’s plenty of blame to go around. Yes, we want what our parents had at 50 and we want it at 25, but part of the problem is the images all around us tell us we have to have all that. And if my education is any indication, the only financial education I received in school was an aside in a U.S. History class.

Let’s talk about how to earn more to dig out of financial ruin, and how to stay out.First and foremost, usually when people get to the point where they start typing “earn more money now” or something similar into Google, usually they need immediate help. A year ago, I was in that situation. Talking it over with the higher-ups didn’t help–a few months later I lost my job. Ouch.

I’d be lying to you if I told you I wasn’t bitter. I still am. But in a way it was the best thing that could have happened to me, because it forced me to look for opportunities. I already had been, but it forced me to find others that I probably wouldn’t have, otherwise.

There are a few ways to make a little money but it won’t necessarily happen immediately. If you have a web site, put Google ads on it. Click my link to find out how. Whether you get your first check in a month or in a year depends on how much traffic you get. A faster way to make a little money is to sign up for some online surveys. You won’t get rich, but a dollar here and five bucks there adds up. Sometimes you’ll hit the jackpot and qualify for a $25 survey. That won’t pay the mortgage but it will pay for a few meals.

Here’s another idea: Become a mystery shopper. Google for it. But don’t pay anyone to become a mystery shopper, not when there are legitimate outfits who are willing to pay you. Just keep in mind some of them want references. That’s actually a good thing. It protects your reputation and theirs. Again, it’s not big money, but it’s fairly easy money.

But I’ll be blunt: If you’re in some real trouble and there’s a bill that’s due in two weeks and you can’t pay it, then it’s time to make some sacrifices. Do you have any recent video games? Any collectible CDs or DVDs or VHS tapes? Collectible toys, such as Star Wars figures? There are lots of places that are willing to buy things like that, but to get top dollar you have to sell it yourself. Search eBay, find out what your items or something similar are selling for, and think seriously about liquidating some stuff. Don’t sell your family heirlooms, but if there are things that you can sell now to get you out of trouble and replace later when you’re out of trouble, consider it. While collectibles do increase in value, I’ll let you in on a dirty little secret: Most of them are doing well to keep up with inflation. None will increase as quickly as your debt–not for a sustained period of time, at least. If you have something that is, sell now. The bubble will burst, and you’ll be able to buy it back cheaper later.

And something sobering will happen as you research what some of the things you own are worth. You’ll find a lot of them aren’t worth anywhere near what you paid for them. There’s a lesson there. It’s much better to spend your money on things that hold their value than on things that have bling factor but have no value once the 14-day return period is over.

So when you have money again, spend less on worthless things so you have more to spend on things that do hold their value. A big truck turns heads and lets you bully people on the road (and the ads to some degree encourage it) but can you really afford $40 a week to keep gas in it? Do you have to haul stuff often enough to justify that expense? For the majority of people, it’s much better to drive an economy car and put the money you save on the lower payment and less gas towards paying off debt. Borrow or rent a truck those occasional times when you need to haul something. So skip the Hummer and get a house. You need a house anyway, and while a Hummer will lose value when you go to sell it, a house usually will gain.

Let’s go back to the eBay thing for a minute. Ebay does a lot of good things. Once you’ve sold your stuff, you have the option to go buy more stuff to sell. Buy what you know and only what you know, and only if you can buy low and sell high. If you can’t either double your money or make $10, don’t bother. It’s best to find something that lets you do both. But if you have the ability to do that, you have an asset that stands a chance of turning your financial situation around within a few years.

But it also does something else. It teaches you how to sell. There is no better, more useful ability than how to sell. Not everyone sells merchandise for dollars, but everyone has to sell ideas. If you regularly find that people don’t listen to you, then that’s a good indication that you need more salesmanship ability. Yeah, but those people are idiots, you say. Even better. There are more idiots out there than smart people. Most rich people got rich by getting idiots to buy their junk.

I remember reading a line in a book once that asked me if I could make a better hamburger than McDonald’s. Of course I can. So why did Ray Kroc have more money than me?

By the way, I don’t mean any insult by any of this if people don’t listen to you. There are a lot of people who don’t listen to me either. I need to work on my sales skills as much as anyone.

I did something else before I started selling my stuff. I took a walk. I walked at least once a day. But I didn’t just walk. I was picking up aluminum cans. At 40 cents a pound, an aluminum can is worth about a penny. There’s no way I can pick up 100 cans in an hour, so it’s a lousy way to make money. But nobody else was paying me to do anything else during that time. I made sure I didn’t walk during working hours so I wouldn’t be out if the phone rang with a job opportunity. At least I felt like I was doing a little something. It was very little, but it kept my mind off things so I didn’t get as depressed. It also helped me watch for opportunity. Those cans aren’t worth anything, but the ability to quickly spot things of value from far off is worth something. It made a few house payments when I didn’t have a 40-hour-a-week job.

That’s enough talk about making money. I’ll admit that they’re just general ideas. I can’t give specific advice because something that works where I live might not work 100 miles away. Something else works there. The nice thing about the United States is that there always is an opportunity, no matter where you are. Although politicians seem to be trying their best to destroy that, they can’t destroy opportunities as quickly as you can find them.

I read a study this past week that said 70% of college graduates today can’t balance a checkbook, and when presented with a 20-ounce jar of spaghetti sauce for $1.99 and a 32-ounce jar for $2.49, they don’t know how to figure out which one is the better deal. That should scare some people.

But it occurred to me that I didn’t learn how to do that in school. I learned it from my mother. And I think she learned it from her mother, who must have known it because she managed to raise 11 kids and her husband didn’t have any money.

They don’t teach that kind of thing in school. To me, that’s the only thing math is good for. But I don’t know how old I was when I realized math was useful for that. Before that I thought math was just something teachers used to prove they knew something I didn’t.

There are lots of books out there that try to teach you how to make more money. But a more valuable skill is learning how to spot the good deal. Learn how to calculate the cost per ounce and use it. Carry a calculator with you if that’s what you have to do. There’s no shame in that. A calculator is also a useful tool for keeping a running total of the cost of the stuff in your cart. So it might be a good idea to carry two calculators. They’ll pay for themselves the first time you use them.

And if you have any influence with math teachers, please hand them this word problem. It’s the only good use of math I can think of for a non-engineer:

A television costs $199 at a store two miles from you. The sales tax rate in your town is 5.75%. The same television costs $179 at a store 100 miles away. The sales tax rate in that town is 6%. Your car gets 25 miles to the gallon. Gasoline costs $2.00 a gallon. Is it cheaper to buy the television at the store two miles away, or is it cheaper to buy it 100 miles away?

I’ll conclude with the secret of getting rich. The secret isn’t to make lots of money. It’s human nature to spend more money as soon as you make more money. The secret is to spend less.

I remember when the first of my college classmates bought a house. He told me that at the end of the paper, it told him how much money the loan was for, and how much money he would pay between then and the end of the term. “Am I really going to make that much money?” he asked. Then he laughed it off.

He will. So will I. So will everyone. Most people living in the United States will make a lot more than a million dollars between their first job and retirement. The question is whether Nike and General Motors and Phillip Morris and Coca-Cola get to keep most of it, or whether the wage-earner gets to keep most of it.

I really don’t like the tone of this rant–and it basically is a rant–because it sounds like someone who made it looking back. I’ve only started the journey myself. I started 14 months ago. But my wife and I already have something to show for it. We have no credit card debt, we own two 2002 Honda Civics outright, and if we can keep up our current pace, we will own our house outright in a little over three years. Five years is probably more realistic.

Remember, around 12 months ago there wasn’t enough money to pay the bills. So if I can do it, lots of people can.

Confessions of a former Best Buy salesman

The State of Ohio is suing Best Buy. One former employee talked about his experiences working for the company.

I last worked for the company in 1995. To its credit, the company did much to persuade me to finish college: It motivated me to get an education so I could get a better job. A few things have changed since 1995, but what I’ve read today about the company rang so true.It might not be a good idea for me to say a whole lot more, seeing as my experiences are limited to working at two different stores nearly a decade ago, and seeing as my name is on it.

But what “Hopjon” said is very, very similar to my experience.

Extended warranties

They’ve never called them those, because extended warranties have a bad rap. They were called “Performance Guarantees” in my day. Now they’re PSPs, or “Performance Service Plans.” For a Benjamin or two, they’ll stand behind the product if it breaks outside of its manufacturer’s warranty period.

“Hopjon” says these warranties are misunderstood, if not downright misrepresented. My experience matches his. I was told that the “No Lemon” clause would replace the product the third time it had to come in for service. This was what my manager told me, and what I related to customers.

I found out the hard way, and to my great horror, that this isn’t the case. If you read the fine print very carefully, it stated that this replacement happens on the fourth service call. Not very clearly, mind you. Customer service knew the difference.

The difference is profitable.

Now, was it malicious? It’s hard to say. None of the managers who trained me were as smart as any of the managers I had when I worked fast food. The question is whether they were told the same thing I was told, or whether they were just told to read it, and someone higher up was hoping these misunderstandings would sometimes occur.

Upper management saw to it that much more time was spent explaining the benefits of 900 MHz cordless phones than all the terms of the extended warranties. (At the time, a 900 MHz phone was a $400 item.)

Whether to buy the extended warranty depends on the quality of the product and the cost of the product versus the cost of the warranty. If you choose to buy one, go over the terms with customer service. Don’t go by what the salesperson says.

Was I pressured to sell the warranties? Yes. Did I? It depended. When there was something in it for me, I sold more warranties than anyone else in my department. When the incentive wasn’t there, I could go weeks without selling one.

Employee expertise

The people who work there very rarely know much of anything special about what they sell. The managers were moved around from department to department. During my second summer with the company, the former computer manager was managing audio. The computer manager had been the manager of CDs and VHS tapes the summer before.

For a few weeks that summer, I worked in audio. I had been the most knowledgeable person in the computer department, by a long shot, especially when it came to any computer more than a year or two old. If the question involved a 286 or an XT, I was the only one who had a chance of answering the question. A customer only ever stumped me once, and that was someone who wanted to hook up an IEEE-488 printer to a PC. I’d never seen the cable he brought in before.

But for a couple of weeks I worked in audio, because my old boss wanted me. Eventually I moved back into computers because the computer people kept dragging me back over there to answer questions, and it didn’t look good to have some guy from audio answering all the computer questions.

The training is nothing. They have training sessions once a month, where they hand out manufacturer-supplied literature that gives an overview of the product, and then you take a test. You eventually have to pass it in order to stay gainfully employed, but the tests aren’t all that hard. I only missed one question on the Windows 95 literacy test on my first try, without ever looking at the educational literature.

Whatever the employee knows was gained on his or her own time. On company time, you’d better find a way to look busy, or else a manager will find something for you to do. Probably unloading the truck.

No pressure

That’s the mantra. It’s bull.

Now it’s true that the salespeople aren’t paid on commission. When I was hired on at age 19, I made a flat $5.35 an hour. That was 55 cents an hour more than I had made as a cashier at a now-defunct roast beef chain. Minimum wage was $4.25 an hour, as I recall.

Occasionally there were contests based on performance. Sometimes it was sponsored by one of our suppliers. Some days a store manager felt generous and would come by and tell us whoever sold the most warranties that shift would get a free CD.

But store managers got monthly bonuses based on sales. So, in effect, the managers were paid on commission. And yes, they did pressure the people under them.

So the people who do most of the legwork aren’t paid on commission, but the pressure is still there. In effect you get the worst of both worlds.

Bait and switch

I only remember one specific incident involving a printer and the person at customer service refusing to honor the posted price, and the department manager getting involved. Ultimately the customer was offered another, much more expensive printer, which he refused. The details are pretty hazy though. The customer was clearly right and the manager yelled at me after he left.

I do remember employees being accused of bait and switch by customers, and sometimes bragging about how close to the legal limit they’d come, but had just skirted the line.

The general attitude was that since they offered rain checks on sale merchandise that was out of stock, bait and switch was impossible.

Used merchandise sold as new

I had one manager who was especially fond of re-shrink-wrapping returned merchandise and selling it as new. This is against corporate policy, and it doesn’t necessarily go on everywhere. But the capability is there, and with it, the temptation.

As far as whether open-box merchandise was opened in the store or was a return, don’t let anyone fool you.Someone probably returned it.

People return merchandise for any number of reasons. You can save some money by buying open-box stuff, but you’re taking a chance. Customer service inspects the merchandise before taking it back. But it’s a fast inspection, and whoever is available does it. It’s not an expert inspection.

The story you may hear is that another customer wanted to see inside the packaging, so someone opened it in the store. That happens on rare occasions. Rarely was that item then marked down and sold as open-box merchandise. I usually saw someone re-seal it to sell as new. I’m pretty sure this was against corporate policy. I don’t know if it’s legal or not.

Do I shop there?

For seven years I didn’t, and I still try to avoid it but sometimes don’t have a choice. Circuit City used to be the closest alternative, but it had its own problems and closed. Silo left St. Louis way back in about 1990. The local chain, Goedekers, closed its South County store in about 2002.

In the name of competition, I buy all of that kind of stuff that I can at Office Depot or OfficeMax or Kmart. When it comes down to Best Buy or Wal-Mart, then I’ll buy at Best Buy. Not because I think Best Buy is a better company–I don’t like either company–but because Best Buy isn’t as big and powerful.

I wish people would realize that all so-called “Big Box” stores will have these tendencies, because the name of the game is maximizing profits. The smaller, local stores will charge higher prices, but in almost every case they give better service.

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