International Business Staying Power Enhanced with Collapsible Overheads

by | Jun 6, 2007 | Archives

International business success is the ultimate way to protect against inflation.

This message is the third in a series that reviews how to continuously succeed in a global business. The series answers this question a reader asked:

“Gary, How do Gary/ Merri Scott continuously continue to produce uniquely insightful information for readers? How could I model just a small slice of Gary’s success online? I truly do not understand how you have been able to continuously grow for decades while evolving from print to internet/online, covering totally new locations, new businesses and completely new subject matter (not only investing, but health, language, Real Estate Retreats, Import/Export, Publishing, Country- UK, US, Ecuador, etc). What angle on marketing (small secrets) has allowed you to continuously succeed? I realize there are no miracles other than hard work, but any pointers to leverage?”

Before we review specific internet marketing and business strategies, this series is reviewing fundamental business steps to assure staying power.

Fundamental #1 is do a business that you love.
Fundamental #2 is to live within your means.

This message reviews fundamental #3: use collapsible overheads in your business.

An excellent book to study about business is titled “Peterman Rides Again”, by John Peterman published by Prentice Hall. You can order it from Amazon.com

You may know of Peterman from the Jerry Seinfeld show or you may have been one of the 18 million people who received his mail order catalogue each year. As a marketing oriented person, Peterman has long been one of my heroes. However as good as he was at marketing, as well known as he was from the publicity he received on Seinfeld and despite the fact that he sold hundreds of millions worth of goods, the J. Peterman Company went broke! His book goes a long way to revealing why he had success and why he ran in to trouble.

One (in my humble opinion) of his problems was described on page 180 of this book when he wrote, “There are two theories of growth. One is to let your organization development lag behind business growth; the danger with that is you get too much business and your company crumbles from within because you don’t have the systems and staff to handle it. The other approach is to build an organization that can handle the business you expect to get; that’s what our investors favored.”

In Peterman’s case, his business had grown from nothing in 1986 to $64 million in sales in 1994! But growth (not surprisingly) had slowed. He tried to stimulate more growth from a weak understanding of his market and staffed up for that growth at the same time. His losses became monumental and he went broke.

He followed his investors’ advice (one reason to not have investors) and it cost him his business.

I believe there is a third alternative to dealing with the rises and falls of business, called Collapsible Overheads. This approach has helped my business stay afloat and profitable through thick and thin (though never in Peterman’s league) over the years. This system has kept my business up-to-date when business boomed and has saved me from huge losses when business has been slow.

The problem of fixed overheads is that when business slows down, one is forced to increase marketing to keep income up. This means one has to take the greatest marketing risks at the worst possible time. With Collapsible Overheads when business drops, so to can marketing expenditure. Reserves can be saved so marketing can be increased when times are good and chances of success are increased.

Collapsible Overheads have one more added benefit for small businesses (such as Merri’s and mine). They can help the business avoid having employees.

Generally collapsible overheads are attained by using independent subcontractors to do work the business requires for low (or non-existent) fixed amounts and a per piece or volume basis. In Merri’s and my case our phone answering, printing, art work, list management, accounting, maintenance, product fulfillment, even filing and office administration were subcontracted in this way.

This saves a lot of paper work and cost not having employees, plus creates several tax benefits (for example one can have a much more efficient pension plan if only family members are employees). Plus a no employee system increases flexibility.

However, there are two downsides to collapsible overheads.

First, collapsible overheads require more work from a business owner to maintain quality control. One has to really spend time selecting and training the right sub-contractors to make sure they know what is expected of them and how the system works. When this is done though, the subcontractors will actually want you to have success (so their income rises). The difficulty is that you have less control over your sub than an employee and may not (if they don’t work directly at your place of business) have immediate access. You need to work out systems that deal with this different approach to getting things done. You need to create a smooth communications and follow up system to make sure your sub knows what to do and to make sure that it is done in a correct and timely way.

There is a secondary benefit to this system though if you create and maintain good systems. If you have employees during slow times and they get used to a low volume of work, they can resist or resent a flood of extra orders coming in. More business for employees means extra work without additional pay. Sometimes employees want business to be slow. And it is amazing how when you surround yourself with those who are wanting less volume, that is exactly what you get. Subs on the other hand want more work because it means more pay!

The second problem with collapsible overheads is that they increase costs when times are good.

For example if a business has ten employees that cost a total $1,000 a day that handle 200 orders a day, the handling costs per order is $5.

If 400 orders come in and the ten people can still handle this, the cost per order drops to $2.50. This is an alluring proposition for a business to have ever increasing volume with ever improving margins. But this rarely works.

If you have contractors that you pay $5 per order for processing then your variable costs remain the same with increased volume.

This second problem is not as acute as it could be because boom times are when your business can most afford increased costs. Many businesses receive their income in spurts. During these spurts you can afford to give up a little profit to save losses during down times.

Most businesses dream of making a big hit. Beware! Sudden financial success creates disaster as often as not because of two mistakes. The first mistake is the belief that this is the only time there will be such an influx of cash. This tightens the business view and stops expansion when it makes most sense, which is during bad times when labor is more available and costs most likely to be low.

The other mistake is to think that large chunks of cash will come easily all the time. This thinking creates unrealistic work ethics and management practices that can lead to disaster.

I have seen example after example of businesses where a sudden chunk of income destroyed a company. This is the riskiest time for a small business. Start-up is a dangerous time but the time when a business really begins to take off creates even more risk. The proud owner with his new found wealth, buys new cars, hires new staff, moves into a bigger home, spends more, works less, and creates overhead and debt. If there is a single reversal, he can be wiped out.

The reason spurts create problems is because they disrupt discipline. Money is discipline and financial affairs create a form of economic routine, either self imposed or not.

We develop a set of mental standards that causes us to think. I can afford this, but can’t have that, etc. Spurts of wealth demolish these standards. Suddenly we can have many things we previously could not. We become, once again, kids in the proverbial candy shop and lose our ability to decide what we can and cannot spend.

Never-ending wealth is a process, (not a state) of taking a continual series of reasonable risks, making mistakes, doing refinements, learning lessons and taking actions that culminates in getting it right. When success arrives there may be a huge income (or capital) spurt. So a long term business goes through series after series of these spurts. The trick is to make profits and build up reserves during the spurts and then hang on during the times between.

Collapsible overheads impose an automatic discipline that helps surviving through the tough times.

The key to setting up contractors is to find good people and give them good deals. Peterman pointed out how one of the problems that led to his bankruptcy was caused by pushing one of his contractors too hard.

Quality, speed and low price. Every businessman always wants all three. We can only have two. In Peterman’s case he always made a point of paying his printer top dollar and always had great results. As the business grew and he delegated this job, his staff squeezed the printer to reduce losses. This led to the printer missing a big mailing at the worst possible time.

Collapsible overheads can help your business meet peak demands and reduce costs during lags.

To this day Merri and my businesses here in the US do not have single employee. All of our help is in the form of independent sub contractors or joint ventures. This helps provide staying power.

Gary

Live Better and Be Free – 5 Global Earning Experiences

Here are 5 global income experiences and 7 business secrets that can help you live well and free anywhere despite the economic conditions created by the pandemic.

I began my international business over 50 years ago and have been creating and running international micro businesses since.

During that time my wife, Merri, and I have been able to live, work and earn all over the world. We could be anywhere we wanted because of seven secrets we gained. I share three of these secrets here with you.  We have been blessed with global earning experiences that helped us make millions… but were also fun, such as with British Lordships.

See how this one micro business helped us rub elbows with British Royalty.

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One of Merri’s businesses that worked with British Royalty was featured in Doonesbury.

Global Earning Experience #1:  Lords.  One of Merri’s ideas (in the mid 1980s) was to broker British titles to wealthy Americans.  We made a ton from that… even gained 15 minutes of fame when Gary Trudeau learned about this business and immortalized it by having B.D. Zonker buy a title!

What fun… profitable, plus stimulating, meeting and working with the Blue Bloods of Britain… visiting their castles… invited to their events and affairs.

Global Earning Experience #2:  Lepers.  Our micro businesses have been fulfilling as well as fun.  Merri started her international business in her 20s (long before she knew me) importing Italian clocks to the USA.  This earned so much ($80,000 in the first year) that she created other micro businesses helping orphans in the Yucatan and Haitian lepers (at the Albert Schweitzer Hospital) produce crafts she sold for them in the USA mostly through Lily Pulitzer stores.

This brought excellent income ($80,000 in the 1960s was a lot of cash)…  incredible contacts… working with Dr. Larimer and Gwen Mellon who created the Albert Schweitzer Hospital in Haiti… and enormous satisfaction.  Merri still cries over 50 years later when she tries to speak of the gratitude of the lepers and her time and life in Haiti.

Plus she gained lessons that allowed her to live and earn… in many places and many ways.

Before I get ahead of myself, may I ask you a question?

Would you enjoy living in two or even more places wherever and whenever you choose?  Would you be happier with more freedom, lack of debt, and a life of riches, adventure and fulfillment?  Would you be glad to feel confident that you can discover interesting and fun business ideas again and again that not only bring in extra income but also help the poor and improve the environment?

If so then read on… because… Merri and I have led that lifestyle for decades and can show you how to live it too.

The key is to earn from home offices.   They are part of a micro business secret and you’ll see why have two home offices (and using two cars in business) can save thousands in taxes.

You can also enjoy such a lifestyle because after years of search, I found business secrets that you can use and enjoy.

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Waterfall at our North Carolina Farm.  See enjoyable benefits of a micro business in water.

Global Earning Experience #3: Hospitality.  Here’s a hotel we owned and operated in Ecuador.  Once we sold this hotel we joined the sharing economy and began offering rentals in our North Carolina cabins through AIRBNB and houses in Florida.  We became designated super hosts within months and added thousands of extra dollars to our income every month.

Caring is just one example of how to live anywhere and earn, especially now that the pandemic has changed how people vacation.

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Having a variety of places to live is part of one of the secrets on how to earn more, have a better life with more fun, adventure and greater freedom.

Global Earning Experience #4:  Import-Export.   Here I am at our Florida house showing clients how to import.

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I was wearing a hand tailored, made to order, high quality wool suit from Ecuador that could be imported into the US for as little as $135 .  Plus that Panama hat was made in Ecuador.  This is odd but true, all genuine Panama hats are made in Ecuador.  We imported Ecuador roses year round as well, all from one of our tax deductible US home office.

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The secrets we’ll share below are not about how to buy suits or flowers though.   The secrets show ways to make money (while helping others) marketing any type of product or service wherever you are and where you want to be at home or aborad.

Global Earning Experience #5:  Green Produce.   We have an orange grove and lake at our Florida home and

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are among the first to test new organic ways to make citrus farming better for the environment and the consumer.  In North Carolina we cultivate Wild American Ginseng as well as aquafarm.

These are just a few of the business experiences that can help you have the freedom to earn globally.  They are shared in our emailed correspondence course on how to be a self publisher..

The course teaches a system based on seven secrets so powerful that it creates money for you regardless of where you are:  in town, out of the country, traveling or even in places as remote as we live.

These secrets have worked for us in real estate… titles… tours… agriculture… clothing… hospitality… alternative health…  spirituality… printing… publishing and art businesses for Merri and me all over the world.

Merri and I have created a special, really simple program so you can “live well and free anywhere”. The course makes it possible for you to enjoy extra income doing something you love.  You can gain full or part time and enjoy excellent profits as you have fun and do something good in the world.

My search stumbled on the fact that most millionaires make their money in business.  This discovery led to a study of rich businesses, ones that generate everlasting wealth.  Here are three of seven secrets we share in our program that we learned and have used in our  micro businesses:

Secret #1: They must enjoy the multiple effect.  A product once created must produce profits again and again, almost on a never-ending basis.  Each investment needs to make huge returns.

Secret #2: They need to be greater than their owner’s time.  They must produce income even when the owner doesn’t put in day-to-day effort. You may already be wealthy or earning a high income.  You may not even need another business or extra income, but some day you might.  One surgeon explained it this way.  “I am making a fortune because peoples’ lives are in my hands.  Once my hands are no longer steady, my income stops.   My entire financial well being will then be in someone else’s hands!”

Secret #3: These money making systems should be enjoyable and fun.  Sadly most people make money for the sake of making money.  Many spend their lives working, just to have a few precious hours having fun.  The most important fact about making and keeping wealth is that those who were richest absolutely love what they were doing.  Money is of secondary importance to their effort.  And as things are, this means they actually ended up making more money.

These secrets created a fantastic way to make money with my own international micro self publishing business writing about what I love!

You too can have everlasting wealth by turning your passion into profit.

You too can have the freedom to do what you love from any place you like, even operating (actually preferably) from your bedroom, dining room or den if you wish.

What do you love? Rare cars?  You can make a fortune creating a business around them.  Do you prefer fine art? Or do you love beautiful jewelry, coins, gems, real estate, furs, model railways, dolls, scientific equipment, war memorabilia, old and rare books, or whatever?  Do you prefer social subjects rather than objects?

Are you concerned with the environment or humanitarian problems, with crimes, war or poverty?  Would you like to help wipe these social problems out in the course of your business?

Are you a golfer? Do you love to travel? Why not make all kinds of money in a global business related to golf?

Would you like to help the world be a more spiritual place, help people get along better together?  You can do something good for the world, increase your income and live wherever you please in the process!

Whatever your passion you can learn how to earn by creating a micro business based on it.

Take fishing, for example.

I am no great aquafarmer, but the numbers and lifestyle our our trout raising business worked on a small scale.  We pay about $3.50 a pound to stock the fish, they double, triple, even quadruple in size and we sell them at a local butcher shoppe for a modest profit.   This is not a big deal, but does generate income, helps attract guests to stay in our rental cabins, gave us some great trout dinners on our table.  Feeding the trout is a thoroughly enjoyable part of my daily labor.  I need this to counter balance sitting in front of a computer.

Over a couple of months the fish grow… a lot.

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Millions of people love fishing but don’t have a pond.  This does not mean they cannot be involved in fishing.  Here are just a few of many ways that others have profitably matched this passion with profit.

Two of my friends, John and Lou, grew up near me in the Oregon mountains.  They were outdoor adventure types and moved to Canada, where they homesteaded 1,200 acres on a trout-filled lake in mid British Columbia.  They built a fishing camp that attracts fisherman from around the world.

Duncan Kinderman on the other hand loved fishing and castles.  He bought a castle on the River Tay, a great Scottish salmon river, and offered time shares for fisherman from Britain, Europe and the US.

Another entrepreneur I know was from Montana.  His skills were in marketing so he sold fishing trips for fishing camps.  He attended rod and gun exhibitions, met owners of these camps and arranged to sell their fishing trips to the US, Argentina and even in Russia to fisherman around the world.

Ralph Kylloe on the other hand loved fishing and photography so he created the book, “Fishing Camps”, which was published by Gibbs Smith publisher. This allowed Ralph to travel across the country enjoying fishing camps as he photographed and wrote.

Steve Ambrose, another friend of ours, had family commitments at home so he set up a bass fishing business in Florida that served Americans, Germans, Canadian, Dutch and Belgians.  Later as his children grew, he used his client base to arrange fishing trips in Argentina.

Each of these people had provincial backgrounds and differed in age, situation and skills.  Their common link, the love of fishing, led each to a global micro business.  Each was able to blend a unique nature and set of skills to develop a global business that surrounded them with fun, like minded fishing souls.

There is such an abundance of opportunity that Merri and I have created this program to help you have your own micro business that can be managed almost anywhere.  This program is unique because Merri and I are unique.  We started our global business together.  Since we’re almost recluses, we decided to do the whole business by ourselves… thus we create micro businesses that do not require large staffs.

We began working at home.  Today, though we have tens of thousands of buyers and have made millions, we still work at home on our remote farms and employ only a few people to help.

You’ll learn how to turn advertising dollars into a fortune.  You’ll learn how to create your own ads and when to use the internet… search engines… pay per click… classifieds, space ads, direct mail or word of mouth… even flea markets and roadside stands in some cases.

See how to build a PR list and social business network on the World Wide Web to gain thousands of dollars in free publicity.  I even share my most secret results on my marketing so you will know why sometimes you sell more units of a product at $49 instead of $29.

Learn how one couple used ads about retirement to supplement their retirement income and received free trips all over the world.

Learn how we have made money over the Internet (specific details, specific experiences, hard earned knowledge over the last 13 years!)  With an inexpensive computer you can easily run a business from home and still have tons of time left over – even if you are computer challenged.  Merri and I have certainly proven this.  We were one of the first to run a successful website and still rank high today even with millions of competitors.  The secrets in the course include a step-by-step approach.

Merri and I with our webmaster, David Cross, were leaders in beginning internet micros businesses and have sold millions over the web.  You gain ways to earn global income over the net from that experience as well.

Business people or professionals who want to add an extra profit center to their business or who want to change their business entirely will benefit.  Those who want more control over their career can profit.  Plus those who love global travel and want to turn their trips into profitable tax deductions!

Even older entrepreneurs are taking advantage of technology.  One of our friends and clients, Mickey E., was a 72 year old real estate broker, when she began a small global business.  With just a computer and internet, she created publications that attracted English real estate buyers.  This allowed her to become a top sales person in the biggest real estate firm (selling over a billion dollars of real estate a year) in town.  She later used the tactics she learned to move to Ecuador (in here late 70s) and start a micro business there.

This course is also for couples who want their own business or who want to have a business together or a family business.

This is the perfect course for those who can no longer find employment, who are looking for ways to earn abroad and who wish to retire and supplement their income.

Whether you are retired, an investor, chiropractor, doctor, dentist, professional or already own your own business, this offers another way to make money, to turn your passion into profit. We guarantee that we have shared all we know to help you start and run your own micro business.  Enjoy and live a life of following your Passion to Profit.

There has never been so many benefits from working at home and self publishing is the perfect at home business.

Learn how to earn extra income from self publishing.

Despite the pandemic, do you crave freedom… and perhaps adventure?

Do you at least desire to get out of the rat race?

Do you want to travel…spend time…live…laugh or love anywhere you choose?

Would you like a low stress life in a, safe, nurturing town in Smalltown USA?

I would like to offer you a streamlined course, “Self Fulfilled – How to Self Publish” at an extreme discount.

The foundation of human society is the ability to communicate ideas through words.   Words support a framework of love, hate and desire and all the emotions throbbing through the heartbeat of mankind.

Writing to sell is one of the most powerful forms of marketing  and marketing is what we do in every aspect of life… every day. 

The heart of all businesses requires marketing.  We market ourselves, our business, our thoughts ideas and beliefs all the time.  In business, marketing covers strategic planning, product design, packaging, distribution, advertising, public relations, promotions and sales.  Marketing is the process by which anything and everything, product, service, idea, person is introduced and promoted. Without marketing, you may be or have something great, but no one knows it.

All marketing begins with writing… whether, a speech, picture, video, movie, advertisement, announcement, banner,  jingle, song… the birth place is in the written word.

Why words are better than cash.

You can turn words into cash.  Mix in a little wisdom and deliver benefits.  The value of honest word’s never deflate.  A dollar, decades ago, was worth 15 greenbacks today… or more.   Useful, wise words, even hundreds of years aged… are often worth more now.

Take these 153 year old words: “Four score and seven years ago our fathers brought forth on this continent, a new nation, conceived in Liberty, and dedicated to the proposition that all men are created equal.”

Has time diminished the value of these words?

Sometimes Merri’s and my writing led us into incredible adventures.

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Here I am with Merri and an Ecuadorian Yatchak deep in the Llanganatis Jungle creating a shamanic tour.

We even built a cabin on a North Carolina creek.

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Yet during the pandemic we have been able to continue sitting away from the madding crowd and working in our cabin on Little Horse Creek and at our Florida farm.

There is a possibility that Merri and I know more about writing from home than 99.9% of the people in the world.  We have been at this for over 50 years now and thousands have taken our online correspondence course on how to create your own self publishing business.

The course “Self Fulfilled” shows how Merri I and have created riches and a lifestyle beyond our wildest imagination and shares steps you can take to create a profitable and fun business.

This course shares how we have done this… what we did right… what we did wrong… how you can get started and what you can do much better than we have.

To help you start, I have created a special streamlined offer… our course on how to be a self publisher, with all the frills removed, at a 75% discount.

Self Fulfilled is normally $299.  Thousands have paid that price.  The streamlined course is only $79.

GUARANTEED. Even At This Low Price, We’ll Still Accept All the Risk!

We completely guarantee the program.

Order Self Publishing: Your Complete Business Plan for becoming a self publisher or using words to gain profit and take a full 60 days to put it through its paces. That way you can follow my simple process and start seeing the results for yourself.

If you’re not completely convinced that this information is so powerful that it can help you quickly develop income through writing to sell—all you have to do is let us know and  you’ll receive a complete refund of every penny of your investment.

Fair enough?

Our publishing business has brought us more wealth, satisfaction, fun and friendship than we ever imagined possible. And now we want to share our knowledge and secrets with anyone who has a desire to experience this way of life.

Whether you are an engineer, doctor, housewife, business owner, or retiree… self-publishing offers a way to make a six- or seven-figure income by turning your passion into profit.

Don’t miss this special opportunity.  Order Self Fulfilled How to be a Self Publisher today if you want to cash in on the satisfying, profitable and exciting lifestyle that publishing can bring despite and in fact because of trouble in the world.

The course is so complete Merri and I extend our “no fooling around-complete satisfaction guarantee”.

If you are not fully satisfied in any way,  just tell us within 60 days and we’ll send you a 100% full refund with no questions asked.

Self Fulfilled Special $79 

Self Publishing 2021 discounted to $79 - using coupon code SELFPUB at checkout to immediately save $220 off the regular price of $299.

Gary