The Knife Fight

Edition #5

August 9th, 2019


Here at Adventur.es, we're in the business of helping small to mid-sized business owners run, grow, and transition ownership of their business more effectively. With that goal in mind, enjoy this issue of The Knife Fight, a weekly newsletter for operators in the trenches.


FOOD FOR THOUGHT

Competitive advantage flywheels (Max Olson @ FutureBlind)
+ Max Olson presents a wonderfully visual way of understanding competitive advantages.

After reading Olson's piece above, it is a helpful exercise to draw the competitive advantage feedback loop for the business you own, operate, or work for. The four main questions to contemplate while going through this exercise are:

1. Which category of flywheel does your business fit into? Is it a combination of two or more?

2. Which levers should you pull in order to build the flywheel's momentum?

3. Which part of the flywheel is weakest?

4. Which piece of the flywheel, if broken, would potentially harm your operation most?


Here at adventur.es, it is pretty simple:

feedback loop 1.png

OPERATIONS

How a mysterious tech billionaire created two fortunes and an outsourcing software sweatshop (Forbes)
+ This piece is the incredible story of Joe Liemandt, the little-known billionaire from Austin, TX who buys enterprise software companies, outsources jobs to lower-wage countries, and reaps massive profits by doing so. Every private equity firm has a different playbook post-close, and it's important to know what that playbook entails.

The strategic reasoning behind DTC consumer brands expanding to service verticals (Modern Retail)
+ When one product won't achieve the desired scale, DTC brands are adapting and augmenting revenue streams by expanding into capital-light adjacent verticals like services, maintenance, and even product-related insurance.

Fedex to end US ground deliveries for Amazon (WSJ $)
+ In response to Amazon's encroachment on Fedex's ground delivery territory, Fedex has chosen not to renew their contract with the behemoth ahead of the upcoming holiday season.

MONEY

China responded to new tariff threats by weakening the Yuan and halting US crop imports (Bloomberg)
+ The first order effects of the currency fluctuations will have far-reaching consequences for businesses exporting to China, but the second order effects may be the longer term economic harm due to uncertainty in trade and monetary policy.

Latest tariff increase could cause short-term spike in transpacific freight rates (American Shipper)
+ Due to manufacturers and purchasers attempting to avoid increased tariffs coming into force in late 2019, there may be a rush to get purchase orders filled before the new tariffs come into effect which could increase freight rates across the Pacific.

DEMAND

'Overhead': why marketing is still seen as a cost-center (Digiday)
+ “A great brand focuses on being relevant in peoples’ lives, proving value and providing a service or product that supports that. Two-thirds of that statement is marketing related.”

The state of digital advertising in 2019 (Marin Software)
+ "Paid search still dominates digital advertising, but other channels are taking their share. Despite ongoing controversies and people leaving for greener (Instagram) pastures, advertisers should stay in front of their massive Facebook audience—and take advantage of surging video and eCommerce advertising opportunities."

How a robotic singing fish made $100M in revenue in one year (The Hustle)
+ One-hit-wonder products are all around us - this is the story behind Big Mouth Billy Bass, the singing fish mount.

Seven reasons why TV's doubters are wrong (Marketing Week)
+ Don't count out TV advertising as a medium for the message just yet!

HUMAN RESOURCES

Durably excellent teams (Irrational Exuberance @ Lethain.com)
+ Every team is in one of four states: 1) falling behind 2) treading water 3) repaying debt or 4) innovating (moving forward). This is a great framework for anyone in a staffing or executive position on thinking about team bandwidth and how to allocate human resources.

Why great employees leave great cultures (Harvard Business Review)
+ Employee and company behaviors must match company expectations - from top executives to the lowest ranks - if an organization's culture is to be maintained over time. Building the right systems to ensure that the right behaviors take precedence within the company's mission and expectations is the only way to define a lasting culture and retain top talent.

WEIRD

The youth sports market doubled in the last decade despite declining participation rates (The Hustle)
+ Promoters are cashing in on parents' willingness to pay for their children's sports endeavors, while the growing trend is keeping children in lower socioeconomic environments out of the game.

The rise of alternative 'milks' and evolution of the dairy industry (The Guardian)
+ Who knew the dairy and plant-based milk industries could be so innovative and so interesting? This story is worthy of your time if you are interested in how consumer product marketing, scientific research, and climate change come together to explain the current state of dairy vs. plant-based milks.


We'd love your help.

If you stumble across something great, send it to knifefight@adventur.es.

If you know an owner, operator, or someone who works with SMB's, please give us the highest compliment and send them our way. You can find previous Knife Fight issues here.