Commercial desertification of the city centre is not inevitable a german small city example for revitalization.

Commercial desertification of the city centre is not inevitable.A German city of 19,000 inhabitants Wassenberg has tried an interesting experiment to put an end to the commercial desertification of the city centre.

In Wassenberg the initial observation reflected a situation “dark and desolate”

One retailer after another had to close his store. Few passers-by were lost in the shopping street. The city of 19,000 inhabitants in North Rhine-Westphalia was hoping for help. Thanks to a marketing consultant the revitalization was a success. Wassenberg has had a fate in recent years, shared by many small and medium-sized German cities: the commercial desertification of the city centre. The reasons for this situation are identical throughout Germany (as in France).

On the one hand, young people prefer to spend their money on online shopping rather than in downtown stores.

On the other hand, the big cities of the region, often through shopping centres, attract customers ready to buy. Wassenberg faced a particularly high number of competitors. Many people preferred to go shopping in Aachen, Düsseldorf, Mönchengladbach or Cologne. In addition, Wassenberg is on the Dutch border. Its inhabitants are within a 20-minute drive of a very popular factory outlet called Roermond.

 

It all started with a market analysis that consisted of studying neighbouring cities by asking the question: what do they offer in terms of businesses?

It quickly became clear that there would be no point in attracting a new H & M or Lidl as the demand for this type of product is being met by local competition bids.

The marketing expert then examined the demographics and purchasing power of the population and found that the population was mostly high-income, mature people. In order to survive as a small town against the big rivals, you had to occupy niches to fight again the commercial desertification of the City centre.

To determine these niches any offer that existed within a radius of 20 km around the city was eliminated. The commercial desertification of the city centre has been halted thanks to a new concept based on four “growth pillars”:

 

Culture,

pleasure,

tourism

and events.

 

The aim was to create themed outlets for which development potential has been identified and which do not exist in neighbouring cities.

For the “pleasure” growth pillar, restaurants have been opened.

For the “Tourism” growth pillar, new businesses have been created for hikers and leisure enthusiasts. A nature park is located near the Schwalm-Nette region, on the border of the Netherlands.

For the growth pillar “culture”, artists such as painters and musicians were approached, and they were able to choose empty stores for readings, lectures and exhibitions.

At the heart of the concept is the growth pillar “events”.

It has been set up a night market once a month. As with all other pillars, this market should only offer quality products, not cheap clothing or other hardware items such as sale. On the other hand, this new market offers home-brewed draft beer, wines, bread, cheeses and typical culinary specialties.

The market has brought people back to the city, which has also benefited existing local businesses. There was suddenly a central anchor event. In the past, people dreamed of the big city. Today, they find parties, drinks and good food in their own city. Result: citizens feel good and are connected to the city again. It is a new acceptance that has not existed for decades. Today, people say, “This is my city.”

Meanwhile, nearby cities like Erkelenz and Geilenkirchen have followed suit and have also established night markets: “Plagiarism is always the best compliment of less inspired contemporaries.”

You have to offer what the online retailer cannot offer: a combination of services and products, more personalized. Today, Amazon and local retailers often offer the same products. Then, retailers are surprised to see that people are learning and testing products locally, but then go to Amazon and order there.

The gradual disappearance of city centres is also due to the development of shopping centres. While many cities think that these huge buildings will be an economic engine, the marketing specialist of Wassenberg thinks the opposite: “These blocks of concrete make disappear the animation and the diversity of the city centres and are already gradually exceeded”, explains the expert. According to this expert, shopping centres are an indicator of urban mismanagement: architects were often responsible for designing large sales areas. Only when the buildings are in the process of completion will developers begin to look for tenants for commercial space. In fact, it would be necessary to do exactly the opposite of doing marketing studies before instead of creating commercial surfaces through architecture and only eventually to ask: who is supposed to go? ”

Instead of shopping centres, you have to rely on a concept he calls Emma Quartier. Many small shops with individual offers, which do not compete but complement each other. “I do not go downtown because I want to buy a jacket at H & M, but because I want some spice”, for example

Kirsten trusted the concept and opened her “Dumb in the Café Post” shop: “I’ve always dreamed of owning a boutique, but it’s always been difficult,” she says, and then she learns about the projects. of the city of Wassenberg in a newspaper and she said

“It’s my chance, if it’s not now, it’ll never be”

His concept, a shop where different artists can exhibit their works and where they have the opportunity to use a free workshop. She found her local thanks to the help of the municipality. In the meantime, she moved and expanded her store, so that not only artists can be staged, but one can also have breakfast in the morning and a coffee and cake in the afternoon, workshops are made available, lectures and readings are organized. The move from the periphery stores to the centre of the city was also initiated this operation was called: healthy shrinking. It is in the interest of all companies looking for qualified personnel to offer businesses and sufficient animation to motivate newcomers to settle in this type of city.

Why does it work in some cities and not at all in others? “Because this must be a top priority, if the mayor puts trade as a top priority for his city and is fighting for it, it will make the process easier. Wassenberg Mayor Manfred Winkens is looking forward to a new life in his city. “By 2020, we will propose nearly 60 different cultural events,” he said. “From art exhibitions to outdoor events such as the book market, the medieval market, cabaret nights and concerts.”

This example cannot be transposed as is in France because the concept of “ droit au bail” to lease is completely unknown in Germany. These notions are a real brake and handicap an average French city in the fight against the commercial desertification of the city centre. I was recently confronted with the following ubiquitous situation: on the outskirts of Strasbourg for a commercial space of less than 200 m2 empty for a long time and for which the owner asks a rent of 4.000 € per month the taker was obliged to fulfil a lease entitlement of € 50,000. For years, the “ droit au bail or pas de porte “ has been considered in many studies as obstacles to French growth and Europe has often expressed its wish to see a modernization reform initiated on this subject.

Georges Vonfelt GEVO Sarl

Hedge Fund the rise of one whom nothing predestined to become the best manager of history.

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Hedge Fund the rise of one whom nothing predestined to become the best manager of history “The man who solved the riddle of the markets” Wall Street Journal’s Greg Zuckerman’s book is the book that everyone is talking about on Wall Street. He portrays the rise of one whom nothing predestined to become the best manager of history. The mathematician Jim Simons, whose fortune exceeds 23 billion dollars, is at the origin of a UFO: the Medallion fund. Since 1988, this quantitative hedge fund has recorded an average annual gain of 66.1%, reduced to 39% after deducting its commissions. Over 20 years (1985-2004), George Soros’ hedge fund (Quantum fund) had an average annual return of 20.2%. Prize of excellence Aware of its value, the Medallion Hedge Fund has taken the highest rates in the industry, 5% of assets and 44% of profits generated through its performance. Hedge Fund typically take between 1.5% and 2% of assets and 20% of profits. Given its success, this Hedge Fund no longer accepted money from investors since 1993. In 2005, it was reserved exclusively for employees of the Hedge Fund. For Simons, this fund was to remain relatively small, less than $ 10 billion, to continue to perform well. The founder is aware of the law of diminishing returns in the financial world: the more the capital is important, the more a manager is struggling to remain as efficient.

Inconceivable In an interview with “Institutional Investor” in November 2000, the founder of Renaissance said: “Today we manage $ 4 billion, perhaps $ 7 to $ 8 billion in the future. But 70 billion, never! It is inconceivable. I am 62 years old and in the next three years I would like to pass the torch. Today the Hedge Fund manages $ 110 billion, and Jim Simons retired in 2010 while remaining involved in his company, being non-executive chairman. The Medallion has been a fantastic Hedge Fund appeal and advertising product, which has launched other funds such as Renaissance equities. He managed the increase in his assets and the change in size of his fund. “Make money when I sleep” In 1978, Jim Simons left his position as professor of mathematics at Stony Brook University to found his first Limroy Hedge Fund. Like other traders of the time, he tries to anticipate the decisions of the Federal Reserve but without much success. Yet at the time, he consulted the opinion of an economist, Alan Greenspan, who would become the president of the Fed between 1986 and 2007. His poor results prompt him to seek a trading system without human interference. “I do not want to worry about markets every minute. I want models that make me earn money when I sleep. He then embarked on quantitative management in the futures markets, particularly commodities. It speculates on potatoes, oil or pig carcasses but again the yields are random. The Hedge Fund, Renaissance Technologies, which was born in 1982, decided to move up a gear and began to build systematic and rigorous quantitative management. “There are movements and configurations in the markets that are not ‘visible to the naked eye’ by traders, but Renaissance wanted to exploit these anomalies in a systematic and rigorous way,” says Greg Zuckerman. Grey matter The fund is progressively recruiting the best mathematicians, astrophysicists, linguists, artificial intelligence specialists and computer scientists. It ensures their loyalty by allowing them to invest their bonuses in the Medallion Hedge Fund, where the average investment of employees is now around $ 50 million. Those who leave the company are subject to very strict confidentiality agreements and a non-competition clause over a very long period. It is not possible that they go into another Hedge Fund to disclose the secrets of the company.

The “home culture” of Renaissance, the antithesis of that of Hedge Fund of the time, was in three words: humility, patience, work. No star manager took positions according to his “instinct”, a word banned internally. His traders had to follow the signals of mathematical models and never take personal initiative. In fact, very few Wall Street professionals have been recruited by Renaissance who prefers to hire IBM alumni. The Medallion fund also invested some of its money in about 40 Hedge Fund. It was a way to seize opportunities that he had not identified himself while benefiting from information feedback on the markets. Data gathering. To help it achieve good market forecasts, this Hedge Fund was one of the first to recognize the importance of having as much financial data as possible. He has collected very old and good course histories. Databases often contain errors that a statistics specialist was responsible for flushing out and correcting. The fund was collecting data that was not available to its competitors: one of the contributors regularly went to the New York Fed in Manhattan to manually collect prices on bonds that were not public. Anticipating the rise of “high frequency trading” (ultra-fast trading machines), the fund invests early in technology and computers at the forefront to increase the speed of its transactions and be the first to seize opportunities. The “gross” anomalies in the markets have long since disappeared and the fund must innovate to remain efficient. “The mathematics we use can be sophisticated,” he told Institutional Investors, “but we start from data analysis, we do not have preconceived notions.” “In our business, we want action, we appreciate a certain level of volatility. In 2008, the year of the financial crisis, the Medallion fund jumped by 80%.

 

In the secret of a debt collection company and its methods

In the secret of a debt collection company and its methods. The terms vultures, sharks, mafia methods and other “bird names” are often referred to when describing a collection society. What is it really? Do debt collection companies get rich on the backs of people by practicing unorthodox methods or are debt collection companies doing their Job only? Camille V. calls exasperated debt collection company who claims 27.90 € for an unpaid radiology bill. She has already reported several times to the medical office that the payment was made. His interlocutor Didier O. remains calm. He verifies on his screen and informs Camille V. that it is enough for him to send the proof of the transfer so that the letter of formal notice becomes irrelevant. Camille V. has already hung up and pronounces another well-sworn oath before cutting the communication. Anyone looking for recognition and consideration for his job would be better off not working in a debt collection company. The brand image of this industry is disastrous and the one who receives a letter of formal notice in his mailbox explodes blood pressure. We are looking for positive attitude! Didier O. has worked for 15 years as sedentary debt collection officer he is not a hooligan of a thick brute, he is smiling and sporty appearance. To be hired he had to meet the following criteria: calm, ability to convince and positive vision of life. One of the secrets of a successful debt collection is to receive the file very early, which greatly increases the chances of obtaining payment without having to expose significant costs. This transfer by the companies of recent receivables makes that many delays of payment are only due to negligence or absences for example for leave. A debtor who receives a letter from a debt collection company is immediately on the defensive. According to a survey, 65% of the recipients of this type of mail from a debt collection company believe that the amount claimed is not due. Telephone subscribers, energy providers or consumer credit companies rely heavily on the services of debt collection companies. It is wrong to believe that debt collection companies merely send out standard letters for which they receive disproportionate fees. Especially for trade receivables the debt collection company will have to convince the one who owes money to find an amicable agreement with his supplier sometimes see a partial debt forgiveness. Nobody has any interest in bringing legal proceedings, as the popular saying goes, a bad deal is better than a good trial. The muscular and menacing boxers are not unique to serious debt collection companies. It is in the interest of the debt collection company to settle the file as soon as possible and with the least possible inconvenience for those who owe money. On the other hand, it is abnormal that in France the individual in bad faith does not bear any costs and that for small claims (individual or professional) there is no way to obtain payment without having to bear considerable costs. In the Nordic countries the situation is different and high costs are due even for small debts. In some foreign countries (Germany) there are pressure tactics to oblige the payment of these costs. There is however a satisfied person it will be the client of the debt collection company who will recover his due.bodyworn-794099__340

Internet digital world European retail business facing the Storm.

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Internet digital world European retail business facing the Storm. The European retail business has lived during these 60 past years several revolutions which have had a deep impact on its physiognomy and in our way of life and the society in its whole. The recent revolutions linked to the rise of internet and the digital world seem to take another step, it’s not the physiognomy of the cities which is changing anymore but the society in its whole.

Step 1: the neighbourhood businesses and the factories in Europe

Step 2: the birth of mass distribution and relocation of the production: the rise of the car industry

Step 3: the development of franchises, malls and pedestrianization of cities

Step 4:  Internet and the digital world desertification of the cities

In the 50s, right after World War 2, neighbourhood businesses are rising, the factories located right next to them are running in full swing. The consumers who are low motorized appreciate having nearby shops and so came several types of restaurants and services (Shoemakers, carpenters…) in the streets of the cities. In the 60s Europe knows a new type of business, mass distribution (mostly alimentary). France will be the first country in Europe to develop it, Italy and Germany being far behind. Visionaries buy agricultural land in the periphery of the cities and develop massive shops with massive parking. This type of retail will rise and create hypermarkets of 10 000m² and more with non-alimentary shopping mall around. These giants will have a significant power on the selling price encouraging industries to relocate first in Eastern Europe (Poland, Czechoslovakia…) and then towards Asia (China, India, Vietnam) where the workforce is the cheapest. The auto industry starts on the same time a massive development as the consumers going to these hypermarkets will be in the need of buying a car. From the seventies to the 2000 and despite the oil crises, a global boom of businesses in every distribution channel is rising. Independents shop retailers first partly destroyed by the mass distribution start to join franchises. The pedestrian city centre leads to the gentrification of the independent businesses. Shopping malls with several types of businesses rise. However, the bistros and the small artisans decrease. From 600.000 in the 60s, the number of bistros in France fell to 35.00 in 2018.  Investors buy commercial real estate which leads to expensive rent prices in the business areas of the cities. If in the early 2000 online shopping took its first steps, not every time in a successful way. The new giant is born: Internet and the digital world. The shops in the mid-cities are closing, the small towns are becoming bedroom communities, mass distribution loses its market shares and even the prestigious brands are shaking.  Internet digital world giants such as Amazon or Alibaba are the new nightmare of the traditional businesses. In France the legislator created legal barriers to protect small businesses, stop the development of hypermarkets and reduce their blackmail to have discounts and bigger margins. But at least the legislator is helpless toward the new giants. Amazon is the biggest supermarket in the whole world even if it is fully digitalized. It is also the biggest group purchasing organization (GPO) in the world. What if Orwell’s Big Brother was in fact Jeff Bezos (Amazon’s CEO)?  It is unquestionable that the typical businesses will need to invest in market niches in order to survive. For instance, some textile manufacturers are now aiming new consumers such as seniors or oversized people who are not yet comfortable with online purchases. Others fashion brands based their communication on the “Never out of stock” which means that the general products are always available. It is directly opposed to the fashion shops whose collections change every 6 months.

But what about payments? How to deal with unpaid invoices? Are the overdues also evolving with Internet  digital world? Even if strong habits are still here in countries like France, we still observe a massive change of the way consumers pay. During the 50s and the 60s bill of exchanges and checks were the most used way of payment. When, Mr. Moreno invented the smart card in France everything changed. Way before its neighbours’ countries, French people will start using credit cards to the great pleasure of mass distribution discovering a new and simpler method of payment avoiding the insecurity of checks and the complicated manipulation of cash. Furthermore, it is still evolving with the evolution of our phones with which we can now pay with. Debt collection firms have also professionalized their approach, for example, the procedure by a collector in the context of home visits disappeared. Courts have gone digital, it is now possible to proceed to an online payment of your court fees with your credit card. Commercial information has gone digital as well, offering business information at extremely low prices causing the end of several investigator’s jobs. What hasn’t changed is the weight and cost of legal action in southern Europe (Spain, Italy, France, Greece, Portugal…). Lawless zones emerged concerning low-amount debts. Debt collection firms will have to adapt to this new environment. It is likely that the dematerialisation of payments will deeply change the structure of the payments especially the supplier debit which may disappear. Businesses will have no choice but search for new ways of funding. In the first days of 2019 we face a dramatic situation mainly in France for the specialized retails like fashion or shoes. There is a massive disappearing of shops due of the fact that for many different reasons the consumers change their habits. For the mid-sized producers and the small shops there is only a future if they intensify their cooperation inventing new retail ways of selling.

In an Internet digital world retail cannot act as in the sixties or seventies, the actors must invest in perspective and prospective.

 

Georges Vonfelt

Payment delays : How to find 20 Billions € in France?

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Payment delays : The most recent figures and surveys in France shows that if the legal payment delays are respected the small and medium French companies (with less than 50 Million € turnover) would improve their cash flow situation with 20 Billions € a year.
The unpaid invoices and payment delays generate a lot of costs inside and outside of the Company:
Internal Management of the payment delays, costs related to the financing of the outstanding sales, debt collection costs, litigation costs.
In France the companies which are far away from the consumer are those with the most of the problems concerning the payment delays from their clients (forwarder, logistic, storage, business services)
In the Business to Business filed the costs per Invoice for the management of the payments are around 609 €!
In the Business to Consumer field the costs for the management of the payments are more or less equal to 6 % of the company turnover. The reason is that the French law exonerate the private customer from every kind of liability in relation with the non-payment of their invoices.
Georges Vonfelt
www.gevo.fr

Debt Collection in France: what is the most efficient litigation process?

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If, in the Business to Business area, you have unpaid invoices in France the first step is to try an amicable approach of the debtor. It’s the first action step for a French debt collection company.
The figures of the collection Industry are telling us that more than 90 % of the files received from a debt collection Company concern firms which are able to pay the open invoice.
Despite of those figures, the success rate of a debt collection agency for the amicable process is usually lower than the half of the received files. It’s often necessary in France to start a litigation procedure to increase the chances to collect the overdue receivables.
In the most of the cases we recommend the so called “injonction de payer” ( injunction).
How has this litigation procedure to be managed?
– The concerned Court is the “Tribunal de Commerce” located at the head office of your customer.
– The demand has to be introduced with all the documents proving the reality of the debt
o Signed order
o Signed Delivery note
o Invoice
o Reminders
o Formal Notice Sent by registered letter with acknowledgement of receipt
o Without the acknowledgement of receipt the procedure will be cancelled
– The judges are not professionals they are elected and their main business is to manage a business in the same city.
– When the “ injonction de payer” is issued you have maximum 6 months to inform the debtor through a local Bailiff
– The debtor has than one month to contest the decision, he can contest without giving any reason
– If the debtor contests it’s necessary to start a traditional legal procedure
– If the debtor doesn’t contest you have 2 months to ask for the enforceable verdict
– The court will deliver this enforceable verdict within one month.
– To seize the goods and assets of the debtor you need the help of a local Bailiff.
We recommend the cooperation with a French professional (lawyer, bailiff, debt collection agency) for the management of the “injonction de payer” procedure.
Georges Vonfelt
www.gevo.fr

Beware Of The Payment Terms Mousetrap

Andriy Sichka
Payment terms are a benefit to the customer, and it is important to find the right balance for your company.
By Andriy Sichka, originally published in Credit, Collections and Risk Magazine, www.CCRMagazine.co.uk.
Every financier knows that, if we set credit risk aside, deferred payment term is a technical equivalent of a discount. As such, payment terms are to be negotiated and fixed in the contract together with the price. Quite often, however, parties fix a price and then start to negotiate on the payment terms. This really is a mousetrap for a seller, as, in essence, he is invited to discuss the price when it is already fixed!
Very often, suppliers leave the setting of payment terms to local customs, market practice, or – even worse – the buyers’ wishes. Retailers are very famous for using positions like: “We ask for 90 days payment term as this is our standard for all suppliers.” Very often sales teams bring the deal with fixed payment terms already agreed, but without any explanation for them. They will simply say “customer expects X days” and many companies agree to accept this for fear of losing a customer. While customers are very important, they are not always right. Payment terms could, and should, be mutually acceptable for both the buyer and the seller.
But how can fair terms be found? In many cases, knowledge of customers’ cash cycles would help. Try to find or estimate a customer’s days of inventory outstanding and add it to their days of sales outstanding. A precise result would require a delivery period as well. Then compare the total with the proposed payment term. There are three possible results:
1. The cash cycle is equal to the term – this is very unusual but possible. You give as much credit as your customer needs to trade. Provided you can afford to finance such a term, it would be good to maintain it.
2. The cash cycle is longer than the term – this is negative for your customer. Very likely they would be looking for external finance to trade your products. Sooner or later they will knock on your door, especially if access to external finance became hard.
3. The cash cycle is shorter than the term – you would be giving more credit than necessary. If the figure is substantial (say above five days) then you are financing somebody else’s business and very likely for free! In this case, the seller should clearly understand the benefits they are receiving from the customer. It may be time to re-negotiate terms.
Fear of losing a customer is normally bigger than the actual risk. Companies normally respect those trade partners who stand for their rights soundly and constructively. It is obviously easier to negotiate if the above exercise is done before the contract is signed. CCR

The new French debt collection procedure for small invoices

Since the 01st of July 2016 we have in France a new system to get a writ of execution without a court judgement. The bailiffs are authorized to produce a write of execution without a verdict.

This for unpaid invoices under 4.000 €.

On the paper it’s a very good idea because it’s extremely difficult to collect those small invoices and a litigation process if far too expensive for those amounts.

What’s about the real life?

The statistics are disappointing the system doesn’t work.

The number of writ of execution made via this system is less than 1 % of the global amount of writ of execution for unpaid invoices.

The reason are the followings :

– The competition between the bailiffs because the bailiff producing the writ of execution is not allowed to make the execution he has to transfer the file to a colleague.

– The fact that the debtor has to be invited at the procedure.

– The costs which are charged to the creditor also if the process is unsuccessful.

At this days the traditional payment order system is more efficient and should be used.

But due to the fact that we still are facing in France thousands of bankruptcies a lot of them due of payment delays from their customers some new ideas are in discussion.

One of them is that it should be possible in a near future that if a company goes bankrupt due of a late payment of a client, this client will have to pay all the debts of the bankrupt company.