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business methodology - investing in stocks and it's importance



Stock Management Value Overall Rating-Date Of Article and business methodology
GM General Motors 2 out of 10 2 out of 10 2 our of 10
Ford F 5 out of 10 5 out of 10 5 out of 10

5/12/2009

As people can note GM executives have sold their shares as of the recent the date of this article. What causes companies like GM to fail? Is it lack of good management? Is it a lack of credit in a poor economy? I think that all these things have a factor in a company’s demise and downfall, but I don’t think any of them compare to the markets themselves changing and causing old business ideas to fall away like water through a sieve. Gone with the old and in with the new always happens in business eventually as many investors will tell you. It’s true that Americans get really attached to a routine of doing the same things over and over again until eventually that routine is replaced by another entirely different routine. GM and Ford are having a hard time making profit in my opinion because they simply are trying to do old business in a new world. The old ways of business are becoming obsolete, people want to drive smaller more compact, efficient vehicles which other companies like Toyota and even smaller companies like Tesla Motors are offering into the markey. This phenomenon happens to not only car companies. but every industry all over the world. K-Mart was once a great retailer but lost their power when in my opinion their ideas of business were old and in came Wal-Mart which drastically reduced their output. The list goes on, think about Starbucks; Starbucks was once “the place for a lot of people to get coffee" but their old business methodology in my opinion is starting to get old now as well.

Companies like McDonalds are creating cheap cold coffee which people buy, and then there are entirely different coffee companies that are a little cheaper or different which are doing in my opinion better than Starbucks for their size. The lists of companies which have an old outdated methodologies or a methodology that is getting outdated goes on and on. It’s important as investors to realize this in the companies that we buy or we can lose a lot of money. You should always think about when you invest in a company “is this companies method of doing business outdated or will it become outdated soon and why?” Are retailers starting to get outdated due to Ebay and the internet? Will people be ordering groceries online due to the high price of gas? I am not saying that any of that will happen, but I do ask that you think about what could happen with the companies that you invest in. Many companies will not be around in the future if their business don't adapt to changing market conditions; you must think about this when investing in the stock market. One of the keys to finding good stocks is finding companies that are more stable to economic changes because of their solid business methodology in the products they sell.

small investing articles on business methodology

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