Using a wholesale optical laboratory is becoming more popular among independent opticians. Choosing the right manufacturer is important for both the health and success of an independent optician’s practice.

Learning about how other opticians select their wholesale laboratories and understanding which questions to ask can greatly help an optician decide which manufacturer is best for their practice.

The increasing popularity of using a wholesale optical laboratory as a source for both frame and contact lenses is demonstrated by a 2004 survey report on the 2020mag website. Of the 221 vision care facilities polled by the survey, 82% stated that they purchased products or services from a wholesale lab.

One possible reason for this dramatic interest is that such labs offer a wide variety of services in addition to their eye care products. These services include educational programs, technical support, online ordering and remote tracing.

One important consideration in choosing a wholesaler is the quality of the lenses which they produce. There are several points to keep in mind when investigating the quality of a lens.

One important issue is whether or not the lab is capable of manufacturing the most up-to-date technologies. For example, can the manufacturer produce silicon hydro gel contact lenses which provide comfort while allowing six times more oxygen to reach the eye than previous contact lens designs?

Another important consideration is the quality of the anti-reflective coated lenses offered. Anti-reflective coating makes use of a series of metal oxide layers to increase the lens’s ability to improve vision, reduce eyestrain and enhance an individual’s cosmetic appearance. Indeed, the 2004 survey stated that 76% of the eye care professionals polled stated that the quality of the anti-reflective coating brand was either an extremely or a very important consideration in choosing a lab.

Another significant issue determining the quality of a lens is the techniques used to manufacture and inspect the lens. The way in which a frame is drilled and mounted during the manufacturing process not only impacts the quality, but also the time and expense of production.

The nature of the remote tracer (a device which is able to outline the inner border of a frame as well as to describe the size and shape of the lens) may also be an important consideration for many independent opticians. Indeed, 81% of those polled by the 2020mag survey stated that they have in fact sent frame tracing data over the Web.

The Internet is also becoming a popular method for ordering eye care products from wholesale manufacturers. While the 2004 survey found that 65% of eye care professionals have ordered products over the phone, and that 58% of eye care professionals have ordered products via fax, many labs have found that the interest in ordering products over the Internet is rapidly growing.

Wholesale optical laboratories are able to yield several potential benefits to independent opticians. They are able to provide quality products at affordable prices as well as offering valuable services including product support and education of emerging technologies.

Independent vision care providers need an trustworthy contact lens manufacturer to offer advanced, quality lenses to their customers. For a wholesale optical lab to partner with you, eye care professionals should visit National Optical Co. online at http://www.nationalopticalco.com/

Ok so you have got your nice car a successful business and have now gone to buy your dream office in the country, this has been a success and now is the time to look at renovating your office. We all have watched the programs at home where they buy a house, barn or office for 30,000 pounds and spend a couple of months in renovations then sell them off for a nice lump sum, giving them 40% profit. But is it really that easy, what they do not show on the television is the stress and strains of getting all the correct builders, electricians and plumbers in place.

A few tips on renovating an office is firstly decide on what sort of look and feel you would like for yourself and the staff. Would you like it to look more professional or more cosy, you will have to weigh up the benefits and the negatives of both, for example if you were to make the work place too cosy would your staff benefit from this or would it feel like more of a second home for them.

Once you have decided the theme of the office then comes the expertise of selecting the correct colours and office furniture, if you have chosen to go with the professional look you will need to get elegant looking leather chairs and other top of the range elegant office equipment. Remember to be very particular when it comes to choosing your office furniture as this is where the whole theme will literally come into effect.

To make an A class office you will need to invest quite abit, if you don’t have many ideas for yourself of how you want the office to look then the best advice is to visit other peoples offices or look at the way in which celebrities and other stars would decorate there own workplace, you can find pictures and information in all the glossy magazines that are available.

Whatever route you decide to take in decorating your office do not forget to implement some technology and innovation into your workplace such as top of the range computers and software to keep your business running smoothly. Do not heavily rely on what you have seen on the television, you must put hard work into building up your small empire making sure you get top furniture, top technology and top staff then you will reap all of the benefits of having an A class workplace.

Office Furniture Suppliers – http://www.theglassoffice.co.uk

Two companies that are recognized as among the best at making successful acquisitions are General Electric and Cisco Systems. These companies have been star performers in growing shareholder value. The core principal that runs through almost every acquisition is integration. Over the past 10 years Cisco Systems has acquired 81 companies. Their stock price is up a remarkable 1300%. GE outperformed the S&P 500 index over the same period by 300%. There are several categories of strategic acquisition that can produce some outstanding results:

1. ACQUIRE CUSTOMERS – this is almost always a factor in strategic acquisitions. Some companies buy another that is in the same business in a different geography. They get to integrate market presence, brand awareness, and market momentum.

2. OPERATING LEVERAGE -the major focus in this type of acquisition is to improve profit margins through higher utilization rates for plant and equipment. A manufacturer of cardboard containers that is operating at 65% of capacity buys a smaller similar manufacturer. The acquired company’s plant is sold, all but two machines are sold, the G&A staff are let go and the new customers are served more cost effectively.

3. CAPITALIZE ON A COMPANY STRENGTH – this is why Cisco and GE have been so successful with their acquisitions. They are so strong in so many areas, that the acquired company gets the benefit of many of those strengths. A very powerful business accelerator is to acquire a company that has a complementary product that is used by your installed customer base. Management depth and skill, production efficiency/ capacity, large base of installed accounts, developed sales and distribution channels, and brand recognition are examples of strengths that can power post acquisition performance.

4. COVER A WEAKNESS – This requires a good deal of objectivity from the acquiring company in recognizing and chinks in the corporate armor. Let me help you with some suggestions: 1. Customer concentration; 2. Product concentration; 3. Weak product pipeline; 4. Lack of management depth or technical expertise and 5. Great technology and products, poor sales and marketing.

5. BUY A LOW COST SUPPLIER – this integration strategy is typically aimed at improving profit margins rather than growing revenues. If your product is comprised of several manufactured components, one way to improve corporate profitability is to acquire one of those suppliers. You achieve greater control of overall costs, availability of supply, and greater value-add to your end product

6. IMPROVING OR COMPLETING A PRODUCT LINE – this approach has several elements from other acquisition strategies. Successfully adding new products to a line improves profitability and revenue growth. Giving a sales force more “arrows in their quiver” is a powerful growth strategy. You take advantage of your existing sales and distribution channel (strength). You may be able to improve your competitive position by simplifying the buying process – providing your customers one stop shopping.

7. TECHNOLOGY – BUILD OR BUY? This is a quandary for most companies, but is especially acute for technology companies. Acquiring technology through acquisition can be an excellent growth strategy. The R&D costs are generally lower for these smaller, agile, more narrowly focused companies than their larger, higher overhead acquirers. Time to market, window of opportunity, first mover advantage can have a huge impact on the ultimate success of a product. First one to establish their product as the standard is the big winner

8. ACQUISITION TO PROVIDE SCALE AND ACCESS TO CAPITAL MARKETS – In this area, bigger is better. Larger companies are considered safer investments. Larger companies command larger valuation multiples. Some companies make acquisitions in order to get big enough to attract public capital in the form of an IPO or investments from Private Equity Groups.

9. PROTECT AND EXPAND MATURE PRODUCT LINES – This has been very effectively done in the pharmaceutical sector where a new technology is acquired to repurpose and re patent drugs.

10. PROTECT CUSTOMER BASE FROM COMPETITION – The telephone companies have done studies that show that with each additional product or service that a customer uses, the likelihood of the customer defecting to a competitor drops exponentially. Get your customers to use local, long distance, cellular, cable, broadband, etc and you will not lose them. Multiple products and services provided to the same customer dramatically improve retention rates.

11. ACQUISITION TO REMOVE BARRIERS TO ENTRY – For example, a large commercial IT consulting firm acquires a technology consulting firm that specializes in the Federal Government. The larger IT consulting firm has valuable expertise that is easily transferable to government business if they could only break the code of the vendor approval process. After many fits and starts, they simply acquired a firm that had an established presence. They were able to then bring their full capabilities from the commercial side to effectively increase their newly acquired government business.

Many larger firms have established business development offices to execute corporate growth strategies through acquisition. These experienced buyers search for companies that fit their well-defined acquisition criteria. In most cases they are attempting to buy companies that satisfy one or more of the criteria from above. The more of these characteristics your company can provide the acquiring company, the more value they can create post acquisition. They are often willing to pay a much greater price than a rule of thumb financial multiple for your company. You are a highly valued strategic acquisition.

Dave Kauppi is president of MidMarket Capital, and editor of The Exit Strategist Newsletter. MMC is an M&A advisory firm serving mid-market business sellers. MMC is a licensed business broker and a member of IBBA and MBBI. (630)325-0123 davekauppi@midmarkcap.com or http://www.midmarkcap.com/exit

Wal-Mart has become the largest corporation in the world employing hundreds of thousands of people in the United States and over a million world-wide. The big retailer posted revenues of $351.1 billion and profits of $11.3 billion in 2006. Wal-Mart has topped the Fortune 500 list five out of the last six years. Its sales are bigger than the GNP of over 150 countries. It employs more people than anybody expect the US Post Office.

Over the years as Wal-Mart has continued to grow, Wal-Mart has become a bigger and bigger target of the media, union groups, consumer groups, etc. Wal-Mart is one of the most watched companies in the world. Union groups claim Wal-Mart pays below average wages. Other labor groups claim Wal-Mart discriminates against women. Whatever side of the fence you reside on, no doubt you have an opinion.

Those who love Wal-Mart love it for the low prices and one-stop shopping. With Wal-Mart Super Center stores consuming nearly 200,000 feet of space, thus the name “Big Box”. There is plenty of room for product variety. Super Centers carry clothing, building supplies, furniture, groceries, a pharmacy, etc. Many smaller business co-host inside the store such as McDonalds, banks, etc. In one trip, you can buy almost anything you want.

The folks who hate Wal-Mart say that Wal-Mart has an unfair competitive advantage and is squeezing out the small mom and pop stores. They also believe that Wal-Mart pays below average wages, mistreats their employees and discriminates against women. One such claim states that Wal-Mart pays such low salaries that many of its workers have to go on welfare and food stamps in order to survive. Since our taxes support these services, it means that while we may be saving money on the goods we buy there, it is costing us tax money every time we shop there. For example, another statistic states that 46% of the children of employees’ children effectively have no health insurance, because the health insurance that Wal- Mart provides has a deductible so high that parents can’t afford to take their kids to the doctor. Instead, like most of the poor, they rely on local hospital emergency rooms, which is an inefficient waste of taxpayer dollars.

It seems everybody has an opinion on Wal-Mart. Senator Obama recently stated, “I won’t shop there” at a union rally. US Senator Hillary Rodham Clinton refused to accept a donation from Wal-Mart to her election campaign. Already in November last year, she returned a 5,000 USD donation to the Big Box Mart Store. Ann Lewis, Senator Clinton’s assistant, says the money was returned as there are “serious differences with current company practices”. During her Arkansas years in the 1980′s, Hillary Clinton served on the Wal-Mart board.

In many towns, Wal-Mart building requests are turned down as supporting Wal-Mart has become political poison. In Hernando, Florida, county commissioners voted against allowing Wal-Mart to build its fourth Super Center there. During an open meeting, nearly everybody there expressed concern against Wal-Mart and did not want another monster store. The politicians listened and voted against it. They expect Wal-Mart to sue them.

How popular is hating Wal-Mart? Books upon books have been written on the subject. Books such as How Wal-Mart is Destroying America, and What You Can Do About It are best sellers. PBS did a documentary about the store and its practices.

Wal-Mart used to advertise “Made-in-America” merchandise. No more. Contrary to its “all-American” advertising hype, Wal-Mart sources over 80% of its products from overseas. In 2004, almost 10 percent of everything imported to the United States from China was imported by Wal-Mart — making the company, if it counted as a sovereign nation, China’s eighth-largest trading partner. Because of this, Wal-Mart is criticized for causing US job loss. The claim states that Wal-Mart can push suppliers so hard, suppliers are forced to lower costs by outsourcing to China and offering lower quality items.
What do you think?

Keith Scott is a successful Webmaster and publisher of http://www.i-hate-walmart.com/wal-mart-forum. His website provides at www.i-hate-walmart.com/wal-mart-forum a place for people to express their opinion on Wal-mart. Good or bad, express your opinion on what you think of Wal-Mart

When getting your new business started, one of the most important decisions will be the choice of a legal structure that best suits your needs and the needs of your particular business. In today’s article we will explain what a sole proprietorship means and how it may best suit your business structure, as well as finding out if a partnership may be right for you.

Sole Proprietorship: A sole proprietorship is owned and operated by one person. This is the simplest and least expensive business structure to form. Many start-up companies choose this form until it becomes practical to enter into a partnership or to incorporate. One of the advantages of the sole proprietorship is the ease of formation. There are fewer legal restrictions and it is the least expensive to form. The costs vary according to the city in which the business is formed, but usually include a license fee and may include a business tax. As the sole owner, all profits go to you, as do the losses! You will be taxed as an individual. Your business profit and loss is recorded on Federal Tax Form 1040, Schedule C, and the bottom line amount is transferred to your personal tax form. You will also file Schedule SE, which is your contribution to Social Security. The control and decision making are vested in you as the owner.

One of the major disadvantages of the sole proprietorship is unlimited personal liability. You will be responsible for the full amount of business debt, which may exceed your investment. This liability may extend to personal assets such as home and vehicles. Since financing comes from the proprietor and loans are based on the financial strength of the individual, obtaining long-term business financing may be difficult. The future of the company is dependent upon the owner’s capabilities in terms of knowledge, drive and financial potential, which may limit growth potential. As the only person responsible for the business, the sole proprietor assumes heavy responsibility.

Partnership: A partnership is a legal business relationship in which two or more people agree to share ownership and management of a business. Often partners are chosen who possess skills or expertise that are complementary. Sharing ownership of a business may be a way of raising additional capital. Care should be taken when choosing a partner: you will be bound by each other’s decisions. Choose carefully based on compatibility of work styles, business practices, character, financial situations, skills and expertise.

The advantages of a partnership include the ease of formation, the sharing of responsibility and the increased growth potential. By sharing in the profits, the partners are motivated to succeed. This form allows for the distribution of the work load and allows for a sharing of ideas, skills and responsibilities. A partnership makes it possible to obtain more capital and to tap into more skills, giving the business increased potential.

One of the disadvantages of a partnership is the unlimited personal liability as partners personally are responsible for business debt. While the opportunity for getting long-term financing is greater in a partnership, it is still dependent upon review of the individual partners’ assets.

Do not underestimate the need for a partnership agreement. Many friendships and good working relationships have ended over business disputes. Like a sole proprietorship, a partnership terminates as a legal entity upon the death or withdrawal of a general partner unless the partnership agreement provides otherwise.

The buying out of a partnership or sale to another party must be spelled out in the agreement. This is also where the terms of profit distribution are stated. Take time and carefully prepare a partnership agreement and have it notarized. It will serve as a guideline for your working relationship with your partners. It will outline the financial, managerial and material contributions by the partners in the business and delineate the roles of the partners in the business relationship.

Jeff Casmer is an internet marketing consultant with career sales over $25,000,000. His “Top Ranked” (http://www.24hourwealth.com/) Earn Money at Home Directory gives you all the information you need to start and prosper with your own Internet Home Based Business.

The Companies Act and its own constitution bind a company when it comes to matters related to managing its affairs. A company’s board of directors possesses the power of issuing shares. However, these powers are restricted to the proviso of the Companies Act and the company’s constitution. The board normally determines the amount of money the company requires to be raised through the issue of shares. The time and the person to whom the shares are to be issued are other related factors.

It is pertinent to know that your company is registered under the Companies Act before you issue shares. Thereafter, your company issues the number of shares mentioned in the registration application to the persons, who have been specified in the registration application. To acquire those shares, the shareholders pay money to the company at the rate per share agreed upon.

Notifying the Registrar of Companies
It is mandatory, as per law, to notify the Registrar of Companies of the act of issuing shares to the shareholders. The law requires a company to notify the concerned office, in the prescribed form, within ten working days of the issue of shares. The failure to comply with this legal requirement can attract penalty for each director of the erring company. The law is very firm on this.

Obtaining Shareholders’ Approval
Another important point that may crop up on issuing shares is the presence of certain restrictive clauses in the company’s constitution. The company could find itself in a bind on account of the restrictive clauses that prevent it from issuing shares. In that case, the board of directors can approach the shareholders and seek their approval to make the necessary amendments so that shares can be issued. A 75% shareholder majority is required to pass a special resolution to this effect.

Pre-emptive Rights of Current Shareholders
Current shareholders of a company have pre-emptive rights. These rights give them priority over non-existing shareholders of exercising the option of purchasing newly issued shares. The shares can only be offered to non-existing shareholders when the current shareholders turn down the purchase offer. There might be instances where shares are offered to non-existing shareholders on favorable terms. In such cases, the shares must first be offered to the existing shareholders on those favorable terms, though they had earlier declined the original offer.

Payment for Shares
The law does not require the existing shareholders to pay anything in return for the new shares, if the constitution of the company is silent on the matter. However the shareholders will have to pay if the constitution says so. The payment of consideration (value of shares) can be in the shape of cash, future services, promissory notes, or other means as defined in the constitution. The board of directors determines the consideration before the shares are offered.

Additional Help
The software available in the market provides the necessary documents related to the issue of shares and other related activities. This software is reasonably priced and provides all required information and help required.

David Gass is President of Business Credit Services, Inc. His company publishes a free weekly e-newsletter on Small Business Consulting at their web site http://www.smallbusinessconsulting.com

Mergers, acquisitions and spin-offs are part of the corporate restructuring strategy in which big and small companies indulge in today’s corporate world. These are also called consolidation activities. Companies pursue consolidation activities to strengthen their strategic and competitive positioning.

Merger happens when a new company is formed by the combination of two separate legal entities. The stocks of both of the companies are surrendered and a new company issues fresh shares in the market. An acquisition is a purchase of one company by another where the target company ceases to exist and the acquiring company holds the stock of the target company.

In today’s world, top managers try to name an acquisition also as a merger, because it gives a negative impression in the minds of the stockholders that their company has been acquired. An equal merger is very seldom seen and most of the times it is an acquisition given the name of a merger. A merger can be both hostile as well as friendly.

A spin off is a divestiture wherein a new company is formed by selling or distributing the shares of an existing company. Companies pursue spin-off in order to streamline their main businesses. Then the companies sell their businesses, which have lower productivity.

Impact of Mergers and Acquisitions on the Shareholders and Employees
Mergers and acquisitions are not always welcomed by the members of the company whether it is the shareholders or the employees. The reason for this is that a merger normally leads to more job cuts and reduction of workforce. Job cuts are what the employees are afraid of and something that is inevitable. As far as the shareholders are concerned, mergers and acquisitions can lead to creation of large and small groups of shareholders. The minority shareholders are always at a risk of losing their interest to the larger groups. However through mergers and acquisitions the companies can achieve economies of scale and an improved infrastructure for the staff.

Causes of Failure of Mergers and Acquisitions
Most companies have increased productivity after a merger or an acquisition. But things might not work that effectively if the corporate cultures are very different. Reduced efficiency and shrinking productivity can hamper the success of the new company if the employees do not enjoy the same privileges they used to have in the target company. These are some aspects, which are ignored by the top management while entering into a contract, but later on they realize the mistake. Due to these flaws the day-to-day business is hampered to the extent that the company may suffer huge losses in a short span of time. Experts suggest that the board of directors needs to be more realistic while making a deal so that the future integration is for the betterment of one and all. The value of the company, which is pursuing an acquisition or merger, would decline, as a result of the integration risks and cash exhaustion associated with the transaction.

Available Software
Several software packages are available in the market to help companies create documents associated with these transactions. Since the approval of the Stock Exchange Commission (SEC) is required to complete the transaction, a lot of documentation work has to be done. This software helps companies to reduce their paper work.

David Gass is President of Business Credit Services, Inc. His company publishes a free weekly e-newsletter on Small Business Consulting at their web site http://www.smallbusinessconsulting.com

Shareholders can bring a proposal for certain resolutions as part of the company’s annual meeting procedures. In order to file a proposal a shareholder must own at least $2,000 worth of shares or roughly 1% of all shares in a company and own these shares for a minimum period of one year as per the rules of the US Securities and Exchange Commission (SEC). The Securities and Exchange Commission protects the interest of the company and the shareholders. A resolution must usually be submitted 120 days before the date on which the company releases the previous year’s proxy statements to the shareholders. The entitled shareholder may file one resolution per year and it cannot be longer than 500 words. The resolution proposed must be clearly written and have background material that justifies the need to implement the proposed resolutions. The shareholder may send a draft to the company and get a clear idea as to whether the company objects to the proposed resolution partially or fully. The resolution must be submitted along with a cover letter to the Chief Executive Officer (CEO) of the company. The secretary of the corporation is the one who deals with shareholder resolutions. It is recommended to file the resolution well in advance in order to negotiate with the corporation and to prepare for the annual meeting. It is also advisable to send a copy of the proposed resolution to the SEC too. A corporation may decide to vote on the resolution, or object partially or fully and may send its reasons to the SEC regarding the company’s decision on the proposed resolution. The SEC allows the corporation 13 reasons to reject a proposal.

Reasons for a Company to Reject a Proposal

1. The company considers the proposal not a proper subject for taking action. This depends on the applicability under the State laws.

2. The proposal would require the company to violate state and federal laws.

3. The proposal contradicts the company’s proxy rules and regulations.

4. The proposal benefits only the shareholder who proposed the resolution and not all the other shareholders, or if it is written out of a grudge against the company.

5. The proposal accounts for only 5% or less of the company’s assets at the end of the recent fiscal year, or less than 5% of the net earnings and gross sales at the end of the recent fiscal year.

6. The proposal involves issues outside the company’s control.

7. The proposal relates to the conduct of ordinary business operations of the company.

8. The proposal concerns an election to office.

9. The proposal is counter to a resolution to be submitted by the company at the annual meeting.

10. The proposal has been rendered moot.

11. The proposal is a duplicate of another proposal submitted earlier by another shareholder, which is going to be voted on at the annual meeting.

12. The proposal is a duplicate of any proposal submitted within the preceding 5 calendar years.

13. The proposal relates to specific amounts of cash or stock dividends.

The Need to Consider Proposals in a Timely Manner
The shareholders must be quick to act since the company has until the last 60 days before the annual meeting to disclose the proxy statements. The company has to notify the SEC that it is omitting and rejecting the proposal based on the 13 reasons and the SEC will review the situation and decide if the company has the right to do that based on the rules. The Internet and the variety of software available today are helping the shareholders and corporations regarding the implementation of corporate resolutions in a timely manner.

David Gass is President of Business Credit Services, Inc. His company publishes a free weekly e-newsletter on Small Business Consulting at their web site http://www.smallbusinessconsulting.com

A proxy is an agent legally authorized to act on behalf of someone else. When shareholders are unable to attend corporate meetings they can still cast their votes by using a proxy, who votes on their behalf. In order to do this the proxy needs to produce a power of attorney document.

Generally the company sends a letter to shareholders, prior to any meeting. This letter contains several documents providing information about the company’s growth, performance, its management, information about changes in the share structure, notices about any mergers or acquisitions and anything else pertaining to the functioning of the company, which may interest the shareholders. In short this letter would contain all the matters that shareholders might vote on during the meeting. Along with these documents, there is a form, which allows shareholders to vote by a proxy if they cannot attend the meetings in person.

Importance of Proxy Voting
Shareholders must carefully study all the documents provided and cast their votes. This is the primary method by which a shareholder can influence a company’s operations, its corporate governance, and other important issues. Therefore voting and making their decisions clear is very essential for a shareholder. Hence, when voting in person is not possible, proxy voting becomes essential for a shareholder. Usually a shareholder has the right to cast one vote per share he owns, so it is important that the shareholder casts his vote at least by a proxy. Proxy voting enables a shareholder to own shares of companies registered all over the world and influence every one of those companies’ decisions.

The Role of Institutional Investors
Thanks to the Internet, several large institutional investors can post their decisions online explaining their stance and making small time investors aware of why they have made their choice. They use proxy voting guidelines, helping proxy voters to know their views about the matters to be decided on at the meeting. These institutional investors can urge the company to alter or at times even withdraw some of the proposals making the institutional investors’ proxy voting guidelines fairly important.

Proxy Voting – Service Providers
The Internet has made it very easy for shareholders to cast their proxy votes online. Proxy service providers, such as EquiServe, Automatic Data Processing and other such companies deliver the documents in an automated electronic format and the shareholders merely have to fill out the form and cast their votes. They log in using a personal number or a code number assigned to them and cast a vote for or against the corporate resolution proposed.

Nominating Board of Directors
Companies also allow shareholders to nominate members to the board of directors. It is a refreshing change to get to nominate directors, for the shareholders can elect an appropriate person who will guide the company to better, above-average growth and ensure good corporate governance in the company. However the wrong choice can lead to someone with no experience or direction causing a lot of harm to the company. Shareholders can vote on such matters as election of directors and auditors as well as the choice of acquisitions and mergers.

The Role of Internet
Owing to the excellent choice of software available to enable the process of proxy voting it is simple and easy for a shareholder, within a matter of a few minutes, to cast his vote by a proxy through the Internet or by a simple phone call. The Internet has made it possible for an investor to own shares of companies across the globe and cast votes for every one of them in a fairly simple manner, allowing the investor to influence the companies’ decisions regarding corporate governance and other important issues.

David Gass is President of Business Credit Services, Inc. His company publishes a free weekly e-newsletter on Small Business Consulting at their web site http://www.smallbusinessconsulting.com

Choosing a stock while making an investment decision depends upon your financial goals. Corporations issue different types of stocks, the basic two types being common stock and preferred stock. Another type of classification, commonly used is to classify stocks as growth, value, or blue chip stocks, amongst others. It is important to understand the various terms clearly so that you can make a wise investment decision.

Common Stock
This is the basic stock issued by a corporation and represents the fraction of the company owned by you. Common stockholders bear the most risks associated with the company. Common stockholders get dividends only after preferred stockholders get theirs. However, the investors holding common stocks have voting rights in the company, which enable them to influence corporate resolutions. Preferred stock holders do not have voting rights.

Preferred Stock
This is a form of equity, but has the characteristics of both bonds and common stock. As the name implies, preferred stock holders can claim the earnings and also the assets in the event of liquidation of the company, prior to common stock holders. However, the claims of preferred stock holders come after those of bondholders.

Additional Classifications
1 Growth Stocks: Growth stocks are stocks of companies whose financial performance and earnings exceed the industry average and the economy in general. The profits are typically re-invested to expand the business and minimal dividends if any, are paid to stockholders. Stockholders gain because the share price goes up as the company grows.

2 Value Stocks: These are stocks considered undervalued by investors. Typically, these may be stocks of companies going through a rough patch or whose growth potential has been underestimated by the market. These stocks attract those investors, who believe in the long-term growth of the company.

3 Blue Chip Stocks: Blue Chip stocks are stocks of financially sound, well- established companies with well-established management and track record of delivering earnings. Their stock price movements are less volatile and they pay regular dividends. Such companies have industry leadership.

4 Defensive Stocks: These stocks provide stability in stock price during periods of recession, economic slowdowns or slow down in industries. Consumers continue to buy food, medicines, gas and electricity even during slowdowns and stocks of companies dealing with these sorts of goods do not lose much value during rough patches in the economy
.
5 Cyclical Stocks: Cyclical stocks are stocks of companies, whose performance increases and decreases along with business cycles. When the business cycle is in an upturn, the value of the stocks of companies related to the particular industry would appreciate rapidly, offering windfall gains. Commodities, airlines, durable goods manufacturers fall in this category. However, these stocks lose value during downturn in business cycles.

6 Income Stocks: These are especially suited for investors looking for a greater proportion of current income of companies. Income stocks offer a higher dividend in relation to their market price. Blue-chip companies and utilities like banks fall in this category.

7 Seasonal Stocks: Stocks of such companies fluctuate with seasons. Examples are stocks of retail companies and greeting card companies, which have a greater proportion of sales during festive seasons.

8 Penny Stocks: These are low value stocks, typically with a value in the range of $1 to $5 per share and are traded Over-The-Counter (OTC). They are highly speculative and high risk investments.

Additional Help
A thorough understanding of different types of stocks and the characteristics of each is essential to make informed decisions, and preserve or witness appreciation in the value of your investments. Modern software makes it easier to manage your stocks in various companies.

David Gass is President of Business Credit Services, Inc. His company publishes a free weekly e-newsletter on Small Business Consulting at their web site http://www.smallbusinessconsulting.com