Sept. 10, 2001, was Jon Delano's first day as KDKA-TV's money and politics editor. Easing into the job was not an option.
Delano was no novice; he's been a familiar face on the tube for some time as an analyst during election seasons. But this was his debut as a reporter, and the plan was to do some sample stories before rolling out reports for broadcast. His deep knowledge of government, public policy and politics, however, was too valuable not to be tapped during the days and weeks following Sept. 11.
"My whole career has been a series of unexpected developments," Delano says.
The turns for Delano have often been into the fast lane. He began his career as an associate with Reed Smith Shaw & McClay, now Reed Smith LLP. Doug Walgren, not long after he was elected to the U.S. House of Representatives in 1977 with help from Delano, invited him to breakfast at a Denny's restaurant, scratched out on a placemat a plan for organizing his office and asked Delano to help. Delano stayed in Washington for 14 years and served as Walgren's chief of staff until Rick Santorum beat Walgren in 1991.
In 1993, Delano himself waged an unsuccessful campaign to win a seat in Congress.
Delano's primary occupations these days are at KDKA and his duties as adjunct professor at Carnegie Mellon's Heinz School, but he still finds time to write columns, offer his expertise as a political analyst in newspapers and on TV and radio, and take his turn getting his kids off to school.
With all the high-profile activities he's been involved in, Delano rates as one of his proudest accomplishments a long but successful battle with the Pentagon while working for Walgren. Because of a technicality, two Pittsburgh-area Vietnam veterans' names had been left off the Vietnam War Memorial. Delano ultimately convinced officials to include the names, and you get the impression that the effort was more love than labor.
Says Delano: "I love going up against bureaucrats who say it can't be done."
The procedure for selling a bankrupt company's assets gives creditors and other interested parties a say in almost every major step the debtor takes, which can delay completion of the sale and add to the buyer's transaction costs.
Even when the debtor and buyer agree on the terms, there's no guarantee the buyer will end up with the asset. The bankruptcy court has to approve the sale agreement, creditors have an opportunity to object and other buyers may bid. To obtain court approval, the sale price must be sufficient to cover the liens on the asset and the debtor's costs to sell the property, and add something to the estate to pay other creditors.
Also, creditors and interested parties must receive notice of the terms of the sale, and the debtor must advertise the terms and hearing date. Because the goal is to obtain the highest price, once the sale is negotiated, the assets are put up for public sale.
The assets may be sold to another bidder, despite the fact that the initial buyer may have spent thousands of dollars to perform due diligence and negotiate the sale contract. The standard rules of the competitive bid procedure offer some protection to a buyer. These rules usually include stipulations that:
- Competing bidders must exceed the contracted sale price by some minimum amount to qualify for consideration.
- Bids after the first competing offer must exceed it by specific increments.
- Offers must be in the same form as the initial bid to avoid comparing apples and oranges.
- The buyer will win if it matches the highest bid rather than exceeding it.
- Competing bidders have to put down a deposit or otherwise demonstrate their financial stability before they can qualify as a bidder.
Bankruptcy judges have a great deal of discretion in approving these bid and sale arrangements. A buyer and its attorney should be familiar with the track record of the judge assigned to the case and prepare motions accordingly.
Peter N. Pross is an attorney in the Bankruptcy and Creditors' Rights Department at Eckert Seamans Cherin and Mellott. Reach him at (412) 566-5934 or email@example.com.
Question: I am self-employed and the only employee of my business. While this affords me a lot of freedom and an above average income, I'm not able to invest as much for retirement as I'd like. I've been contributing the maximum to my SEP but would like to put away more on a tax-favored basis. Any suggestions?
Answer: You're in luck. The new tax law provides a jackpot for one-person businesses.
You probably already know the new law provides increased contribution limits to IRAs and 401(k)s for everyone and catch-up provisions for those over 50. But you may not know that businesses that employ only the owners and their spouses can stash even higher amounts into a 401(k).
In the past, a 401(k) has not been the retirement plan of choice for the self-employed because of higher set-up fees and more complicated IRS filing requirements. SEP and Simple IRAs were easier to establish and offered the same investment limitations, for the most part.
With the advent of the new rules, you'll begin to see special 401(k) programs designed for you. Pioneer Funds offers a "Uni-K" for a $100 annual fee and signature-ready IRS 5500 preparation for $250 per year, a small price for the additional investment it allows.
Under previous rules, there was a 15 percent-of-pay cap that an employee and employer (you are both) could contribute on as much as $170,000 of compensation. That increased to 25 percent of $200,000 in 2002 for an incorporated business, 20 percent for one that is not incorporated.
The bigger change is that in 2002, employee contributions won't be counted toward the 25 percent cap. That means you can make a large contribution as an employer and still contribute the maximum of $11,000 as the employee.
Over 50? You'll be able to contribute an extra $1,000 as an employee to your 401(k) or $500 to a Simple IRA. If you're not incorporated, your percentages will be slightly less. The combined employer and employee contribution cannot exceed $40,000 in 2002.
Ruth Forsyth is an investment advisor associate and registered representative with The Advisors Group. Reach her at (412) 922-4360 or at firstname.lastname@example.org.
When the Internet boom was going full force, we began investigating ways to use Internet technology to better serve our audience -- top decision-makers of local companies. As we were putting the finishing touches on our plan, the bubble burst.
Undaunted, we moved forward with our vision of building a Web site that not only met the needs of busy executives but did so profitably. The revised SBN Online (www.sbnonline.com), launched as a pilot site in our Cleveland market, has met both our goals.
Each subscriber to SBN Cleveland has been pre-registered for SBN Online. By using the user ID and password we supplied by mail, readers can activate their registration and get a personalized home page containing local business news and information relevant to them. Our database of thousands of articles, ideas and resources is filtered using a reader's profile, resulting in the display of news, events, presentations and other information that best matches the profile.
The response has been great. We are ahead of our projections for users and site activity, though SBN Online is only a few months old. We are so pleased with the success that we plan to expand the concept to other cities this summer.
As I look back on what it has taken to relaunch SBN Online, a number of important lessons stand out.
1. Stick to what (and who) you know. We spent a great deal of time and money researching our concept for SBN Online. What became clear is that while we may not be concentrating on the biggest market, we are concentrating on the best market. Middle-market companies account for only 10 percent of all businesses, but they boast nearly half of all corporate revenue and purchasing power.
2. Work within a budget. In the headiest days of the Internet boom, we were quoted incredible prices for products and services. While many of these offers would have met our needs, we continued to look for the right deals with the right partners.
3. Stay the course. Even as events conspired against us, we pressed forward. The bursting of the Internet bubble had everyone rethinking the role of the Internet for businesses. As the economy weakened, more doubts crept into people's minds. Then came the Sept. 11 terrorist attacks. Each one of these developments could have caused us to put the project on hold. Instead, we made adjustments and kept moving forward.
Having done these things, SBN Online was reborn even as the bursting of the Internet bubble caused other business Web sites to fold or take significant steps backward.
If you haven't registered for SBN Online, I encourage you to do so soon. If you receive SBN Magazine under your name, you were sent a user ID and password. If you've misplaced it, e-mail your name, business and address to email@example.com and we will reply, or call us at (216) 228-6397 and ask for SBN Online customer service.
And please let us know what you think. We already are at work on improvements and welcome your feedback.
"I can't describe what it feels like to sit and wait for a jury to read a verdict, kind of like watching that field goal going through the posts," McGinley says.
Little wonder that he uses a football analogy to describe it. Art Rooney, legendary founder of the Steelers, was his uncle, and McGinley's family still owns a share of the team.
McGinley's lived in Pittsburgh nearly all of his life, save four years as an undergraduate at St. Bonaventure University and a brief stint working at a Rooney family business near Philadelphia. He spent most of his law career at Grogan Graffam & McGinley, the firm he co-founded nearly 30 years ago.
In January, the 1961 Central Catholic grad accepted an offer to join Eckert Seamans Cherin & Mellott. It wasn't easy to leave his firm, he says.
"A lot of law firm splits are acrimonious," says McGinley. "Mine wasn't."
Rather, McGinley says, many of his old friends had left the firm. Fellow founding partner Steve Graffam had retired, and Frank Lucchino had gone to the bench. McGinley saw the opportunity to join Eckert Seamans, a national firm with more than 200 lawyers, as a way to expand his own practice and add the depth he needs to serve his clients, whose needs he says are growing increasingly complex.
McGinley is a casual golfer and fly fisherman, and confesses a passion for Irish poetry. The law, however, remains his first love.
"Deep down in my shoes, I remain the guy who likes to get up and say, 'May it please the court.'" How to reach: www.escm.com
The company, a Texas concern that handles reverse logistics for large mail order retailers, is interested in using Wein's Ross Township store as a drop-off point for customers who want to return merchandise to large catalog merchants. Wein says the company identified his store location as having sufficient customer traffic and visibility to serve as a receiving point.
Mailboxes Etc. offers a variety of services required for mailing and shipping, as well as related products and services.
Wein says his store is enjoying strong growth -- 2001 sales were up 7 percent over the previous year, and last year's December sales bested the December 2000 sales mark by 17 percent.
There's little wonder, then, that Wein is motivated and encouraged by the business and social trends that are making his industry successful and bode well for his prospects for growth.
But those weren't the incentives that drove Wein when he entered the business in 1987.
"I was motivated by fear," says Wein. "I just felt that I couldn't afford to fail."
Private businesses that offer the services that Mailboxes Etc. offers are no novelty today, but in 1987, Wein was entering a business that was in its early stages. His was just one of three in the Pittsburgh market at the time.
Mailboxes Etc. today has more than 4,500 locations, including 20 in Pittsburgh, and was ranked No. 2 on Entrepreneur magazine's Franchise 500 list in 2001. But when Wein launched his store, the company was No. 434 systemwide.
Perhaps most important to Wein, his father had provided personal guarantees for the loan taken to start the business.
Mailboxes Etc. was anything but a household name in 1987. Wein says customers often stopped in because they thought the store sold mailboxes. The company ultimately added a line of mailboxes to its inventory, but it was clear early on that the store's concept had yet to gain widespread recognition.
After several years of sluggish sales, even his wife doubted his prospects for making the business successful.
"My wife said to me, 'When are you going to stop playing store and get a real job?'" Wein says.
Still, he has managed to stay in business while others, including other Mailboxes Etc. and independent and franchise operators have closed their doors.
The invisible store
Wein started off in a less than desirable location and struggled for four years until he could negotiate with his landlord for a better spot in the center. He negotiated his first lease for a storeroom in the McKnight Siebert Shopping Center but soon found the location was anything but prime.
The view of the store was obscured by a service station sign, and it was difficult to see from the road. It was too small, and at the end of the strip, rather than at its busier entrance. He tried for six months to negotiate for a better spot in the same center, but the space he wanted went to another tenant.
But when a better space came available in the center four years after he opened his doors, Wein this time was able to move to the larger, more visible spot, closer to the heaviest foot and motor traffic.
Wein built awareness of his business every way he could think of. He walked up and down McKnight Road, talking with business owners and dropping off his business card and promotional flyers.
"I beat the streets a lot," Wein says.
He went to networking and local chamber of commerce events, and handed out coupons for the nearby McDonald's, while the fast food restaurant passed out Mailboxes Etc. coupons to its customers. He made certain that clerks at the U.S. Postal Service office on the next corner knew Mailboxes Etc. offered passport photos.
And while the West Penn AAA office across McKnight Road offered notary services for automobile-related work, it didn't provide them for other purposes. Wein asked the office to refer such work to him, while he referred his customers to the auto club office for notary services he couldn't provide.
But the grassroots marketing activity that might best demonstrate Wein's enthusiasm and commitment was the "Zippy" mailbox costume he donned on heavy traffic days to catch the attention of motorists as they drove past the McKnight Seibert Shopping Center.
To gain name recognition for Mailboxes Etc., Wein and several other owners formed an advertising cooperative to take advantage of a 50 percent match the franchiser offered for local advertising efforts.
Cash flow problems plagued Wein early on, as sales were weak but bills continued to roll in. He initially negotiated an arrangement with his lender that required interest-only payments on his loan.
When he found that cash was tight at the end of the year, he approached his banker to extend the interest-only payment for an additional year. At the end of the second year, with cash still scarce, Wein asked the banker once more to waive the principal for another year. The bank agreed.
Wein says consumers are getting used to alternatives to the traditional methods of sending packages and mail. Home-based businesses need specialized shipping services, and recent changes in air travel have prompted some travelers to consider other ways to ship goods.
"I've realized that people are shipping things that they can't travel with anymore," says Wein.
Recent drop-offs at his store include $35,000 worth of jewelry headed to a trade show and a cache of silver bullion. Online auction sites like eBay are also bringing traffic to his store, says Wein.
He's shipped fishing rods, antique dolls and even a hard top for a Mazda Miata.
Wein says luck has played a role in his success, too. The growth of home-based business, e-commerce and his decision to locate in the McKnight Road business corridor, he says, have all contributed to his success.
While his fear of failure motivated him to make his business successful, his lack of fear -- or his choice to ignore it in some instances -- may have been the difference between succeeding and failing. One of the most important lessons Wein says he's learned in business is to not be afraid to ask for something.
"When the worst that someone can say is, 'No,' you might as well ask the question." How to reach: Mailboxes Etc., www.mbe.com
In its investigations, CII collects information from numerous sources. Each client project creates a complex billing task, and clients often want access to the information CII collects as an investigation progresses.
Typically, several CII investigators collect data on an employee or applicant from multiple sources, and the data must be assembled into a single report. Initiating a particular element of a screening may be contingent on completion of another check, which can delay an investigation. In some cases, clients order services a la carte, which complicates the data collection and billing process.
CII thought it needed a technology solution to streamline its process. Improved technology was undoubtedly a critical component in solving the problem, but it took three tries to get it right.
The company had a DOS-based system that proved cumbersome, so it invited vendors to propose solutions. In one case, the company decided the vendor didn't understand its business and rejected its proposal. In another, the vendor had the project underway when CII chose to abandon it because it became clear the second vendor, too, lacked a true understanding of CII's business.
Enter Joseph Cherian, president and CEO of Turning Point Systems Inc., a South Side company. Cherian's company developed a system called CorpNet, an immediate interface between the client and CII that allows clients access during each phase of the screening process from the clients' offices.
It has simplified the billing process, allows clients to cut costs by doing some of the work themselves if they choose to do so, and produces reports that can help clients identify problems in their operations, such as turnover trends.
The solution, according to CII, has increased productivity by 50 percent.
Carmella Leonette, CII's director of operations, says Cherian's company not only understood the technology, but also had a clear appreciation for CII's business needs. Companies seeking a technology solution, it seems, need to do some careful investigation of their own.
"It is important to focus on companies with experience in business solutions and not merely technology vendors," says Leonette. "They must look for companies with a track record who can provide real examples of the solutions they have developed with tangible results." How to reach: Corporate Investigations Inc., www.ciilink.com; Turning Point Solutions Inc., www.turningpoint-sys.com