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Monthly Archives: June 2013

GDP revision may give the Fed food for thought

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Vanguard’s Economic Week in Review

With plenty of signs out this week pointing to momentum in the economy—improvements in factory activity, consumer confidence, new-home sales, and personal income—the downward revision to first-quarter gross domestic product came as a surprise. On June 19, Federal Reserve Chairman Ben Bernanke had rattled markets by mentioning that “letting up a bit on the gas pedal” with the Fed’s bond purchases might be appropriate later this year if the economy keeps improving. But this week’s GDP revision, along with reassuring statements from the central banks of Europe and China, helped allay market concerns about an imminent change in monetary policy.

As of midafternoon Friday, the S&P 500 Index was up about 1% for the week to 1,613, while the yield on the 10-year U.S. Treasury note was basically flat at 2.49%. The week’s final figures will be posted here after the markets close.

First-quarter GDP estimate is lowered

The Commerce Department again lowered its estimate for economic growth in the first quarter of 2013. Its latest reading indicated that economic output grew 1.8% on an annualized, inflation-adjusted basis. That was well above the 0.4% reported for the fourth quarter of 2012, though considerably below the previous estimate of 2.4%.

Consumer spending remained the largest contributor to growth despite January tax increases, but to a lesser extent than earlier estimated. Winter utility bills accounted for a considerable part of the rise. Business spending and inventories also drove growth for the period. Disappointing, though, were a quarter-over-quarter deceleration in fixed investment spending and acceleration in inventories.

Government spending was less of a drag on growth in the first quarter than in the fourth quarter of 2012, thanks to a slower decline in defense spending.

“The Fed has made clear it will implement policy consistent with current economic conditions,” said Vanguard economist Andrew J. Patterson, “and a sharp downward revision in GDP such as this, especially considering much of the revision was due to downwardly revised consumer spending, may quell some fears of the central bank tightening policy too soon.”

GDP: Under the hood
4Q 2012 1Q 2013
Real GDP growth
+0.4% +1.8%
Major components: Contributions/subtractions
Consumer spending +1.3% +1.8%
Business spending and inventories +0.2% +1.0%
Trade (exports minus imports) +0.3% –0.1%
Federal, state, and local government spending –1.4% –0.9%

Annualized quarterly change, rounded.
Get a closer look at GDP and its components.

Consumer confidence reaches five-year high

Consumers surveyed by The Conference Board about the present economic situation and their expectations for the next six months were more optimistic in June, pushing the Consumer Confidence Index up to 81.4, its highest level since January 2008. That compares with 74.3 in May and 58.4 in January. It should be noted, though, that June’s survey results were collected before the recent market volatility.

SubscribeThe present-conditions component of the index rose by 4.4 points, with more respondents saying jobs were “plentiful” and fewer characterizing current business conditions as “bad.” Consumers were even more enthusiastic about the short-term outlook for employment and business conditions, pushing that measure up by 8.9 points.

The picture was more muted for income and buying plans. Fewer consumers in June said they expected their income to increase over the next six months, and more indicated their income was likely to stay the same. In keeping with those guarded expectations, consumers’ buying plans remained more or less flat.

For durable goods, a solid repeat performance

May orders for long-lasting manufactured goods surprised analysts by rising $8.0 billion, matching April’s 3.6% gain. A significant part of that increase came from the volatile transportation equipment segment, as orders rose 10.2%, led by nondefense aircraft and parts. (Aircraft orders at Boeing rose from 51 in April to 232 in May, according to the company’s website.)

The Commerce Department data showed more modest increases in orders for many other segments. Notably, orders for core capital goods rose more than 1% for the third month in a row. This category—which includes machinery, computers, and software—is watched closely as a proxy for business spending. Orders for motor vehicles and parts were an exception to the upward trend, falling 1.2% in May despite strong vehicle sales in recent months.

New-home sales remain on the mend

Sales in May of new single-family homes reached a seasonally adjusted annual rate of 476,000, up 2.1% from April and 29.0% from May 2012. Some regions fared far better than others; monthly sales climbed 40.7% in the Midwest and 20.7% in the Northeast but slumped 9.0% in the South.

The inventory of new homes for sale remained near cyclical lows. Although it edged up a little in May to 161,000 units, that level represented a tight 4.1 months of supply at the current sales rate. The median sales price for a new home in May was $263,900, 3.2% lower than in April but 10.3% higher than in May 2012.

Income rise joined by more spending and saving

Personal income rose 0.5% in May—more than expected—mostly because of increases in interest and dividend income as well as government transfer payments such as Social Security income, the Commerce Department reported. Consumer spending rose 0.3%, a welcome development given its importance to the economy and April’s disappointing reading. Higher earnings also allowed consumers to save a little more: The savings rate rose to 3.2% in May and was adjusted upward for April from 2.5% to 3.0%.

The economic week ahead

Monday brings a construction spending report along with the ISM Index on manufacturing. Reports are due out Tuesday on factory orders and Wednesday on the ISM Non-Manufacturing Index. Import and export data will be released Wednesday and the closely watched monthly employment report Friday.

Summary of major economic reports
Date Report Actual
value
Consensus
expected value
10-year note yield S&P 500 Index
June 24 +5 bp –1.2%
June 25 Durable-Goods Orders (May)
Source: Commerce Department
+3.6% +0.9% +3 bp +0.9%
Consumer Confidence (June)
Source: The Conference Board
81.4 76.8
New-Home Sales (May, annualized)
Source: Commerce Department
476,000 464,000
June 26 Real Gross Domestic Product (Q1 annual rate)
Source: Commerce Department
+1.8% +2.5% –5 bp +1.0%
June 27 Initial Jobless Claims (week ended June 22)
Source: Labor Department
346,000 336,000 –6 bp +0.6%
Personal Income (May)
Source: Commerce Department
+0.5% +0.2%
Personal Spending (May)
Source: Commerce Department
+0.3% +0.4%
June 28
Weekly change

bp=basis points. 100 basis points equal 1%. For example, if a bond’s yield rises from 5.0% to 5.5%, the increase is 50 basis points.

Notes

  • The economic statistics presented in this report are subject to revision by the agencies that issue them. For more information on the reports mentioned in this article, read our Guide to major U.S. economic reports.
  • All investing is subject to risk, including possible loss of the money you invest.
  • Past performance is no guarantee of future returns. The performance of an index is not an exact representation of any particular investment, as you cannot invest directly in an index

 

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Are Businesses Crossing Lines by Tracking Employees?

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Expert Cites Benefits & Ways to Ease Privacy Concerns

Nearly 10 years after real-time package- and people-tracking went viral with the advent of GPS-enabled cell phones, small businesses face two big concerns.

“One is expense. Small businesses, especially those still recovering from the worst recession in modern history, can’t always afford to provide their employees with GPS-equipped smart phones,” notes location-based services specialist George Karonis, founder and CEO of LiveViewGPS, Inc., provider of Mobile Phone Locate tracking service,  (www.mobilephonelocate.com).

“The second issue is privacy. People generally don’t want their employer to be a ‘big brother’ boss who can track their every move. It’s not because they’re doing something they shouldn’t, but because it invades their space, and the information could be misinterpreted or misused.”

But employee tracking has plenty of obvious benefits to small business owners:

• Provide baseline information. It gives businesses solid data to analyze for initiatives such as improving efficiency. Businesses with lots of workers in the field making deliveries or service calls can optimize routes and schedules.

• Improve customer service and satisfaction. Tracking helps a business tell people waiting somewhere for a delivery or service exactly where their package or service-person is and how long the wait will be.

• Improve response times. On-site coordinators can re-route workers in the field to respond to unscheduled calls in the most efficient way possible.

• Reduce costs. The greater efficiency provided by tracking helps lower costs by reducing both downtime and overtime.

So how can businesses circumvent affordability and employee privacy concerns?

One way is to accomplish both is to use a service that doesn’t involve extra equipment, including software, or a contract, Karonis says.

“If you’re not loading apps or software onto someone’s personal phone, it’s less intrusive for the employee and he or she will be more willing to allow use of their own phone. There’s also no added drain on the battery, because there’s no app constantly running in the background, and no hitch-hiking on their data plan or incurring a data charge,” he says.

“If you make it non-intrusive employees won’t tend to feel that you’re invading their privacy.”

Using a service that charges per location, with no requirement for a time-specific contract, is also more cost-efficient for the business, Karonis says.

“For the small business that’s merely seeking to improve efficiency and customer service, constant tracking isn’t necessary. That’s more appropriate in a situation where employers have large number of people constantly in the field, for instance, UPS. Or, employers who feel the need to monitor unproductive employees,” he says.

There’s a growing backlash as the public is subjected to more and more stalking – from cameras mounted at traffic lights to social networking sites recording shopping habits and topics of conversation, Karonis notes.

“We’ve reached a crossroads where we need to find a balance between surveillance that provides legitimate business advantages and surveillance that invades people’s privacy,” he says.

“It really is possible to strike that balance and, in a small business that thrives on trust, mutual respect and fully invested employees, it’s essential.”

About George Karonis

George Karonis has a background in security and surveillance, and has specialized in location services since 2005. A self-professed computer geek, one of his chief concerns is balancing the usefulness of tracking with the protection of individuals’ privacy. He is founder and CEO of LiveViewGPS, Inc.

 

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‘Jetson’-Age Tools Click with Big-Event Planners Trade Shows Expert Shares 3 Cutting-Edge New Technologies

jane-jetsonMost of us think about technology on a mostly two-dimensional plane as we flick our way from screen to screen on touch glass. But today’s tech includes applications that are far from flat, says major-events expert Ann Windham.

“What if you could control all primary aspects of major events like trade shows, big weddings and awards ceremonies through your iPad or smartphone; imagine shutting everything down at the end of a long and exhausting night by pushing one button on your phone – that’s just some of what’s possible with today’s software,” says Ann Windham, president and CEO of Imagine Xhibits, Inc. (imaginexhibits.com/events).

Lights, climate control, projectors and monitors, curtains, fountains and much more can be controlled with an app, and the data that you take away from trade shows can be used to quickly follow up on sales leads, says Windham, who will be showcasing this cutting-edge technology July 9 at Trade Show Technology Summit 2013, to be held at the Irving Convention Center at Las Colinas in Irving, Texas.

The summit will show attendees how to manage technology such as QR codes, mobile apps, virtual trade shows, social media, on-line asset management, interactive media and live stream video on electronic devices as simple as a mobile phone, she says.

“We’ll show planners the newest event management tools for efficiency and streamlining tasks before, during and after their event. We’ll also have hands-on, educational workshops to show them how to use management,” she says.

Windham shares three of her favorite new technologies:

• Pre-show – Event Management Software: This one-stop source for managing every detail about your event – from Fed Ex tracking numbers to vendor contact information to photos from the show – even allows you to manage multiple events from any location. “In the past, we carried all the details for each show in one huge binder. If you were at a show in Texas and someone called with a question about the show in Oregon, you wouldn’t have that information handy,” Windham says. Event management software relies on cloud storage, so members of your team can access it from their smart phone or iPad no matter where they are. Another benefit: You’ve got just one place to input all that data.

• During the show – Remote Sensors: Sensors built into the walls of an exhibit allow you to control all of the electronics from your smart phone or iPad. Not only does it save time, it’s an easy way to add valuable theatrics during a demonstration. “Say you’re standing at the back of the room and you realize the speaker can’t be heard, you just turn up the volume on his mic, right from your your iPad,” Windham says. “Or, if you want to create special effects using lighting and room temperature, you can dim the lighting and drop the temperature.” Her favorite feature? At the end of a long day, rather than walking from one device to the next, shutting off each, you press just one button and turn everything off while walking out the door.

• Post-show – Sales Leads Follow-up: Seventy percent of percent of exhibitors who capture sales leads at trade shows don’t collect qualifying information, according to the Center for Exhibition Industry Research (CEIR).Scanners collect only the most basic data from visitors to each booth – there’s no way of knowing whether they were a “hot” lead ready to buy, or someone who stopped by for the free T-shirt, Windham says. Now, however, event management software allows exhibitors to include qualifying information every time a visitor’s badge is scanned. “At the end of the event, you can quickly see who your hottest leads were and send them an email or postcard before you’ve even left the event,” Windham says.

For planners who’ve been hamstrung by personnel cutbacks in recent years, these new tools are lifesavers, she says.

“The days of ‘The Jetsons’ has arrived.”

About Ann Windham

Ann Windham is the president and CEO of Imagine Xhibits, Inc., a full-service trade show marketing company that offers custom design exhibits using modular components. Windham’s company offers customers more than 50 percent savings on operating expenses; expert face-to-face marketing consultants that will work to increase ROI with four-step marketing; quarterly seminars offering continuous education by certified trainers; in-house design services for custom structures, graphic design and brand development; turn-key services and exhibit management program for all logistical needs; and a one-stop shop for meeting planning, promotional products, collateral web-site and more.

 

 

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Creating A Successful Marketing Campaign

email_marketing_campaign-300x249As a worldwide population we all have our differences as well as those things that bind us together whether we live in Asia or on the beaches in countries such as Brazil.  One of the ties that bind us is the fact that we are all consumers in one form another; whether we are enjoying a meal at our favorite restaurant or purchasing the seeds to plant our garden at home. As consumers we are constantly exposed to a variety of marketing campaigns that can help us make decisions on products.  Creating a successful marketing campaign is a crucial component in ensuring that potential consumers become customers for your businesses.

Organization is Critical

All members of the business community known that organization is critical in order to reach all goals set before them. The ability to prioritize and organize is especially critical when planning your marketing campaign.  Make sure that all members of your marketing team are kept up to speed throughout the entire process. You can either plan daily or monthly team meetings. Technology can also be an ally here because you can use email or other electronic communications to keep each other up to date.

Decide on the purpose of your Campaign

One of the first steps in creating any type of campaign is deciding on its purpose. Marketing can be useful in many different respects. If you are a smaller business, marketing is the critical avenue for you to introduce yourself to your community.

You may also choose to focus on a new product or line of products that may replace or improve on existing items.

Focus on Your Audience

Not all products are meant to be used by consumers of all ages. Be sure to focus on the specific demographic(s) that you wish to reach with your campaign.  As it comes together it may be a wise choice to test it out on your demographics.

Choose a Color Scheme

The right color can make all the difference in your campaign. If your company is known for a specific color scheme this aspect of your campaign is already taken care of. However, you can also choose the scheme based on specific needs.

When choosing the color keep in mind that contrast is important as it will make your message stand out. Be sure to tie the color into the emotion you are trying to elicit with your product or service.  For example, red and orange generally elicit strong feelings and excitement. On the other hand, white connotes purity or safety.

Decide on Your Message

Your color scheme is only a part of your overall campaign. You also need to decide on a message that will not only appeal to people, but also resonate with them.

Mediums

Your choice of marketing mediums is also important. There are traditional formats like television or radio. The new avenue of social marketing is also an important exploration tool. Physical items such as ink pens and pins can also help spread your message. If potential customers have the opportunity to take an item home it may further cement your name into their brain.

Creating a successful marketing campaign will take a lot of work. Keep all decisions fluid until the last moment to allow for any last minute changes.

Featured images:

Chloe, a marketing manager, gives insight on how to create a successful marketing plan for your business.

 

 

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Grow Your Business With Outsourcing

images (2)Running a small business can be fulfilling: you get to pursue your passion, be in control and be your own boss. However, it can also be incredibly frustrating. When you decided to start your own business you probably did not imagine that most of your time would be hijacked by mundane routine tasks such as bookkeeping, making appointments, writing PR materials and so on. If you are inundated with back office tasks that can really throw a spanner in the expansion of your brilliant innovating business.  Instead of trying to do it all yourself, you can get easy affordable help by outsourcing.

Outsourcing seems like something big businesses need to do. Thanks to the innovations in technology, however, any and all manner of tasks can be effectively outsourced. There is an entire global workforce online who are qualified in various skills but do want the flexibility for working from home, or from working from other countries, and are therefore freelancing online. These include everything from executive assistants who will answer you mail and set up your appointments, to writers who will create effective copy for your marketing, to graphic designers, PR managers, graphic designers, IT consultants; the list is endless.

Here are some things you can and should outsource, without hampering your progress:

  • Any job that requires highly skilled expertise, such as finance management. If you are not from a finance background, it would be a good idea to have a finance expert step in and take a look at your books to make sure things are in ordering. Also, a brand consultant can help you create a brand and comprehensive marketing strategy that you can then deploy;
  • Any job that is routine and mechanical, such as data entry, bookkeeping, inventory and so forth;
  • Jobs that require specific technical expertise such as IT support for your business, or graphic design and search engine optimized copywriting for your marketing materials.
  • Another area that could easily be outsourced is your payroll and HR functions.  HR and Payroll can be confusing and could cost you a ton in fines.  Team up with a qualified payroll management comapny to complte your HR functions the right way.

To figure out who the right contractor is for you to get your job done right, you will need to do some research. The best way as usual is to go through personal recommendations from people in your business network. However, you can also get referrals and ratings on contractors on websites that connect freelancers to businesses who need them. Once you have figured out what exactly you need from your contractor, communicate it clearly to the contractor, and make sure you understand each other before embarking on work together.

Finally, although you should keep some focus on following up with your contractor to ensure your work is done according to your needs and specifications, do not get so involved that you are not able to effectively use all the time you freed up by outsourcing in the first place. Outsourcing gives you the chance to focus on the things that really matter to your business, such as research and development to improve the quality of your product and service, and expanding your business.

Shawn Wise is the Director of Marketing at Contractors1stInsurance.org.  CFI provides Employee Leasing, Payroll Management, and other affordable contractors insurance services to help small business owners outsource time consuming parts of their company and get back to the more important operations.

 

 

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U.S. Surveillance Is Not Aimed at Terrorists

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By Leonid Bershidsky 

The debate over the U.S. government’s monitoring of digital communications suggests that Americans are willing to allow it as long as it is genuinely targeted at terrorists. What they fail to realize is that the surveillance systems are best suited for gathering information on law-abiding citizens.

People concerned with online privacy tend to calm down when told that the government can record their calls or read their e-mail only under special circumstances and with proper court orders. The assumption is that they have nothing to worry about unless they are terrorists or correspond with the wrong people.

The infrastructure set up by the National Security Agency, however, may only be good for gathering information on the stupidest, lowest-ranking of terrorists. The Prism surveillance program focuses on access to the servers of America’s largest Internet companies, which support such popular services as Skype, Gmail and iCloud. These are not the services that truly dangerous elements typically use.

Read More: Leonid Bershidsky on Snowden’s Moscow Layover

In a January 2012 report titled “Jihadism on the Web: A Breeding Ground for Jihad in the Modern Age,” the Dutch General Intelligence and Security Service drew a convincing picture of an Islamist Web underground centered around “core forums.” These websites are part of the Deep Web, or Undernet, the multitude of online resources not indexed by commonly used search engines.

No Data

The Netherlands’ security service, which couldn’t find recent data on the size of the Undernet, cited a 2003 study from the University of California at Berkeley as the “latest available scientific assessment.” The study found that just 0.2 percent of the Internet could be searched. The rest remained inscrutable and has probably grown since. In 2010, Google Inc. said it had indexed just 0.004 percent of the information on the Internet.

Websites aimed at attracting traffic do their best to get noticed, paying to tailor their content to the real or perceived requirements of search engines such as Google. Terrorists have no such ambitions. They prefer to lurk in the dark recesses of the Undernet.

“People who radicalise under the influence of jihadist websites often go through a number of stages,” the Dutch report said. “Their virtual activities increasingly shift to the invisible Web, their security awareness increases and their activities become more conspiratorial.”

Radicals who initially stand out on the “surface” Web quickly meet people, online or offline, who drag them deeper into the Web underground. “For many, finally finding the jihadist core forums feels like a warm bath after their virtual wanderings,” the report said.

When information filters to the surface Web from the core forums, it’s often by accident. Organizations such as al-Qaeda use the forums to distribute propaganda videos, which careless participants or their friends might post on social networks or YouTube.

Communication on the core forums is often encrypted. In 2012, a French court found nuclear physicist Adlene Hicheur guilty of, among other things, conspiring to commit an act of terror for distributing and using software called Asrar al-Mujahideen, or Mujahideen Secrets. The program employed various cutting-edge encryption methods, including variable stealth ciphers and RSA 2,048-bit keys.

The NSA’s Prism, according to a classified PowerPoint presentation published by the Guardian, provides access to the systems of Microsoft Corp. (and therefore Skype), Facebook Inc., Google, Apple Inc. and other U.S. Internet giants. Either these companies have provided “master keys” to decrypt their traffic – – which they deny — or the NSA has somehow found other means.

Traditional Means

Even complete access to these servers brings U.S. authorities no closer to the core forums. These must be infiltrated by more traditional intelligence means, such as using agents posing as jihadists or by informants within terrorist organizations.

Similarly, monitoring phone calls is hardly the way to catch terrorists. They’re generally not dumb enough to use Verizon. Granted, Russia’s special services managed to kill Chechen separatist leader Dzhokhar Dudayev with a missile that homed in on his satellite-phone signal. That was in 1996. Modern-day terrorists are generally more aware of the available technology.

At best, the recent revelations concerning Prism and telephone surveillance might deter potential recruits to terrorist causes from using the most visible parts of the Internet. Beyond that, the government’s efforts are much more dangerous to civil liberties than they are to al-Qaeda and other organizations like it.

(Leonid Bershidsky is an editor and novelist based in Moscow. The opinions expressed are his own.)

 

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Business Etiquette Tips

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Employees with bad attitudes can spoil a business and alienate customers. This principle remains true whether the business in question is a fast food restaurant, high-end retail store, or even a business-to-business company. People skills and social etiquette are instrumental to a successful business – paradoxically, people will sometimes choose a smiling face and an inferior product over a more efficient solution which is dealt out in a surly manner. Here are some tips on how to keep employee and client dissatisfaction at a minimum by using old-fashioned good manners!

Etiquette Tips

  • Stress the team. Every person at a company has a role – at least they ought to if they’re being paid! Make sure that everyone feels included. If lower-level employees don’t feel appreciated, their quality of work will suffer. Without proper support staff, hot-shot upper level employees will have their efficiency compromised.
  • Minimize meetings. Although they are a necessary part of running a business, meetings can become a burden on productivity. Keep meetings concise and be sensitive to the time-strain they may put on employee’s effectiveness.
  • Be quick on the draw. Nothing is worse than reaching out to give a company business only to receive dead air in return. No matter how absurd or demanding the request, always be prompt in correspondence with potential clients.
  • Organize thoughts. Rambling emails appear unprofessional and can also be a legitimate source of confusion. By being concise and clear the first time, the chances of having to explain something twice or deal with a perturbed and confused employee are reduced.
  • Don’t overdress or underdress. The idea of a uniform might seem constricting, especially in creative fields. But for most businesses, and especially in the case of those that are engaged in a large amount of business-to-business contact, underdressing can be taken as a sign of unprofessionalism. Establishing guidelines for dress is a tacit way of reminding employees that they’re at work and that they need to reflect this outwardly.
  • Make deadlines. A missed deadline can give a client the impression that they are of limited importance. If the scope of work becomes larger than expected, give significant notice and explain the reasons behind a project’s tardiness.
  • Be sensitive to diversity. This goes both for clients and employees, creeds and personality types. Remember that a business relationship requires collaboration and compromise. Additionally, keep in mind that a lack of dissenting voices doesn’t necessarily mean consensus – it may mean that employees are afraid to speak out!

Some may underestimate the value of proper etiquette in the work place. After all, we live in an era when many of the formalities have gone out of business relationships. We can see our business associate’s exploits on social media, and interoffice emails these days often contain cat video attachments or the like. But when it comes to ensuring a profitable and smoothly functioning business, decorum still has a rightful place. It can be difficult to measure how many clients may be lost or never secured because of poor etiquette, so it’s best to do everything possible to keep this number low!

Justin blogs about business tips and how to start and market a business on behalf of Kwikkerb. He also provides information on the Kwikkerb business opportunity.

 

 

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