Consolidation will continue in every segment of California League of Food Processors and ½ will survive 10 years.

Technology will increase product transportability, growing season and the life of the product through Genetic engineering

Logistics and operations savings will not compensate for price reductions in commodity strategies for most firms.

Those that add “fresh” to their product line will capture significantly higher profits with no modification to the product.

China will convert their 1000’s of small farmers to high tech farming where farmers will bring product to a single facility servicing multiple farms versus on site storage and processing.

China will also be an opportunity for minimal growth for US production.

Product diversification and partnership development will be the reason firms survive when interest rates rise in the next decade.

Reverse auctions will keep prices low as major retailers push discounting.

Those that move to the outside lanes of the retail store today will continue to have profits eventually erode…a long process.

Those that control imports or align with imports now will double their chance of survival.

California will struggle with water supply challenges.

Significantly higher energy and land costs in California will severely limit growth in the CLFP segment.

CLFP member will struggle with overcapacity as technology advances increase yields.

CLFP customers will continue to consolidate.

Supply chain and packaging that’s integrated with retailers will drive sales as a significant competitive advantage.

Public Transportation (2005)

US public transportation needs four factors to achieve 10+ % ridership:

1. Universal payment system. (You should be able to use your card in NYC, San Francisco and Atlanta and your own community as a universal pass.) This little switch would enable users to keep only one card in their pocket and most likely try another service around the country.

2. Connectivity of community public transportation systems with other communities (County roads, bridges and infrastructures, link to the next infrastructure. The same is necessary in order to increase ridership. Currently the systems do not connect.) Currently you can't travel from Seattle to San Diego or Atlanta to Boston without jumping to an Amtrak or another service. It's like building a bridge only half way and then stopping in the middle of the gorge.

3. Singular transportation guides throughout the system. (There needs to be one universal travel guide so that like airline travel, no one needs to relearn how to use a system.) I know I personally dread trying to figure out the maps in each city. Airlines have one system and so should the public transportation sector.

4. Transportation authorities need to be established. (Today, road and mass transit are at odds over how to use funding. With a transit authority the objective of the organization is to serve the public transportation needs in the best manner possible.) Right now the road and highway industry is 10x more powerful than all the other services so when it comes to funding they get 90% of the pie even if it's not the best use of the money to move people in that region.

5. Lastly, the future of public transportation will never improve until the industry moves from viewing that there are two types of users to three. Currently there exists the lingo that there are people with CHOICE and those Without Choice. With choice means they can use alternative forms of transportation; however, if gas goes up $1 per gallon they might move into the Without Choice category.

Obviously these users have only one method to get to work, shopping, visiting the doctor, etc. The group I suggested the industry see in the future is the group with MEANS. These are the people who earn $1 million per year and use the NYC Metro to get to work in the morning. These are the people with political and financial capital. Those that would insure that NYC never closes the metro system.

What this means to the industry is "Density" must be defined differently. They may get 50 people on the train in a low income neighborhood yet 17 people from the high income community. The difference is the high income users will make sure that there is a system at all for two reasons. They will be aware of the product AND it's self serving. Their kids use it every day. (For those that don't know, the industry looks for density of population to determine service development.)

Accounting/Finance (2004)

Technological advancements will initially remove the tasks inherent to accounting while shifting some complex tactical roles overseas. This will reposition the accountant as truly an intellectual function where the role is to capitalize on economic strengths.(2004)

The second shift will be completely automated; IA systems will eliminate most of the accounting functions within an organization. (2004)

First wave is the automation of accounting functions shrinking accounting clerical workers. Second wave is the off shoring and outsourcing of accounting functions. Third wave is the automation of complex functions removing both clerical and cognitive thinking from accounting departments. The impact will be that those in accounting departments will be focused on strictly evaluating and making financial strategic decisions, not tactical. (2002)

Shopping Center Industry (2007)

1. The sub prime lending troubles are right sizing the personal home ownership condition. Over the past 10 years those that could not afford a home and the extras that come along with home ownership were able to pick up loans that to a large degree extended the families beyond their means. For some, money that should be saved, or used for personal enjoyment, went into alternative expenses including, lawn care, house repairs, fixture purchases, heat and air conditioning utility bills, taxes and other such costs incurred with ownership. (Mind you no one demanded that after purchasing the home these individuals needed a big screen TV, a pool, new furniture, etc. Sub-prime is only one part of the equation!)

For others the ARM (Adjustable Rate Mortgage) solution allowed for early entry without a strong foundation or even an understanding of risks associated with such an investment tool.

I projected back in 2006 that the bankruptcy and foreclosures would carry on forward into 2009 and in doing so, families will have to start over. For many the crisis will not end until late 2010. However, they will do so at a level in which they can afford. More importantly, the hope is they will learn through this ordeal strategies that will enable the individual to handle their money more responsibly along with allowing the individual a more balanced discretionary budget to enjoy life versus struggling to make ends meet.*

2. “Napster Conundrum:” when an industry does not keep pace with consumer needs innovative entrepreneurial companies will create alternative solutions that transform an industry. In the case of the recording industry, producers were rapidly launching poorly developed CDs where the buyer only liked a song or two on the product. The founder of Napster identified this challenge and created software that allowed file sharing of songs. In essence, it allowed individuals free access to music and more importantly access to the songs they wished to hear. The next iteration became Apple iTunes where an individual can purchase a single song for $0.99 each. (The result was billions in sales.) Surprisingly, the same people who downloaded free tracks also purchase high quality songs from Apple.

3. The NetFlix model is outdated and is a model ripe with issues prevalent in the year 2000. Here are a few. Netflix is stuck with an infrastructure designed around the purchase and shipping of DVDs using the internet. (Just because a firm uses the net does not mean it’s an internet business.) They can’t force users to watch more films nor can they charge more for the use of the product. NetFlix’s only competitive position today is discounting and securing new clients. Blockbuster on the other hand has a different position, a multi-dimensional model which allows consumers multiple means of access. (See white paper on home page.) Blockbuster has brick and mortar, internet access similar to Netflix and the potential to go VOD. Their first strategy, to reduce store locations' foot print while tying inventories to consumer usage, will allow customers two different approaches to the same product. Mail or walk in. The company also has the ability to enable Video on Demand rounding out the consumer that fits multiple profiles.

4. Winners in the shopping center industry will focus on the outcomes desired by consumers and not building buildings. Translation: stores may in many respects change their models to match consumer needs. Grocery stores will turn into distribution centers full of robotics tied to PDA, smart homes and GPS systems allowing for a smart home to signal to the center that supplies are low triggering robots to pull inventory to be ready for pick-up on the ride home after picking up the dry cleaning that will be also triggered by hand held technology. The result may be that the shopping center may also be a traffic cop offering easy in and easy out solutions. By the way, you pick your meats through a glass window, you can and will do the same from your car seat.

5. Parking lots will become intelligent. When one enters a lot the consumer wants to be close to the store in which they are to visit. The car will be directed to the closest possible location for both entering and exiting from the store given that hand helds or similar devices will aid consumers in their shopping patterns through a facility, especially if they are in a hurry.

6. Lifestyle centers are not life style centers because they don’t create community!. People don’t want to spend time at shopping centers. Period. Life is at home with family and friends. Therefore, clowns, fireworks and all the other extras won’t create community nor will individuals pursue life at a mall. Besides a successful shopping center draws from further and further distances, therefore, the better the design the less chance of community.

Granted if you changed the demographics and infrastructure, certain shopping centers may work such as in Redmond. In the end, people don’t want to go to a shopping center; they want a life, and the less they spend on tasks of shopping, the better the more rewarding their lives may be.

7. The style of many life style centers is that of an open environment. The benefit is that stores can easily be changed and space added while covered mall environments are more challenging. Those that build in these types of malls will win by default as they have much more capacity to change with changing times. Harriman NY is an example of such a sprawling metropolis.

8. Urban consumers and multi dimensional buyers don’t only see price, they look at the entire package including access, shopping experience, and ease.

9. The retailers will fight to keep retailing traditional while the manufactures will continue to look to create a direct connection to the consumer. Two models fighting for the same space. Consider the automotive environment. Their ultimate would be a holographic image of a car in a consumer's home where an individual can pick out the options they want and order the car from their couch. The retailer wants the consumer to come in to see the car. From a marketing perspective you’ve got go Microsoft building smart retailing operations watching everything that happens to a consumer once they enter the store while their manufacturing division is using robots and smart technology to try to reach the consumer in a completely different manner.

10. Future is a transparent supply chain where the entire vertical and suppliers can see within their counterparts' offices so as to meet demand as quickly as possible.

11. Stores of the future will tie to inventory levels of the home to mobile devices that when critical balances are dropped, the system will start a reordering system tied to GPS. The refrigerator says inventory balance is low for the meal you wish to make as your son used some milk and eggs. This triggers the home to notify the shopping center that there is an order of 76 items that may need to be picked up in the near future. At the same time, the dry cleaner sends a notice to the home that the dry cleaning is ready. The home notifies your personal device and then asks if you want to pick up the merchandise. When you enter the car, GPS gives you the best route to pick up the items in the best order. When you arrive at the cleaner's, the product is robotically pulled to be ready as you drive around the corner. Payment is digital, and the shopping center robotically pulls the goods to match traffic patterns. Multiple robots will be pulling so instead of 20 minutes it may take 4.32 minutes to pull all the merchandise. You select the meats and fish and drive up to a loading platform.

Comercial Real Estate (2009)

1) 2-4 million additional homes will fall to foreclsure. The previous round of foreclosures were ARM and excotic loans, the new round will be traditional loans stemming from unemployement, slow US growth, and the deplecion of the wealth by business owners and investors. Florida, California, Arizona and Michigan will lead.
2) $800B in comercial loans will default in the next 2-3 years.
3) Vacancy in commercial and warehouse space will continue throughout the US. Companies such as Amazon will build new buildings but the buildings they leave will remain vacant to a zero sum gain. Arizona warehouses will not fill for years. Seattle will remain at 17% vacancy for at least 2 years.
4) To keep tenants, landlords will offer higher value real estate in exchange for remaining a teenta.
5) Apartement vacancy will also remain high at 8% and potentially 9% due to renters sharing homes and moving in with family. College students will return home in larger numbers as unemployment in the 20-30 year old range will remain high.
6) Unemployement numbers are distorted and therefore will eventually show that:
     - The 10% unemployement does not show the numbers for those not looking for work. We could be approaching 18 million Americans by 2010. Bend Oregon is at 18%.
     - The underemployeed are not counted.
     - College student who never did secure a job are not unemployeed. The numbers would include 2008, 2009 and 2010. The numbers would then indicate another 3-4 million unemployed
     - Earnings reports will earned income will decline as employeers try to cut payrole
     - The growth in the US government will signficantley alter the actual unemployement (Census)
7) Persona bankrupcy is 7th on record and will continue to climb through 2011.
8) Retail will have peaks and valleys and yet the numbers will still indicate a contraction through 2011.
9) Stimulous bill will have limited impact - Ex: Bill allocated $40B for infrastructure. PA needs repairs of more than $40B with one road estimated at $9B. US needs $3.2B so the $40B will be specific projects and some maintenance in the end everyone will say, "Didn't we have a road repair part of the package?" and there will be nothing to show for it.
10) States will not make the hard choices. Washington state has a dept of $2.8B and without government contraction, increased business growth, the chance of balancing the budget is zero.
11) Globally, Greece, Hugary, Latvia, Estonia, are all in trouble and may default. Spain has 19% unemployment so they too are at risk along with the UK.
12) China has an artificial growth pattern that will eventually catch up with itself.
13) Japan will continue to slide. India's economy is also based upon growth that the world cannot support. South America is also in trouble.
14) Utilty costs will rise by 2x to 3x by the year 2020.
15) Life's value will come into question for many.

Summmaries
- Hiring will not start through 2010. Technologtical improvments will cause decision makers not to hire but autormate.
- Obamacare, carc check , Fed policy will contiue to remove incentive to hire and force automation and process improvement.
- Business owners are the hidden causalties because they are trying to keep their businesses afloat with savings while the employees have no clue.
- Corporations will not invest heavily until there is stability.
- Typically exports pull the US out of a recession. There will be limited exporting in this environment.
- Capital markets will continue to slow the the challenge of value to equity in question. Only the right deals will be funded.