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What is Product Equity Value©? |
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Written by P. 'Tan' Douglas Katchings
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Sunday, 01 February 2009 |
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What is Product Equity Value©?
P. ‘Tan' Katchings
All Rights Reserved 1981 - 2009
"You never change things by fighting the existing reality. To change something, build
a new model that makes the existing model obsolete.” R. Buckminster Fuller
“Product Equity Value© is the giving of free shares in a new type of b2bvp customer-owned public corporation where the free shares are worth more than the product or services purchased, thanks to the corporation’s earnings from customer purchasing.”
When a minimum number of customers own these new public corporations and purchase their products or services from these corporations, the price of the fixed number of free shares given after each purchase is 11, 20 or 40+ times the price of the product or service.
The formula creating these multiple values only works for new public corporations. This formula is X=(A*B)/C where X is stock price, A is revenue, B is earnings as a percentage of revenue and C is an acceptable rate of return.
We use this formula to show how publicly companies create multiple values for its shareholders. The formula is integrated into a complete business system that favors customer-owners for whom the new corporate model is intended.
When used to its maximum potential, this formula and customer integration into the public corporation effectively kills credit, debt, interest, venture capital, micro-finance, loyalty programs and unemployment . A new financial paradigm is ushered in.
For example, 14 million customers can own a public corporation with a $1 product or service. A 63% earnings rate is realistic because economies of scale will be reaped from the elimination of traditional costs associated with marketing, advertising, sales and excess inventory. With 61 million shares authorized, the corporation allocates 3 shares each to the 14 million customer-owners. A 3% return on investment brings the corporation’s stock price to $4.82 per share.
Since the customers paid $1 for the product or service and have received 3 shares now worth $14.46 (or $4.82 times 3), the Product Equity Value© of the product or service is 14.46 times $1.
This is the same as if a person bought a bag of rice for $1 and got back $14.46 in cash everyday or as often as a new corporation with a new product or service is started where the buyer is one of the 14 million customer-owners.
New Product Equity Value© ratios and multiple values can be created by changing the earnings and rate of return percentages in the value creation formula for public companies. In other words, these new public companies turn their customer purchases into savings by way of free equity in the companies owned by the customers.
What makes this multiple value creation possible is:
1. The multiple creation value formula only used by public companies,
2. The preassembly of 14 million customer-owners, and
3. Pre-determined guaranteed sales of any product or service.
Product Equity Value© is the economic solution sought by all humans for a fairer, more stable, and diversified global value system creating automatic savings caused by individual choice and customer purchasing.
If you are in a hurry, read:
The Top Economic Secret of 2009!
The End to Credit and Debt replaced by Equity!
*Paul Rogers, head of the global-organization practice for U.S. consulting firm Bain & Co ., says “managers undervalue long-term customer relationships because traditional accounting doesn't measure them'.
See also: WSJ Article about valuing on-line Financial Services Companies
Paul 'Tan' Katchings
Business Engineer Inventor
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Last Updated ( Thursday, 02 July 2009 )
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The Top Economic Secret of 2009! |
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Written by P. 'Tan' Douglas Katchings
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Sunday, 08 March 2009 |
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The Top Economic Secret of 2009!
‘Did you know that your everyday spending is worth $138,000?
Paul ‘Tan’ Katchings
All Rights Reserved 2009
A few years ago the Wall Street Journal ran an article stating that the value of each member of a financial services network was worth from $1,000 to $10,000 to the company.
So this article started me to wondering. How did this writer determine this range of numbers? Well, the conclusion I found is different from his. The range of numbers is not $1,000 to $10,000, but in excess of $138,000 because of a Top Secret in business hidden from people.
Like any train of thought or line of research you start at one point and can end up at a completely difference location or conclusion than what was intended at the beginning. When searching you never know what exciting things that you will find. |
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Last Updated ( Thursday, 02 July 2009 )
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