Ricardo turns back to Sean. “I have been delighted to meet you. I will e-mail a preliminary proposal to you, for your possible client’s consideration.”
“Thank you,” Sean replies. “Are you willing to negotiate the terms?”
Ricardo nods hesitantly. “I’m willing to negotiate a fairly favorable contract for the right U.S. company willing to commit to at least a ten-year lease arrangement.”
“And what about a right of first refusal to purchase and an option to buy?”
Ricardo says, “Absolutely, these provisions can be worked through and included in any arrangement.”
Satisfied, Sean shakes Ricardo’s hand. All three men go to a local cantina, enjoy more pleasant conversation and local cuisine, and then Hugo and Sean depart back to the villa.
When they arrive, Sean invites Hugo for drinks by the pool, and Hugo accepts and peppers Sean with many questions regarding his opinion of the factory.
Sean plays it very cool, being as vague as possible without being rude. “I have to discuss matters with my client, as I’m sure you understand. At the moment, I am unable to commit on her behalf.” Hugo frowns and Sean realizes he needs to throw some type of bone to maintain the opportunity. He sighs. “However, I’m delighted by the facility, and I can see several benefits for my prospective client, should she choose to utilize it in a global growth strategy, especially in the emerging Latin American markets we discussed last night. I will absolutely suggest this is the best move for her, but I will also need to explore her financial tolerance for this type of rapid expansion, as well as the appropriate timing for it within the fashion industry.”
Hugo’s informational needs are satisfied for the moment, and he stands and shakes Sean’s hand before leaving the villa. “Thank you for your time, Mr. Green,” he says, and Sean returns the pleasantry.
After Hugo has gone, Sean calls Mark Stevens to let him know the deal is completed with Diablo Mining and to thank him for the use of the villa over the weekend. Next, Sean begins the intense process of market research and preliminary outlines for his discussion with Jessica Silva, appreciating how delightful doing research is when it’s done poolside.
CHAPTER 6
INITIAL ANALYSIS
As Sean considers the possibilities for Jessica’s company, he is struck by the fact that for the first time in a long time, he will need to consider his client’s financial ability to implement the strategy he develops. The relocation or opening of an additional facility is an aggressive transition into a new global strategy, which will most likely be beyond Jessica’s ability to accomplish. He makes a note for himself to determine the strength of “Beauty Something’s” brand within its niche market.
God, I need to get the name of this company into my brain correctly, then evaluate it solely upon its public recognition and credibility within the fashion industry. But to him, the name still seems trite, juvenile, and insignificant. But hell, what do I know about women’s fashion? He decides to have Evelyn assign one of his best researchers to answer these questions prior to his next visit with Jessica.
Perhaps the most difficult issue to wrap his head around is the level of political corruption a U.S. company will be forced to deal with in Brazil’s political environment. Mark, Hugo, and Ricardo will be able to shed some light on this issue and what will be expected in order to make things happen quickly. Next, Sean develops a preliminary benefits list for potential employees, health care coverage, marriage counseling, and family planning education, as well as literary and basic budgeting for the undereducated employees. Sean also makes sure the benefits include scholarship opportunities for the employees’ children and educational programs so the workers will be able to complete high school and strive for college completion as well, in order to qualify for management positions within the organization. Considering the setup of the factory, Sean realizes there is also plenty of space to provide on-site day care for working moms, the costs of which the employees could reimburse, in full or just partially. Perhaps the biggest bonus the “Beauty Whatever” could offer is discounted clothing and bonuses paid in clothing to appease workers’ need for social status along with their appetite for middle-class identification.
Most of the programs can be provided by the organization at limited or no expense for the facility employees, and can even be offered to the general public for a small fee to offset the organizations expenses, Sean thinks, nodding to himself. With the general concepts done, Sean starts to focus on the financial ramifications of this type of programming and expansion. Since he knows absolutely nothing about fashion costing per item, markup, or shipping expenses, he decides to speak with Mark, specifically about the ease or difficulty of getting the products out of the country and into the United States. He decides against doing it over the weekend, and then spends the majority of his time at the villa drawing out a variety of figures for the fashion industry, in preparation for checking costs.
While on the corporate jet back to San Francisco, Sean calls Mark, then Evelyn. He discovers from Mark that shipping, via air service, to the United States will add approximately five percent to the overall production costs, regardless of the product, as long as none of the products are considered hazardous material. During his following conversation with Evelyn, Sean instructs her to have one of his researchers conduct preliminary market cost analysis on the fashion industry in the United States and Latin America, specifically focusing on production, shipping, and quality control issues in the niche market industry and on Beauty Boutique’s market placement.
Evelyn quips, “Well, Mr. Green, seems to me like you have given considerable thought to the Beauty Boutique’s representation.”
Sean sighs into the phone. “I didn’t say I was going to get involved. I’m simply trying to decide if the margins are large enough for SGM to engage in a realistic discussion with Ms. Silva.”
“Mmh. I see,” replies Evelyn knowingly.
“Just tell someone to have the damn preliminary research done by Thursday morning when I get into the office,” Sean growls.
“Yes, Mr. Green. By the way, you have a meeting scheduled for 11:00 a.m. with Ms. Silva three weeks from today. It’s only for an hour. Should I block out a longer time for you?”
“Yes. Block out two hours on my calendar, just in case we need a little longer depending on the research results. Also, please arrange for lunch to be catered by Basta Pasta, have my merlot available, and get a few cannolis from Stella’s Pastry for dessert. I don’t want us to go hungry if things go well, and if they don’t I’ll have a great lunch for myself.”
“Is that it?” Evelyn asks, dripping sweetness.
He frowns at the phone. “For now, thank you. Oh, wait! Can you also schedule a dinner appointment with Mark Stevens this week? Tell him it’s for sushi and it needs to be just between him and me. If he hesitates, tell him he owes me, and it will be all about business this time. We’ll go to the usual spot.”
“You got it,” she answers, fake sweetness gone.
“Thanks, Evelyn,” Sean says, then ends the call.
The jet touches down in the early evening in San Francisco. After a short ride from the airport, Sean pours himself a scotch and settles down on the couch with Sinatra playing softly in the background. He awakens early Tuesday morning slightly bemused about having spent the night on the couch. He packs up some clothes for work, dresses in sweats for the gym, and heads out for his normal workout.
He arrives at his office around 8:30 a.m. to a mound of messages, e-mails, and demands from Evelyn. When he finally allows an interruption to his work, it is Evelyn reminding him that it is nearly 5:30 p.m., and he is supposed to meet Mark for sushi at 6:00.
“Oh, shit. Thanks,” he murmurs. He closes what he was working on, grabs his notes, and dashes out the door. Mark is already seated when Sean arrives in a whirlwind.
“I took the liberty of ordering us both a beer and the first round of sushi,” Mark says with his generic smirk in place.
<
br /> Sean huffs out a breath and runs his hand through his salt-and-pepper hair. “Great. Sorry I’m late. It’s been one hell of a day.” They exchange the normal pleasantries, with Sean asking about Bonnie and Mark asking about Brazil. A serious tone comes over Sean and catches Mark momentarily off guard.
Mark studies Sean’s face as only he can. Sean finally breaks the silence and asks, “How well do you know Jessica Silva?”
Mark smiles and answers Sean’s question with a question. “Are you asking me for a personal or business reference?”
Sean hesitates for a moment, slumps in his chair a little, then confesses to his friend, “Both I guess.”
Mark chuckles and replies, “Well, she is an intelligent, beautiful woman, with enormous talent in the fashion design field. She has worked her ass off to get where she is and hasn’t asked anyone for help. That is, until she asked you. Bonnie absolutely loves her, and from what I’ve seen of her, I don’t think you could find a more honest, straight-shooting person. Why do you ask?”
Sean sighs. “Well, that helps I guess. As for why, you know she came to my office and was completely unprepared for any type of business discussion. I wasn’t exactly accommodating.” Mark nods, acknowledging Sean’s statement. “However,” Sean continues, “she recovered very well. And I responded with a snarky note and some flowers, to which she recovered well yet again, with an equally sarcastic note and a bottle of my expensive scotch. I’ve been doing a little research, and it looks like SGM might be able to help her, but in order to do so, she would need to expand rapidly, globally, and with a whole new line of products. I don’t think her company has the capability to do so on its own, and I’m looking at possible options to help.”
Mark gives Sean a curious look, wondering why Sean’s talking to him about this in such detail. “Like what?”
“Well, my numbers are very preliminary at this point, but I expect she will need between $1.5 to 2 million, cash, to accomplish what I see as a possibility for her company. It’s also the only way SGM could make a profit while assisting her.”
“And what is this extremely expensive possibility?” Mark asks.
“Well, when I was in Brazil, I toured a fairly new apparel factory that had recently been abandoned by Nike Clothing. Hugo’s cousin owns the property and is willing to negotiate a lucrative ten-year contract for the right renter. I think Jessica’s company just might fit the profile. I don’t believe many modifications would be needed to the factory, but you and I both know I don’t know shit about fashion apparel production. I’d like for Jessica to tour the facility before anything else is decided. However, if the funds needed aren’t available, I don’t want her to get excited about the possibilities only to realize she is undercapitalized.”
Mark analyzes Sean’s words for a moment, then says, “You know, Sean, I wouldn’t necessarily count Jessica out. My experience with her, as limited as it has been, has told me that she is a very capable and resourceful businesswoman. If she needs capital, I suspect she would be able to raise whatever is necessary to accomplish her goals.”
Sean nods, pleased with Mark’s appraisal of Ms. Silva. “So do you think Beauty Boutique Clothing is a good risk?”
Mark raises his eyebrows. “Sean, quit beating around the bush. What exactly are you driving at today?”
“I’m not sure yet, and, as I’ve said, my numbers are only preliminary.”
Mark rolls his eyes. “I have never known your numbers to be off more than ten percent, at the most. Out with it, my man. Now!”
Sean shifts in his chair and says, “I think I’m crazy for bringing this to you, but based on my initial analysis, I think Jessica has found a very viable niche market with enormous profit potential.”
Mark sighs; realizing Sean is going to takes his time with whatever this proposal is aiming at. “Yeah, so?”
“I see the possibility that any investment into the Beauty Boutique could be doubled or tripled within the first full year of operation,” Sean clarifies. “If you invest big…”
Mark leans back in his chair, puts his hands behind his head, and studies Sean’s face. When he finally breaks his stare and silence, he says, “I only have one question for you at this point. Is your interest in Beauty Boutique Clothing and Jessica Silva personal or professional?”
“Professional,” Sean says immediately. “I’m much more interested in making money than I am in chasing pussy. Hell, finding some split-tail to spend time with me in bed has never been an issue for me. You know that.”
“True,” Mark concedes, “but I’m sensing a different type of interest in Jessica Silva from you, and I just want to caution you. If you’re analyzing this company as a possible investment vehicle, you need to view Jessica as a CEO and client only, not a possible conquest. Decide which it is before we continue with this discussion.”
Without hesitation, Sean replies, “Mark, you have my word. I am more interested in the company’s possibilities than I am in any possibilities with Jessica Silva.”
Mark eyes Sean carefully before giving in. “Very well. What else?”
Sean shakes his head. “Nothing at this point, but I’d like you to consider investing one million dollars. I would do the same in order for this expansion to work for Ms. Silva, if she can’t come up with the funds on her own.”
Mark grins knowingly. “Well, here we are then. The actual purpose of this dinner meeting, eh? I’ll tell you what; I’ll consider this a preliminary proposal with results subject to your final analysis. But I would have one major condition.”
“What’s that?” Sean asks, smiling at Mark’s directness.
“If I’m going to invest that much money in a fledgling clothing company, even if you’re going to do the same, I want both of us to be seated on a board of directors. Good luck getting Jessica to agree to me sitting on the board, given her friendship with Bonnie. She’d see it as a conflict of interest.”
“All right, fair enough. I’ll take the challenge. And you’ll consider it?”
Mark nods. “If you tell me it’s a good investment and your analysis demonstrates it to be correct, I’ll consider joining you in it. However, if you back away from putting your own funds into the company, I won’t go forward either. Fair enough?”
“Fair enough,” Sean answers, appreciating the deal-making banter. “Now, what else do you want to eat? I’m starving.”
CHAPTER 7
WOULD YOU?
Thursday morning, Sean meets with Evelyn and Bradley Jenkins, a classically dressed, geeky young man in his early thirties. Bradley is a well-educated market researcher and statistician. He works for SGM, and Sean personally considers him to be the best on board, but Bradley doesn’t know it. Bradley starts off the meeting explaining mode, medium, deviations, and variations.
Sean fakes a snore then interrupts Bradley. “I never was interested in the mechanics of statistical analysis in graduate school and I’m not interested in it now. That’s why I hired you. I understand the significance and interconnection of certain variations, and that’s all I really need to know. Tell me, Bradley, if you were going to invest two million dollars in Beauty Boutique Clothing, given their position in their niche market, and you wanted to double or triple the return on that investment in, say, one to two years, knowing SGM would be doing the marketing, would you invest?”
Bradley begins with a disclaimer and qualifications and is again interrupted.
“It’s simply a yes or no question,” Sean says, “Would you risk two million dollars developing this company? Does the research warrant such an investment? Yes or no?”
Bradley squirms in his seat. Sean focuses on him with a piercing stare, then asks again, “Yes, or no?”
Bradley looks at his feet, wrings his hands, glances at Evelyn, who purses her lips, then finally looks up at Sean’s laser gaze and says, “The market research warrants such an investment.”
Sean nods, relaxing slightly. “Okay. But would you, personally, risk two million of
your own hard-earned dollars with such an investment?”
Sean notices Bradley seems a little annoyed at his persistence when he straightens up and his face goes stiff. “Well, that’s not really a fair question, is it, since I don’t have two million dollars to invest!” He snaps. “Sir, I told you, the research indicates the parameters established in your question are possible to achieve. But there are still many variables that can change your dynamic dramatically, which haven’t yet been fully explored.”
Sean sits back fully, trying not to chuckle, and lets him off the hook. “Okay, fair enough. Now that you know my parameters, explore some of the other concerns that could change the dynamic and get back to me in two days. Oh, one more thing. Look at the possibility of moving production into Brazil and factor that into your equation. Don’t worry about the cost of building a production facility. One has already been identified on a very favorable long-term lease arrangement. I’m only concerned with the market and industry conditions at this point. That will be all for now.”
Bradley seems to shake himself out of his defensive stance as he stands. “Yes, Mr. Green,” he says on his way out.
Evelyn shoots a disgusted look at Sean and says, “Do you always have to mess with people’s minds? You had him so unsettled by the time you dismissed him, it was actually unpleasant to watch.”
Sean scoffs. “Oh, come on, some of this has got to be for me. Besides, if Bradley is a little unsettled, he’ll do better research and his analysis will be more detailed because he doesn’t want to be caught off guard again.
Evelyn gives Sean a cockeyed, quizzical look from under her dark pixie-cut hair and asks, “So, where are we going with all this research?”
Sean smirks back at Evelyn, saying, “I don’t know yet. SGM is still in the analysis phase of client selection. Ms. Silva appears to have established a nice niche for her company. However, she is right in her contention that without some significant marketing help, her company’s profits will level off at best, and stagnate at worst, neither of which will suit her desires. On the other hand, Beauty Boutique Clothing isn’t significant enough in its revenue stream to threaten major designers or industry movers and shakers. What I’m struggling with is entering into the realm of fashion marketing, especially for a company as small as Beauty Boutique. You said many of your outfits were Jessica Silva designs, correct? Why do you like them enough to purchase them?”
Uncontrolled Spin: The Power and Danger of Spin ( Un missable Series Book 1) Page 5