Vacuum Cleaners Discussions

James Dyson has voiced his feelings in regard to what it will take to save Britain's manufacturing industry in a report commissioned by the country's Conservative Party.  An interesting read and plenty of UK reader comments follow.

http://www.telegraph.co.uk/finance/financetopics/recession/7400742/Sir-James-Dyson-plan-to-fill-UKs-engineering-vacuum.html

M00seUK and vacmanuk, I'll be glad to learn what you think.

Venson

It's possible that the vacuum business (other than handhelds) is doing well, but the hand dryers and bladeless fans are a drag on Dyson's bottom line.  Likely margins are down on vacuums.   The washer fiasco is likely still dragging down Dyson's net worth. 

It's possible that Dyson's net worth has dropped considerably due to charitable contributions.   

DysonInventsBig wrote:
CarmineD wrote:
Carmine,

I know small-men like to throw rocks at big-men (doers, job creators, life changers).  It’s an ugly habit and something good men unfortunately have to deal with and young people have to recognize, that is...  to decipher and then believe in those who ‘do’ (things big) or believe in those ‘who’ve never done’ (anything big).


Dyson Invents [lots of things] Big

Interesting interview with Sir James:    http://business.timesonline.co.uk/tol/business/industry_sectors/engineering/article7061037.ece

From The Sunday Times

Apparently James is planning to step down as CEO. 

And you might think he is preparing for something, as he lets slip that he will shortly stand down as chairman of Dyson, the business he founded in 1992. Bob Ayling, long-term board member and former boss of British Airways, will replace him. The company’s chief executive, Martin McCourt, another long-term ally, will remain in day-to-day control.

Dyson himself will have a new job title. “I’ll probably be called chief designer,” he says. “It’s just to make sure there is proper continuation should I go under a bus.”

...

Dyson doesn’t need anyone to warn interviewers off certain topics. He will talk about wealth if you want, though he is barely interested. That could be because he is worth more than £920m in the forthcoming Sunday Times Rich List. He was a billionaire three years ago but won’t mind dropping a notch in the recession.

I guess in American dollars, James is still a billionaire (£920m). 

Severus wrote:

Hello SEVERUS:

Certainly a real possibility.  But being old school, I won't believe it until it's proved true.

Carmine D.

DysonInventsBig wrote:

Dibster:

 I was a successful independent vacuum business owner/operator for over 40 years.  I didn't slave to any boss except me.  I didn't make my fortune by suing others and/or bashing my competition.  I had no business complaints filed against me by any customers in all that time.  I sold the business to another independent who still has the store and business in the same location.  Then, I spent 1the next 15 years as a self-employed industry consultant before retiring in August 2006.  I have degrees in accounting, economics and business from what many would consider an Ivy League University.  I think that I know and speak authoritatively on all matters of vacuum related business.  I also know good business leaders and wise business decisions.  Just as I know and recognize the bad ones.  Big and/or small men and/or women with and without rock throwing abilitie have no bearing on the successful outcomes of businesses.  Both sized men/women are equally capable and/or incapable of being good and/or bad business managers. 

After more than 3 years into retirement, I'm pleased to say I still receive offers of employment and contractual bid requests.  All of which I have so far graciously turned down.  

Carmine D.

Severus wrote:

Hello SEVERUS:

Forbes March 29, 2010 List of World's Richest puts James Dyson exactly at $1B in net worth.  This is a decline in net worth since first making the list several years ago with a reported $1.6 Billion.  James is tied in last place [number 937] with 8 others.  He just made the cutoff for the list.  I presume that's what is meant by not minding dropping a notch in a recession.  However, more accurately and truthfully, tied in the last position at 937 puts James 236 notches [names] down from last year.  

According to Forbes, the net worth valuation is based on an estimate, in many cases not even vetted/verified, at one point in time: Feb 12, 2010.  The amount may have declined/increased since the Forbes publication.  I presume a disingenuous person, knowing the approximate time of valuation, could delay debt payments and expense payments in order to meet the $1 Billion cutoff.  I don't say any one, let alone Sir James, would actually do that although it is a possibility according to Forbes.  

Carmine D.

CarmineD wrote: 

If you use the 920 million British pounds figure from the Sunday Times, it is equivalent (with an exchange rate of 1.51317 USD to 1 British pound) to around 1.39 billion US dollars.  Given that his wealth is tied up in his private company, who knows what he's really worth.  One guess is likely as good as another.  Perhaps the British estimate is higher because they include more good will in the company's valuation.    James would be very foolish to be concerned about the Forbes rankings. 

It's curious that he's thinking about turning over the CEO reigns of the company.  Perhaps he sees that he's made some poor decisions (e.g. washing machine, hiring Dustmite as a spokesperson ...), and he's decided to stick with design.   the fact that he's willing to put someone more business savvy in charge of the company tells me that he's smart enough to know that he's in over his head.  

Severus wrote:

Hi Severus:

Forbes is "the" list for the world of the "rich" and "famous."  Sort of like Consumer Reports and product sales/recognition. 

On all other points, I agree with you.  Harkens back to a statement I made here and elsewhere years ago that engineers make terrible CEO's especially of their own companies.  Steve Jobs and Apple are the rare business exception.  Typical of Sir James, he took too long to come to that business realization.  Not choosing a family member, as one would naturally expect, to take the reigns of the helm speaks volumes.  As well it will be a constant cause of problems for the new dyson CEO and its employees.  Many of which are already insulted and demeaned by Sir james.  Expect a cut in the 2500 dyson Malmesbury employees as the first order of business by the new CEO.  Wonder how secure Dibster's job is?  Should have gotten out when the gettin was good.  As the saying goes:  With all your getting, get wisdom.

Dyson's stepping down now from all operational business ties [Chief Designer is a made up job for him to stay on the company dole] guarantees with almost absolute certainty that he will not make the Forbes list next year.  I'd say he came to the realization this was his last year on the list.  Good timing for a change on his part.  Last year and last place. 

Carmine D.

CarmineD wrote:

Carmine,

I don't subscribe to Forbes, but I was curious whether there were any other vacuum related people on the list.   It would be curious to know if their personal fortunes dropped similarly to Sir Jame's. 

CarmineD wrote:
Hi Carmine, can you explain to me why I should pay any real attention to the 'reported' values placed on people who compile for Forbes and the various 'Rich lists'?

While these 'estimated' values make for entertaining league tables and interesting figures for news articles, the accuracy of them is open to interpretation.

The difference between exact net worth and estimated will vary from person to person. If you know from public filings that Steve Jobs has x stock in Apple, y stock in Disney and assets worth z you can calculate an approximate net worth at that moment in time and track it as the investment markets rise or fall. You might add a figure for cash in the bank, based on past returns, but it's likely the estimated figure would be far out from the actual by a fair margin.

With someone in James Dyson's position, there's even less to go on. The Dyson family's biggest asset is 100% ownership of Dyson Ltd. Being a privately-held company, next to no financial information is publicly available. There's no quarterly release of comparative sales data with margins, no stock market value.

How well the business is doing is solely based on what spectators think might be happening on the balance sheet. They might conclude: "Hrmm... recession, people with less money, credit. It's possible this will have a negative impact on high priced goods, such as vacuums. Dyson will possibly sell less than in previous years, so we'll knock x off our valuation of the business."

If we're to believe what James Dyson said in the interview, sales are even better than previous years. Also, if as reported, a business has been able to reinvent a desktop fan and sell it $330, clearing out their 3-month allocation in a matter of weeks, I'd say that it's a reasonable indicator that they're in good form and while subjective, you might conclude that James Dyson is worth more than two years ago ...for all it matters to some.