D6 THE OAKVILLE BEAVER Wednesday, August 4, 1999 Protect your investment assets from creditors Business PETER WATSON Dollars & Sense This is the fourth article in a series of articles on successful investing strategies. We have dealt with the importance of equity investing, investing internationally, and dealing with the inevitable mar ket volatility. Today, we will review a defensive strategy on how to achieve some creditor proofing on your investment assets. If you run into financial difficulty, either in your business or personally, your creditors may be able to access your savings, including your RRSPs, to settle your debts. The best time to make your assets safe from potential creditors is when your financial position is strong. The problem that most people face is that they think their position will remain strong and, therefore, they have little incentive to take a defensive position in advance of any financial problems. To help illustrate this point, we will assume that you plan to start your own business. One of the first things that your lawyer will do is talk to you about incorpo rating your business to give you financial security if things turn bad. The equiv alent strategy with investments is transferring some, or all, of your investment assets to segregated funds. The advantage is that these types of funds can be creditor proof. Effectively, you have built a "fire wall" around your investments the way your lawyer would by incorporating your company. Your lawyer should be consulted about this type of strategy because, like many legal issues, there are a number of things you need to consider. To be an effective creditor-proofing strategy, you must be invested in these funds long before you have an inking of financial trouble, some suggest two years or more. If you are already having financial difficulties, or know you will be soon, a transfer to segregated funds will not protect your assets. You will need to assess the risk you face from potential creditors and evalu ate that risk against the slightly higher cost of owning segregated funds com pared with other investments. Is the guarantee feature of segregated funds important to you? Segregated funds guarantee your principle over a certain time period such as 10 years. Some segregated funds have a 100% guarantee of the original principal while others have a 75% guarantee. Typically, the extra cost for a segregated fund decreases with the lower guar antee. So if you only want the creditor-proof advantage, select the lower guar anteed amount at a lower cost to you.Most investors will probably not require the credit-proof option but if you ever do, getting it might be one of the best invest ment decisions that you have ever made. Peter Watson, MBA, CFP, RFP is the president o f Peter Watson Investments -- an Oakville firm specializing in retirement planning, RRSPs, and investment planning. He can be reached at 842-2100. Rubaroc Local firm brings European surfacing material to Canada A high-tech surfacing material that has been* a staple in Europe for decades has finally made its way to Canada. Rubaroc, billed as the surface that "bounces like rubber and wears like a rock" is now available through Rubaroc (Canada) Limited, located on Lakeshore Road West in Oakville. What makes the product unique is its non-skid, safety surface which can be applied right over existing materials such as concrete, interlocking brick, asphalt or wood. Created from a combination of rub ber granules and specially formulated resin, Rubaroc can actually expand and contract to accommodate temperature changes and minor ground movement. Company spokesperson Lisa Lacroix says the highly skid-resistant nature of Rubaroc-- even when wet-- makes it an ideal surface for areas such as pool decks, commercial kitchens and school play areas. It's also becoming increasingly pop ular on golf courses and is soon to be installed on the walkways of the Marklin Woods G olf Club in Mississauga, the first in Canada. Lacroix says the original technology was developed in Europe over 50 years ago and it has since built its reputation in a variety of demanding commercial and residential environments from water parks, running tracks and tennis courts to manufacturing plants and weight rooms. In addition to its non-slip qualities, Lacroix notes that Rubaroc is also ideal for reducing noise and providing com fort underfoot. Rubaroc is available in a variety of different colours and special forms can be used with it to create custom pat terns and designs. The material is mixed on site and Photo by Peter C. McCusker Lisa Lacroix, of Rubaroc Canada, holds a round sample of the Rubaroc material which is installed at Markland Wood Golf and Country Club in Mississauga. troweled on over existing surfaces. Most installations can be ready for use within 24 to 48 hours. Costs for resi dential installations range from $7 to $10 per square foot, while thicker, com mercial applications can run up to $ 15 per square foot. Rubaroc (Canada) Ltd. is located at 2448 Lakeshore Road West, Suite 19, in Oakville. Category dominance vs market dominance Category dominance is not the same thing as market dominance. They are two different things. A head office creates cat egory dominance. Market dominance is what a front line store creates. The single most important requirement for business success is effective position ing. Effective positioning means having top of mind recognition. Effective posi tioning means the customer is predisposed to give you first shot at making him or her a loyal, long-term customer. You get that opportunity because the customer has been programmed through constant spaced repetitive advertising to come to you first. That is category domination. The marketplace has changed dramati cally even in the past few years. In today's crowded marketplace, there ig consider able competition and little differentiation between businesses. Even so, those busi nesses positioned as category leaders still hold an enormous advantage. The pie is being divided into a few more pieces, but the category leader will get more than his share. Category dominance means top of mind recognition. Category dominance means being first in the consumer's mind, when they recognize a personal need for your product or service. Category domi nance represents potential from effective positioning. Market dominance is a differ ent game. Market dominance comes from the franchisee or manager who takes effec tive positioning (potential) and translates it into the creation of long-term customers at the front line level. Market dominance is The .--.B usiness^ D o c t o r won or lost during face to face communi cation between front line associates and customers. Your front line associates are the only ones that can maximize the use of catego ry domination (positioning). While senior management is effectively in charge of positioning (category domination), it is the front line manager that is in charge of mar ket domination. That is where the rubber hits the road. Positioning gives its advan tage to the store or individual that deals face to face with the ultimate end user. In the hands of an effective customer orient ed front line franchisee, store manager or salesperson, positioning is an awesome advantage. There are two fundamental objectives for any business organization. The first is to constantly expand the number of people who are aware of your location, and avail able products or services. That is a head office function and it attracts potential cus tomers to store locations. The second fun damental requirement in every business is to create long-term returning customers. That is a store function and in the end that's what pays the bills. Dave Anderson is available for sales meetings and annual conferences, 705- 526-7661. Photo by Peter J. Thompson KOOL VISIT: Oakville Kelsey's bartender Colette Ireland offers up a fresh pitcher of Kool-Aid during a recent visit by the Kool-Aid Man to launch the restaurant's new Kool-Aid beverage selection for children. You want the most exposure for your classified ad, right? How's this? Click Here HattonSearch.com Classified advertising goes online August 4/99 An OokviUe Beaver Feature To advertise in this section call 845-3824 Fax:337-5568 v 4 Protect your investment assets from creditors Business PETER WATSON Dollars & Sense HattonSearch.com