So the bad news for the commercial real-estate industry is that we will see less and less tenants looking for that prime office location in the next decade.
Like TWITTER has told their employees that anybody that wants to stay and work from home can do so in the future.
We will see companies look for cheaper commercial real estate,in the next decade and they will be looking much more outside of the prime locations of today.
Companies will still use commercial real estate but as the US strip and shopping malls have seen in the past decade , the commercial real estate will see that the habits have changed in the consumers mind.
So around 2010 the online boom really started and people could see that you can by a lot on www.amazon.com and also becoming a Amazon prime member is well worth the money.
Amazon is the big fish, but the thing that has almost destroyed the shopping and strip mall industry is that many vendors are focusing more on the e-commerce side of things, rather than opening up a store in a mall.
In shopping malls you have to obey by a lot of rules, when you are aloud to be open, and when you have to be open and all costs have risen a lot in the past 2 decades, the decline of customers have forced many malls to close.
So the commercial real estate market will find out that at least 50% of the workforce that are sitting in offices down town, actually can do the work from home and be maybe even more efficient, than they did in the office.
And our best guess would be that on Fridays maybe there will be an office day where all the employees that works remotely would meet up at the office or even at a coffee shop to meet in person and keep the company dynamic going that way.
So signing a 5 year 1 million dollar a year lease will be much less frequent and even larger companies will be looking at either building there own office building outside of the city or finding a 300.000 dollar a year lease, in a location that is not prime real estate location.
For many companies this remote work from home, has been a things that they have not been totally sure of, now with the COVID-19 pandemic hitting they can see raw data that for every week the work speed has picked up a bit.
Because it is a really big change in an office workers life working from home compared to heading in every morning to the office and coming back home in the early evening.
So you need to build new routines when you wake up and how you take your lunch break and other breaks at home.
And once you get the hang of it, then usually the work speed is higher at home than in the office.
For a lot of companies allowing people to work from home can actually keep the workforce more intact than you would other wise be able to do when it comes to the turnover of personal.
Almost every business world wide benfots from low turnover of the staff.
Not all talented people like sitting in small cubes working 9-5 and having to commute 2 hours each day.
So this is not good news for commercial real estate and particularity for commercial real estate in the big cities.
This reason here above is the main reason that many major investors like Carl Icahn and others are betting against the commercial real estate market these days.
So a lot of people who are not part of the business community wonders why smaller companies do not have around two months worth of funds saved up for a rainy day like the Covid-19 Pandemic has brought on.
The reason for this is pretty simple actually, and we will explain it to you.
So if the company what ever business type it might be like a restaurant,bar, production company that is older than 15 years today.
They went true the 2008-2010 recession and what ever funds they had saved up for a rainy day, was used at that time.
And they have never been able to restore that rainy day fund again.
Many companies would have gone under without savings then.
So by using them then and also by doing so they kept a lot of jobs going in the US for a 10 year period.
Make no mistake about this fact, there are many business owners who works 80 hour weeks for very little pay to keep their business open even in the best of times.
So now when we have an even worse recession 11 years later, there is no safety net in play any longer.
No rainy day fund, no bigger credit line coming from the bank, it is all over, for a lot of companies in America.
Many will try to give it a last chance in June-August, during the summer, but in the fall starting in September we will see a tsunami of bankruptcy’s and failed business.
Many companies in the hospitality industry have in the best of times low margins a few % profit per year.
And the owners do not draw a proper paycheck from the company, because if he or she would have done so then the company would have been in the red, or even more in the red.
So be prepared that many companies in America and elsewhere will try and re-open over the summer and then in the fall they will close for good.
Then we have the other segment is the newer companies who have been forced to either buy an expensive franchise or to invest everything in a family restaurant or small business in recent years.
They have never been able to put much money aside at all for a rainy day, they needed to put it back into to the business.
So this is why so many American and companies all over the world will fail in the fall.
So the one thing you can do when you spend your money is that try and support your local stores the mom and pop stores even if the price point is a bit higher compared to the global retail chains.
We have nothing against global companies, but it would be really boring if we have no small shops and no small restaurants in our neighborhoods and towns.
So if 1000 people decide, that i will support my local shops the mom and pop kind, it will go along way in saving those jobs and that store or restaurant business.
Even if you only spend 15 or 20 dollars there each week ,it will go along way to save some of the smaller mom and pop stores and restaurants.
So we can all do what we can to keep our local business owners open for as long as possible and try to keep the jobs in our community in the process.
So let us start by sending all of our thoughts to our client Mr.Marcus two adult sons in Boston and Dallas.
Mr.Marcus decided to end his life on Friday night.
This was the third one of our clients that ended there own lives in the Covid-19 pandemic.
We do not want to go into deep with this matter, but it was COVID-19 related and he was a long time client of ours who had a really nice boutique hotel with 52 rooms and a stellar restaurant and piano bar.
Marcus was 67 years old and had two adults sons that lives in Dallas and in Boston.
His wife pasted away 5 years ago due to Brest cancer, and his dog went also in cancer 5 month ago.
In the letter that was sent to us at mrlifeavise thanking us for being his partners in business by helping him out with many consulting matters over the past decade.
So here are a few lines that we writes prior to ending his own life.
I have lived a full life and i have two adult sons that lives there own life, they dont need me.
I put everything into buying this wonderful hotel and i am leverage up to my ears.
When the Covid-19 hit we had money for March, but not April or May.
The bank has already told me that they want to take over the notes,debt in the end of June(taking my hotel).
I am to old to start over in my life, i do not have the energy to do so.
And i do not want to be a burden on my sons who have there own lives to live.
I tried to double up the money we had to save our company on a risky investment and it did not pan out, so i feel that i am out of options today.
So i am taking a last stand on my own terms, and i am raising my glas to all of my workers who will hopefully be given their jobs back under new management.
I wish my sons and their loved ones the best of luck in this post corona world.
But i am to old to start over again.
And as my wife passed away 5 years ago and my beloved dog Juno left me 5 months ago also in cancer, i do not see a reason to go on any longer.
And i also wish all of my friends the best of luck with their ventures and with there families.
I do not want you to morn me or pity me, i had in general terms speaking a good life.
But the hotel and my wonderful staff, was last thing that i had to hold on to.
Take care Marcus.
Mrlifeadvise response:
So there are many reasons why Mr.Marcus took his own life, but here we see the clear cut of mental health issues for small and mediums sized business owners with by the Covid-19 LOCK-DOWNS who are about to lose all that they have worked for in their lives, or at least in the past 10 years time.
So when politicians and medical expertise says that stay home, they do not understand what this lock down does to our economy and all the small and medium sized business owners in the process.
So we will be sad to not be able to visit Mr.Marcus for a lunch in his great hotel-restaurant and sit and chat with him about different things.
You where a great client to us for many years and we really appreciated your business.
So here we are 09-05-2020, after 53 days of the shut down, we manage to tank the world economy for decade to come.
Not even during the world wars did we see this kind of shut down.
Yes we did close the trading and our businesses artificially and not due to an economic meltdown, but now we have created an economic meltdown by listing to much to the medical professionals and fair mongers that does not know the first thing about running a business .
Make no mistake about this, the bigger companies will use this leverage to buy up smaller and medium sized companies for a 0.25 cents on the dollar over the next 18 months time globally.
A business owner in the production field that has worked all of his and his families life with building up a business that was a few months ago valued to over 10 million dollars will have an evaluation of 2.5 million today in May 2020.
So how could this be?.
It is quite simple actually the shutdown created a vacuum where larger companies who have piled up cash for a long time and normally used that for buying back their own shares have now been placed in a great positions as a liquid company to take over all smaller and medium sized companies for a 75% discount.
But why is that?, the reason behind this is that smaller and medium sized companies have for decades been forced to re-invest everything they make back into their business to keep them self relevant when competing with larger competitors for market shares.
And by offering a more personalized products/service at a better price point they have been able to compete.
But this has also meant much smaller margins and very little saved up in the rainy day fund.
So when we have a shut down like this regardless if the company qualifies for PP, paycheck protection they will have huge problems starting up again like nothing ever happen.
You will have huge issues for a year in many supply chains, which will affect the possibility for many companies to resume their normal business routines.
Layoffs of 1/3 of the personal staff will be forced up on business owners when the business is not operating at a normal capacity any-longer when we now start to re-open the world step by step again.
This will mean that 2/3 of the staff that will still have a job, will have to pick up the slack and cover the work load that the 1/3 that was let go, handled on a daily basis.
There will be a big risk that we will have to start working also 6 day weeks meaning that we will work also Saturdays with the same pay as before for 5 day work weeks.
At many larger companies people will be let go and then re-hired again with very disadvantaged terms, compered to what they had in the past, with the same company.
So it will look something like this, John had 80.000 dollars a year in base salary and two weeks of paid vacation and a 25.000 dollar yearly bonus.
Now when he has been let go, the same company will offer him a (new position) same job as before but with a different title to justify the pay cuts for John.
So he will be offered 60.000 dollars in base salary and a 10.000 dollar bonus and with one week of paid vacation and one week without pay.
So the company will save money, but for John he will be forced to cut all excess consumption besides the groceries and the mortgage and the car payment.
So for John there will be no high ticket items in his near future of consumption.
So this will also affect the American economy really hard.
There is no doubt in our minds as experience business advisers that the last of the middle class will be moved into the working class during the next decade so from 2020 to 2030.
And this will also mean that for the next decade the unemplyment numbers will stay at double digits overall.
Unless the minimum wage gets slashed even more, than it already has in many profession over the past two decades.
A lot of people do not seem to understand that many professions work 80% on tips, and they make a few bucks an hour from their employer without any benefits like medical or 401K , or anything.
There is a reason why many Americans have been forced to work 3 jobs already in a bull economy, so what happens when we enter into a decade of a bear economy.
So we are seeing a tragic future happening in-front our eyes as we speak.
Is there any hope for a recovery of the boom cycle economy that we have been having for the last decade.
Yes and no, it is simply put very difficult to tell the future based on a pandemic that will linger for a few years and come back in waves.
The silver lining here is that maybe we will start to produce items again in the US, and move back some jobs in the process.
But the problem with this is that many jobs can not be moved back because the items would cost 3 times as much to buy, as they cost to buy today.
And with more middle class workers being moved to the working class, the Walmart type of businesses that are based on import from Asia up to 80% of their items will be the big winners in this mega depression that we are heading into as we speak.
We will also see much less travel which will impact the tourist economies of New York and Florida and also California very much in the next decade.
There are a few reasons for this, reason number one will be that many people do not want to travel as much as before again due to them being afraid.
The second things will be that vacations will become an extrem luxury in the next decade, compared to how it has been in the last two decades where almost the whole middle class have made trips abroad globally every year.
The final punchline here will be that we will have to start helping each other out much more than we have done in the past.
In our families in our church group’s, sports teams and in general in our communities.
There will be much less time to be jealous of someone elseĀ“s life, and much more time to help each other out in many different ways.
The one good thing that can come out of this pandemic and economic meltdown will be that maybe we can focus on what really matters in life which is family,friends,pets and clean water and clean food and clean air.
There has been a lot of talk in the last two weeks about the civil liberties for Americans and that the first amendment and the second amendment is at risk these days.
When we see power hungry governors and mayors doing everything in their power to consolidate more power to themselves.
And in this blog post we are gonna talk about the civil liberties of business owners and mainly smaller and medium sized that is the bread and butter client base for mrlifeadvise business consulting.
So let us say now that the US economy kicks off again in June and then we get back to our daily routine in the end of this year 2020.
What happens when the second wave of the COVID-10 will surface , and what about the third wave?.
The thing that is very difficult for a lot of people to take in is that many politicians has never ran their own business of any sorts.
They do not understand that you can not open and close a business like you do with a normal door, open-close-open-close.
This destroys all types of business,regardless of size, because the supply chain will go nuts.
So what if we keep open two months, and then closed two months and then we repeat this for a few years, what then.
It is totally insane to believe that any economy the world will survive this type of crazy behaviour.
But most of our politicians do not understand this, at all!.
So here comes a rhetorical question, how do you plan to open up a new business (start up) if you dont know if the government and the state will shut you down anytime soon.
So the gut feeling as business advisers is that we strongly believe that many Americans who wants to open their own business will not do so in the next 24 months time.
They will ride this pandemic out to see what happens, and then they will re-visit the topic of starting up a new business later on.
This will mean that a lot of new companies will not open up in the next 24 months time, that normally would have opened up otherwise.
The second investment problem for new jobs are that the company that has one or several locations will not open up any new ones in the next 24 months time, where most experts believe that the Covid-19 has disappeared from our society, by heard immunity and vaccine.
So this America will have double digits in unemployment, just as Europe will have for the next two years time.
Sometimes around 2022 we will see the unemployment to start going down again.
But there is no doubt that a lot of the middle class that was not wiped out during the last rescission will be wiped out this time around.
There was a lot of hope around the 1990 s that more of the working class was gonna become more mainstream middle class.
And it looked liked that for awhile, but the subprime mortgage crisis and all the cheap loans that where available made consumers go nuts.
And after the 2008-2011 financial crisis, many jobs where obsolete.
We could see that 1/3 of all Office jobs disappeared in the crisis, and basically every one that was left standing in a job had to do more work per person compared to the working situation prior to 2008 meltdown.
There will be a huge emotional roller coaster for most smaller and medium sized business owners during the upcoming two year period.
What will be very important for all smaller and medium sized business is to get your community behind you, buy local as much as possible and support the town business as much as you can.
So a lot of news reporters from the leftwing channels likes to tell people to stay home, which is very easy to do when you can work from home and you make millions each year, and still they are outside without protective masks and get into altercations with civilians.
For normal people not so easy to do!.
If you work in a hospitality business like a cafe,restaurant,nightclub,hotel etc you have no income today from work since there is no job.
And the same can be said about the construction industry also.
So Mrlifeadvise has lost two wonderful long-term clients this week due to suicide!.
And we have spoken to both families with our condolences, and we have been told by their family member that the financial stress in the hotel and construction businesses , made them take that fatal choice to end their own life.
What politicians needs to be careful about is listening too much to the medical community, because the medical community wants to have a lock-down until a vaccine is available on the open market.
Not all doctors are financially stupid, that the dont understand the financial consequences of a world wide long-term lock-down.
But most doctors that now take part in the debate work for the government or state or a university.
They have never been forced to make payroll for 10+ employees each month, ever in their lifetime.
And herein lies the problem when talking about the coronavirus.
Anybody who has ever ran a business knows that you need to make payroll, which means that you need to do business on a weekly basis.
Most companies can survive a shutdown of 1-2 months time, but that is then all of their savings from the business and many time even there own cash at hand.
But there are also companies that had a tough time with their business finances even before the COVID-19 pandemic.
And those companies only had 2 weeks worth of money at hand to stay shut down.
A lot of people will die from the COVID-19, but a lot of people die every year from suicide and cancer.
And when it comes to suicide not much is done about that, and there is almost never any state or government funds available to increase the assistance to the suicide prevention programs.
ASK YOURSELF ALSO THESE QUESTIONS?, WHY ARE SO MANY POOR NEIGHBORHOODS DRUG RIDDEN AND SPECIALLY WITH THE VERY NASTY OPIOID PROBLEM THAT STARTED 20 YEARS BACK WITH THE PRESCRIPTION DRUGS THAT NOW IS FUELING THE HEROIN SALES ALSO IN MIDDLE CLASS NEIGHBORHOODS.
And why does poor people turn to addiction?, the answer is simple, when you are poor and unemployed and have no real life prospects, people try and find escape in drugs and alcohol.
And then comes the horrible tragedy for kids and young adults/ teenagers who has to deal with family drama on a daily basis due to unemployment.
So when we say that we need to save American lives then we also need to take this X factor into our equation.
It is easy to sit at home as a millionaire politician eating 12 dollars ice cream pints telling people to stay at home.
So there is a serious disconnect between the left-wing media and left wing politicians trying to lecture hard working paycheck to paycheck living in Americans, it is just downright wrong, and borderline shameful.
We understand that 0.5% can die from the Covid-19 virus.
But the question is to everybody do we lose 4% to addiction and suicides and cardiovascular diseases because of unemployment and poverty along the way!.
So a more sober view on the lock-down has to be made, and the reality is that the early data on the COVID-19 was almost all wrong.
In combination with left-wing media fear mongering the corona virus epidemic along the way has created a 3 trillion dollar bill that we tax payers have to pay sooner or later.
America is built on trade and doing business, it is not made to be closed down for longer periods of time.
We can clearly see that SWEDEN has chosen not to close down the country and it is working well for them.
Yes they have banned sports and they have a gathering maximum up to 500 people at once, and the economy is suffering in Sweden a lot also.
But their economy will remain much stronger for years to come, by not doing a full shut down.
Life is fragile and it always has been.
We seem to forget that when you have not fought a in a war yourself, and you drive in your newer car with bluetooth and a great AC system, to your office and you have all kinds of services provided to you, as most overpaid left wing politicians are these days.
We have know for the past 10 years time that a pandemic like the Covid-19 will surface but it has not been broadly talked about among normal citizens and the media.
So for that reason many people was taken by surprise in February when this virus started to spread around the world.
We will be forced to live with this virus for years to come.
This is just the simple truth, but 90% of the American workers wants to go back to work.
Unfortunately a lot o jobs have been lost for along time around the world and they are not coming back, at least anytime soon!.
So every hardworking upstanding American deserves to get a chance at least to get their life functioning again somewhat normally.
So a lot of the left-wing media wants to portray the people protesting in an in a open carry state as villans.
They are not villans, they are hard working financially suffering fed up Americans tax payers, who the politicians actually work for.
Then there are millions at home who sympathize with them , but who have not hit the streets yet.
So we are long overdue with opening up America again, and yes the virus will start to spread again, when America is opening up again.
But hey, this is life , we live and die like this i dare you to fight for it!.
We had a conversation with a sheriff yesterday and he told us that he has 6 times more distress calls from loved ones, who where worried about unemployed family members and relatives in these stressful times.
So if you have ever wondered what if feels like to do time, this is then a luxury version of that, staying in home quarantine.
Because at home you have access to spending time with your loved ones, you beloved pets, and also you dont have messed up cell mates and other inmates trying to get one over on you all the time, and you also get proper food and you avoid the horrible smell that most prisons and jails suffer from.
So the next time you offer your opinion on somebody smoking pot, and wishing they go to jail/prison for a year or two, remember this time when you are going nuts at staying at home for a month or two.
So to avoid left-wing radical politicians taking away even more of your human/civil rights and stomping on the constitution even more than many of them already are doing, it is time for people to ask for their civil rights back once and for all!.
Also remember that violence is not the answer here, protest peacefully and exercise your constitutional rights as tax paying Americans to get your voice heard, and rest a sure that your opinion matters.
So if anything has become crystal clear during the Covid-19 pandemic is that Americans needs to support the US farmers by buying locally produced items.
And US FARMED foods.
If you know your history about the great depression in the early 1930s , then you know that farmers had to destroy crops and food supply even when millions of Americans where unemployed and hungry.
So we need to try and not repeat this mistake in 2020.
So to all Americans across this great nation the word has to be to support your local farmers.
So instead of bringing in food from outside the US , try and buy as much as you can locally farmed.
A lot of people where surprised why others kept hoarding guns and ammunition during the beginning Covid-19 pandemic.
It is actually very simple folks, the depression that we are now entering full speed a head into, is gonna change the landscape completely in the US for the next 10 years to come.
We will see unemployment at a 20% rate meaning that millions of formerly employed Americans will go without a J.O.B.
This is the main reason so many millions of Americans want to get back to their job, becuase they need to put food on their kids table and a roof over their kids home.
This is something that many politicians that are multimillionaires should really take to heart and , show more compassion for in these difficult days.
And a lot of people will get desperate and turn into crime for their survival.
Also there will be a lot of budget cuts in local law enforcement in many towns across the US in the upcoming years.
Most of these crimes will be of burglary /theft type and maybe you dont need a gun, but you might also see more home invasion type of crimes in the upcoming years.
So having guns might save you and your families life.
It is very easy to point fingers at a person buying multiple guns , when you live in an city apartment and they live in a house on the country side where it might be up to 20 min response time from law enforcement.
We are living in sad times, and we need to try and get true them as safe and hole as we can.
There is a good reason why the founding fathers invented the second amendment a very long time ago!.
So we see this question asked often in forums world wide.
Pretty much on a daily basis.
So how do you get rich, without inheriting the money.
So there are a few ways you can go about this , but the reality is that almost everybody you see that are rich today, they where in the right place at the right time without taking away anything from the person that is rich today.
But all people who are smart knows that they got lucky, that they where in the right place at the right time.
Because no matter how smart you are, you also need luck.
There are a tremendous amount of smart and hard working people who never made it past a some what normal paying job.
Even if they had great ideas and worked really hard, and maybe invested in something really smart along the way.
But they where a few years to early to the show.
Or they where never able to find funding for their project or company.
There is a rule of thumb in the angel investment community that for every 100 pitches you get you invest in 1! , yes in one project.
So often 99 projects or starts up out of 100 never get the necessary funding to be able to get things off the ground.
Mark a client of ours, got really lucky and he knows it!.
In the year 2009 he started working for a smaller mining equipment company the year after the financial crisis in 2008, as an engineer he had worked in another field for 10 years and he wanted a change in his work-life.
So after he had worked for the company for 1 year, the owner of the company wanted to close it down because it was losing money, and the large cooperation that owned it was willing to let it all go for 1 million dollars for the lock stock and barrel.
So 10 people in the company bought a 10% stake in the business for 100.000 dollars each.
Then in 2013 one of the companies clients where bought up by a huge cooperation many billions of dollars in revenue annually.
And after a year in 2014 they received and offer for a whopping 100 millions dollars, the owners did not want to sell and a year later after the initial offer they got a 170 million dollar offer from the same company a raised bid so to speak and they accepted the offer.
So in a few year period Mark had made 170 times his initial investment of the 100.000 dollars.
So this is by no means and unusual story, very often a company takes off by share luck, and a bigger company comes and says we want to buy your business.
And this is often how people become rich.
Then once they have made their first million, it is easier to make the next one, and so on.
Mark knows that he got lucky and that his family has now generational wealth, by him investing 100.000 dollars that he borrowed from the bank putting up his house as collateral.
A house that he had paid 200.000 dollars for over a 15 year period, so by paying of on his house he had the opportunity to borrow money and make this investment.
So you also need to have some money to make money, this is a real fact of life.
The second way people can get rich is by a fluke like buying for instance bitcoins at a very early stage.
So these kind of fluke investments are often common in stocks or digital currency.
To be fair 99% of the people trying these kinds of fluke investments fail and they lose most , if not all of their investment in the process.
The third way people get rich is by working hard and living a very frugal life for many years and then investing long-term in property and stocks often actually in blue chip stocks.
So there is not just one way to go about getting rich in life.
But it is very unlike that you can get rich on a normal paycheck unless you ar willing to work hard , and save most of your money for 30 years time.
So best way is to go into a start up, and work hard and hope that inside a 5-10 years period some larger company will come in and buy the company you invested in as an employee.
There is also another way and that is that you invest you savings in several starts ups and you hope that 1 or 2 will be very successful in the future.
But every investments has its risks and pretty much it is safe to say that any investment is a risk that you have to be able to take to ever get ahead in life.
And there are almost never any risk free investments out there in the world.
But here is a few concept you can think of when trying to get rich in the future.
But please remember specially now in COVID-19 times that your health and your families health and safety is much more important than getting rich.
We know a lot of rich people who are miserable in life and we know a lot of people only pulling a medium size paycheck who are blessed with family bliss and good health and are over the moon in happiness.
So dont get fooled by money, it is nice to have but it is far from everything is life.
So for us that have been around awhile we can remember the scary times of early 1980 s and early 1990 s, where people where very scared for a very long time.
If you remember the people that had HIV in the 1980 s and early 1990 where completely singled out from the community and looked upon as a market men and women.
And they where not allowed to touch other people or sometimes even be near other people.
A person who others new had the HIV where never invited to any social gathering after the fact.
This is why a lot of people did not disclose to others that they had the HIV virus.
Many did not even disclose this to their family members until the had full blown AIDS.
One of the fears with COVID-19 is that people will hide the fact that they might have it.
And they might not even know that they have it.
Then we can look forward to being singled out in public every time we sneeze or cough out loud, and people will think maybe that person has the corona virus ,covid-19.
So we have to be careful not to single out people like we did in the 1980 s and 1990 s with the HIV virus when it comes to the COVID-19 virus.
Take care and stay safe.
Mrlifeadvise.
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And mrlifeadvise has created over 10000+ lasting jobs during that time frame.
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mrlifeadvise is a business consulting company specializing in smaller and medium sized companies.
We have 60+ years of experience from building companies, and we have created over 10000+ lasting jobs during that time frame.
We will help your business with good advise, regardless of what business branch you belong to and regardless of what part of the world you are active in.
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