America's Best Companies

Small Biz Tip: Organize Your Desk

cheryl@gowithabc.com (Cheryl Sowa) — Thu, 09 Jul 2009 16:35:54 GMT

Tips from July 9, 2009

The Small Business tips today will be about getting rid of the clutter and cleaning your desk.

Clean out your desk drawers & designate a purpose for each one. Example: supply, personal, and brand/logo drawers.
Only keep supplies you use on a regular basis on your desk: several pens/pencils, stapler, post its, notepad, and calendar.
Consider buying multifunctional equipment: all-in-one printer, scanner, copier & fax machine eliminate clutter & allow space.
Keep quirky items to personalize your desk that don’t get in the way of necessities: pictures, posters, comics or mementos.

Daily Overview: A cluttered desk shows others you are not focused about your job. Get organized and get serious.

United Breaks Guitars: Poor Customer Service in Song

charles@gowithabc.com (Charles Cooper) — Thu, 09 Jul 2009 09:52:20 GMT

We often say that you judge a company not by what it does right, but by how it fixes things when it does wrong, and United Airlines did a big wrong to musician Dave Carroll and his band, Sons of Maxwell. While sitting on the tarmac at O’Hare International Airport in Chicago, they looked out the window and saw the baggage handlers throwing their guitars around. That was the beginning of a long and painful ordeal with United, but why don’t we let Dave tell the story?

Dave has written a more detailed version of his ordeal on his website, but after months of fruitless effort, United’s excuses for not doing right by their customer boiled down to these:

Dave didn’t report to the Omaha airport within 24 hours while he was driving to places that weren’t Omaha .
It was an Air Canada issue, but Air Canada already denied the claim because Air Canada would not pay for damage done by United baggage handlers.
Someone from United would need to see the damage to the already repaired guitar.

Now, there is no problem with United or any company having processes in place to protect itself from fraudulent claims. Having such policies and following them ultimately helps everyone by (at least theoretically) keeping costs down, but when a plane-load of people witness United baggage handlers throwing luggage around and that luggage ends up damaged, for the company to not own-up to its responsibility is more than just poor customer service, it is amazing arrogance.

Dave’s response was the creation of the video you just enjoyed, which got the airline’s attention. Robin Urbanski, a spokeswoman for United, issued a statement saying in part: “This has struck a chord with us, and we’ve contacted him directly to make it right.”

Nice pun, but hardly the mea culpa that this warrants and it certainly does not put United in a good light. We know that this is merely one of thousands of baggage damage complaints—the US Department of Transportation says in April 2009, United ranked 10th among 19 carriers, with 13,517 “baggage reports” among 4.03 million passengers—but this one is getting attention because it happened to a musician with the resources to create a music video about it that took off on the Internet. What if it had not been Dave Carroll, musician? What if it had been Dave Carroll, penniless college student? It seems that without the exposure this incident received, nothing would have been done, a fact that makes United look even worse than it did to those people watching the baggage handlers at play outside the aircraft.

Like any other company that takes peoples belongings and cares for them for a period of time and for a price, United has a responsibility to keep those belongings safe, and that include keeping them safe from abuse from United employees. When they fail in that responsibility, they have a duty to make it right. We will see if they really make things right for Dave and his band, but what really matters is whether they will make things right for all the other passengers whose baggage is mangled and manhandled by United employees.

Shoplifting and What You Can Do About It

charles@gowithabc.com (Charles Cooper) — Wed, 08 Jul 2009 17:04:14 GMT

U.S. Small Business Office of Advocacy: The Small Business Economy 2009: A Report to the President

From WVGazette.com: “Vienna [West Virginia] police are searching for organized teams of shoplifters who looted about $25,000 worth of merchandise from two stores at the Grand Central Mall in a single day.” Their haul at Victoria’s Secret and Aeropostale included about 400 bras and 350 pairs of panties worth about $23,000 as well as more than $2,000 worth of T-shirts. That’s a lot of cotton and spandex to move out the door. How do they get away with it? They do it by planning, personnel and the right technology.

Planning. The check out the store ahead of time, casually looking around, noting places where floor personnel generally are, who circulates around the store, who stays at the register, where the manager is – that sort of thing. They are also looking for security cameras, alarms, hidden areas, loaded displays, the locations where their preferred merchandise can be found. The idea is to know where to go and how to best evade detection.

Personnel. The lone shoplifter is probably an amateur and is certainly a low-volume affair. One person, after all, does not steal 400 bras in one trip through a store. Shoplifting on this scale takes a team, some to distract the employees and others to actually take the merchandise. The math is simple: The more people on the team, the bigger—and faster—the haul.

Technology. The thing to look for here is a stiff, flat bag, especially one that is very square and not from any nearby stores. Bags of this sort in the hands of a shoplifter are usually lined with aluminum foil and duct tape in an attempt to foil the anti-theft sensors on the items being stolen. Police believe that this was the method used in the Vienna robberies.

According to the San Diego Police Department, there are a number of things you can do to protect your store. Their tips include:

Protective Measures

Make the shoplifters feel watched. Elevate the cashier’s platform. Install mirrors that enable cashiers and sales people to see over and around displays. Install one-way glass in offices to enable employees to see into the store without being seen from the floor. Install and monitor surveillance cameras.
Post signs warning against shoplifting. Emphasize that you will prosecute. The best way to discourage shoplifters and keep your business from being tagged as an easy mark is to take a get- tough attitude and prosecute on the first offense.
Encourage checking parcels on entry.
Require receipts for merchandise returns for cash. Require a photo ID and signature for returns without a receipt. And then just give merchandise-only vouchers.
Take an inventory of returned merchandise against receipts on a regular basis to catch false returns, i.e., ones without returned merchandise.

Display Strategies

Minimize the shoplifter's access to merchandise without inconveniencing customers.
Keep display and clothing racks away from entrances and exits to discourage "hit-and-run" thieves.
Alternate hangers front-to-back to prevent thieves from quickly grabbing bundles of display clothing.
Keep small and expensive items out of reach or in locked display cases. Have sales people show only one item at a time from a case.
Use good locks and laminated or “strong” glass in cases that contain expensive items. This will help prevent smash-and-grab attacks.
Arrange merchandise neatly to make it easier to detect missing items.
Take daily or weekly inventories of expensive items.

Fitting Room Security

Keep fitting room doors locked when not in use.
Install cafe doors to allow staff members to monitor fitting room use.
Limit the number of items allowed to be taken into the dressing room.
Post a sign that directs customers to see a sales person before taking items into a fitting room.
Issue color-coded tickets and tags to indicate the number of items taken into fitting rooms.
Use a return rack for unwanted items.
Post signs in fitting rooms warning against shoplifting.

Preventing Ticket Switching

Use tamper-proof gummed labels.
Attach tags with a hard-to-break plastic string.
Use preprinted, not hand-written, price tags.
Use concealed multiple price tags.

Train your sales people to:

Watch for people with loose or baggy clothing inappropriate for weather, and people with large bags or other props, such as newspapers, strollers, briefcases, or umbrellas that can easily conceal merchandise.
Pick up stray receipts around the store.
Be aware of shoplifter’s tactics to confuse and distract you. For example, when working in teams one shoplifter will create a disturbance, e.g., complaining loudly, staging a faint, or knocking over merchandise, to draw attention away from the other who is doing the lifting.
Be attentive to people in your area. This helps legitimate customers and deters shoplifters. A simple "Can I help you?" or "I'll be with you in a moment" warns shoplifters they are being watched. Keep a close watch on people who seem nervous or refuse assistance.
Cover their entire area of responsibility, even blind spots.
Have another sales person cover your area when you leave the floor, e.g., to check for items in the stockroom.
Be especially alert at when the store is crowded. Shoplifters often operate when sales people are busy helping legitimate customers.
Watch for shoppers walking with short or unnatural steps, which may indicate that they are concealing lifted items.
Watch customer's eyes. If they are looking at you they may need assistance or are thinking about shoplifting.

Train cashiers to:

Check the lower racks of shopping carts, watch for switched labels, look inside items that can also be used as containers for lifted items, e.g., tool boxes, jacket sleeves, waste baskets, etc.
Check for factory seals on boxed items. And look inside if the boxes are not sealed.
Staple receipts to the outside of packages.
Check for and remove or desensitized electronic tags.
Be familiar with the store prices. This can help prevent price switching.

Have supervisors:

Keep employees alert by holding periodic review sessions on store shoplifting policies.
Discourage socializing on the sales floor. A group of employees in one spot usually means inadequate coverage somewhere else.
Schedule hours so that an adequate number of sales people are working at all times.
Watch for customers lingering in one area, loitering near stock rooms or other restricted areas, or wandering aimlessly through the store.
Watch for customers who consistently shop during the hours when few people are working in the store.
Watch for customers who visit the store frequently, but make only token purchases.
Be alert for disturbances that distract sales people and cashiers.

Stopping a Shoplifter

If you suspect that someone may be considering lifting something, approach the person and ask "Can I help you?" or "Can I ring that up for you?" If you suspect someone has lifted and concealed something, keep him or her in sight and notify a manager or security personnel immediately. If you are working alone, request the assistance of another worker. Plan a "buddy system" for your own safety and as a witness.

It all boils down to this: Make the shoplifter’s job as difficult as possible. This is done through vigilance and professionalism, through arranging the physical space to make stealing difficult, by providing good and active customer service, and by using best practices when it comes to returns, receipts, tags and dressing rooms. This won’t guarantee you will never have merchandise lifted, but it will make you a much tougher target, one that shoplifters would avoid in favor of easier pickings down the street.

Small Biz Tip: Electronic Organization

cheryl@gowithabc.com (Cheryl Sowa) — Wed, 08 Jul 2009 16:39:12 GMT

The Small Business tips today will be about keeping your electronic necessities organized.

Organize computer folders and documents. Clearly name all documents and sort in different folders via date, name, or type.
Create shortcuts on your desktop for easy access. For a step by step process, visit: http://support.microsoft.com/kb/140443.
Install an anti-virus software and schedule it to run at least once a week. Try Norton Antivirus: http://www.symantec.com/index.jsp.
Keep your email inbox organized. Set times aside to read and respond to emails in a timely manner. Try these tips.

Daily Overview: Stay up to date with technology to avoid being lost on your computer in the electronic world.

The Small Business Economy, 2009 Edition, is Available

charles@gowithabc.com (Charles Cooper) — Wed, 08 Jul 2009 14:31:20 GMT

U.S. Small Business Office of Advocacy: The Small Business Economy 2009: A Report to the President

The 2009 edition of The Small Business Economy documents the 2008 recession’s effects on small business as well as the role of those effects in the 2008 economy. The report includes chapters focusing on the state of small business (with brief subsections on small business challenges such as healthcare and globalization, as well as contributions in job creation and innovation) and financing. Appendices include additional data on small firms and a summary of Advocacy research into 25 different topics including finance, energy, entrepreneurship, regulation and taxation that was published in 2008.

Some of the specific results discussed in the report include:

Small businesses in most industries, especially in the construction industry hard hit by the housing market downturn, saw declines in employment.
Average unincorporated self-employment fell from 10.4 million in 2007 to 0.1 million in 2008 and averaged 9.6 million by November and December 2008.
Incorporated self-employment remained steady at 5.8 million on average over the 2007 – 2008 period.
Some surveys found small firms expressing less willingness to expand, hire new workers, invest in new plant and equipment, or borrow money, at least in the near term.
Health care costs remain a major concern for small firms: according to the Kaiser Family Foundation, the average annual cost of a family premium for employer-sponsored health insurance increased 119 percent between 1999 and 2008, with a 5 percent increase in 2008 from the previous year.
Real exports have risen steadily since 2005, outpacing the growth in imports; the value of real exports increased 6.2 percent in 2008.
Most small businesses faced a less accommodating credit market, especially in the second half of 2008.
Lenders exhibited widening interest rate spreads and tightening terms of lending.
Business borrowing plunged in the fourth quarter of 2008 to a low annual rate comparable to the levels experienced in the 2001 recession.
According to June 2007-June 2008 Call Report data, developments in the financial markets had a limited impact on small business lending in the first half of 2008.
Despite the lack of very current financial data, a number of indicators suggest that the flow of funds to small firms was much curtailed by the end of 2008.

The report concludes by observing that the “financial environment for small firms was extremely challenging in 2008” and that the flow of funds was down in the latter part of that year and that “At the end of the year, policymakers were hopeful that the initiatives taken through TARP and actions by Treasury and the FRB would help to forestall further deterioration and stimulate economic activity.”

A copy of The Small Business Economy: A Report to the President 2009 can be found at http://www.sba.gov/advo/research/sb_econ2009.pdf and the research summary can be found at: http://www.sba.gov/advo/research/rs347.pdf.

Small Biz Tip: Organize Your Finances

cheryl@gowithabc.com (Cheryl Sowa) — Tue, 07 Jul 2009 16:34:30 GMT

Tips from July 7, 2009

The Small Business tips today will be about organizing your finances.

Keep your bills in one place to pay them on schedule and avoid unwanted late fees or worse, damaging your credit record.
Consolidate accounts to one credit card if you have outstanding balances. Check balance transfer rats & one time fees.
Use a software program. Quicken makes bill paying and reconciliation easy. ABC members receive discounts on the software.
When saving receipts, save them in order of your purchases. When the statement comes, it will be easy to go over.

Daily Overview: Avoid errors with your finances by organizing. You will also save time and money!

Small Biz Tip: Organization: Implement a Filing System

cheryl@gowithabc.com (Cheryl Sowa) — Mon, 06 Jul 2009 16:28:16 GMT

Tips from July 6, 2009

The Small Business tips today will be about keeping an organized filing system in the workplace.

Sort your files & throw away what you don't need. Keep legal documents & save tax returns for at least 7 years.
Establish a constant organization method. Sort files into categories & label into color codes, alphabetically, or file type.
It is okay to file within files. For example, "Invoices" can contain "2006", "2007", and "2008" files. Be consist ant.
File everything in its correct spot after organizing. Keep up with the method you implemented to find your information.

Daily Overview: Filing systems grants easy access to information while keeping it organized.

Is Small Business in Decline?

charles@gowithabc.com (Charles Cooper) — Mon, 06 Jul 2009 15:53:31 GMT

The number of nonemployer firms has risen steadily in this decade, from 16.5 million in 2000 to an estimated 21.1 million in 2007. An estimated 637,100 new employer firms began operations in 2007 and 560,300 firms closed that year.

That is what the Small Business Administration had to say about the growth of small business over the last decade. According to the agency, there has been a steady growth in the number of small firms opening up shop in the United States. As of 2007, small businesses (those with 500 employees or less) made up 99.9% of the businesses active in the country. These small businesses also:

Represent 99.7% of all employer firms.
Employ about half of all private sector employees.
Pay nearly 45% of total US private payroll.
Have generated 60% to 80% of net new jobs annually over the last decade.
Create more than half of nonfarm private gross domestic product (GDP).
Hire 40% of high tech workers (such as scientists, engineers, and computer workers).
Are 52% home-based and 2% franchises.
Made up 97.3% of all identified exporters and produced 28.9% of the known export value in FY 2006.
Produce 13 times more patents per employee than large patenting firms; these patents are twice as likely as large firm patents to be among the 1% most cited.

That is pretty robust activity for a sector of the economy that some, like Scott Shane—Case Western professor of entrepreneurial studies and New York Times small business blogger—say has been in decline for a long time. According to Shane, we are creating fewer employer firms per capita than we did a decade ago, we are creating fewer establishments than we were a decade ago and fewer people are becoming self-employed than they were a decade ago. Shane takes statistics from the SBA, the Census Bureau and the OECD Factbook 2009 and uses them to paint a bleak picture of entrepreneurship in the United States, blaming the rise of big box retailers like Wal-Mart for this decline, citing how these “super efficient” stores (evidently, he has never actually had to shop in one) have out-competed their small business counterparts, driving them out of business.

It’s an ugly picture to be sure, but he doesn’t stop there. No, Professor Shane goes on to say this:

Most Americans would like to believe that this country is getting more entrepreneurial over time. While I wish this were true, the data don’t agree. Policy makers need to take a look at these data and acknowledge the pattern. More important, they need to understand why the rate of entrepreneurship is declining over time.

So, now he is calling for Washington bureaucrats to embrace this view, which, like global warming and other hysterical claims, is not supported by real numbers. Nor is it supported by experience. This should be no surprise, read enough of Professor Shane’s work and you see a man who is a true tenant of the ivory tower, far happier with nice, clean, abstract policy than he is with the messy realities of small business and entrepreneurship that Case Western expects him to teach and that the New York Times expects him to write about. Consider this from a recent CNNMoney.com article:

From a societal point of view, if you have a group of people who do something that makes them happier but less productive (which the data support), and you aggregate that, then entrepreneurship is an economic drain. If the goal of the policymaker is to make everybody in your country happy, then let everybody start businesses.

But most policymakers seek to create jobs and promote growth. If that's your goal, you want to stop all these people from starting marginal businesses that don't go anywhere and devote the resources to encouraging high-growth companies. In terms of tax policy, for example, you could argue that the government should eliminate the home-office tax deduction - which doesn't differentiate between high- and low-performing businesses - and beef up R&D tax credits.

Shane sees small business as a productivity drain that policymakers should do something about. He says this in spite of the overwhelming evidence that small business—American entrepreneurship—is the engine that drives all economic growth. He also sees it along racial lines:

White Americans are three times more likely to start businesses than black Americans are. And that's been pretty much the same since 1910. So what's going on here? If you measure psychological characteristics of representative samples of whites and blacks, you see very little difference.

The main difference between white and black households is net worth. White household net worth is 10 times that of black households on average. Now, most U.S. startups are self-financed. Entrepreneurs with 10 times more money take on less risk because they invest a much smaller percentage of their net worth when starting a business. So until you get rid of household wealth discrepancy, you'll see that gap there.

His obvious point: Whites with money start more businesses than blacks without money. His underlying assumption: Small business is primarily a white activity, minorities don’t have a shot. Guess what: Poor folks of all colors are at a disadvantage when it comes to a lot of things—including starting a business—as compared to their more well-heeled counterparts and just because you are white does not mean you have ten times the resources of your black neighbor. Yet, that does not stop many of these disadvantaged people from starting their own firms. In fact, according to the SBA, between 1997 and 2002, black-owned small business grew by an astounding 45.4%. Asian-owned firms saw a 12.6% expansion and Native American and Alaska Native firms grew by 2.1%. Hispanics, however, owned the largest share of minority-owned businesses at 6.6% of the total number of business in the country. Do minorities start as many small businesses as whites? Probably not, there is a financial disparity, but the small businesses that minorities start are every bit as robust and their white counterparts and their owners are, like all entrepreneurs, energetic and focused.

The Bottom Line

When you are discussing small business, bringing up the entire racial issue is silly and deflects one from the real issue, which is the strength of small business in America. It has taken some hits of late, like every other sector of the economy, but it is certainly not in decline. In fact, it is stronger than most, regardless of what the good professor says, and it still provides the only real traction the US economy has right now. So, instead of using his space on the New York Times website to talk down the small business sector, why not talk it up?

In his CNN interview, Shane spoke of race and financing and competition, but he missed the point of it. As Ken Blanchard, author of The One Minute Entrepreneur put it, “Entrepreneurship is all about fire in the belly.” That is something that Shane, for all his calculations, has no reckoning of. You cannot chart a fire in the belly, that drive to excel, and it does not fit into Shane’s preconceived narrative. His references to policymakers and race, his stance that small business is less efficient and than tax policy should be used to move the economy away from it, his very connection with The New York Times all testify to someone with a policy-first mindset, as opposed to an entrepreneurial or even an open and inquiring academic mind.

Another point that Shane and the policy-first crowd always miss, is that small business can and will succeed very nicely without them, without their studies and without their interference. If Shane ever really wants to see what American entrepreneurs can accomplish, he should be demanding that those policymakers of his do everything they can to give small business all the tools and freedom—mostly freedom—it needs to succeed.

SBA’s Dealer Floor Plan Financing Begins

charles@gowithabc.com (Charles Cooper) — Mon, 06 Jul 2009 08:48:45 GMT

July 1st saw the beginning of the Small Business Administration’s Dealer Floor Plan (DFP) financing program, which will make it easier for auto, RV and other dealerships to borrow against their inventory and increase their cash flow. The new pilot program is one of the many tools SBA is making available to help increase access to capital and technical assistance to small business.

DFP financing is a revolving line of credit that allows a dealership to obtain financing through SBA’s 7(a) program for inventory that can be titled, such as autos, RVs, manufactured homes, boats and trailers. As each piece of collateral is sold by the dealer, the loan advance against that piece of collateral is repaid. As the loan is repaid, the dealer can borrow against the line of credit to add new inventory.

DFP loans will be available for a minimum of $500,000 up to the $2 million allowable under the 7(a) program. With a maximum repayment term of five years, the loans will come with a 60-75% government guarantee, depending on the type of collateral and the lenders advance rate against the wholesale price of the inventory. Borrowers will also benefit from the temporary elimination of fees on 7(a) loans made possible by the American Recovery and Reinvestment Act of 2009.

Since the DFP pilot program is a new initiative that provides a guarantee for a specialized product, the agency is working with and training lenders who may be interested in offering this type of financing. SBA expects there will be a ramp-up period for these lenders. “In recent months, we’ve seen a dramatic decrease in the availability of credit for financing dealership inventories,” said SBA Administrator Karen G. Mills. “We want to be a partner for these small businesses and help ensure they have the resources they need to help keep their businesses open, save jobs and survive these tough economic times.”

The DFP pilot program will run through Sept. 30, 2010, after which SBA will determine whether to extend it further. DFP loans can be made by any lender already participating in SBA loan programs. Borrowers interested in obtaining a DFP loan should contact their lender or their nearest SBA field office to get a list of SBA-approved lenders in their area who may be participating in the program. Local district offices and contact information can be obtained at the SBA website at http://www.sba.gov/localresources/index.html.

Small Biz Tip: Money Management: Going Green

cheryl@gowithabc.com (Cheryl Sowa) — Fri, 03 Jul 2009 17:00:00 GMT

Tips from July 3, 2009

The Small Business tips today will be about how going green will save you money.

Converting computers, printers, and copy machines to "hibernate" mode will save your business hundreds of dollars when the electric bill rolls around. Not only are you saving money, but you are saving power by keeping your machines on, but in a state of hibernation.
According to the Energy Star website, a compact fluorescent light bulb saves $30 over its lifetime and will pay for itself in 6 months! It uses 75% less energy and lasts 10x longer than an incandescent light bulb.
Xerox found that 45% of paper printed in the office is tossed by the end of the day. Eliminate unnecessary printing and save your business hundreds of dollars per year by ordering fewer reams of paper and ink cartridges.
Disposable coffee cups contribute to unnecessary waste. Spending $2 for coffee mugs with your office logo not only provides cheap advertising, but saves money in buying bulk stacks of disposable coffee cups.

Daily Overview: Eliminate wasting resources and energy to give your electric bill (and the environment!) a break.

PCI: Do You Comply?

charles@gowithabc.com (Charles Cooper) — Thu, 02 Jul 2009 14:52:46 GMT

The Payment Card Industry Security Standards Council (PCI SSC or just PCI) is an organization that was started by the five major credit card providers to develop an across the board standard for payment card security. The standard they developed will be put into force by these companies—American Express, JBC, VISA, MasterCard, Discover—in July of 2010. If you take credit cards online then you will need to be in compliance by then. Here is what you will need to know.

The Standards

Before you can be PCI compliant, you need to have a grasp of the standards you will have to meet.

PCI DSS : The Payment Card Industry Data Security Standards. These are the standards that the industry put into place to fight data theft and they are broken down into 12 main security requirements. To be truly PCI DSS Compliant, you will have to adhere to all of them, but the extent to which you will have to meet them really depends on how many transactions your company processes in a year. These twelve standards, broken down into 6 areas are:

Build and Maintain a Secure Network

Requirement 1: Install and maintain a firewall configuration to protect cardholder data
Requirement 2: Do not use vendor-supplied defaults for system passwords and other security parameters

Protect Cardholder Data

Requirement 3: Protect stored cardholder data
Requirement 4: Encrypt transmission of cardholder data across open, public networks

Maintain a Vulnerability Management Program

Requirement 5: Use and regularly update anti-virus software
Requirement 6: Develop and maintain secure systems and applications

Implement Strong Access Control Measures

Requirement 7: Restrict access to cardholder data by business need-to-know
Requirement 8: Assign a unique ID to each person with computer access
Requirement 9: Restrict physical access to cardholder data

Regularly Monitor and Test Networks

Requirement 10: Track and monitor all access to network resources and cardholder data
Requirement 11: Regularly test security systems and processes

Maintain an Information Security Policy

Requirement 12: Maintain a policy that addresses information security

PA DSS : This means Payment Application Data Security Standards and they apply specifically to companies that develop or operate Payment Applications that online merchants (like yourself) use to process transactions, shopping carts for example. These standards make sure that your shopping cart's payment application software processes your client's credit cards using the proper security specifications, to protect against fraud and theft.

Complying with the Standards

What is required by way of compliance is based on which one of four different merchant levels you fall into. These levels are based on the number of transactions you process each year. Compliance is determined through an auditing process which involves a Report on Compliance, which can be written for you by an outside assessor or a self-assessment questionnaire, and a procedure called PCI Scanning.

Report On Compliance . This report is submitted to your acquirer—the bank or processing company you contracted with to be able to process credit cards—and it demonstrates that you are, in fact, compliant. The scope of this report will vary, depending on the merchant level you fall into.

PCI Scanning . This is done quarterly and involves a third party PCI ASV (Approved Scanning Vendor) scan all of the publicly accessible IP addresses that have to do with the transaction process, which is usually your IP address as well as the IP address of any third-party shopping cart hosted by your shopping cart provider during the checkout process because the entire transaction needs to be conducted under the PCI DSS and PA DSS.

The Four Merchant Levels. To know what you will need to do to comply with the PCI standards, check which of the four merchant levels you fall into:

Level 1: Over 6,000,000 transactions a year.

Use an onsite assessor called a QSA to evaluate your security and write an in-depth Report On Compliance for you.
Quarterly PCI Scans.

Level 2 Between 1,000,000 and 6,000,000 transactions a year.

Complete a Self-Assessment Questionnaire (SAQ).
Quarterly PCI Scans.
Credit card information report (a one-page form stating that you don't keep certain types of credit card information on file).

Level 3 Between 20,000 and 1,000,000 transactions a year.

Complete a Self-Assessment Questionnaire (SAQ).
Quarterly PCI Scans.

Level 4 Between 1 and 20,000 transactions a year.

Complete a Self-Assessment Questionnaire (SAQ).
Quarterly PCI Scans.

If you are wondering what the ROI on doing all of this will be, aside from being able to process credit and debit cards in a safe and secure way, it really boils down to public perception. When consumers see that your website is secure, they are more apt to trust doing business there and that translates into more sales for you. It is an investment you can’t afford to miss. For more information, visit PCI at www.pcisecuritystandards.org/

Small Biz Tip: Money Management: Cutting Corners

cheryl@gowithabc.com (Cheryl Sowa) — Thu, 02 Jul 2009 13:25:28 GMT

Tips from July 2, 2009

The Small Business tips today will be how to cut corners to save money in your business.

Send emails rather than mail through the USPS whenever possible. The money spent on a number of stamps will add up throughout the year. Additionally, most businesses use email to communicate already, and
When renovating your office, look to purchase used or condition furniture. Some office furniture is very expensive, and looking on websites such as eBay and Craigslist could save you money.
Plan your shipping and mailing ahead of time. Shipping in bulk will save money on fees for trucks, drivers, and general shipping costs. Take advantage of deals through various shipping companies, such as UPS. ABC members receive discounts on UPS shipping. For more information, visit http://www.americasbestcompanies.com/partners/view/ups.aspx.
Print your own business cards. Many office programs allow for business cards to be designed on your own computer and printed in your home.

Daily Overview: Planning ahead and not outsourcing work keeps your money in your business. If outsourcing work is necessary, try Virtual Assistants. For more information, visit http://www.americasbestcompanies.com/blog/small-business-tips-virtual-assistants.aspx.

Small Biz Tip: Money Management: Making Sacrifices

cheryl@gowithabc.com (Cheryl Sowa) — Wed, 01 Jul 2009 16:40:53 GMT

Tips from July 1, 2009

The Small Business tips today will be about making sacrifices in your business to save money.

Cut back on office luxuries, and focus on spending money on the important things. For example, providing office food can be cut back to once a week instead of every day. That money can be used towards a new marketing or advertising campaign.
Let the unproductive and nonprofitable employees go. Having staff is important, but having staff that is not doing any good for your business is wasted money.
Go generic. Some prestigious brands are much, much more expensive than the generic ones. Stick to the basics and you will have extra cash in your pocket.
As a business owner, set money saving trends in the office. Limit personal spending and make other employees aware. They will see the benefits and follow your trend.

Daily Overview: Cutting back on unnecessary things in the workplace keeps your business's money in the bank.

The FedEx Scam: Yet Another Crooked Game

charles@gowithabc.com (Charles Cooper) — Wed, 01 Jul 2009 13:35:34 GMT

I love scams, and sometimes, when I get a really good one, something with a little originality to it, something that shows a little effort, I want to share it. Here is an email message that America’s Best magazine editor Lynn Celmer forwarded to me that supposedly comes from FedEx (emphasis mine):

Dear Customer !!!

We have been waiting for you to contact us for your Confirmed Package that is registered with us for shipping to your residential location. We thought that the sender gave you our contact details and that you would have contacted us by now. we would also let you know that a letter is also attached to your package. However, we cannot quote its content to you via E-mail for privacy reasons. We understand that the content of your package itself is a Bank Draft worth $800,000.00 USD, in FedEx we do not ship money in CASH or in CHEQUES but in Bank Drafts only. The package is registered with us for mailing by your colleague, and your colleague explained that he is from the United States but he is in Nigeria for a three (3) month Surveying Project. for he is working with a consulting firm in Nigeria West Africa .

We are sending you this E-mail because your package is been registered on a Special Order. What you have to do now, is to contact our Delivery

Note that the payment that is made on the Insurance, Premium & Clearance Certificates, are to certify that the Bank Draft is not a Drug Affiliated Fund (DAF) neither is it funds to sponsor Terrorism in your country. This will help you avoid any form of query from the Monetary Authority of your country. However, you will have to pay a sum of $125 US Dollars to the FedEx Delivery Department for the Security Keeping Fee of the FedEx company as stated in our privacy terms & condition page. Also be informed that your colleague wished to pay for the Security Keeping charges, but we do not accept such payments considering the facts that all items & packages registered with us has a time limitation and we cannot accept payment not knowing when you will be picking up the package or even respond to us. So we cannot take the risk to have accepted such payment incase of any possible demurrage.

Kindly note that your colleague did not leave us with any further information. We hope that you send your response to us as soon as possible because if you fail to respond until the expiry date of the foremost package, we may refer the package to the British Commission for Welfare as the package those not have a return address.

Kindly contact the delivery department (FedEx Delivery Post) with the details given below:

FedEx Delivery Post
Contact Person: Mr. Smith Isu
mr.smithisu@btinternet.com

Kindly complete the below form and send it to the email address given above. This is mandatory to reconfirm your Postal address and telephone numbers.

FULL NAMES:
TELEPHONE:
POSTAL ADDRESS:
CITY:
STATE:
COUNTRY:

Kindly complete the above form and submit it to the delivery manager on: mr.smithisu1@btinternet.com

As soon as your details are received, our delivery team will give you the neccessary payment procedure so that you can effect the payment for the Security Keeping Fees. As soon as they confirm your payment receipt of $125 US Dollars. They will not hesitate to dispatch your package as well as the attached letter to your residence. which usually takes 24 hours being an over night delivery service.

Note: that we were not instructed to email you, but due to the high priority of your package we had to inform you as your sender did not leave us with his phone number because he stated that he just arrived Nigeria and he has not gotten a phone yet. We personally sealed your Bank Draft and we found your email contact in the attached letter as the recipient of the foremost package. Ensure to contact the delivery department with the email address given above and ensure to fill the above form as well to enable a successful reconfirmation. Attach to this email is a scan copy of the package to be delivered to your address containing the draft of $800,000.00 USD, immediately you we have confirmed your payment of $125 US Dollars for the Security Keeping of your package.

Yours Faithfully,
Mr James Wellington.
FedEx Online Team Management.
All rights reserved. © 1995-2009.

--------------------------------------------------------------------------------------------------------------------------
This E-mail is only for the above addressees. It may contain confidential or Privileged information. If you are not an addressee you must not copy, distribute, disclose or use any of the information in it or any attachments.
--------------------------------------------------------------------------------------------------------------------------
FEDEX INTL>>>LICENCE OF FEDERAL EXPRESS CO-OPERATION.

Wow! It seems that I am violating the terms of their confidentiality warning by putting a copy of this up on The Bottom Line. It really makes you wonder what these people are thinking when they put this out there, other than that I would get a hold of it and pick it apart.

Now, let us assume that you, indeed, have a colleague on a surveying project in West Africa who just happens to have nearly a million dollars burning a hole in his pocket (he must be wearing those jungle explorer pants with the really big cargo pockets on the legs). Let us also assume for the moment that for some reason that pesky wire transfer thing is simply so unappealing to this latter-day Captain Spaulding that he searched high and low to find the nearest FedEx office in order to get this small fortune to you, told them all about it, showed them the letter written to you and then sent it to you collect. If that doesn’t sound like a Marx Brothers movie, I don’t know what does!

The Signs of a Scam

Now, the absolute absurdity of the story behind this attempt to lighten your wallet by $125 really does make this scam email suitable for framing. However, even if all of that rubbish was true—including the bit about the cargo pants—there are ample clues within the letter itself to demonstrate that it is nothing more than a phishing lure!

Phishing is a kind of scam that is really designed to collect personal data. Sure, if they can get you to pony-up some money as well, all the better. However, the real pay-off comes with the inevitable identity theft that follows the disclosure of the information they request. It is easy to spot one of these scams. You notice the clues—you may even laugh at them—but you need to connect them with the scam.

Sloppy writing . This is supposedly from a professional, worldwide, multibillion-dollar company and the writer cannot spell. Nor has he any idea how to use capital letters and punctuation, word spacing and so on. Moreover, a quick look at the sentence structure and vocabulary shows unnecessarily complex and flowery language. Sentences like: So we cannot take the risk to have accepted such payment incase of any possible demurrage do tend to stand out, and that salutation, Dear Customer !!! is both vague, as if they don’t know who you are—which they don’t—but the prospect of contacting you is still incredibly exciting. Editorially speaking, this email is a mess!

Misuse of the company name . The actual name is FedEx Corporation. It is not, as this scam letter suggests, “FEDEX INTL,” nor is it “Federal Express Co-operation.” This is more than just the company name; it is the heart of their brand, just as your company name is the heart of your brand. Everything that FedEx puts out is consistent both within the document and with everything else that the company distributes. If that were not the case, then their brand would be diluted, and that is the last thing they want.

Strange email addresses and URLs . Take a look at the FedEx website and you will notice that their email addresses end in @fedex.com. So, if you want to reach, say, investor relations, it would be ir@fedex.com. They also have contact forms. Now, knowing that, what does it tell you about the email address of one Mr. Smith Isu, which is mr.smithisu1@btinternet.com? After all, if the man was with FedEx, why does his email direct you to well-known spam email company? If nothing else in this email sets off alarms for you, this discrepancy between this email address and FedEx’s usual email practices really should. The same thing goes with links. Roll over all the links in a message and at the bottom of your browser you will see the URL the link points to. If the links don’t point to where they should, based on who supposedly sent the email, it’s a scam.

Ask yourself, if one of your employees sent out a similar email to a potential customer—impersonal, poorly written, riddled with mistakes—how would you react? Not well, certainly. There is, however, more.

Internal inconsistencies . When they say they cannot tell you what’s in the letter for “privacy” reasons, but go ahead to tell you there is a bank draft for $800,000 riding with the letter, then something is distinctly wrong. The writer of the email states at the top that they have been waiting for you to contact them, yet further down they say that this is a “high priority” package. Which is it, a high priority or something you can just throw on the shelf until you get tired of looking at it?

False sense of urgency . This is the hard sell. They say you have to reply quickly to avoid having the check sent to the British Commission for Welfare in order to get you to act rashly. Since when does a delivery company give unclaimed packages to a government welfare agency? Does that mean they would send that sweater Aunt Kate mistakenly tried to mail to your former address to Goodwill because you didn’t pick it up? No! They would return it to Aunt Kate. If this was real, the worst thing that would happen would be the package being returned to Captain Spaulding.

The terrorism/drug angle . Everyone wants to do their part and we all know that Obama’s Department of Homeland Security and Drug Enforcement Agency have lists of people and transactions they want to keep and eye on, but to imagine that you have to pay $125 to avoid being branded a terrorist or a drug smuggler is patently absurd on the face of it. The implication here is that if you don’t play ball, then you will be suspected of wrongdoing.

Keep it quiet . This goes back to the comment about breaking their confidentiality rules by posting their email and discussing it. Scammers don’t want you talking about their activities. At the same time, they want to look as legitimate as possible. By adding the language: This E-mail is only for the above addressees. It may contain confidential or Privileged information. If you are not an addressee you must not copy, distribute, disclose or use any of the information in it or any attachments, the scammer is trying to accomplish both.

The Bottom Line

I cannot say it any more plainly than this: No one in Nigeria wants to send you money. On the other hand, there are quite a few folks who would like to take some—all—of yours, so you have to be careful and you have to have your eyes open.

In this specimen, the company being used in the scam was FedEx, but it could have just as easily been UPS or some other courier/delivery service and there are examples of this. These scammers are using these companies to give themselves some legitimacy, to cover their real purpose. This is very damaging to the company’s brand, but there is little they can realistically do. It is the latest version of the old Nigerian 419 scam and it is spreading through the Internet thanks to spam merchants like BTI Internet. If FedEx and the other companies went after companies like BTI and tried to either shut them down or bleed them through high legal fees, then there might be a chance to stop these scams, or at least a portion of them.

Until then, however, we have to be careful. Since email like this can be filled with malware, make sure that your spam filters are properly set and that you don’t open any attachments that might come with the email. This one, for example, refers to a scan copy of the package (whatever that means) as being attached. The most important rule, however is this one: If you do not initiate the business, never send any money to anyone you do not know and trust. If you do, odds are you will never see it again.

Small Biz Tip: Money Management: Take a Step Back and Readjust

cheryl@gowithabc.com (Cheryl Sowa) — Tue, 30 Jun 2009 16:34:33 GMT

Tips from June 30, 2009

The Small Business tips today will be about taking a step back and readjusting how you manage your business.

If things are slow, change your look and feel about your business. Keep your business updated with current times and trends to catch potential customers' eyes.
Ask for feedback from customers about what can be done to update your business. Loyal customers can give a great response as they are dedicated to your business.
Recalculate your budget. Some of the money you thought was a good idea to spend in one area may be better in another. If needed, write up a modified budget and think about how you can save.
Keep track of your office supplies. Take inventory and cut back on your overstocked supplies and focus your money on purchasing the essential ones. ABC members have discounts on thousands of products at Staples. Go to http://www.americasbestcompanies.com/partners/view/staples.aspx for more information.

Daily Overview: Look at the big picture when analyzing your business. Decide what is essential and what is not to eliminate wasteful and meaningless spending to have more money for your business.

Small Biz Tip: Money Management: Safeguard Your Finances

cheryl@gowithabc.com (Cheryl Sowa) — Mon, 29 Jun 2009 16:34:45 GMT

Tips from June 29, 2009

The Small Business tips today will be about ways to safeguard your finances to save money.

Keep track of every purchase by saving receipts from transactions. Find an effective way to record purchases, whether a computer program or check book. Validate purchases by keeping up with bank statements and your purchases. ABC members have a discounted program, Shoeboxed.com, for record keeping. Try http://bit.ly/7Qb58.
Back up your computer! A virus, crash, or even a simple computer malfunction can erase data and records. If you have a computer program for your finances, back that up as well. Losing this information could cost your business hundreds of dollars and many hours of recovery. Save your information on an external hard drive to ensure safety.
Check, recheck, and check again on your bank statements. Although unlikely, there is a chance for an error in the banking system and could accidentally cost you money.
Don't give out your credit card or bank account number. Safeguard those in a safe place, and beware of email and online scams.

Daily Overview: Ensure financial safety by keeping records accounted for and tracked. This will not only save you money but countless hours for recovery.

Small Biz Tip: Pre-Screening Employees: Background Checks

cheryl@gowithabc.com (Cheryl Sowa) — Sun, 28 Jun 2009 17:00:00 GMT

Tips from June 27, 2009

The Small Business tips today will be about background checks for new employees.

One of the most important reasons to conduct a background check on a potential future employee is to eliminate those who lied on their resume. With the economy struggling and people desperate to find jobs, it is important to hire those who are truthful and have the proper credentials.
Before diving into potential employees’ personal records and history, be sure to look into what constitutes as a legal background check and which does not. Being safe and preparing yourself is essential to avoid court and legal problems.
Conducting a background check ensures that your employees will retain a sense of safety at the workplace. Employees will be less stressed about the possibility of incidents at the workplace.
It is very important for small businesses to conduct background checks to save money by hiring the right candidates from the start instead of wasting time and money on hiring the wrong ones.

Daily Overview: When conducting a background check, find out all necessary information to shield yourself and your business from legal issues. Find more information at Privacy Rights Fact Sheet.

I am not an attorney. I have attempted to condense complicated and detailed legal issues into 140 characters per line. My interpretation may not be exact. Please contact an attorney for professional legal advice.

For more information, please visit the American Bar Association.

Small Biz Tip: Establishing Workplace Safety

cheryl@gowithabc.com (Cheryl Sowa) — Fri, 26 Jun 2009 15:41:40 GMT

Tips from June 26, 2009

The Small Business tips today will be how to establish workplace safety.

Keep a stocked first aid kit at your workplace in case of a medical emergency. Keep emergency numbers for the police, fire department, hospital, and poison control center in an area where all employees can reach them, such as the break room.
Educate employees about safety during a fire, tornado, or lock down emergency. Have practice drills every few months and post evacuation and safety information in the workplace.
Keep your business sanitary, including the supply and break rooms. Restrooms need to be kept up to code and sanitized on an hourly basis.
OSHA On-Site Consultation is offered to small and medium sized businesses for free, although priority is given to working environments which are likely for hazards. OSHA consultants educate employers about the safety hazards that are present in their workplace.

Daily Overview: OSHA works to ensure safety in the workplace for you and your employees. For more information, please visit http://www.osha.gov/.

For more information, please visit the American Bar Association.

Cap and Trade: Win or Lose, It Will Be Close

charles@gowithabc.com (Charles Cooper) — Fri, 26 Jun 2009 15:34:19 GMT

There is a last minute push going on around the country to get to as many fence-sitters on the climate change issue as possible to vote NO on the final ballot. Why is this? After all, the legislation is just to put a cap on the amount of carbon dioxide and other greenhouse gasses that we pump into the atmosphere each day; we need it to fight global warming. The UN says so, and there is that consensus in the scientific community, and that guy from NASA has been going on about this for years! Al Gore made that movie! If anyone knows about climate and planetary atmospheres, it’s the folks a NASA and Al Gore. Right?

Not so fast. There are a number of reasons why this bill is getting the opposition it is, but it all comes down to two things: Bad science, worse economics.

He Blinded Us with (Bad) Science

A recent article in the Wall Street Journal introduced us to a legislator named Steve Fielding. According to the article:

Steve Fielding recently asked the Obama administration to reassure him on the science of man-made global warming. When the administration proved unhelpful, Mr. Fielding decided to vote against climate-change legislation.

If you haven't heard of this politician, it's because he's a member of the Australian Senate. As the U.S. House of Representatives prepares to pass a climate-change bill, the Australian Parliament is preparing to kill its own country's carbon-emissions scheme. Why? A growing number of Australian politicians, scientists and citizens once again doubt the science of human-caused global warming.

The fact is that more and more scientists and politicians from around the globe are turning away from the idea of man-caused global warming, questioning the computer models, the conclusions and even the science of those who espouse the global warming dogma, the people who have spent more time smearing those who disagreed with global warming than in actually proving their theory. There is now a vigorous debate happening in Asia, Europe and Australia and even here in the US.

Oklahoma Sen. Jim Inhofe now counts more than 700 scientists who disagree with the U.N. -- 13 times the number who authored the U.N.'s 2007 climate summary for policymakers. Joanne Simpson, the world's first woman to receive a Ph.D. in meteorology, expressed relief upon her retirement last year that she was finally free to speak "frankly" of her nonbelief. Dr. Kiminori Itoh, a Japanese environmental physical chemist who contributed to a U.N. climate report, dubs man-made warming "the worst scientific scandal in history." Norway's Ivar Giaever, Nobel Prize winner for physics, decries it as the "new religion." A group of 54 noted physicists, led by Princeton 's Will Happer, is demanding the American Physical Society revise its position that the science is settled. (Both Nature and Science magazines have refused to run the physicists' open letter.)

This is not good news for the green/global warming crowd, a fact that is not lost on American Democrats who are working feverishly to ram this legislation through before the tide here turns completely against them. These people are ideologically-driven, not rationally-driven as shown by the way they blissfully ignore the following:

The earth's temperatures have remained steady since 2001 despite major growth in the amount of C02 in the atmosphere.
Peer-reviewed research has debunked the various doomsday scenarios about the polar ice caps melting, rising oceans, monster hurricanes, mass extinctions, etc.
A massive recession is precisely the worst time to kneecap the economy in the name of reining in carbon.

Voodoo Economics

We know how cap and trade is supposed to work: The government puts a cap on the amount of carbon dioxide a business is allowed to generate, and then sells carbon credits that allow the business to generate more. These can then be traded, bought and sold like any other commodity. It’s been tried before, in Europe and Australia, with disastrous results. That’s not political spin, it’s history, and it tells us that cap and trade laws:

Amount to a massive energy tax
Have no substantive impact on the environment
Kill jobs by burdening businesses—especially small businesses
Cause electricity bills and gas prices to sharply increase
Force the outsourcing of manufacturing jobs
Hurt free trade
Make people choose between energy, groceries, and other necessities
Are highly susceptible to fraud and corruption
Hurt senior citizens, the poor, and the unemployed the worst

American families will pay an additional $3,000 a Year for energy, which falls into line with what President Obama said when he was a candidate, admitting that "Electricity rates would necessarily skyrocket" under his cap-and-trade Program (January 2008). In fact, the price for all goods and services will skyrocket as the added cost of energy is figured into the final consumer prices. Just consider energy prices. According to recent Heritage economic analyses, the costs of the proposed global warming bill will kick in when it takes effect in 2012. By 2035, a family of four will see the following changes to their energy bill:

90 percent increase in electricity costs
58 percent increase in gasoline costs
55 percent increase in natural gas costs

How affordable is that, especially considering the pseudo-science that all this taxation is based on? Will your small business be able to stay in business with energy costs like this? Remember, these will hit you, your suppliers and your customers. Every use of energy will be so taxed and cost will be sent along to those who pay for the final products.

The Bottom Line

The rest of the world understands this all too well. They experimented with these schemes during the good times and know the damage that these policies can do. President Obama, Nancy Pelosi, Harry Reid and many others in the Democratic majority are bound and determined to repeat those mistakes, perhaps feeling as though they can avoid the pitfalls, or perhaps to pay back their political masters in the radical environmental movement. Who knows? What we do know is that not every Congressional Representative has made their decision, so there is still time to stop this where it is.

The following 25 Representatives in Congress are on the fence about this issue. Time is running out, so you might want to call them and let them know how you feel about Cap and Trade and the damage it will do to your business and to your family’s standard of living.

Republicans:
Bartlett (MD) – (202) 225-2721
Bono Mack (CA) - (202) 225-5330
Castle (DE) – (202) 225-4165
Dent (PA) – (202) 225-6411
Ehlers (MI) - (202) 225-3831
Frelinghuysen (NJ) - (202) 225-5034
Gerlach (PA) – (202) 225.4315
Inglis (SC) - (202) 225-6030
Tim Johnson (IL) – (202) 225-2371
Kirk (IL) – (202) 225-4835
Lance (NJ) - (202) 225-5361
LoBiondo (NJ) - (202) 225-6572
Petri (WI) – (202) 225-2476
Platts (PA) - (202) 225-5836
Ros-Lehtinen (FL) – (202) 225-3931

Democrats:
Altmire (PA) – (202) 225-2565
Bright (AL) - (202) 225-2901
Dahlkemper (PA) - (202) 225-5406
Drieshaus (OH) - (202) 225-2216
Ellsworth (IN) - (202) 225-4636
Kissell (NC) - (202) 225-3715
Kratovil (MD) - (202) 225-5311
Kanjorski (PA) - (202) 225-6511
Minnick (ID) - (202) 225-6611
Teague (NM) - (202) 225-2365

Small Biz Tip: Pre-Screening Employees: The Fair Credit Reporting Act (FCRA)

cheryl@gowithabc.com (Cheryl Sowa) — Thu, 25 Jun 2009 16:46:05 GMT

Tips from June 25, 2009

The Small Business tips today will be discussing the Fair Credit Reporting Act (FCRA).

Employers generally ask a credit reporting company for credit, employment history, motor vehicle records, criminal background, and references which must comply with the FCRA requirements.
Under the FCRA, a credit reporting company will not provide an employee’s credit report to an employer without proper written consent.
As an employer, if you decide to not hire or promote an employee based on their credit report, you must provide a copy of the report and let the employee know the right to challenge the report.
FCRA also requires businesses to report accurate information regarding debts owed to a credit reporting company by a debtor to avoid costly fines.

Daily Overview: The FCRA protects credit reports of employees. For more information, go to the Fair Credit Reporting Act.

For more information, please visit the American Bar Association.

Loyalty to Your Brand: 4 Laws of Customer Service

charles@gowithabc.com (Charles Cooper) — Thu, 25 Jun 2009 10:51:53 GMT

There are brands that have been around since, it seems, the beginning of time. These are the big names in the ads that fill those convenient sandwich-making-refill-the-soda-trip-to-the-bathroom moments during our favorite TV shows; the ads blaring at twice the volume of the show itself to tell us these products are new, improved, bigger, better, faster, more! They tell us these things yet these are the same brands that our parents hauled into the house when we were kids and told us to buy when we left home for college. Our folks were loyal to these brands and for a long time so were we.

According to a new survey, though, those times are over. A new study by the Chief Marketing Officer Council and Pointer Media Network found that fewer consumers were staying with their traditional consumer packaged goods brands in 2007 and 2008 with a third of the respondents reporting that they completely abandoned their traditional favorites. Among the findings:

52% of highly loyal customers strayed to some extent from their favorite brand in 2008.
33% of these customers stopped buying the brand at all while continuing to buy the same kind of items.

What in the world happened? More to the point, does the unfortunate experience of these consumer brands say anything about the relationship your customers have with your brand? If we assume that these results show a shift in the mindset of today’s American consumers away from the kind of brand loyalty seen in previous generations, then the answer is that it probably does.

What it says is that today’s consumer is looking for the “better deal” and that when they come across it; they are very likely to jump ship. You simply cannot count on knee-jerk brand loyalty to see you through. Like a good husband does with his wife (and vice-versa), you have to remind this most “significant other” why they are with you on a regular basis, make them feel important and give them a reason to stay. If your customers feel that you have forgotten about them, they will forget you.

So, how have these major brand names forgotten their customers? There are all sorts of ways, ranging from offering products that are not really wanted (General Motors is notorious for that) to charging more for less (breakfast cereal anyone?) to changing formerly included services into fee-based services (the airlines perfected this art) to offering ridiculously sub-standard customer service (Comcast, Dell, AT&T…the list goes on and on and on…). Consumers are feeling ignored, they are feeling neglected and frequently insulted. They have developed a level of cynicism regarding how businesses treat them, usually expecting the worst, so is it any wonder they are going across the street?

What does that mean for you? It means you have to take stock of how you and your staff are treating your customers. After all, they are not coming to you for the lowest price in town. That’s at the area big-box store, where apparently the major hiring criterion is that the applicant be some sort of primate (or at least a mammal, or maybe a marsupial). No, your customers are coming to you because you offer them a better shopping experience and provide a significantly higher level of service than the proboscis monkey in a logo-bearing polo shirt who doesn’t know one product from the next (except for what’s on the product information card that you just read for yourself). However, thanks to a morning sales meeting reminiscent of an early scene in Glengarry Glen Ross, and armed with a buzz-word or two, he utterly committed to convincing you that the other, more expensive version of whatever you are looking at is the perfect “solution” for your “problem.”

This is not a great customer experience, but places like that trade only on price. Customers are only dollar amounts on a spreadsheet to them.

So, assuming that you are different and that your customers are coming to you for the service, how are you treating them? If you are satisfied with an answer such as “Well, they are being treated alright,” then you need to back and think about this more. If you have been tracking customer retention on any level—and you should—then how does that match-up with your belief that they are being treated alright? It doesn’t matter if you are gaining new customers every month; if you are losing customers it’s because they are not being treated alright, you need to know where the problem is and you need to solve it.

There are two reasons for customer loss. The first is price. There is only so much you can do about that. You don’t have the buying power of the big-box stores so you cannot compete with them on that. You can, however, compete with other small competitors, but you are constrained by your own expenses. The best you can do is price your goods and services fairly and justify the price you ask by addressing the second reason for customer loss: Poor customer service.

You can turn your customer service efforts around by remembering that:

Good customer service is everyone’s business . From you, the owner, through the management to the people on the floor and behind the counters, good customer service has to be everyone’s top priority.
Good customer service is a top-down affair . That means it all comes from you, the boss. If you are going to engender an atmosphere where good customer service is the norm, then you must lead by example.
Good customer service is an investment. Don’t consider any small additional expenses you might have to incur to make things right for your customer to be losses. Look at them as investments in retaining that customer.
Good customer service means taking responsibility . Things go wrong, even with the best of us. Customers don’t like it when things go wrong, but they tend to care more about how you deal with problems. Take responsibility, make it right (at least as right as possible) and generously compensate your customer for the trouble your mistake put them through. The expense of doing this, plus the possible loss of future business that you are working to save, are reminders to strive to do better. Heed that reminder.

Solid customer service, the kind of customer service that gets people to stick with you; to shell out a little more even during a recession, comes from a customer-centric business philosophy. If you want your customers loyal to your brand, you must make satisfying the needs of your customers—as much as a partner as a vendor—your top priority. After all, that is why you are in business in the first place.

Small Biz Tip: Pre-Screening Employees: The American with Disabilities Act (ADA)

cheryl@gowithabc.com (Cheryl Sowa) — Wed, 24 Jun 2009 16:51:25 GMT

Tips from June 24, 2009

The Small Business tips today will be discussing the American with Disabilities Act (ADA).

The Equal Employment Opportunity Commission (EEOC) defines a disability as a person who has a physical or mental impairment that substantially limits one or more major life activities, has a record of such impairment, or is regarded as having such impairment.
Under the ADA, employers cannot ask during the interview or background check about a person’s disabilities. Employers may inquire only about an applicant’s ability to perform specific job.
An employer cannot make a job decision (hiring or promoting) based on an employee’s disability.
The ADA covers businesses with 15 or more employees, including state and local governments. Some states have laws protecting the confidentiality of medical records.

Daily Overview: Learn about the ADA to ensure you do not infringe on the rights of your employees. Visit the Americans with Disabilities Act.

For more information, please visit the American Bar Association.

Native-Owned Small Businesses Win Top Honors for Urban Economic Growth and Development

charles@gowithabc.com (Charles Cooper) — Wed, 24 Jun 2009 14:40:41 GMT

The US Small Business Administration has recognized two of its Emerging 200 (e200) initiative participants as being among the winners of the 2009 Inner City 100 competition, which is held by the Initiative for a Competitive Inner City (ICIC), a national not-for-profit organization founded in 1994 by HarvardBusinessSchool Professor Michael E. Porter. The award spotlights and supports growing companies in urban areas and highlights the importance of a healthy economy in developing healthy urban communities. Chosen from a pool of nearly 6,500 applicants, the two small businesses recognized from the SBA’s Emerging 200 initiative program are Sacred Power corporation of Albuquerque, New Mexico and FutureNet Group of Detroit Michigan, both of them Native-American owned and operated.

Sacred Power Corporation (www.sacredpowercorp.com) is a 2008 graduate of the SBA’s Emerging 200 initiative with a charter to provide renewable and distributive energy, as well as telecommunications solutions. FutureNet Group is a current participant of the 2009 SBA Emerging 200 initiative that provides environmental and engineering services to protect the environment and support communities.

Winners of the Inner City 100 award were determined in part based on their revenue growth over a five-year period, and must have been headquartered in, or have 51% or more of its physical operations in, an economically distressed urban area.

The SBA launched the Emerging 200 initiative to identify and support inner-city small businesses that have substantial potential for growth and to provide them with executive level MBA-like training, networking, and other resources necessary for success. The intensive and comprehensive curriculum focuses on developing winning, local strategies and attracting capital to fuel growth. Participants work with experienced mentors, attend workshops and develop connections with banks and the private equity community.

For its e200 initiative, SBA commissioned ICIC to identify the nation’s largest inner city areas (40,000+ inner city jobs) that have experienced flat or negative compound annual job growth rates in recent years. From these areas, SBA selected a representative cross-section to participate in the e200 initiative based on the cities’ interest, demonstrated support from the local community, and capacity to support the effort with SBA District office staff and in-kind support from resource partners. SBA collaborated with ICIC and its network of economic development researchers to establish criteria for the types of businesses that would benefit most from Emerging 200.

In 2009, the Emerging 200 initiative was expanded to include five new cities – Detroit, Dallas, Denver, Jacksonville, and Portland – in addition to the original 10 participating cities: Boston, Philadelphia, Baltimore, Memphis, Atlanta, Chicago, Milwaukee, Albuquerque, New Orleans, and Des Moines.

Small Biz Tip: Pre-Screening Employees: Legal Interview Questions

cheryl@gowithabc.com (Cheryl Sowa) — Mon, 22 Jun 2009 16:47:27 GMT

Tips from June 22, 2009

The Small Business tips today will be about legal questions you can ask when hiring an employee.

Questions regarding citizenship are tricky to ask during an interview. You cannot ask if your potential employee is a U.S. citizen, but you may ask if they are authorized to work in the United States.
Asking about age could lead to cases for discrimination down the road. Instead, ask if they are over the age of 18 to be sure your potential employee can legally work for you.
Although it would be good to know if a potential employee has been arrested, you cannot ask that question in an interview. Instead, ask if they have been convicted of a specific crime (fraud, theft, etc). The specific crime should be related to the performance of the job in question.
Asking potential employers if they “have any disabilities” is illegal and will be discussed further in later tips. If the interviewer thoroughly described the job tasks, it is legal to ask, “Are you able to perform the essential functions of this position?”

Daily Overview: Always be careful the way that you phrase interview questions and consider the repercussions that could result. For more information, please visit the The Department of the Interior.

For more information, please visit the American Bar Association.

Fairness May be Coming to How Telecommuters are Taxed

charles@gowithabc.com (Charles Cooper) — Mon, 22 Jun 2009 10:56:26 GMT

Now we have some tax legislation coming out of Washington that makes sense, thanks to Rep. James Himes (D-CT), which would make it easier for companies to employ telecommuters from out of state by removing the tax penalties these employees currently face.

The bill sponsored by Himes eliminates the so-called “convenience of the employer” rule that leads to double taxation on the employee’s wages. Under the current system, when an employee is telecommuting for a company in another state—say he lives in Illinois but the company he works for is in New York, both states with income taxes—both states are entitled to tax that telecommuter on 100% of his income derived from that job. There is no distinction between the income made during visits to the employer and that made strictly at home. It is all taxable by both states as long as the telecommuting is for the “convenience” of telecommuter (such as the “convenience” of having the job in the first place) and not due to a specific job requirement.

The Telecommuter Tax Fairness Act of 2009 changes that. As introduced, the bill prohibits a state from imposing an income tax on the compensation of a nonresident individual for any period in which such individual is not physically present in or working in such state or from deeming such nonresident individual to be present in or working in such state on the grounds that: (1) such individual is present at or working at home for convenience; or (2) such individual's work at home fails any convenience of the employer test or any similar test. (Summary written by the Congressional Research Service.)

In other words, unless the employee is there, within the borders of the state in which the work is being done, the state cannot tax that income. This means that our telecommuter in Illinois who works for that New York-based company would only be liable for New York income taxes when he has to come into to work at the New York corporate office. As long as he is in Illinois, he is only subject to Illinois income taxes.

This is important legislation and should be supported by the small business community. After all, telecommuting is constantly growing as it offers a lot of advantages for both employer and employee including:

Improved Productivity . People who work from home tend to work longer hours as they no longer face long commutes and have fewer interruptions. Also, they are more likely to work a few hours on weekends and in the evening simply because there is work to be done. This is great for salaried employees but can add up to hefty overtime for hourly employees so that needs to be watched carefully.

Personnel Retention . Life changes like pregnancy or having to go with a spouse who was transferred to another city or state can force valuable employees to resign. Allowing them to telecommute means you won’t lose their talent even when life intervenes.

Reduced Office Overhead . With workers working from home, you don’t need the kind of office space you otherwise would need. This translates into lower costs for you, the employer.

Reduced Absenteeism. Who has not had to take a day off to care for a sick child or handle some necessary personal business? There is no reason to lose that workday, however, when you permit telecommuting, which offers employees flexibility that improves their work-life balance while also keeping up their productivity.

A Wider Pool of Recruits . Geography is no longer a limiting factor when it comes to recruitment and workers with special needs, such as those with disabilities or chronic illnesses who are not comfortable in a traditional, can be considered, thus giving employer the broadest talent pool possible from which to recruit.

Stronger Continuity Plans . Business continuity planning relies heavily on telecommuting. More and more we see the necessity to plan for emergencies such as pandemics, terrorist attacks or natural disasters and telecommuting, with its decentralized structure, is a perfect way to remain up and running when coming into the office is difficult or impossible.

Yet with all these advantages, many will not—or can not—participate and take advantage of them due to the unjust double-taxation that this legislation seeks to eliminate. This legislation, which is currently before the House Judiciary Committee, is a real step toward having the nation’s policies answer the real needs of business and it should be supported by business owners everywhere.

Small Biz Tip: Forecast the Future of Your Sales

cheryl@gowithabc.com (Cheryl Sowa) — Fri, 19 Jun 2009 16:00:43 GMT

Tips from June 19, 2009

The Small Business tips today will discuss forecasting the future of your sales.

Predict your future sales based on a realistic scale. Project your weekly sales within the first few months, as well as monthly sales for the year.
Develop customer profiles and predict what other types of consumers you can sell to. Look up demographics and the target market to get an idea of whom and where to sell to.
Revisit your annual sales plan. Check your progress of your plan and make any necessary revisions to stay on track with your budget and sales.
Develop a plan or strategy in case your sales predictions completely miss what you are projecting. This way, your business is prepared to handle not generating enough income due to lack of sales.

Daily Overview: Sales predictions are a good way to set goals for the future. They are also a way keep your business on track for generating enough sales to keep a steady profit.

Study Ranks Banks on Small Firm Lending, Hints at Current Trends

charles@gowithabc.com (Charles Cooper) — Fri, 19 Jun 2009 15:42:33 GMT

The statistics are in: Growth of small and microbusiness lending was positive during the first half of 2008, but it was slower than in the previous year. This is according to the latest edition of the Office of Advocacy’s annual study of lending to small firms: Small Business & Micro Business Lending in the United States for Data Years 2007-2008, which gives a detailed account of small business lending overall, plus state-by-state totals and totals for individual lenders.

The report uses the most recent Consolidated Reports of Condition and Income (Call Report) data for June 2007 to June 2008 and Community Reinvestment Act (CRA) data for 2007 to examine financial institutions’ small and microbusiness lending. Small business loans in these data are business loans
of less than $1 million and microbusiness loans are loans of less than $100,000. The report ranks lenders on their overall small business lending, not lending under SBA programs.

The Top 10 Large Institution Small Business Lenders

American Express Bank
Capital One Financial Corporation
Regions Financial
Synovus Financial Corp
First Citizens Bancshares Inc
BB&T Corporation
Zions Bancorporation
GMAC
Fulton Financial Corporation
Compass Bank

The Top 10 Large Institution Microlenders

American Express Bank, FSB
Capital One Financial Corporation
JPMorgan Chase & Co.
GMAC
Citigroup Inc.
Wells Fargo & Company
U.S. Bancorp
Bank Of America Corporation
Regions Financial Corporation
Manufacturers & Traders TC

The study finds that for the year that ended in June 2008, the total value of small business loans outstanding increased 4% and the value of microbusiness loans outstanding was up 6.8%. Both rates were down from the previous one-year period, but still in positive territory. The largest increase was in the number of microbusiness loans (under $100,000), which were up by 15.7%, which may indicate that more loans are being made through business credit cards. The number of mid-sized loans ($100,000 to $1 million) fell by 23.3%.

Small businesses that are looking for loans will find the report useful because it provides state-by-state rankings of banks and other financial institutions on their small business lending. These rankings show who made the most small and microloans in each of the 50 states and the District of Columbia. “In the current financial climate, it’s especially critical for small firms to know which banks and financial institutions have been the most likely to make small and microbusiness loans,” said Advocacy Economist Victoria Williams, coauthor of the study with Senior Economist Charles Ou.

The full study, including expanded state-by-state tables, is available online at
www.sba.gov/advo/research/lending.html.

Exempt or Nonexempt: You Need to Know

charles@gowithabc.com (Charles Cooper) — Thu, 18 Jun 2009 16:41:00 GMT

As anyone who has spent any time in the workforce can tell you, there are exempt employees and nonexempt employees. The big difference between them is the fact that the first does not qualify for overtime while the second does. Most people are familiar with the so-called “white collar” exemptions for executive, administrative and professional employees. These folks are usually salaried, which people associate with exempt employees. However, according to the Fair Labor Standards Act, just having a salary is not enough.

Workweeks and Overtime

To begin with, an employee's workweek is defined as a fixed and regularly recurring period of 168 hours -- seven consecutive 24-hour periods. That means your employee’s workweek may begin at 1:00am on Thursday morning and will continue for the following seven 24-hour periods. It does not need to coincide with the calendar week, but may begin on any day and at any hour of the day and different workweeks may be established for different employees or groups of employees. Also, the averaging of hours over two or more weeks is not permitted. Overtime is calculated for each workweek and overtime pay earned in a particular workweek must be paid on the regular pay day for the pay period in which the wages were earned.

Once you understand the basis of employee overtime pay, you can then look at the exemptions. Yes, the white collar exemptions are important, but so are the exemptions for creative professionals, computer employees, outside salespeople and highly compensated employees. The exemptions do not apply to manual laborers or other “blue collar” workers who perform work involving repetitive operations with their hands, physical skill and energy. Nor do they apply to non-management employees in production, maintenance, construction and similar occupations such as carpenters, electricians, mechanics, plumbers, iron workers, craftsmen, operating engineers, longshoremen, construction workers and laborers no matter how highly paid they might be.

Keep in mind that all of the following tests must be met for that particular exemption to be valid. Miss one and you are liable for overtime.

Executive Exemption

For an employee to qualify for the executive exemption, all of the following conditions must be met:

The employee must be compensated on a salary basis (as defined in the regulations) at a rate not less than $455 per week;
The employee’s primary duty must be managing the enterprise, or managing a customarily recognized department or subdivision of the enterprise;
The employee must customarily and regularly direct the work of at least two or more other full-time employees or their equivalent; and
The employee must have the authority to hire or fire other employees, or the employee’s suggestions and recommendations as to the hiring, firing, advancement, promotion or any other change of status of other employees must be given particular weight.

Administrative Exemption

For an employee to qualify for the administrative exemption, all of the following conditions must be met:

The employee must be compensated on a salary or fee basis (as defined in the regulations) at a rate not less than $455 per week;
The employee’s primary duty must be the performance of office or non-manual work directly related to the management or general business operations of the employer or the employer’s customers; and
The employee’s primary duty includes the exercise of discretion and independent judgment with respect to matters of significance.

Learned Professional and Creative Professional Exemptions

For an employee to qualify for the learned professional exemption, all of the following conditions must be met:

The employee must be compensated on a salary or fee basis (as defined in the regulations) at a rate not less than $455 per week;
The employee’s primary duty must be the performance of work requiring advanced knowledge, defined as work which is predominantly intellectual in character and which includes work requiring the consistent exercise of discretion and judgment;
The advanced knowledge must be in a field of science or learning; and
The advanced knowledge must be customarily acquired by a prolonged course of specialized intellectual instruction.

To qualify for the creative professional employee exemption, the position must meet all of the following conditions:

The employee must be compensated on a salary or fee basis (as defined in the regulations) at a rate not less than $455 per week;
The employee’s primary duty must be the performance of work requiring invention, imagination, originality or talent in a recognized field of artistic or creative endeavor.

Computer Exemption

For an employee to qualify for the computer exemption, the following conditions must be met:

The employee must be compensated either on a salary or fee basis (as defined in the regulations) at a rate not less than $455 per week or, if compensated on an hourly basis, at a rate not less than $27.63 an hour;
The employee must be employed as a computer systems analyst, computer programmer, software engineer or other similarly skilled worker in the computer field performing the duties described below;
The employee’s primary duty must consist of:

The application of systems analysis techniques and procedures, including consulting with users, to determine hardware, software or system functional specifications;
The design, development, documentation, analysis, creation, testing or modification of computer systems or programs, including prototypes, based on and related to user or system design specifications;
The design, documentation, testing, creation or modification of computer programs related to machine operating systems; or
A combination of the aforementioned duties, the performance of which requires the same level of skills.

Outside Sales Exemption

Your outside sales people can qualify for the outside sales exemption, as long as the following conditions are met:

The employee’s primary duty must be making sales (as defined in the FLSA), or obtaining orders or contracts for services or for the use of facilities for which a consideration will be paid by the client or customer; and
The employee must be customarily and regularly engaged away from the employer’s place or places of business.

Highly Compensated Employees

Highly compensated employees performing office or non-manual work and paid total annual compensation of $100,000 or more (which must include at least $455 per week paid on a salary or fee basis) are exempt from the FLSA if they customarily and regularly perform at least one of the duties of an exempt executive, administrative or professional employee identified in the standard tests for exemption.

The FLSA offers a minimum standard. It may not be waived or reduced, but it may be exceeded. Other federal, state or local laws can establish higher minimum wages and overtime rates or reduce the number of hours in a workweek. When the state laws differ from the federal FLSA, you are obligated to comply with the standard that is most protective to your employees. By that same token, as an employer you can make changes as long as you meet or exceed the mandates of the law. Also, entering into a collective bargaining agreement will not eliminate your obligations under the FLSA and nothing in the law will relieve you from your contractual obligations under that collective bargaining agreement.

These are the basics. For additional information, visit http://www.wagehour.dol.gov or call the Department of Labor’s toll-free information and helpline, available 8:00am to 5:00 pm in your time zone, 1-866-4USWAGE (1-866-487-9243).

Small Biz Tip: How to Close a Sale

cheryl@gowithabc.com (Cheryl Sowa) — Thu, 18 Jun 2009 16:36:08 GMT

Tips from June 18, 2009

The Small Business tips today will be how to close a sale.

Recognize the time to close. Distinguish their mood and personality. If the client is stressed, busy, or in a rush, stress the important points and tone down your presentation. If the client is relaxed and willing to talk, go through your presentation thoroughly.
Debrief your prospective client. Restate the benefits to your product or service and what the prospect can expect. Reiterate what you have agreed on and what the client needs to do.
Decide on a closing technique. There are hundreds of ways to close, but the most common is the direct close approach. Once you feel you have gotten over every objection and can fulfill the needs of your prospective client, go for it.
Make a closing statement and ask for their order approval. Include all necessary information the prospect needs to know before making a decision.

Daily Overview: Closing a sale can be a tedious process, but it will be worth it in the end. Follow these steps to ensure a deal.

Taxing Your Way to the Poorhouse

charles@gowithabc.com (Charles Cooper) — Thu, 18 Jun 2009 10:11:34 GMT

Some of the states in the union are getting pretty desperate—or pretty greedy. Like California, which is now finally facing the consequences of its self-imposed high-tax-welfare-state way of doing business, a number of states are seeking to maintain their profligate ways by looking for new taxes to shore-up their sagging revenues in the face of the recession. A quick look at US history will show what a bad policy this is, but the lessons of the past seem lost on this generation of politician. They seem far less concerned with the impact their new taxes will have on the people of their state than on getting their hands on the money. Case in point: North Carolina. According to the Greensboro News & Record:

As part of the effort to bridge that gap, House members broadened the number of items to which state sales tax would apply and have to be collected by retailers. The tax on the category “digital click-throughs” under which the Amazon agreements fall would raise $13.2 million next year, according to estimates by the General Assembly’s fiscal research arm.

So, the North Carolina General Assembly passed a tax on digital click-throughs that would affect Amazon’s affiliates in that state. This is similar to a tax passed in New York. One has to wonder what the legislators were thinking, perhaps that this is easier to slide past the people than a big, obvious income tax hike that would make reelection more difficult, especially during these hard economic times. It did not, however, slide past Amazon. Here is their response, in the form of an email to their North Carolina affiliates:

We regret to inform you that the North Carolina state legislature (the General Assembly) appears ready to enact an unconstitutional tax collection scheme that would leave Amazon.com little choice but to end its relationships with North Carolina-based Associates. You are receiving this e-mail because our records indicate that you are an Amazon Associate and resident of North Carolina .

Please note that this is not an immediate termination notice and you are still a valued participant in the Associates Program. All referral fees earned on qualified traffic will continue to be paid as planned.

But because the new law is drafted to go into effect once enacted – which could happen in the next two weeks – we will have to terminate the participation of all North Carolina residents in the Amazon Associates program on or before that same day. After the termination day, we will no longer pay any referral fees for customers referred to Amazon.com or Endless.com nor will we accept new applications for the Associates program from North Carolina residents.

The unfortunate consequences of this legislation on North Carolina residents like you were explained in detail to key senators and representatives in Raleigh , including the leadership of the Senate, House, and both chambers’ finance committees. Other states, including Maryland , Minnesota , and Tennessee , considered nearly identical schemes, but rejected these proposals largely because of the adverse impact on their states’ residents.

The North Carolina General Assembly’s website is http://www.ncleg.net/, and additional information may be obtained from the Performance Marketing Alliance at http://www.performancemarketingalliance.com/.

We thank you for being part of the Amazon Associates program, and we will apprise you of the General Assembly’s action on this matter.

Sincerely,

Amazon.com

North Carolina imposes taxes, Amazon pulls out of the state to avoid the new taxes. The victims in all this, you guessed it, the affiliates who can no longer do business with Amazon. Now, I am not sure of the constitutionality of the taxes, though taxing the click-through and then the income derived from the click-through does smack of double taxation, there is a larger issue here.

We have learned in the past—and that lesson is being reinforced today—that the more government taxes, the more damage it does to the economy as a whole. Productivity tends to drop, fewer people have jobs and prosperity suffers. Moreover, those who can pull-up stakes and move to more tax-friendly places do so. That goes for individuals and companies like Amazon; it has always happened that way and it is happening today. When votes at the ballot box don’t seem to make a difference, people will vote with their feet.

Governments, like people, have two choices: They can either live within their means or they can go into debt. Unfortunately, in an effort to pander to the various pressure groups, constituencies, contributors and anyone else they can milk for money or votes, they are far more likely to go into debt than remain fiscally responsible. In other words, they game the system for their own benefit.

Illinois Governor Pat Quinn, who is championing a 60% income tax increase, is a prime example. During a recent radio interview on WLS, he was pressed to name a single state program that can be cut. He could not—or would not—do it. According to the Governor, there was nothing left to cut, but if something had to go, it would be police and medical services. In other words, give me the money or I will make cuts in two of the most important things to Illinois voters.

Pat Quinn, New York Governor Patterson, Nancy Pelosi, Barney Frank, President Obama—yes, even George W. Bush; what they don’t understand is that our governments—all of them—are simply too big, they are doing things now that they were never meant to do—and for the most part they are doing them badly—and that the cost associated with them has become prohibitive. It is long-past time for the people to take stock of their government and demand that it stop trying to be everything to everyone.

The Bottom Line

When we read in the Constitution that the role of government is to “promote the general welfare” that does not mean the creation of a ponderous, tax-heavy welfare state. It means that the government should foster individual prosperity through policies that promote business and commerce. It means that government acts as a referee, not a participant—except in those specific areas where the Constitution gives it authority—and that it stands back from the lives of the people.

We don’t have that now, we lost it years ago, but it is time to find it again. We cannot afford government growth spurred by political pandering at taxpayer expense. Amazon’s departure from North Carolina is a great example of that. Instead of looking for more ways to dip into the pockets of the taxpayers, the General Assembly should have come up with ways to spur business growth and prosperity. As Reagan’s tax cuts back in the 1980s demonstrated, the more money people get to keep, the more business and the economy are stimulated, the more taxes are paid. It may not be “progressive” but it is the perfect formula for increasing tax revenues.

Small Biz Tip: How to Grab a Prospective Client’s Attention

cheryl@gowithabc.com (Cheryl Sowa) — Wed, 17 Jun 2009 15:13:19 GMT

Tips from June 17, 2009

The Small Business tips today will be how a sales team can grab a prospective client’s attention to lead to a successful sale.

Set limits on how much you talk. On average, 60 seconds is the maximum to talk about yourself or your business. Engage the prospective client to signal the next time you can speak so you avoid rambling.
Ask open-ended questions to enable dialoguing with your prospective client. Prompt them with questions that cannot be answered with a yes or no question. Begin with what, where, when, why, or how.
Do not manipulate, lead, or control your prospective client. Encourage the other party to reveal their opinions about your product or service.
Build rapport. Being kind and courteous goes a long way and you will gain the trust of your potential client. An individual who can trust a salesperson is more willing to do business with them.

Daily Overview: Gaining the attention of a prospective client is the first step in completing a successful sale. Set limits on talking to engage your client and build trust to seal the deal.

Sometimes You Just Need to Apologize and Make it Right

charles@gowithabc.com (Charles Cooper) — Wed, 17 Jun 2009 13:07:54 GMT

General George S. Patton said it best: I don't measure a man's success by how high he climbs but how high he bounces when he hits bottom. In other words, everyone fails. It happens. The real measure of who you are is what you do to recover when you fail. Patton applied that rationale to his soldiers, but in the world of business, especially service businesses, it also applies.

I know of a destination management company (DMC) that just lost a very lucrative client and they did it by forgetting that the real measure of a business is what they do after the mistake is made, after the damage is done.

In the field of destination management, when things go bad, they tend to go bad in an obvious and embarrassing way for the client. After all, they have put their image—personally and professionally—in the hands of the DMC and when there is a failure, it is the client that takes the hit and not the DMC they hired. Here is what happened:

The DMC was contracted to manage a corporate event for the client’s outside sales team. As part of that contract, they were to have a bus waiting at 4:00pm at a suburban Chicago hotel. The bus was then to take the assembled outside salespeople downtown to Chicago’s Navy Pier, a journey of about an hour. These arrangements were confirmed by the client in writing the day before and again by phone that morning. There was no miscommunication, yet at 4:00pm the tour bus was waiting at Navy Pier, instead of picking up the salespeople for the trip to Navy Pier.

The destination management company had just experienced an epic failure and the client, who was left looking rather foolish, was furious. This was the time for the DMC to; as Patton put it, bounce. There were a number of different ways they could go to deal with the issue. They could have A) worked to resolve the issue as quickly as possible and with as little trouble to the already troubled client as possible, or B) insult said troubled client with a flurry of profanity, angrily lecture them on how they are human and make mistakes as well, offer to buy a couple of drinks while the people wait and then hanging-up on them.

Which choice do you think our DMC made? Here’s a hint: They showed very little bounce.

No, rather than bounce, our DMC went with Option B, preferring to slither in an altogether terrible and viscous fashion along the gutter of pathetic business practice as they left their client shaking with outrage, finally oozing into a fetid sewer where mediocrity is something sorely to be yearned for.

To recap: they swore at the client, told her off, threw a token offer at her and hung up on her. That is a recipe for losing business, which is precisely what happened. They did pay for the drink tab at the hotel while the passengers waited their 90 minutes for the pick-up. I’ll give them that, but the apology they sent via email had their client a bit puzzled. (The names have been removed to protect all those involved.)

Thank you, and again I am so sorry about last night, this [the bar tab] will be credited to you today.

And for your other service, I have made it crystal that your service is to be onsite no less that 15 min prior to the scheduled pick up time. And I will follow up with the drivers to see that this happens.

That second part would be comforting, indeed, were it not for the unfortunate fact that there was no other service contracted. This was a one-day event. Didn’t the company know that, and what does it say about them that after failing with the bus, they thought that there was more to the contract? Nothing good, I imagine. In fact, somehow the word “chaos” comes to mind.

The Bottom Line

Gross disorganization in the office of the destination management company is probably at the bottom of all of this mess. Orders get lost, emails go unread, people forget things, the busier the office, the more likely things are to slip through the cracks. It’s normal, it’s human, and it is also utterly irrelevant. To the client, all of that adds up to excuses. With any customer, you are responsible for their experience with your firm, but when you take the image and reputation of your client in your hands as part of your services, then you are not only responsible for the experience you provide your client, but also the experience your client provides to whoever they are working with. With the DMC in this story, the client was entertaining salespeople, so the damage was not as bad as it might have been. They could have just as easily been entertaining major customers. However, the DMC raised the damage level by taking a high-handed approach to the initial failure and then demonstrated their incompetence when trying to make amends.

Remember, everyone makes mistakes and no one is perfect, including you. The issue is never one of flawless service. That would be nice, but it doesn’t exist. The issue is what you do when things go bad. Do you turn inward, circling the wagons and defending your mistake, or do you reach out to your customer and work hard to resolve the issue quickly and effectively? Do you bounce or do you slither? The choice is yours.

ARC Loans Now Available

charles@gowithabc.com (Charles Cooper) — Wed, 17 Jun 2009 08:05:31 GMT

The Small Business Administration is accepting loan applications for a temporary new program called America’s Recovery Capital. These “ARC” loans, which go up to $35,000, are designed to provide a “bridge” for viable small businesses with immediate financial hardship – to keep their doors open until they get back on track. “These ARC loans are another tool in the SBA toolkit which will provide critical support to small businesses struggling to make it through these tough economic times,” said Administrator Karen G. Mills.

ARC loans are deferred-payment loans made by commercial lenders to established, viable, for-profit small businesses that need short-term help to make their principal and interest payments on existing and qualifying business debt. While the ARC loans are not made by the SBA directly, they are 100% guaranteed by the SBA and have no SBA fees associated with them.

These loans will be disbursed over a period of up to six months and will provide funds to be used for payments of principal and interest for existing, qualifying small business debt including mortgages, term and revolving lines of credit, capital leases, credit card obligations and notes payable to vendors, suppliers and utilities. The SBA will pay the interest on ARC loans to the lenders at the variable rate of Prime plus 2%. Repayment will not begin until 12 months after the final disbursement. After the 12-month deferral period, borrowers will pay back the loan principal over a period of five years.

For more information on ARC loans, as well as all of the other SBA programs for small business, visit www.sba.gov or call the SBA Answer Desk at 1-800-U-ASK-SBA or TDD 704-344-6640.

Small Biz Tip: How to Make a Successful Sales Call

cheryl@gowithabc.com (Cheryl Sowa) — Tue, 16 Jun 2009 16:02:22 GMT

Tips from June 16, 2009

The Small Business tips today will be steps in order to make a successful sales call.

Use a professional greeting and introduce yourself and your company. Let the other party participate in the greeting. Be general and keep your prospect curious by not introducing the product right away.
Express gratitude when informing the prospect the reason for your call. Don’t waste any of their time, and show appreciation towards the prospect. Give the purpose of the call in the form of a question, and sell what your product can do for them and not just the product itself.
Set up a second meeting to give a full presentation. If your prospect wants to discuss your product right then and there, do so. If not, set up a meeting at a future date and give two specific times for them to choose to put you in control.
Thank your prospect for their time and give your contact information. If a second meeting is planned, follow up with a confirmation via email or phone.

Daily Overview: Be professional, courteous, and informative during a sales call to ensure attention and consideration from your prospect.

Small Biz Tip: Supporting Your Sales Staff

cheryl@gowithabc.com (Cheryl Sowa) — Mon, 15 Jun 2009 17:18:35 GMT

Small Biz Tip: How to Support Your Sales Staff

Tips from June 15, 2009

The Small Business tips today will be about supporting your sales staff.

Reiterate your company’s products and services to the sales representatives. Keep your sales team up to date in every single way to help potential customers.
Develop an annual sales plan. Include sales and profit goals, as well as plans for the future to increase sales to new customers. Implement the plan, and make changes to it as necessary.
Offer incentives for your sales representatives. Giving the top seller days off or allowing them to leave early will boost productivity and encourage record breaking sales.
Support your sales team when they lose a sale. Instead of watching them be frustrated, help them channel their energy into making their next sale successful.

Daily Overview: Support your sales staff. They are the driving force behind making your product or service available to the world.

Get Ready for the Pay Czar

charles@gowithabc.com (Charles Cooper) — Thu, 11 Jun 2009 16:49:03 GMT

The Associated Press story put it in stark, clear terms: Democrats on the House Financial Services Committee said Thursday the administration's efforts to hector the private sector into reining in executive pay might not go far enough.

Now, this is after naming a Special Master for Compensation to make sure that the pay and bonuses of executives for companies that needed to be bailed out is not over the top. As I mentioned in a previous article, this is a fine, populist move, but hardly an economically practical one unless the entire playing field is leveled by across-the-board wage controls. Now, as if fulfilling a prophecy, we have this: [Congressional] Democrats and administration officials agreed that companies across the private sector need to adjust compensation practices to avoid damaging the economy.

Right now, they are talking about ways to have the shareholders of these companies make the decisions about executive pay, and if it goes no further than that, they might be on to something. After all, the executives—right up to and including the CEO—are just employees. Sure, they make lots more money than anyone else in the company and they have all sorts of perks, but they are employees all the same. The shareholders are the owners. They ought to have a very strong voice when it comes to determining the pay of their company’s executives.

There was another idea worth considering, new administration guidelines that call on all publicly held companies to link compensation to long-term performance rather than short-term gains. "We believe that compensation practices must be better aligned with long-term value and prudent risk management at all firms, and not just for the financial services industry," said Gene Sperling, a counselor to Treasury Secretary Timothy Geithner.

Two great ideas, but that is really not the point. Executive pay did not damage the economy regardless of what Obama and his Congressional minions claim. The damage to the economy came from short-sighted but socially laudable programs that put people into mortgages they could not afford on the mistaken idea that the real estate boom would last indefinitely. It was further exacerbated by poor government oversight and an abandonment of the regulations that ensured fiscal safety and stability from the Great Depression onwards. These were political decisions made by politicians pressed by lobbyists from the financial sector and made for political purposes and personal gain. Sure, executives made a lot of money, and they made decisions that would guarantee even more, but it was not their pay that was at the center of the problem, it was the environment created by Washington politicians of both parties that opened the door to the abuses we now have to clean up.

Capping the compensation for executives in firms that received bailout money makes sense. The tax payers are part owners of these companies and so they ought to have a say in the pay and bonuses of the executives. That, by itself, should be enough to keep any company from taking any government money at all. However, this notion that the executive pay for all firms across the private sector should be subject to controls for the good of the economy is ludicrous.

Executive pay regulation is just another in a string of political decisions that have little to do with helping the ailing economy but everything to do with furthering the political ends of the American Left. It is really little more than a ham-handed populist tactic designed to garner support among an increasingly unhappy citizenry for Obama’s big government policies, a way for him and legislators like Barney Frank to be able to identify with the proverbial “little guy.” Of course, Obama and company will argue that they are doing the Lord’s work and that everyone has to sacrifice. All he wants to do is narrow the gap between the workers and the executives and since he can’t raise the workers up, he will push the executives down.

So, to recap, corporate greed as typified by high executive pay—not a long string of harebrain political decisions—damaged the economy. Lowering that pay across the private sector is good because it will A) Save the economy; and B) Narrow the gap between the executives and the janitors. Well, if all that is true and righteous, then there should be no problem whatsoever in following the advice of the Workforce Fairness Institute: Apply the same caps to the executives of the labor unions. In a story by Amanda Carpenter for The Washington Times, we learn that a 2008 Hudson Institute study that suggests unions have short-changed benefits for their rank and file in favor or generous executive compensation packages and to pad the coffers of their political allies, who are mostly Democrats.

According to the study cited in the article, the 21 largest unions’ pension plans had less than 70% of the funding needed to meet their obligations, and none were fully funded. Seven were less than 65% funded. Yet, in spite of this, 23 officer and staff funds from the same unions were 88.2% funded. Seven were fully funded plans and another 13 were at least 80% funded. Isn’t this the same sort of financial malfeasance and gross underperformance that has corporate executives under attack? Where is the outrage in Washington over how the “little guy” is being cheated by the “fat cats”?

The Bottom Line

It is not there, union bosses are above reproach these days since no one in the current government is going to go after their benefactors in the labor movement. This is more than mere politics; however, it is damning proof that the executive pay cap issue is nothing more than an unconstitutional ploy to win some votes and initiate some of the Left’s long sought after social change by vilifying a certain group of people in the finest Saul Alinsky tradition. Seeing that this is a recipe for disaster, Representative Tom Price of Georgia, chairman of the Republican Study Committee, summed it up perfectly: "The president cannot continue his heavy-handed meddling in the private sector and expect it to function, much less flourish."

Stimulus Scams Continue

charles@gowithabc.com (Charles Cooper) — Tue, 09 Jun 2009 15:06:39 GMT

I just got a call, on my cell phone no less, telling me that I am required to visit a certain website to apply for my share of economic stimulus funds that will soon be available in my area. Needless to say I didn’t bother, it was an obvious scam, but with all those autodialers at the disposal of these criminals and hucksters, it occurred to me that calls like that are going out to hundreds of thousands, if not millions of people and enough of them are gullible enough to take the bait. Then I read this on BusinessWeek.com:

My sons own and operate an architectural/engineering firm and a steel fabrication firm. These are Main Street firms, needing operating capital. What department of the stimulus package do they apply to for a loan?

The answer went through how this person’s sons can apply for SBA loans backed by stimulus funds and then went on to talk about the fraud arising from the stimulus program, saying in part that:

Hundreds of complaints have poured in to the BBB in the weeks since the stimulus package was passed, she says, most of them from people who responded to Internet ads leading to websites featuring "testimonials" from individuals claiming they got government money to start businesses or pay off bills. For a fee, many of the website pitches say, they'll send you a CD or a mail-order kit explaining how to have access to government stimulus money.

That sounds awfully similar to my phone call. What these places are selling is, essentially, free information. You don’t have to pay to learn about government grants or SBA loans, unless you sign-up with one of these outfits. What they are gathering is your identification and details about your finances and we know all too well what unscrupulous frauds like to do with that information.

What gets me, other than having to pay airtime to listen to some conman’s spiel, is how desperate we are today that the idea of Washington cutting us all stimulus checks is even something anyone would consider. Step back for a moment and think about this: When was the last time the federal government actually handed out money? The Bush Stimulus, right. Now, how much wailing and gnashing of teeth accompanied that thoughtful but largely impotent gesture? Right again, lots. It was all over the media and in the corridors of power—it’ll work, it will fail, too much, not enough—and the debate was loud and generally danced around the real issues: that people could decide what to spend their own money on and that it was really the people’s money that was being returned. As it turned out, the people like keeping more of their money and with it they will do what is in their own best interests. This was not good news for the Washington elite, so let’s not expect that experiment to be repeated anytime soon.

Of course, we have heard a lot of loud debate since Election Day, it is true, and the issues—the people keeping their money and doing what is in their own best interests—are the same as well. The difference is that this time the focus is on government and government action, not on the actions of individuals. Today, the economic stimulus is being allowed to trickle down to the people in the form of a generous $8 tax cut that may or may not last the year, payments for work on the so-called “shovel ready” projects, government programs of all sorts and funds to back business lending.

The Bottom Line

The lesson in all this is that if someone offers you something for nothing, offers to deliver free government money to you to ease your problems and make you and yours prosperous again, they are lying to you.

To get your hands on some stimulus money, you have to actually be part of something the government wants to fund. If you are not, then your only hope is an SBA loan. You can work for it, or you can borrow it. What you cannot expect to do is hold your hand out and receive it.

Announcement: Kim Fenolio Guest Expert on Twitter Dos and Donts Discussion

kim@gowithabc.com (Kim Fenolio) — Tue, 09 Jun 2009 12:04:02 GMT

Every Tuesday night from 7-8 pm Central time there’s a small business chat that occurs on Twitter. This chat is hosted by John and Chrisanne Sternal from Understanding Marketing. They host discussions and introduce experts for both online and offline marketing.

They’ve asked me to be the guest expert tonight. I’ll be answering questions about how to use Twitter the right way for business. I’ll cover DOs and DON’Ts on how to get and keep followers, get attention, make some money in the process and whatever else you want to talk about.

To follow this chat, just be on Twitter and watch for the hashtag of #smbiz. You can keep updated via Twitter Search or by using TweetGrid. TweetGrid actually makes group chats on Twitter incredibly simple to follow and participate in.

I hope to see you there! Bring some questions, challenges or just come to soak up the knowledge.

Small Biz Tip: New Employee Orientation

cheryl@gowithabc.com (Cheryl Sowa) — Tue, 09 Jun 2009 09:08:35 GMT

Tips from June 9, 2009

The Small Business tips today will be about ways to orient new employees on their first day of the job.

Utilize your time with the new employees by putting yourself in their shoes. Think about what questions you would have for a new employer, and be ready with the answers
Establish the company culture with the new employees. Educate them on your company’s policies, rules, company background, goals, and environment.
Introduce your new employees to co-workers and give them a tour of your office. This will allow them to have a chance to establish familiarity with their new surroundings.
Give the new employees time to let everything sink in on the first day. Bombarding them with too much information will leave your new employees overwhelmed and anxious.

Daily Overview: Orientation is vital to ensure all new employees have the information and resources they need to start at a new company on the right foot.

Do We Really Need a Compensation Czar? Or Maybe a Different Kind of Czar?

charles@gowithabc.com (Charles Cooper) — Fri, 05 Jun 2009 16:26:06 GMT

Deborah Solomon at The Wall Street Journal reports that:

The Obama administration plans to appoint a "Special Master for Compensation" to ensure that companies receiving federal bailout funds are abiding by executive-pay guidelines, according to people familiar with the matter.

Talk about a wonderful example of having to play the King's tune when you take the King's shilling. This is the executive pay czar that the administration has been talking about ever since they seized upon the outrage over executive compensation and turned it into a populist cause. The czar will make sure that executive compensation for companies who have taken—or will take—falls within the guidelines developed by President Obama. These guidelines include limiting salary for top executives and requiring that additional pay be in the form of restricted stock, vesting only after the company repays its debt, with interest, to the government. Congress added even tougher rules on bonuses for top earners at companies receiving TARP money, barring them from paying those executives bonuses that exceed a third of their total compensation. Throw in the administration's efforts to change the way the financial sector pays its employees—to keep them from paying people in a way that would threaten the safety and soundness of the bank—and you can see that Mr. Kenneth Feinberg, the man likely to get the job, will have his hands full.

From a political point of view, this is a slam dunk. The people are outraged at the huge sums of money these people made while their firms, overloaded with bad debt and crippled by questionable mark-to-market accounting regulations, went under. Obama comes in, judiciously saves some, lets others go to the wall, and demands accountability, transparancy and even a dose of humility from these former masters of the universe. He will end this terrible injustice and the people will see his efforts and love him for it.

The problem is that politics is not business and rarely reflects anything even remotely like the real world. It certainly does little, if anything, to help business or the economy. In this case, companies that cannot pay the big bucks are not likely to get the big talent, which will impede their ability to compete. That may be why Obama wants to revamp the entire pay system for the financial industry. By leveling the playing field, the temptation to find greener pastures will drop dramatically.

The real question, though, is whether we need a “Special Master for Compensation” (will people be walking around calling him “Master” all day?) or some other kind of czar. After all, czars get appointed to sort out things that have gone horribly awry, right? There is a problem with the auto industry, for example, and we get a car czar. We also get a controlling interest in General Motors and Chrysler to go along with that. Well, there is a harrowing problem in this country and it is getting worse by the day. I speak, of course, about the economy. Former Clinton advisor Dick Morris summed-up the current economic situation and Obama's response to it as follows:

In April, personal household, inflation-adjusted income rose by $122 billion. Of that increase, one-third or $44 billion came from the government’s stimulus program. But while personal income was rising, household savings (which includes paying down credit card balances, mortgages, student loans, car loans, etc) rose by $132 billion — $10 billion more than the rise in income. So personal consumption dropped 0.1%.

The stimulus package was a total and complete failure. As predicted, as happened with Bush’s 2008 tax cut, as happened with the Japanese stimulus packages of the 90s, fearful consumers sat on their money and wouldn’t spend it. Keynesian economics didn’t work. Again.

But the debt sure piled up. The deficit quadrupled and is sending interest rates soaring as the government elbows aside businesses and consumers at the loan window, all in a desperate effort to borrow enough money to spend enough money to stimulate the economy which isn’t happening.

Keynesian economics doesn’t work. The theory for rational expectations has taken its place. Consumers are not idiots. They know that when their paycheck is fatter - either because of tax cuts or government spending - that it is not the beginning of nirvana but just a short term, one shot respite from hard times. They know the difference between standing in front on an electric fan and a windy day.

Barack Obama has fatally undermined our currency, our solvency, our financial stability, and - ultimately - our economy all to spend money that has had no economic effect!

When folks from your own party are looking at your policies and seeing nothing but scortched earth, it is time to rethink things. The problem is, that rethinking will not happen. Obama has turned to policies that have been tried—and have failed miserably—time and again because free-market capitalism does not fit well with his left-wing ideology. More than that, these policies have taken a recession, which would have naturally eased by now, and are making it worse and more long-lasting. Last time this happened, it was set into motion by Franklin Delano Roosevelt and it took World War II to stop it.

The Bottom Line

By the President's own logic, the executives are out of control and the business—in this case the Federal Government—is on a sure road to ruin. More than that, it will destroy the US economy in the bargain! If we apply the remedy that Obama is pushing on the private sector, then it is time to appoint a Government Czar, to sort things out and make changes so the government is run correctly and the economy is saved. A noted business leader, an entrepreneur with a track record of sound, real world, financial success—someone who knows how to make a profit—who can bring that experience to bear on the economic problems we face.

I know that such a Czar would not be ideologically palatable to Obama, Pelosi and the rest, but I really have to wonder: Would the Government Czar decide to fire Obama and the other leaders who brought us to this ruinous point? That may be why they would never appoint one.