Can a Gas Tax Fuel Clean Energy Innovation? |  |
- Can a Gas Tax Fuel Clean Energy Innovation?
- What Job Are You Helping Your Customers Do?
- Small Business Loans and Small Loans to Business
- As U.S. Small Biz Week Arrives, Are You Stressed or Optimistic?
| Can a Gas Tax Fuel Clean Energy Innovation? Posted: 21 May 2012 11:30 AM PDT With gas prices already reaching nearing $4 per gallon in many places, most business owners don't relish the idea of them rising even further. Yet, some people are still calling for the government to deliberately increase them – by raising the gas tax.
Scott Burgess, senior editor of AOL Autos, recently argued that a gas tax of $1 per gallon could help the U.S. government shore up its dismal balance sheet. Burgess cites a Congressional Budget Office report that came to the conclusion that more strict fuel efficiency standards will reduce gasoline consumption enough that the U.S. government will lose billions of dollars a year in tax revenue. Add to the mix the fact that the 18.4-cents-per-gallon federal gasoline tax has risen since 1993 and it's no longer enough to cover the transportation infrastructure improvements it's supposed to fund. That said, many small business advocacy groups, including the National Federal of Independent Business, are adamantly against raising taxes that directly hit small businesses, including the gas tax. A March survey by the Small Business and Entrepreneurship Council found that 72% of small business respondents said higher gas prices were already affecting their business. And stories abound in local media of businesses being pinched by surging gas prices. (The U.S. Chamber of Commerce, somewhat surprisingly, has supported a modest increase in the gas tax in recent years order to improve U.S. infrastructure and lower the federal deficit.) Tax and deficit issues aside, there's another reason for business owners to think about the gas tax: Higher gas prices may help encourage clean energy innovation and support environmentally sustainable behaviors among business owners and consumers – such as the purchase and development of eco-friendlier vehicles and driving less. While it may raise business costs, it may spur business owners think about how to reduce their gas usage and be more sustainable. Christopher Knittel, an energy economics professor at MIT, has studied how gas prices affect behaviors. He and researchers from Northwestern University found that a $1 increase in prices between 1998 and 2008 led people to buy 21% more fuel-efficient vehicles. (Not surprisingly, the CEO of General Motors has come out in support of a gas tax increase.) Knittel also found that less driving led to less local air pollution and related health problems. So, what's your view on raising the gas tax? Would it be a step in the right direction for the U.S.? Or is it just bad for business?
From Small Business Trends |
| What Job Are You Helping Your Customers Do? Posted: 21 May 2012 08:30 AM PDT Marketing is often described in terms of a product life cycle. The development, the launch, continued support, and finally, discontinuation all have specific marketing efforts associated with them. From social contests to reduced prices and giveaways, the emphasis is nearly always on the product or service provided. However, this does not take into account the way that customers actually search for and find products.
Consider the last time you purchased something. Every so often, aesthetics or "wow-factors" play a role in the purchase, but not usually. Most people buy something because they have a need, or job, to be done. No one goes out and buys business software because they like filling in little squares with information; they do so to keep track of where, why and how their business is operating. They don't pony up cash for consultants because they are lonely and want someone to talk to; they do so because they require assistance with a problem. Recognizing the impetus that ultimately draws consumers to your product or service will greatly enhance your marketing and sales success. Instead of focusing on what your product brings to the table, you can focus on the pain points that drive customers to your product. If the marketing for a product speaks directly to a customer need, they are much more likely to buy. This is extremely powerful, and we all know this to be true. For instance, when you see an ad for an accounting program, you don't care that it was developed with the latest in programming techniques, you just want it to accurately deal with financials and help you run your business more smoothly. So how do you figure out what needs your product speaks to? If you have been in business for a little while and have delivered a product to the market, try to spark a dialogue and ask customers why they bought the product. If you are new to the market, think about what prompted the creation of the product in the first place (products and services are often born because someone had a problem and found no viable market solution available). Then ask yourself, how often do I have the problems that the product addresses? Remember this simple truth: consumers buy products to complete jobs that need to be accomplished. I had the opportunity to speak with Clayton Christensen recently, Professor of Business Administration at the Harvard Business School and founder of Innosight Institute, a non-profit think tank. We chatted about two of his newest books, Disrupting Class and The Innovator's Prescription. "We all have jobs in our lives that we must get done. We reach out and bring products into our lives to get these jobs done," said Christensen. "Marketing is all about asking, 'What job is the customer trying to accomplish?'" By shifting the focus to the job that needs to be completed, a product's life cycle becomes insignificant. "Most marketers think there's a concept called a product life cycle. Once you realize that the world is organized by jobs that need to be done, you understand that product life cycles don't exist." Pull out your pencils because here's your formula: Always test your approach. You could be speaking to the wrong issues. Make sure you focus on the value of your product, not the features. Customers will respond more positively, and it will be much easier to sell. Go forth and sell!
From Small Business Trends |
| Small Business Loans and Small Loans to Business Posted: 21 May 2012 05:30 AM PDT A few weeks ago, I wrote about the decline in “small loans to business” during the Great Recession and economic recovery that followed. Now I am back to tell you that data on “small business loans” paints an even worse picture of the small business credit markets. No, this is not a semantics test. “Small business loans” and “small loans to business” measure different things. The more popular "small loans to businesses," reported recently by the Small Business Administration, uses data from the Federal Deposit Insurance Corporation Call Reports to track loans of less than $1 million, regardless of the size of the borrowers. The less popular "small business loans," produced by the Federal Financial Institutions Examination Council (FFIEC), uses information gathered from the banks under the Community Reinvestment Act to measure loans of any size to companies with $1 million or less in revenue. The statistics on "small business loans" may provide a more accurate picture of the small business credit market than the "small loans to business" figures because big businesses can obtain loans of less than $1 million. The number of bank loans to small businesses dropped a whopping 68 percent between 2007 and 2010, and the dollar value of the loans declined 55 percent in inflation-adjusted terms. These drops are much larger than the 9 percent decline in the number of small loans to business and the 10 percent slide in the the real value of those loans observed over the same period. Like the small loans to business numbers, however, the small business loan numbers show that the fall in lending to small companies didn't just occur during the downturn but continued into the recovery that followed. From 2009 to 2010, bank loans to small businesses fell by 32 percent, and the dollar value of the loans declined 11 percent in inflation-adjusted terms. The recent decline in small business lending more than offsets the expansion that occurred in the years prior to the downturn. As the figure below shows, the number of loans made to businesses with less than $1 million in sales increased 70 percent between 2005 and 2007. (That is much faster than the rise in the number of companies with sales of less than $1 million, which IRS data show only increased 7.4 percent between 2005 and 2007.) But even after accounting for a correction for this period of easy lending, bank loans to small businesses have contracted severely. In 2010, the number of loans was at 54 percent, and the real dollar value of the loans was at 48 percent, of 2005 levels.
From Small Business Trends |
| As U.S. Small Biz Week Arrives, Are You Stressed or Optimistic? Posted: 21 May 2012 02:30 AM PDT With the arrival of National Small Business Week here in the U.S., a variety of events, beginning yesterday, have been scheduled in Washington D.C. and across the country to recognize the importance of small business to the U.S. economy and to address topics important to small business owners. Just in time, a semi-annual study of American small businesses shows those business owners to be stressed but optimistic. Check out the schedule of national events and hear what leaders and small business owners are saying about issues most important to small business today. Special Week for Small BusinessObama holds small business roundtable. Ahead of this week’s small business events, the President called a round table proposing a 20% tax credit for businesses returning overseas jobs to the U.S., a 10% income tax credit for creating new jobs or increasing wages in 2012, and to extend 100% expensing for all businesses throughout year’s end. Fox Small Business Center Small firms in the U.S. are 28 million strong. That’s the figure used by Karen Mills, administrator of the U.S. Small Business Administration in her blog kicking off National Small Business Week on Sunday. Check out the full post for a list of events during the week of interest to small business owners. SBA.gov Are Your Stressed or Optimistic?Owners stressed but optimistic. Released just in time for this week’s event, an inaugural semi-annual Small Business Owner Report from Bank of America looks at the concerns, aspirations and perspectives of small business owners. It suggests small businesses cause owners three times as much stress as raising a child but more than half remain optimistic about their business’s future. Yahoo! Finance Thinking About SMBsWhat you need to know about Washington. As credit unions push for permission to increase the financing they are permitted to offer small business owners, Credit Union National Association CEO Bill Cheney wants to share some information he feels small business owners ought to know about their government and about what is necessary for a climate more supportive of small businesses. Huffington Post The smallest of the small matter too. When looking at the companies that are most important during National Small Business Week, it’s important to remember the huge impact of some of America’s smallest businesses. Consider, suggests columnist Rhonda Abrams, that today 27 million are employed by companies with fewer than 20 employees. USA Today Self-Development TipsWhy entrepreneurs can’t afford a victim mentality. An important tip for small business owners when dealing with stress, is to avoid a victim mentality. Don’t focus on your set backs. Instead, blogger Martin Zwilling of Startup Professionals Inc. suggests steps for overcoming obstacles with optimism and a sense of purpose. Startup Professionals Musings A guide to handling unhappiness during stressful times. Stress created by business pressures is perfectly understandable, but the solution to remove some of that stress and return to a happy state may be easier than you think, writes blogger Amanda DiSilvestro. She suggests three simple steps designed to help anyone return to a better sense of balance. Self-Help Happiness Blog Bids for a Better MarketIt’s time to find your customers. One of the issues likely to be discussed often during National Small Business Week is the tough economy, something all small businesses are facing. But in this post, Tom Ewer suggests entrepreneurs can’t wait for customers to come to them. MyWifeQuitHerJob.com How small businesses can conquer the world. While small to medium sized firms face their share of problems, they also enjoy a number of opportunities. The days when competing on a global level was limited to big corporations are gone, says blogger Adam Gottlieb. Researching the challenges facing you when entering a foreign market is an important first step. The Frugal Entrepreneur Fostering a culture of creativity. Keeping your company creative is one way to avoid stress and boost optimism. Some of the ways to build a creative culture at your company include team diversity, true encouragement of new ideas from management, and a supportive environment. These elements can help your business not only survive but thrive. Small Business Bonfire From Small Business Trends |
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