ASBL: SBA Will Start Damage Control

Here is an article By Chris Crum that I found very interesting..

ASBL: SBA Will Start Damage Control

May try to get away with "computer glitches"...

Recently, he American Small Business League (ASBL) won its fourth federal lawsuit against the U.S. Small Business Administration (SBA), and it is making sure that everyone knows about it.

The ASBL is trying to call the SBA's moves before they make them, which should make it interesting to see if they happen as the ASBL paints them.

The ASBL believes that the SBA will initiate a "damage control" campaign, to draw media attention away from potentially incriminating documents that the ASBL believes will reveal that billions of dollars in contracts were awarded to Fortune 500 firms and their subsidiaries rather than small businesses, which should have received them.

The SBA was ordered to comply with the ASBL's Freedom of Information Act request within 2 weeks from May 19th, and this request asks specifically for all of the names of firms that received federal small business contracts in 2005 and 2006.

"This information will be very damaging to the credibility of SBA Administrator Steven Preston and the Bush Administration," says Lloyd Chapman, President of the ASBL. "Why else would they have gone to federal court to withhold what should be harmless figures? I believe this data will prove that the Bush Administration has lied to Congress and the public since 2001 and intentionally diverted billions of dollars in federal small business contracts to Fortune 500 corporations."

"I think they are going to use every trick in the book to withhold this data and divert media attention from the damaging nature of this information," added Chapman. "I wouldn't be surprised if they appealed the case to the Ninth Circuit Court."

Strong words from the ASBL. Not that the bitterness between the two organizations is anything new. For earlier stories on their conflicts, go here.

The ASBL says that since 2002, the SBA has been blaming "computer glitches" and "miscoding" for inflated numbers involving federal contracts and Fortune 500 firms. They suspect that they will edit the numbers in the forthcoming documents to reduce their guilty appearance, and if busted, chalk it up to "computer glitches" yet again.

I'm back

It seems like it's been forever since I have posted, well it's only been 2 weeks. During that time a lot has gone on in my personal life, I've turned 30, I've become the new President of the PTA at my sons school, and entertained out of town visitors for 5 days. Needless to day I just haven't had time to sit down and write a post. Well I 'm back!

Networking the old fashion way

I seem to have forgotten the importance of face to face networking. With all of the business articles and seminars out there focused on web based social networking that I almost forgot about the importance and effectiveness of networking the old fashion way, actual human interaction. I decided that it was time to break away from the computer and venture out in the the world and actually meet some professional in my area.

I was surprised how rewarding it was. In addition to meeting some talented professionals I met some really cool people that I was able to connect on a personal level. Although we may not need each others services right now I felt more inclined to refer a friend to the individuals that I actually met and had a conversation with rather than a name an picture who had some great post on my favorite social networking site and a cool website.

In addition to meeting people you are able to sell yourself. If you are offering a service you know how important it is that you and your clients personalities are compatible. If you are a people person use it to your advantage.

Make sure you take your time to find a networking group that is comfortable for you. There are group out there everyone, some are geared towards nurturing you as an entrepreneur, some a strictly elevator spiels and business card, some require hundreds of dollars in membership dues and some are absolutely free.

I say all of this to say get up from your desk and go mingle with the professional in your area. you may find more than just a contact. For more info on networking events in you are a check out you cities visitor and newcomer site, BNI, and Meetup.

Independent Contractors vs. W-2 Contractors

I was reading one of the many newsletters I an I cam across an article about W-2 contractors. I don't know about you I have never heard of this before. As far as I knew you were either a contractor on an employee, there was nothing in between. Well apparently was wrong...kind of.

W-2 contractors are independent contractors who have their client pay the taxes on their earnings for them but don't receive any of the benefits of being an employee. Besides making sure the government gets their cut off the top, I don't really see the benefit of being (or hiring for that matter) a W-2 contractor versus a traditional independent contractor.

Take a look a this article and decide for yourself.

Succeeding In Your Business: Dealing With The "W-2 Contractor"

Cliff Ennico

"My husband and I have a small business, and there are several people who work with us on a fixed schedule. We are the only company they work with. From previous columns you've written, it's clear that if we are someone's only client and he works almost 1,500 to 1,800 hours for us every year, we should convert them to 'employee' or W-2 status, and start withholding and paying employment taxes. The problem is . . . these people don't want to become employees, because as independent contractors they get to take business expenses as tax write-offs.

"These days I'm hearing a lot about so-called 'W2-Contractors.' As I understand it, these people are still basically independent contractors who get paid depending on the number of hours that they work multiplied by their hourly rate, but the company withholds and pays all federal and state income and employment taxes on their income. They get a W-2 at the end of the year, not a 1099, but they don't get any benefits in the company. Is that a better or less risky way to go than treating them as independent contractors for tax purposes?"

There are few more difficult decisions for a small business owner than determining whether someone who works regularly for you part time is an "employee" or "independent contractor" for tax and legal purposes. Generally, someone cannot be both an independent contractor (or "1099," because that's the IRS form you send contractors at the end of the year) and an employee (or "W-2," because that's the IRS form you send employees at the end of the year) at the same time.

The IRS complicates matters by allowing you -- on a strictly voluntary basis -- to withhold from an independent contractor's paycheck all federal and state income and employment (FICA, FUTA and Medicare) taxes. A number of small businesses have viewed this as a "loophole" in the tax laws allowing them to treat their contractors as "employees" for tax purposes and "contractors" for all other purposes. Hence the name "W2-Contractor" to describe such folks.

But . . . by doing so you don't avoid having to make the fundamental decision of whether a person is your employee or independent contractor. Even if you withhold taxes from a contractor's paycheck, you are still required to treat him or her as a contractor and send out Form 1099 at the end of the year, not Form W-2.

"Wait a minute!," I can hear some of you saying. "If you're withholding taxes from their paychecks, then the government is getting their tax money on time, and in the right amounts. There's no risk that the contractor will play games on their taxes, or fail to make quarterly estimated payments of taxes. Isn't this a case of 'no harm, no foul' where everybody, including the IRS, benefits?"

The short answer is . . . maybe.

Here are two problems with the "W2-Contractor" arrangement that I can think of (there probably are more):

(1) If you and your husband have any sort of pension or retirement plan (such as a 401K plan) for your small business, giving your contractors W-2 forms at the end of the year but not allowing them to participate in your plan may violate the prohibition against discriminatory or "top heavy" plans in the federal Employee Retirement Income Security Act of 1974 ("ERISA"). I'm not an ERISA lawyer and cannot tell you for certain if a "W2-Contractor" arrangement will put your plan in jeopardy, but you should check with one before putting this arrangement in place.

(2) Under the labor laws of many states, you are required to provide a certain minimum level of benefits to your employees that contractors don't qualify for. For example:

-- in most states you are required to provide worker's compensation insurance coverage for employees;

-- in many states you are required to make payments to a state unemployment insurance fund for employees;

-- in a few states you are required to give your employees X days of paid sick or medical emergency leave;

-- in California, you may prohibit an independent contractor from working for a competitor after the contract relationship is ended, but you cannot prohibit an ex-employee from working for a competitor.

Even though a "W2-Contractor" arrangement may technically comply with the IRS rules governing employment taxes, there are lots of other rules out there that require you to distinguish between employees and independent contractors. You will have to speak to an employment or labor attorney in your state to get the full picture.

"W2-Contractor" is a contradiction in terms. Even if you are satisfied that your state does not absolutely prohibit treating your people this way, I wouldn't want to be in your shoes if a disgruntled ex-"contractor" complains that you did not give him required benefits and your state attorney general's office wants to bring a "test case" against your business. Just imagine all the unwanted publicity in your local newspapers . . .

Cliff Ennico (cennico@legalcareer.com) is a syndicated columnist, author and former host of the PBS television series "Money Hunt." This column is no substitute for legal, tax or financial advice, which can be furnished only by a qualified professional licensed in your state.

Copyright 2008 Creators Syndicate Inc.

Social Network Marketing

As a small business owner operating on a shoe string budget I am always looking for new inexpensive ways to market my business. Everywhere I turn there are blogs, forum postings, newsletters and local small business resource seminars dedicated to teaching people like me how to benefit from the networking sites. Since my marketing budget is almost none existent I have put in a lot of time to do it myself. If you're like me here is an article that may help:

Social Media Marketing for Small Business

Are there really opportunities for small business to succeed using social media?

Absolutely, if one factors the strengths and weaknesses of the media with the strengths, weaknesses, and goals of the company.

The reality of the matter is that various social media have different strengths and weaknesses. While it is true the most obvious benefit of social media is branding and traffic, the truth is that social media can also:

• generate lots of good, quality, relevant links, which we all know can help a site perform better in the search results
• help to forge relationships. Not necessarily relationships with potential clients, but with those who help to influence potential client decisions i.e. indirect sales
• generate direct sales
• build a company's authority in an industry

In order for a small business to utilize social media to its fullest, and to determine which social media it should be using as part of its effort, it must understand the trade-offs it faces. Without being able to commit time or money to social media, many small businesses will seriously need to question their commitment to winning in their space in the foreseeable future.

What are the variables to consider:
a. available client time vs. available client $
b. complexity of client product/service information
c. client goals (direct sales, improved positioning, authority building, etc.)

As is the case with search, those social media sites offering the most potential for traffic, also contain the most competition. The more competition there is, the more thought and effort must go into being successful in that medium.

Does that mean that small business should avoid search? Not at all. Same with social media. It just means that small business must assess their desire and means, and find reasonable opportunities where competition is not too intense for their means. Precisely as with search ... though rather than looking for keyword opportunities, you're looking for content and medium opportunities!

For example, would you ever suggest to an SME client that you would try to rank for a generic, ultra-competitive, one-word term such as "weight loss"? Never. Though you may consider "weight loss san diego," right? Precisely!

That said, here are the strengths and weaknesses of several major social media sites, as they relate to small to medium sized businesses:

1. Yahoo Answers:
Yahoo Answers will not require much money to engage in, making it an attractive option for small business. Since in most cases, SMMs (Social Media Marketers) won't/can't play a large role in Yahoo Answers, as they're not experts in the space, it will require client time and expertise.

Yahoo Answers is a great tool for generating direct sales, rather than links or even indirect sales ... an anomaly amongst social media sites.

* Some SMMs may offer Yahoo Answers training solutions, designed to get SMEs up to speed quickly, and teach a few inside tricks. It will also be important to make the system as efficient as possible, so senior-level involvement is not necessary in identifying and answering each question. Instead, relevant questions should first be identified (and answered where a simple answer will suffice) by a junior-level person, then handed to more senior-level people as the questions become more in-depth and technical.

2. Wikipedia:
Wikipedia is another great solution for companies with more time than money. This is often a do-it-yourself solution for companies, though a good SMM can greatly aid with training, planning, and implementation, and can save companies a great deal of time. Securing a presence on relevant pages on Wikipedia isn't necessarily intuitive.

As Wikipedia doesn't like companies adding information about themselves (as it's likely biased), having information added by an experienced SMM with a solid reputation is worth its weight in gold.

Wikipedia is great for generating links (not direct as they are nofollow, but indirect through copied text), but is not exceptional at generating either indirect sales via forged relationships or direct sales.

3. Digg:
Having a submission go hot on Digg is equivalent to ranking on an ultra-competitive keyword on Google, in terms of the number of links generated. Digg is, in reality, the Google of the social media world in terms of those looking to build links, which means Digg itself has had to become very cautious and difficult as a result of being gamed so frequently.

As Digg's algorithm favors larger, more trusted sites, SMEs cannot expect to do well on Digg routinely without a substantial investment of either time and/or money in the effort. The cost of doing so is therefore beyond the means or commitment of many small to medium sized companies.

Beyond its biggest benefit (links), Digg can also be utilized to forge strategic relationships with key influencers such as reporters, DJs, and the like.

4. Reddit:
Reddit is capable of generating significant volumes of links, although somewhat less than Digg. It is like Digg, except on a lesser scale. Though it generates fewer links, the results are greater, given the lesser level of effort required compared to Digg. That said, Reddit still requires a significant time and/or money investment from the client. It still involves a commitment to win!

5. Propeller:
Propeller (formerly Netscape.com) is also like Digg and Reddit, though generating fewer links again. This is in essence what makes it so attractive though ... it's the MSN of the social world. Most companies focus so heavily on Digg, that Propeller is often overlooked. Accordingly, small business can still win on Propeller with reasonable effort.

Time needs be invested in Propeller to determine how the system works, identify the types of posts that are successful, and to forge the necessary friendships to seed posts properly on the Propeller network. SMM Training solutions can again expedite the process, and engaging the services of an experienced quality SMM will trade money for time where time is very limited.

6. Delicious:
Delicious is a good option for small businesses, though it does require a commitment. SMEs need to spend time creating resource, research, and/or instruction type blog posts. These posts take time, often 8-10+ hours of research per post. Special insight into topics that might be successful on Delicious will absolutely be aided by the guidance of an experienced SMM. Otherwise, much time and effort can be spent creating content that really has no chance of being successful.

Posts that do well on Delicious typically attract a good many links, albeit typically less than those on Digg or Reddit, and more than Propeller.

7. StumbleUpon:
StumbleUpon is capable of driving large volumes of traffic (more than Reddit and less than Digg) to a site, given the right content. For whatever reason though, it generates substantially fewer links than either Digg or Reddit on average.

For companies with brand new, innovative products and services, StumbleUpon is a great way to gain exposure and build awareness. It is not however, good at generating direct sales unless the item is an impulse type item.

8. YouTube:
YouTube is unlike any of the other social media mentioned above. While video itself has the ability to generate substantial quantities of links via other social channels, the YouTube medium essentially attracts all links for its own purposes, leaving the video creator with virtually no additional link power.

What YouTube can do when great content is created is attract additional quality search traffic via the search results (YouTube videos are often included in the search results of major engines), and can help to forge relationships with key influencers.

Summary:
In the end, success with any of the above social media sites is still largely based on the quality and creativity of the content. For companies without the time to dedicate to creating such content, it will require a financial investment. In this situation, hiring experienced SMMs skilled in the art of choosing topics is very important, as they can likely aid real quality content be successful on numerous platforms.

This is why I say it takes a commitment to winning. It's going to require either time and/or money from the small business perspective, but success is absolutely achievable, given appropriate amounts of either, and proper selection of media.

Posted by Jeff Quipp at April 29, 2008 10:54 AM