Small Auto Suppliers Struggle to Stay Afloat. The New York Times goes to Michigan this morning and digs into the issue of what happens to the companies that supply parts, tools, and services to GM and Chrysler. In short, it's bad. Suppliers employ more people than the car companies, and the article quotes an industry representative who says that 500 of the 4,000 suppliers could be out of business by the end of the year. Companies have been trying to diversify--going into aerospace work and trying to expand to foreign automakers--but for many it isn't enough. Others are "hibernating," drastically cutting staff and hoping that the market will turn around soon. In an almost-prescient interview in our May issue, Jack Stack touches on this very topic about why every company needs a Plan B.
Get ready for an Internet sales tax. That's the prediction of Business Insider, which says that taxation of internet purchases is inevitable given the massive budget problems in many states. Right now, congress is working on introducing legislation called the Streamlined Sales Tax Project, which would allow states to collect taxes from residents who make purchases in online stores located in other states. (Right now, most people don't pay sales tax online as long as the store they're buying from is located in a different state.) Though the move is sure to upset Internet retailers, who may see one of their key competitive advantages disappear, Business Insider advises holding off on our outrage: "[I]t's regressive to tax physical commerce and not tax electronic commerce, the latter of which is more popular with the affluent. There's no particularly compelling reason to offer a tax-haven to those who are more likely to be shopping online."
Credit card reform slow to reach small businesses. Last month, President Obama signed the credit card reform bill into law relieving U.S. consumers from "skyrocketing credit card debt." Small business owners, however, have yet to receive the same shields, reports the Los Angeles Times. The National Small Business Association reports that 59 percent of small businesses use credit cards as a major source of financing, up 18 percent in the last six months. "More and more small businesses are using credit cards for small business purchases," says Scott Schneider, the Communications Director for the US Senate Committee of Small Business and Entrepreneurship. "If a mom-and-pop Italian restaurant went to buy a cash register for their restaurant, it wouldn't be protected under the [Credit card accountability, responsibility and disclosure] act of 2009." Schneider says the Committee is working to change that. "We are looking for more vehicles to attach legislation to," he adds.
Lifestyles of the rich and entrepreneurial. Forbes takes a look at the more glamorous side of starting your own business in this article about married celebrity entrepreneurs. For example, celebrity chef-turned-entrepreneur Wolfgang Puck's resume is certainly well known, but his wife Gelila has had an equally successful career with her high-end L.A. boutique and a line of handbags. While these celebs probably aren't facing the same business dilemmas most entrepreneurs face, at least you can say you have something in common with Selma Hayek and Jay-Z.
Tim Geithner can't sell his house. For today's dose of schadenfreude: our country's Treasury Secretary hasn't been able to sell his house in Larchmont, New York. He's been renting it, at a loss, for $7,000 a month, since February. And he's already reduced the price to $1.575 million. "As a matter of avoiding conflict of interest, we wonder if Tim Geithner excuses himself from the room everytime the subject of homebuying incentives or mortgage rates comes up," quips The Business Insider
Talk about filling a need in the market. With unemployment numbers at sky-high levels, NicheBoards.com and LatPro.com founder Eric Shannon is right on time with yesterday's launch of his new job site, JustJobs.com. ERE reports that the new offering is a simplified job board more akin to Craigslist than eHarmony. Rather than the comprehensive search-and-collect method other online aggregators follow, JustJobs.com will be "all partner focused," Shannon told ERE. Following Craigslist's philosophy, the service will be free of charge.
Health gurus meet today.Today begins the three-day conference of the American Health Insurance Plan in San Diego. More than 2,000 attendees are expected. The conference should address some of the top concerns of small business owners: cost, access, price transparency, individual responsibility, the role of technology and public plans. CNN reports on how consumers, and your employees, are wondering how the conference's verdict will affect their health coverage.
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