How the US Government Is Holding Small Business Back and Affecting Communities

The US economy has been extremely destructive to the small businesses across the United States. Small businesses employ more people than any other sector of our economy. The government has given loans and help to large companies, without holding them to the same standards that most small business are held to.

Specifically for some of our clients, who have been hard hit. These clients are located in Klamath County Oregon, an area of the country with higher than national average unemployment and economic loss. These companies have lost hundreds of thousands of dollars between 2008 and now. During this time, our company and the owners were not paid and in fact invested hundreds of thousands of dollars to keep the businesses viable and continue to employ almost 100 hundred people.

To make it through this time, our clients found themselves unable to pay the employee withholding taxes in full. However, these companies always filed and communicated their position to the Internal Revenue Service each quarter. Each company had a payment history that showed progress through these tough times and how they prioritized their finances. The companies only paid wages and business critical expenses to keep the doors open which allowed them to continue to employ people, they paid all their obligations, albeit late.

We tried for over a year to get a formal payment agreement with the IRS for our clients, however the attitude of I.R.S. employees was one of disgust and uncaring for our clients or the employees. It took the IRS almost a year to get an agreement in place, and only after hiring a professional tax company to represent the firms, did the IRS allow a payment plan to be approved. Further, despite providing case law, IRS regulations and policy and backup information that showed these clients did not with malice or ill intent, not pay their taxes; the IRS has refused to abate penalties, with the final reason given in writing as; “A lack of funds does not amount to reasonable cause for failure to pay taxes”.

It is this inconsistency with regard to the law, IRS’s own rules and government policy that is currently holding many small businesses back. These companies are now in a position to not only get a loan to pay the tax and interest due the US Government, but also get one to make specific capital improvements and increase their business and employ more people. However, they cannot get the loan to do this without an abatement of the penalties.

It is disheartening to small business owners when they see our government give money to big companies and threaten to violate the same “Trust Fund Rules” by saying Social Security will go unpaid. Why would a government have a policy to ignore and punish those who are willing to fairly compensate the government through interest payments and investment in future business?

Our advice to clients is to refrain from growth without certain funding for all aspects of an expansion or new venture. The US Government has declared Small Business a target, with no apparent understanding of the way small business operates or affects the overall economic viability of our communities.

Our Mothers Recycling Business Back in Iran

Back in Iran and in our childhood there were special men who visited our home town most days of the week.

In those old good days these visits in our quarters had particular purposes. These men had special business offers for our mothers. Women mostly housewives were the customers of these very unique trades. I guess our mothers have many stories of these men who would also enjoy having business with ladies in our quarters. Our fathers did not appreciate these visits mainly because this business offers would mean a financial loss instead of gain for the regular households. Women were enjoying that little unique trade which was an exchange of goods right at the door. Somehow these trades were helping the society in large, it was about recycling goods. If today there are recycling places you take your unwanted clothes or furniture, back then our mothers had the comfort to have things removed by these men.

Namaki or Satlman was one of those men. We used to have various salesmen coming to our neighbourhoods. How can we forget jacket and pants salesman (kasse-boshgabi), vegetable salesman (sabizi forosh), Pond Cleaner (abhouzi), Snow Shower workers (barfparokoni), and blanket sewers (lahafdoz)? How could we forget our garbage men (Asghali)?

These names are only familiar to most of us Iranian whether we have lived in Iran or not. Indeed depending on the neighbourhood and status of the citizens in that area, these services would be more or less appreciated. You could tell that these mobile workers enjoyed their walks in between neighbourhoods. As a child I always wondered whether these types of trades would really pay enough for a living. Would these men be able to buy their children school clothes or school items? The mystery was and still remains, how could these men support their families with this type of jobs? I guess job security was not a concern back then. Other days we would have other mobile salesmen in our quarters.

These salesmen used to come on certain days, mostly on an unwritten and informal schedule. They came one after another in each week day. Our mothers would always be happy to see these men who were willing to take our old clothes and unfit shoes, not mentioning our father’s shirts and suits. These men would instead give our mothers some plates, plastic baskets, or some household items that did not have any material value anyway. The good thing was that a natural recycling business was happening. No one wasted bread, food, and clothes. Indeed no household items used to go to waste, if our mothers did not engage in this exchange many bread would have gone to waste.

Three Biggest Myths That Hold Crafters & Cottage Businesses Back From Being Profitable

There are 3 big myths that hold crafters, designers, and small cottage industries back from stepping up to the plate, realizing their full potential and making a profit. The truth is, all of these myths are centered around fear, doubt and uncertainty. Change is an inevitable part of growth. Take a look at these Myths and see which ones apply to your business:

Myth #1: If I price my products too high people won’t buy them. I keep my prices low to sell more

Truth: You can’t decide what other people will pay for your products. Pricing is an art combining perceived value, workmanship, availability and timing in the marketplace and perhaps actual costs. If you’re lower than everyone else you may encounter lack of sales because your products are considered inferior quality even though they are better than other similar products. I had a client recently who was thinking along these lines and when she raised her prices she not only sold more units but greatly increased her revenues. Ask yourself this question: do you always make purchases based on the lowest price?

Myth # 2: Shipping & Admin work takes so much of my time I don’t have time for creating new products

Truth: Shipping and admin work are tasks that can be easily systematized. You can’t afford not to hire help in doing those things that are not your forte. Rule of thumb here is: Do what only you can do and delegate the rest. You cannot grow your company if you do everything. As the owner you are the visionary – and it is up to you to be working on your business and not in it. For example, if it takes you 6 hours a week to ship and you could hire that out for $72 a week – with that time saved you would then have 24 hours a month to devote to product development, marketing & sales. You are actually losing money by doing it yourself – it is false economy!

Myth #3: It costs too much for marketing, people find me by word of mouth

Truth: The life blood of any product based business is marketing. If you don’t get your name and products in front of the public to let them know you’re in business, you will not have a business for very long. Marketing is what draws prospects in to take a look at your products. It is not enough to open up your website, buy an ad in a magazine or attend a trade show. You have to “work it” over and over again. The truth be told, marketing is what makes your business sink or swim. Marketing makes people aware of your product and they must be aware that you exist in order to buy.

There are many ways to promote your business that are low cost: social media, newsletters, post cards, phone calls, classified ads, special promotions, Blogging, SEO ( search engine optimization) and press releases to name a few. The more often you’re seen the more likely it is that your customers will become familiar with your company. You want them to know, like and trust you because they will then buy your products.