Archive for September, 2009

Swine Flu Vaccine On Its Way

Monday, September 28th, 2009

On October 5, the first shipments of 6 – 7 million doses of the nasal spray swine flu vaccine will arrive in doctor’s offices. Thereafter, another 40 million doses of injectable vaccine will be delivered, with another 10 million to 20 million doses shipped weekly. Public health experts believe that those who most need the vaccine are pregnant women, health workers, young people and parents and caregivers of infants younger than six months. Check the website of your state’s public health department for further details. The vaccine is free, so be sure to advise your employees and their families.

Typhoon Kills 95 in the Philippines

Sunday, September 27th, 2009
Calm Before the Storm

Calm Before the Storm

A typhoon swept the main island of Luzon in the Philippines, killing at least 95 people and displacing more than 337,000 residents. The event sadly recollects Katrina as delays in the rescue of flood victims provoked public anger towards President Gloria Macapagal Arroyo’s government. Civilian and military rescuers have struggled for two days to reach people stranded on the rooftops of their flooded homes waving for food and supplies. As of this evening, they have rescued more than 5,000 people. The Philippines disaster management agency reported that 68,550 people were housed in 118 emergency evacuation centers. The government is scrambling to get as many boats as it can for use as rescue vehicles. San Miguel, the largest food and beverage company in the Philippines, offered to purchase up to 50 boats for that purpose and the national dragon boat rescue team also contributed to the effort. Although the typhoon wind speeds reached only 85 km/hour, the storm deposited more than a month’s worth of rain in the capital city of Manila in just six hours, causing the flooding. The storm has moved on towards the South China Sea. The government declared a “state of calamity” in Manila and the surrounding areas, closing many schools and businesses.  Particularly for those of us who do business in the Philippines, contributions to the Red Cross and other disaster relief agencies will be welcome.

Microinsurance Partnership in Sri Lanka

Monday, September 21st, 2009

Microinsurance protects very small enterprises against financial ruin from events such as medical emergencies, drought, flood and other natural disasters. Such disasters occur frequently in the developing world; a mudslide in an urban center can eliminate whatever modest shelters slum dwellers had built. Vulnerability to such risks keeps people trapped in the vicious spiral of poverty. They lack basic social protections or any kind of safety net. And as we know from our experience in the U.S., relief aid rarely trickles down.  Microinsurance is complementary to microfinance (the provision of credit) and plays an important role in development.  In Sri Lanka, where less than 1% of the country’s 19 million citizens are covered by insurance, there is strong market potential.  To develop this sector, Janashakthi Insurance PLC announced a partnership with Hannover Re, one of the world’s largest reinsurers, with 8 billion Euros in annual premiums. It will be interesting to see how this market develops and if such products can be successfully exported to low-income entrepreneurs in the developed world.

Women in the MBA Pipeline

Sunday, September 20th, 2009
Entrepreneurship Is A Team Sport

Entrepreneurship Is A Team Sport

The Forte Foundation offers resources to support women business school students, including mentoring and career counseling. With women starting more than one-half of all businesses in the U.S., it certainly makes sense to consider the resources business school can offer you, even if you cannot make the time available to pursue an MBA degree. I benefited from participating in weekend certificate programs of the Continuing and Professional Studies Program at Baruch College of the City University of New York, as well as an entrepreneurial executive education program, Owner President Management, of the Harvard Business School. The networking and peer support is invaluable.  Evening, weekend or part-time study may also be an option. Another possibility might be to engage a team of business school students to work on a project for your business for academic credit. These are quite common in MBA programs, and offer the experience of a professor to oversee the project – another way to leverage limited resources in this economy.

California Wildfires Threaten Homes and Businesses

Saturday, September 19th, 2009

California has experienced more than 5,000 fires this year to date. Although the state budget has a $23 billion deficit, a $500 million reserve has been established for emergencies such as fires.  A wildfire north of Los Angeles in the San Gabriel Wilderness Area of the Angeles National Forest burned over 140,000 acres and cost $21 million in firefighting services. Thousands of homeowners have been displaced. The regret most often expressed is the failure to preserve treasured family photographs, as those memories cannot be replaced. I have all of my photographs scanned in and stored online for safekeeping. The cost is negligible and the benefit incalculable.

Moving Back Home Is Not Without Risk

Friday, September 18th, 2009
Home Office

Home Office

With the recession putting pressure on increasingly scarce resources, many small businesses are foregoing leasing office space to return home. While this may result in cost savings, improved lifestyle and no commuting expense, there are several issues to consider. The first concerns compliance with your lease or homeowner’s association rules. You could inadvertently cause a violation of your lease or city codes. One issue that might be problematic is if your home-based business attracts a steady stream of visitors that may violate your reasonable use clause. Or constant shipments via UPS or FedEx for an eBay sales business could be considered a quality of life violation for your neighbors.  Some businesses, such as food-service businesses, could be considered health code violations and others may require special permits. So investigate the requirements for your business to make sure you are in compliance.

Merchant Credit Card Fees Are Burdensome

Thursday, September 17th, 2009
Sign Petition

To Do: Sign Petition

Although interchange bank fees have remained constant in recent years, according to the American Bankers Association, more customers are using credit and debit cards to pay for their purchases. According to Card & Payment, interchange fees generated by bankcards reached nearly $24 billion in revenue in 2008, almost 20% of revenues for bank cards. While credit and debit card issuing companies such as Visa and MasterCard set the fees, everyone in the chain takes a cut of the revenues, including the merchant’s bank and the issuing bank. For small businesses with low individual purchases, these fees can be onerous and were not addressed in the new credit card reforms enacted by Congress in May. Interchange fees are typically 1.2 – 2.2% of the transactions made on credit and debit cards. Franchisees of 7-Eleven are trying to collect 1 million customer signatures on petitions to deliver to Congress in the hope of reducing such fees which are burdensome to the convenience store business where the average purchase totals $6.

Survival of the Smartest

Wednesday, September 16th, 2009

Office Depot is offering a “bail-out” for small businesses in its “rescue plan” contest and we were lucky enough to be selected as one of the winners. The company has launched a new website, Office Depot is recognizing 500 small businesses nationwide for their smart survival strategies and award each with a $1,300 Office Depot Gift Card, tech support for a year from Office Depot’s Tech Depot Services, and copy, print and ship services from Office Depot’s Design, Print, and Ship center with a total prize value of over $2,000. We would like to thank the company for its generosity towards us in this challenging economy!

Public Health Experts Warn Small Businesses of Flu Risks

Tuesday, September 15th, 2009
More Than a Nuisance

More Than a Nuisance

The federal government urges small businesses to develop contingency plans to work through a possible influenza pandemic that could cause high workforce absenteeism. The White House estimates that up to half of the U.S. population could contract the new strain of flu between now and next spring. Testifying before the House Small Business Committee, Rebecca Blank, under-secretary for economic affairs of the U.S. Department of Commerce, stated that owing to fewer resources, smaller businesses would be particularly vulnerable to disruptions in their operations. While not as deadly as the avian bird flu that struck Asia, a flu outbreak could leave businesses short-staffed as employees recover. The Centers for Disease Control suggest that employees with flu-like symptoms should remain at home, out of caution, for at least 24 hours until their fevers subside which, allowing for recovery times, could prolong absences from work to three to five days. To prepare for this possibility, small businesses should cross-train employees on critical business functions. To the extent that workers can telecommute when experiencing suspicious, but not disabling, symptoms they should be encouraged to do so. Public health experts also suggest that adults under age 24 may have to be immunized twice as the flu poses a greater risk of infection to them. Advance preparation should slow the transmission of the flu virus and enhance the safety of your employees and their families.

Rising Medical Costs in Workers Comp Claims

Monday, September 14th, 2009
Lower Employment, Higher Costs

Lower Employment, Higher Costs

The California Workers’ Compensation Institute reports that workers’ compensation costs for self-insured employers rose 12.1% from year-end 2007 to year-end 2008. These data reflect the claims experience of private-sector employers that self-insure, which are chiefly Fortune 500-size companies. Nevertheless, this report offers insight for small businesses as it reflects cost trends. Last year represents the first increase in the number of workers’ comp claims for self-insured private sector employers since 1991. Increases in medical payments account for the rise in claims volume. Indeed, it is medical payments, rather than indemnity or lost time from work payments, which account for most workers’ compensation benefits. Because the self-insured employers are large corporations it is less likely that cost-shifting occurred by workers who lacked medical coverage. For small businesses, this can be a significant driver of costs, as employees who lack medical coverage are incented to seek medical benefits by other means. At the same time, however, net premiums written for workers’ compensation in California have declined. Unfortunately, this decline does not reflect reduced risks, but rather reduced employment. California’s unemployment rate is approaching 12% and other states are following, with rising unemployment and declining workers compensation premiums. This trend is exacerbated by the fact that manufacturing, which typically accounts for more claims than service businesses, is in decline. It makes sense to review workers compensation job classifications annually to ensure that your business is not paying more than it needs to in premiums and assessments. The complexity of job coding often results in overpayment. Make sure that your assessments are accurate and fair.