Alms for the Poor Entrepreneur

Goldman Sachs and Warren Buffet have teamed up to give money to low-income entrepreneurs. But there's a catch. Most of the money will be connected to courses the entrepreneurs must take from community colleges and small business development centers. I used to run a small business center at Norwalk Community College and had a federal grant to mentor low-income people who wanted to start businesses. It was very worthwhile work. Out of 80 people we mentored, about three actually started businesses.

That's why I wish that some of the Goldman-Buffet largess ($500 million) would also go to entrepreneurs who already know what they are doing but are finding it hard to get the capital to jump-start their businesses. I know several entrepreneurs like that.

Banks have cut way back on the money they're lending to small business. They are cutting back on credit lines and credit cards. Small businesses are hurting badly, even though new small businesses are the engines of growth and employment in our great country.

I think community colleges are wonderful. And I believe it is essential for business owners and entrepreneurs to understand business. But there are many other ways I believe this money could help more businesses to get started and grow.

Read more here: http://money.cnn.com/2009/11/17/smallbusiness/goldman_sachs_warren_buffet_small_business/index.htm?section=money_latest&utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+rss%2Fmoney_latest+%28Latest+News%29

Marketers Learn From Online Chat

When I was in business school, and later when I worked at General Foods (now Kraft), one of the fundamental tenets of marketing we were taught is to focus on the end benefit for the consumer. As I built my career in marketing and advertising, that concept was always at the heart of any marketing message. While you can talk about the technical reasons a product works well, and you can show such things in a brief demonstration, the focus of any ad was on the product's benefit for the consumer. Benefits sell.

So I really had to laugh when I read an article in the Wall Street Journal that claimed big companies like IBM were surprised to learn from online chat between their customers that all the customers really cared about was what the product or service actually did for the customers - the end benefit. Gee, the customers didn't care about all the technical gee-wiz stuff that IBM executives cared about.

I must say that I was truly amazed that a company like IBM didn't already know this elementary rule of marketing and that they had to learn it from online chat. Where have they been? (Probably just talking to themselves in corporate speak.) What has their advertising agency been saying to them? Was anyone listening? At least they're listening to consumers now. Yay for online chat!

When I work with entrepreneurs to develop a business or marketing plan, the one thing I emphasize is focusing on the end benefit for the target consumer. That is the message that must be developed and must come across. You'll see this in my Ten Questions Your Business Plan Must Answer on my website: www.upstartbusinessplanning.com.

If you want to read more about marketers learning from online chat, visit All Things Digital or the Wall Street Journal -- http://voices.allthingsd.com/20091123/marketers-find-web-chat-can-be-inspiring/?mod=ATD_rss

New Tax Break for Business Could be Good

Despite the bad spin New York Times business columnist Gretchen Morgenson put on a new tax cut for businesses, I believe it actually could be highly beneficial for struggling small businesses. On November 6, 2009, President Obama signed a law enabling businesses of all sizes to carry back current loss from 2008 and 2009 for five years, instead of only two. That means they can offset profits from the boom. This new tax break is tucked into the Worker, Homeownership and Business Assistance Act of 2009. That's the same law that extends unemployment and renews the first-time homebuyer tax credit.

While Gretchen bemoans this action as an unneeded, unwarranted gift to large, lobbying, cash-rich home developers who helped get us into our current financial mess, I feel somewhat differently. Many businesses - mom and pop stores, small contractors, manufacturers and other small businesses that make up the backbone of our country may be getting the cash relief they need to stay in business. That relief will come in the form of a tax refund, after they recalculate past tax bills from years past.

As Ms. Morgenson points out companies can "offset losses incurred in 2008 and 2009 against profits booked as far back as 2004. The tax cuts will generate corporate refunds or relief worth about $33 billion, according to an administration estimate." I will admit that when I first read her column, I was disgusted by such a gift to the already wealthy. But later, after a dinner conversation about it with my husband, I had second thoughts. I realized that this break could be good and could help the recovery, even if it rewards builders who do not plan to build until demand for new homes resumes.

Read the article in the New York Times:

Fair Game
Home Builders (You Heard That Right) Get a Gift
By GRETCHEN MORGENSON
Published: November 15, 2009
Analysts say home builders will be among the biggest beneficiaries of a new tax break. http://www.nytimes.com/2009/11/15/business/economy/15gret.html