Small Business News

On Sunday, August 8, 2022, the Senate approved bill H.R. 5376, the Inflation Reduction Act of 2022 a climate change, health care, and tax package. The Senate vote was passed along partisan lines with a narrow margin of 51 to 50. It saw 50 Republican senators opposing the bill and was passed with the support of all 48 Democrat senators, and two Independents and the tie was broken by Vice President Kamala Harris.

Democrats and supporters of the legislation tout it would lower health care, prescription drug, and energy costs, invest in energy security, and make the US tax code fairer while also fighting inflation and reducing the deficit.

However, proponents argue that the new spending would further aggravate inflation and stifle growth.

Some of the measures include:

More than $300 billion to be invested in energy and climate reform: This is the largest federal clean energy investment in U.S. history and had originally called for a whopping $555 billion in investments. The budget has slated some $60 billion for developing renewable energy infrastructure through manufacturing solar panels and wind turbines. In addition, it offers incentives through tax credits for individuals with electric vehicles and energy-efficient homes. Democrats say these measures will help in lowering greenhouse gas emissions by 40%.

Lowering the cost of prescription drugs: This measure looks toward making prescription drugs more affordable allowing the federal health secretary to negotiate the prices of certain expensive drugs each year for Medicare. The bill puts a cap of $2,000 on out-of-pocket prescription drug costs for people on Medicare, effective in 2025 along with a three-year extension of healthcare subsidies in the Affordable Care Act (ACA).

Tax reform: The tax-related portion of the bill attempts to create a 15% minimum tax for corporations making $1 billion or more in income which is expected to bring the federal government more than $300 billion in tax revenue while eliminating tax loopholes. The Act also aims at boosting tax enforcement by proposing $80 billion of additional funding to the Internal Revenue Service (IRS) over the next ten years.

The Bill received endorsement from Small Business Majority CEO John Arensmeyer. “The legislation includes measures that small businesses across the country have been calling for nearly a year. Most importantly, the legislation extends the Affordable Care Act’s premium subsidies through 2025 and lowers prescription drug prices. More than half of all healthcare marketplace participants are small business owners, employees, or self-employed entrepreneurs. Access to affordable, quality healthcare is vitally important to them because they have historically comprised a disproportionate share of the working uninsured population and current healthcare provisions are hurting small business owners’ bottom lines”, said Arensmeyer in a statement.

Despite praise for the bill, it isn’t without criticisms. Republicans, argue the bill will not address inflation, could kill jobs, and undermine growth when the economy is in danger of falling into recession.

Senator Joe Manchin argues that the bill would add more pressure on business as it would raise taxes on Americans making less than $400,000. The argument here is that despite Democrats’ assurances that it would not affect Americans with annual earnings of less than $400,000 the ripple effect of additional taxes being levied on corporations will ultimately affect them.

The sentiment is also shared by the National Restaurant Association which argues that the bill will likely raise prices on restaurant’s supply chain, whose costs will inadvertently be passed down to local restaurants thus fueling inflation.

“Passage of this bill will likely lead to higher supply costs for restaurants already struggling to weather the economic storms. For restaurants hoping for a pandemic lifeline from Washington, this bill falls very short,” said Sean Kennedy, executive vice president for Public Affairs at the National Restaurant Association.

He cited the report by the Joint Committee on Taxation, that manufacturers and wholesalers will be responsible for paying 59% of the $313 billion. This will likely impact manufacturers and producers of poultry, meat, frozen food, soft drinks, and alcohol, as well as their distribution partners, all of whom directly or indirectly provide products to the nation’s restaurants. These partners will likely have to pass on many of these costs to restaurant owners.

The bill now goes to the House where a vote is expected as early as Friday. If it passes there, it will then go to President Joe Biden who will sign it into law.

Image: Envato Elements

This article, "Debate Heats Up on Inflation Reduction Act Effects on Small Business" was first published on Small Business Trends

Read more: https://smallbiztrends.com/2022/08/inflation-reduction-act-2022-small-business.html

There are a quite few successful YouTubers around these days, many of which owe their popularity to video game live streams. But there is another kind of success that can be achieved on YouTube, and an unassuming woodworker has shown us the way.

Texas-native April Wilkerson has a woodworking channel with over 1.4 million subscribers, the success of which has enabled her to open a brick-and-mortar shop selling woodworking plans and associated paraphernalia. Yet just nine years ago she had never even used a power tool.

It was in 2013 when April reached a crossroads in her life. She had a new home with little spare money to furnish it, and she was unsure where exactly she was going in life. To solve one of these issues, she had the idea to make her own furniture.

She then discovered the craft of woodworking and decided to give it a real go, teaching herself the basics through trial and error.

April had never attended shop class or used any power tools, so she was learning everything from scratch. But the more she learned about woodworking, the more she fell in love with it. Then she had another idea.

As she learned new skills, April began filming tutorials to teach others how to do what she had just learned. She posted her videos on YouTube with the hope of helping others discover the joy of woodworking, and within a few months, she became the most well-known female woodworker on the platform.

Her success was down to her step-by-step style of tutorial which was easy for woodworking beginners to follow. She quickly became a full-time YouTube creator and has since hired nine employees to help her run the multiple business ventures that have emerged from her YouTube success.

The YouTube blog explains how April turned the success of her tutorials into a brick-and-mortar shop: “In 2020, April bought a shop called The Wood Shed, which she turned into a commercial venue. Today, she uses the site to manufacture woodworking templates and furniture along with selling wood, tools, and her own products.”

The blog added that as her brand grew, so did her platform, and by 2020, a TV network had reached out to April after seeing her channel. This led to her co-hosting the History Channel’s show Assembly Required with Home Improvement stars Tim Allen and Richard Karn in 2021.

April’s manager Gary Wentz is certain that the YouTube success was what created the chance to open a brick-and-mortar store. “There’s no way it could have happened without [YouTube]. It’s the foundation on which she has built the rest of her business,” said Gary.

Gary also explained how April’s YouTube channel has become the economic backbone of her businesses, with a significant amount of her revenue coming through AdSense to supplement her sponsorships and woodworking plan sales.

Not everyone will have what it takes to create a successful YouTube channel, although the first requirement seems only to be a genuine interest in something that you enjoy and want to share with others.

“If I can do this, anybody can,” says April. “And I’m not talking about just making and building. I’m talking about changing your life: finding something that makes you happy and leaning into that.”

So, if you have a passion you can lean into, as April says, then you have taken a big step towards potential YouTube success already. There are also plenty of technical aspects you can research, such as designing an attractive and appropriate channel banner, making an auto-playing introduction video, and optimizing your playlists.

Another often overlooked element is the defining of channel keywords. Such defined channel keywords help YouTube’s algorithm understand what your channel is about and who it should be targeted at, based on a user’s search, watch and like history. You can find the option to set channel keywords in the Settings section of the YouTube Studio hub. You simply toggle to ‘Channel’ and the option to define your channel keywords is right there.

After that, it’s time to focus on the quality and unique appeal of your content.

Image: April Wilkerson

This article, "Woodworker’s YouTube Success Story Could Be Your Business Inspiration" was first published on Small Business Trends

Read more: https://smallbiztrends.com/2022/08/woodworkers-youtube-success-story-for-business-inspiration.html

?

Inflation is a huge problem right now. The cost of goods and services is going up, making it harder and harder for businesses to get by. Why is inflation so high right now? Anything from the Ukraine war to a strong demand laying waste to supply is behind the surge. What’s a small business owner to do?

In this special episode of Small Biz in :15 On Location, Small Business Trends Executive Editor Shawn Hessinger interviews business expert, Chandrashekar LSP, Senior Evangelist of the Zoho Corporation, to discuss how you can battle inflation with your business.

Shawn: Inflation is a huge deal with small businesses in terms of their supplies. What steps can small businesses take to, if not control inflation, at least mitigate the effect that it’s having on their business?

Chandrashekar: This is a challenge, but keep in mind that the data is always your best friend.

First, understand what your business data is telling you and predict what’s going to happen from past trends. Then, you can make an informed decision as to when to raise prices and at what level. Secondly, during inflationary times, know that it is a great time to understand what aspects of your business can be automated. Next, act on it since all this automation will essentially help you, even if not right away.

So, understanding those aspects, understanding how to change the processes, and helping make making sure that the investment that you make in business today helps you run it now and in the future.

Shawn: How do you use data to figure out if you’re going to raise prices? First of all, is that the right solution to raise prices? And if so, how can you raise prices without chasing your customers away or destroying your business or its competitive advantage?

Chandrashekar: Does every business need to raise prices? I don’t think so. I think there are other ways to mitigate that. For example, if you are getting a specific price for a specific product…maybe just buy some additional storage space and store it and have inventory. That way you can mitigate the price rise until a point that you can defer it and still be able to meet your main commitments.

Afterward, take a look in your system to see how profitability margins have changed in the last 12 months or 18 months. These indicators are good enough to help you understand if you really need to raise prices.

Also, ask yourself if you can mitigate by just having more supplies in store. And then if it makes sense for you, go get some storage space or a small warehouse to keep those components. But there comes a point where even that has to stop. At that point, you must decide when to stop, and the decision has to be based on data.

And then you’re also seeing the trends where there’s inflation and then there are shortages. There are logistic and supply issues going on. Then, it’s all about timing in these cases sometimes.

So quite a few factors and attributes that, based on the business, you can put a finger on it and say, “Okay, here are the things that I can do.”

But overall, the idea is you have data and there are things that you can do…that’s the mitigation that can help initially. And then there comes a point where you must pull the trigger. But pulling the trigger must absolutely be with all the data and information you have.

Shawn: Let’s take an example of a hypothetical business. Say I’m an e-commerce business that’s been hit with a price increase on everything I sell. How do I start to make the decision about whether I should raise prices, how much I should raise them, and what that’s going to do overall to my business? Because e-commerce is one of those businesses where, unless I make something and no one else makes it, people are going to be looking all over the place to find something priced cheaper than mine. So, prices become really important for e-commerce.

Chandrashekar: It is more than just the price; it’s the availability of products. And what’s actually driving profitability for some of these e-commerce spaces is the fact that you can get…let’s say, for example, something that I can relate to is the availability of baby formula.

There are many places that don’t have any baby formula. So, the fact that you have it gives you an advantage, whether it’s highly overpriced or underpriced. Right? Because it’s all about availability. It’s a supply & demand challenge that everyone is dealing with.

So, can you get a leg up there as a baby formula business? Can you do something and understand what the data is telling you? Again, this is where data helps you understand where the shortages are, and you can stock up supplies with needed things and give your e-commerce store a competitive advantage.

Now, let’s say there’s no supply shortage. Then, it’s all about price. When the cost of acquiring goods has changed, how do you increase the price appropriately? Do you do it one time or do you stagger it over a period? You’re looking at your profit margins and you’re saying, “Hey, here’s a goal: I want to be at a profitability margin right now and profit margins are up like 20%.” And your goal is not to go below 17.5%.

However, don’t change the price overnight. Just get there and know that by the end of the year that you’re going to be able to reach your goals if you price it this way. Again, that’s where data is going to help you.

Every size of business is going to be hit hard by inflation. But the first one that is going to be hit is the small businesses because they depend on the supply chain from the bigger guys who are also hurt.

But again, think of ways that you can look at new avenues and new opportunities in terms of how business models or pricing models can help you. It need not always be about raising the price. It can be models that you can bring in that can help you to combat inflation.

Be sure to catch the rest of the episode to find out other helpful tips Chandrashekar LSP gives on dealing with inflation.

If you enjoyed this presentation, be sure to check out the following articles that help further demystify how inflation affects small businesses and how you can protect yourself against it.

Listen to this episode on SoundCloud:

READ MORE: 

This article, "Chandrashekar LSP on How to Deal with Inflation" was first published on Small Business Trends

Read more: https://smallbiztrends.com/2022/08/how-to-deal-with-inflation.html

Are you thinking of selling your produce or other items at a farmer’s market? It’s a great way to get your fresh fruits, vegetables, and other goodies in the hands of consumers, and can be a profitable enterprise, too. But before you can start packing up your veggies, there are some things you need to know. In this post, we’ll discuss how to sell at a farmer’s market. Let’s get started!

A farmers market is a place where farmers and other food producers sell their products directly to consumers. Farmers’ markets can be found in towns and cities across the United States, and typically operate on a weekly basis. At most farmer’s markets, you’ll find fresh produce, meats, dairy products, baked goods, flowers, arts and crafts, and more.

Many farmer’s markets require vendors to produce everything they sell, so it’s important to consider whether or not you’re able to meet their criteria. Here are five things to consider when deciding if selling at a farmers market is a good fit for you or not:

Are you looking to start selling at your local farmer’s market? When you sell at a farmer’s market, it provides a great opportunity for small businesses to offer their products directly to consumers. Here are 15 tips for starting and running a successful farmer’s market booth.

Make sure to contact the market operators to find out what the rules and regulations are for selling at the market. Doing your research ahead of time will help you avoid any surprises or issues down the road.

Some farmer’s markets only allow certain types of products to be sold. Be sure to check with the market manager or operator to find out what is and isn’t allowed before setting up your booth. This will help you avoid any potential problems.

Make a business plan to figure out your costs and profits. This will help you determine if selling at the farmer’s market is right for your business. Some things to consider in your business plan include the ongoing costs of renting a booth, insurance, and licenses or permits.

Make a list of what you will need to sell your products. Things to add to your list include a tent, table, chairs, displays, signage, and packaging materials. Checking things off of your list will help you make sure you have everything you need on market day.

Decide on what prices to charge for your products. You will need to factor in the cost of your materials, time, and overhead when setting your prices. Be sure to check out the competition to see what they are charging for similar products.

Be organized and efficient in your operations. This will help you save time and energy on market day. Having a system in place for setting up and tearing down will help make things go smoothly. Also, be sure to have a plan for dealing with customers.

Have a positive attitude and be friendly to your customers. This will help you make sales and build relationships with your customers. People are more likely to buy from someone they like and trust.

Plus, being friendly will make your time at the market more enjoyable.

Offering samples can entice customers to buy your products. This is a great way to let people try your products before they commit to buying them. This tactic has been shown to increase sales and is used in mall food courts around the country.

Here are a few more tips to help you succeed with your farmers market stand:

When selling prepared food, always make sure that your ingredients are fresh and of the highest quality. This will help set your prepared foods apart from the competition’s and ensure that your customers return time and time again.

Be sure to take advantage of market incentives, such as waived fees or increased exposure. These can help you save money and attract more customers to your booth. Don’t be afraid to ask the market’s management team about these opportunities.

When setting up your booth, be sure to choose a good location. A high-traffic area will help you get more customers. Also, be sure to set up near other vendors that complement your products. For example, if you sell fruits and vegetables, setting up near a vendor selling baked goods would make sense.

Network with other vendors and learn from their experiences. This is a great way to get tips and advice from people who have been in your shoes. Also, be sure to network with market staff and customers. These relationships can help you in the long run.

Make sure to let people know you’ll be at the farmer’s market. Promote your booth on social media, in local newspapers, and through word-of-mouth. The more people that know about your booth, the more customers you’re likely to attract.

Get involved with market events, such as cooking demonstrations or kids’ activities. These events can help you attract more customers and generate interest in your booth. Doing this will also help you build relationships with other vendors and market staff.

Depending on what type of products you’re selling, you may need to check with the state or local authority to make sure you’re following local regulations. For example, if you’re selling prepared foods, you’ll need to obtain a food handler’s permit and submit to required facilities inspections of your commercial or home kitchen.

When selling at a farmers market, small business owners should avoid doing the following:

Small businesses selling local produce, baked goods, and other food items do well at farmer’s markets. These businesses often have a loyal following in the community, and customers appreciate the fresh, locally sourced products. Other things that sell well are handmade arts and crafts, jewelry, and soaps. These items are often unique and make great gifts.

There are a few things you can do to set yourself apart from other vendors and increase your sales. First, make sure your booth is well-stocked and attractively arranged. Next, be sure to engage with customers and let them know what your products are and how they can be used.

Finally, offer samples of your products so customers can taste them before they buy. By following these tips, you can increase your sales at a farmer’s market and stand out from the competition.

Image: Envato Elements

This article, "How to Sell at a Farmers Market" was first published on Small Business Trends

Read more: https://smallbiztrends.com/2022/08/how-to-sell-at-a-farmers-market.html