Resources

Small Business Association of Michigan and Davenport University partner to deliver online Business Growth Strategies Series - Thursday, Oct. 14, 2010, 11:30 A.M. – 12:30 P.M.

As part of its ongoing commitment to deliver education and resources to help business owners throughout the state, the Small Business Association of Michigan (SBAM) is kicking off its Business Growth Strategies Series in partnership with Davenport University on Thursday, Oct. 14, 2010.

Through an online virtual classroom, business owners from across Michigan will be able to participate in “Cultivating GREAT Customer Service,” a session helping organizations identify and deliver the very best experiences for their customers.

“We are excited to bring this session to our members online, letting business owners bring their teams together over lunch to gain practical and immediately useful skills,” said Rob Fowler, president and CEO of SBAM. “With the underwriting support of our partners Blue Cross Blue Shield of Michigan and PNC Bank, we are able to deliver this initial kick-off session free of charge to SBAM members.”  

Future virtual classroom sessions will be offered on Sales Techniques, Conflict Negotiation, Social Media, and Innovation.

“The Business Growth Strategies Series addresses the topics of greatest interest to small business owners and delivers information that can be put to practical use . says Max Gibbard, executive director of Davenport’s Leadership and Management Development Institute, the organization charged with training and professional development within the University.  “With a career education focus, Davenport University faculty members are uniquely able to draw upon current, real-world work experience and deliver insights essential to  the development and growth of Michigan business.”

The Oct. 14 virtual classroom event will run from 11:30 a.m. to 12:30 p.m.  Individuals interested in participating can register online at to reserve a spot at the event, or can contact Sarah Miller or by phone at 800-362-5461.

About Davenport University

Davenport University – the only West Michigan-based private university specializing in business, technology and health professions – serves an enrollment of approximately 12,000 students at its W. A. Lettinga Campus in Grand Rapids, at campuses throughout Michigan and online. Davenport focuses on innovative, practical and affordable education and offers graduate and undergraduate programs. More information is available at www.davenport.edu.  

Employment Law Alert: National Labor Relations Board Permits Unions to Display Large Stationary Banners in Front of Businesses Where They Have No Primary Labor Dispute

Reproduced with permission from Clark Hill PLC

by Kurt M. Graham

The newly comprised National Labor Relations Board ("NLRB" or "Board"), which now consists of a majority of pro-union appointees, has wasted no time expanding the rights of organized labor. In Carpenters & Joiners of America (Elaison & Knuth of Ariz. Inc.), 355 NLRB No. 159 (2010), the NLRB found that a union's practice of displaying large stationary banners in front of a secondary employer's business is not coercive and thus does not violate the secondary boycott provisions of the National Labor Relations Act ("NLRA").

Under the NLRA, a union having a dispute with an employer over the terms and conditions of employment being offered to its employees (the primary employer) must confine its picketing activity to that particular employer. It may not extend the labor dispute to other employers (secondary employers) in the hope that pressuring those employers to cease dealing with the primary employer will help it gain the upper hand in its primary labor dispute. Section 8(b)(4)(ii)(B) of the NLRA makes it unlawful for a union to force or require "any person to cease using, selling, handling, transporting, or otherwise dealing in the products of another other . . . person . . ."

In 2003, the Carpenters & Joiners of America Union was involved in primary labor disputes with four construction employers - Eliason & Knuth of Arizona Inc., Delta/United Specialities, Enterprise Interiors, Inc., and Hardrock Concrete Placement - that the union contended did not pay their employees wages and benefits that equaled area standards. In furtherance of the dispute with these four primary employers, the union engaged in peaceful protest activity at the Thunderbird Medical Center in Phoenix, the Northwest Medical Center in Tucson, and the RA Tempe Restaurant in Tempe during which union members held a large banner on a public sidewalk 15 feet to 1,050 feet from the company's facility. The banners stated "SHAME ON [the name of the employer]" in large letters, flanked on either side with the words "Labor Dispute" in smaller letters. As they were displaying the banners, union members offered fliers that explained the nature of the labor dispute to interested members of the public. The fliers explained that the union's complaint was with the construction companies but asserted that the employer was contributing to the undermining of area labor standards by using the services of those construction companies.

In late 2003, Eliason & Knuth, Northwest Hospital, and RA Tempe filed unfair labor practice charges with the NLRB contending that the union violated the NLRA by displaying the banners at secondary employer sites with the intention of forcing the neutral employers to cease doing business with the primary employers.

In a case of first impression, the NLRB found that the Carpenters & Joiners of America Union did not violate Section 8(b)(4)(ii)(B) because the provision does not prohibit the "peaceful stationary display of a banner." According to the majority, the conduct that makes picketing coercive is the combination of carrying picket signs and the persistent walking of picketers back and forth in front of an entrance to a worksite so that a physical or symbolic confrontation with workers entering the worksite exists. The majority further stated: "Banners are not picket signs. Furthermore, the union representatives held the banners stationary, without any form of patrolling . . . the banners were located at a sufficient distance from the entrances so that anyone wishing to enter or exit the sites could do so without confronting the banner holders in any way."

According to the two dissenting Board members, the Board has long held that the use of picket signs and patrolling are not prerequisites for finding a union's conduct to be the equivalent of traditi

Weekly Legislative Round-Up

Bernero Goes After Snyder on Tax Plan


U.S. Senate Passes Jobs Bill, 1099 Repeal Left Undone


Election 2010



Bernero Goes after Snyder on Tax Plan


Earlier this week, Democratic gubernatorial candidate Lansing Mayor Virg Bernero claimed that Republican candidate Rick Snyder’s tax proposal would hurt small businesses.

Snyder has proposed eliminating the Michigan Business Tax and replacing it with 6% flat corporate tax.  The Bernero campaign alleges that this proposal will hurt many small businesses that currently pay no business taxes or are taxed under a lower rate using the alternative profits tax.

SBAM has conducted a Q and A interview with Rick Snyder that will appear in our next edition of the Focus magazine.  As part of that interview we asked him about how he would reform business taxes in Michigan.

Here is that excerpt:

How do you propose to reform Michigan’s tax system?

The first thing we need to do is eliminate the Michigan Business Tax and the job-killing tax surcharge.  My plan cuts the taxes of every business in Michigan by at least $1.5 billion, but it would especially help small businesses and “Mom & Pop” shops on Main Street who currently pay the Alternative Profits Tax.  Their tax rate would go from 1.8 percent to zero. 

I would replace Michigan’s job-killing MBT with a 6-percent flat corporate tax on C-corporations and exempt S-corporations, sole-proprietorships and LLCs.

My plan is simple, fair and easy for businesses to follow.  Take your federal taxable income, multiply it by 6 percent, write your check to the state and get on with running your business.

SBAM has endorsed Rick Snyder because we feel he has the better plan for turning Michigan’s economic doldrums around.  Bernero’s claims have received a great deal of media attention and we just felt the need to set the record straight using Snyder's own words.


U.S. Senate Passes Jobs Bill, 1099 Repeal Left Undone


The United States Senate this week passed the Small Business Jobs Bill that includes many provisions that will be helpful to small businesses.  However, amendments to repeal or change the new 1099 reporting requirement were defeated.

SBAM and the National Small Business Association (NSBA) have been working all summer on educating Congress about the onerous addition to the healthcare bill that would add paperwork and costs to doing business.

The controversial new 1099 reporting requirement, which was included in the Patient Protection and Affordable Care Act, would require businesses to report to the Internal Revenue Service (IRS) any purchase from a vendor of goods or services worth $600 or more during the calendar year. The new requirements would be effective for purchases made in 2012 that will be reported on 1099 forms filed in 2013.

First, lawmakers voted 46 to 52 to block an amendment authored by Sen. Mike Johanns (R-Neb.), and supported by NSBA and SBAM, that would have fully repealed the 1099 reporting provision, and would have made more people exempt from having to buy health insurance by lowering the affordability exemption for the individual mandate.

Senators also managed to block the Democratic alternative sponsored by Sen. Bill Nelson (D-Fla.) that would have increased the threshold from $600 to $5,000 and exempted businesses with 25 or fewer employees from the new reporting requirement. Nelson’s amendment failed by a vote of 56 to 42, four votes short of the 60 needed to cut off debate.

For now the 1099 reporting r

Texting Law is No LOL Matter Outlook Voice Access Comes to the Rescue

When Gov. Granholm signed the new Texting Bill into law during a live appearance on the Oprah Show on April 30, more than a few of us road warriors started looking for practical answers to staying legal.

According to the U.S. Census Bureau, the average American spends over 100 hours each way commuting to work every year, surely a fraction of the time most road warriors spend on the road. I have to admit, I have done my share of texting while driving.
What’s the safe bet? In my opinion, “Unified Messaging” may be the answer. On the server side, Unified Messaging (UM) delivers a complete suite of voicemail functionality, but Outlook Voice Access (OVA) may be the best part of the package. OVA allows users to interact with their e-mail, contacts, and calendaring information through any telephone or mobile phone.

Among the features in OVA:
  • Listen to new and saved e-mail and voicemail messages.
  • Forward, reply, save, and delete e-mail and voicemail messages.
  • Interact with your calendar.
  • Locate a person in the global address list or personal contacts.
  • Send a voice message to a person.

Voice Commands Keep You Hands-Free and Legal

The speech recognition technology in the Outlook Voice Access system lets you use voice commands to access your calendar and get meeting details, call the organizers, or send a message notifying attendees that you will be late. Then you can access your address book, find related messages from the sender, or call the senders directly. This system may be the best efficiency tool since the PDA. Another solution is the Cisco Unified Communications platform for small businesses, a complete package of hardware and software for integrating voice and email. Beyond integration with Microsoft’s technology, Cisco offers its own software packages to manage voice mail, email and calendaring, and even integrate your customer relationship management database.

On the leading edge for many small businesses is the concept of managed phone systems, which allows a company to outsource its phone service and system to a third-party provider. The Cisco system allows small businesses — restaurants, service intensive companies or those with disparate staff — to take advantage of the features of enterprise phone systems without the capital outlay.

Using a Virtual Private Network connection — essentially a secure, dedicated connection delivered over the Internet — managed phone service routes business calls and faxes to designated phone lines, and manages the storage and retrieval of messages. Employees can check any type of message from the same inbox — either the voicemail box, accessed from a phone, or the e-mail inbox, accessed from a computer.

Similarly, a growing number of IT companies are providing hosted (or cloud computer based) Exchange Servers that deliver similar functionality to Cisco’s managed phone systems. Keep in mind, those that currently offer Outlook Voice Access usually provide a streamlined feature set in keeping with Exchange Server 2007.

To get the system off the ground, your company will need to start with a systems analysis to understand your business needs as they relate to a newer phone system. Companies with older business phone systems may need to upgrade to take advantage of this new Outlook Voice Access technology. If your company currently uses Exchange 2007, you can take advantage of most of the Exchange 2010 features if your phone system can be integrated with the server.

If you think Outlook Voice Access will make you a more responsible road warrior or save you from one of those $100 tickets, we advise that you act now as the texting law took effect July 1.

Chad Paalman is Vice President, NuWave Technology Partners.

Businesses are Not Launched Overnight, Nor Are They Sold Overnight

By Eric Seifert, a Senior Business Consultant with the Michigan Small Business & Technology Development Center. From SBAM’s member-only Focus on Small Business magazine.

A successful business is not created overnight or in a conference room some rainy afternoon. It takes years of strategic planning, long hours and usually the owner’s personal financial investment to launch and grow a new business. The whole process of launching a business could take years. As the economy recovers, and it is recovering, more business owners who spent that time developing and growing their businesses will consider selling their business.

Establish an Exit Plan
Similar to planning the start of a business, a well thought out exit plan will increase the possibility of a positive outcome. Ideally, a seller should begin preparing two to three years prior to putting the company on the market. According to Kevin Hirdes, Managing Partner of NuVescor Group, “With solid planning for a transition in place, the enterprise value of the entity being sold can increase substantially.” It’s much more expensive, disruptive and time-consuming to rush and prepare all the necessary information in a short period of time than it is to consistently compile the necessary records over a period of several years.

Timing Can be Crucial
Many business owners wait until their business is stagnating, or they are exhausted with running the business to decide to sell. They wait until the last minute to try and sell their business-which will not provide the results they want. The optimal time to sell is when a business is doing well. Business valuations are driven by cash flow, so stronger cash flow creates higher value. At times, some business owners have a tendency to disengage from the business prior to selling it. As a result, these businesses many times are sold at compressed values as the business owners passion has decreased for leading the business, and the performance of the business often times follows suit. In sports, the adage is to leave at the top of your game. It is the same with selling your business.

Position the Business for a Sale
Staging or positioning the business for sale can result in a higher price. This can include grooming a level of management and leadership that reduces the reliance of the business on the owner. Unless the buyer is already familiar with the industry, he may need to turn to someone for help running the business after the seller exits. From the buyer’s perspective, it’s better if the current owner is not important to the day-to-day operations and ultimate success of the business. A great management team enhances a firm’s value. Steven Tjapkes, attorney with Clark Hill, Grand Rapids, commented that key employees should be under contract prior to placing the business on the market. “The type of contract is critical – a personal services contract cannot be sold,” according to Tjapkes.

Not only is a succession plan important for the business owner, so too is the management of the customer concentration risks and other key concentrated relationships within the entity. Critical vendor, employee, and customer concentrations are common risks associated with a business. These concentrations should be mitigated well in advance of a sale.

Pricing is Critical
Without professional assistance, many business owners price their businesses based on emotion or hearsay rather than a solid valuation. Unrealistic seller expectations torpedo many transactions. Paul Jackson, a business attorney with Warner Norcross and Judd, believes that sellers lacking a clear understanding of their business’s value can be at the mercy of buyers. Professional valuation experts, accountants and experienced intermediaries [business brokers and merger & acquisition advisors] can

Weekly Legislative Round-Up

Legislative Leaders Making Progress on Budget

Gubernatorial Candidates Choose Running Mates

Party Conventions Round Out the Rest of the Ballot




Legislative Leaders Making Progress on Budget


There are four weeks to go before the end of the State’s fiscal year.  In two out of the last three years, legislators and the Granholm administration have been unable to resolve the state’s budget until after Oct. 1, the beginning of the next fiscal year.  This has forced brief government shutdowns.

Legislative leaders and members of the administration have been meeting this week to work out the details of the budget.  There appears to be a chance that the last minute maneuvering of recent years can be avoided.

Two weeks ago Gov. Granholm laid out a proposal to resolve both the current year deficit and the 2010-11 FY budget.  For the most part her proposal has been positively viewed by legislators from both sides of the aisle.

The budget deficit for this year is estimated to be around $300 million and for next year it is $484 million.

The governor made the following proposals to address this year’s budget:

  • Transferring $208 million from the School Aid Fund to the General Fund to be spent on community colleges.
  • The proposal also relies on $94 million of federal money that goes to Medicare pharmaceutical coverage.

While many in the education community do not like the idea of using School Aid funds (which historically go to K-12 education) to cover the community colleges budget, it is felt that in the end the legislature will go along with it.

For the 2010-11 budget, here is what the governor has proposed:

  • An additional $222 million in cuts to the various state departments and agencies.
  • Re-structuring long term debt to take advantage of lower interest rates that would save $77 million.
  • A tax amnesty program that would allow those who owe back taxes to pay without penalties would raise an estimated $88 million.
  • Various other proposals would amount for the rest of the savings.

In addition some kind of state employee retirement program remains a possibility.

The difference between this year and past years and the reason that there is optimism that the legislature can complete the budget this month, is that the governor has not proposed any tax increases to solve the budget problem.

We will keep you posted on any developments related to the state’s budget issues.


Gubernatorial Candidates Choose Running Mates


Last week, prior to the Republican and Democratic nominating conventions, both Rick Snyder and Mayor Virg Bernero chose their respective Lt. Governor nominees.

Rick Snyder, the Republican candidate and the SBAM endorsed candidate, chose State Representative Brian Calley (R-Portland).  Calley has been a strong ally of small business during his three plus years in the House.  He was chosen as the 2008 SBAM Legislator of the Year.  SBAM believes that Rep. Calley is a strong pick to advance the small business agenda should the Snyder/Calley team be elected.

Mayor Bernero, the Democrat candidate, chose Southfield Mayor Brenda Lawrence as his running mate.  

The Governor’s race will feature two candidates with business backgrounds on the Republican side vs. two candidates that are mayors of urban areas on the Democratic side.


Read more

Summary of Benefits and Coverage - Delayed

As we have previously reported, in mid-August the Departments of Health and Human Services (HHS), Labor and Treasury issued new proposed rules that set requirements for health insurers and plans to provide a Summary of Benefits and Coverage (SBC) and a uniform glossary of terms that are commonly used in the health insurance industry.

According to the Affordable Care Act, HHS was required to provide this guidance and a template for compliance by March 23, 2011, with employers required to provide these new SBCs to their participants beginning March 23, 2012.  As with other components of the Affordable Care Act there are many issues and unanswered questions.  Including:
  • Issue one surrounding this new requirement is that the guidance and template came out roughly 5 months late from HHS.
  • The template was 8 pages long versus the 4 pages contemplated in the Affordable Care Act.  
  • HHS asked for public comments on the template and guidance – and they got many comments.
HHS intends to issue, final regulations that take into account these comments and other feedback.  It is anticipated that the Departments’ final regulations, once issued, will include a date that gives group health plans and health insures sufficient time to comply. As a result, health insurers and plans will not have to meet the original compliance date of March 23, 2012.

As a reminder, the Summary of Benefits and Coverages is intended to help consumers understand and evaluate their health insurance choices by providing a concise document detailing, in plain language, simple and consistent information about health plan benefits and coverage. When completed, the SBC is to summarize the key features of a health insurance plan, including:

  • covered benefits,
  • cost-sharing provisions,
  •     coverage limitations and exceptions.

The SBC will include coverage examples illustrating benefits provided under the plan for three common scenarios.  The scenarios include having a baby, treating breast cancer, and managing diabetes. The examples should help subscribers understand and compare their share of the costs for a particular plan. The uniform glossary will help subscribers understand some of the more common wording (deductibles, co-insurance, co-payment, etc) used by health insurers and plans.

By law, the SBC is to be provided health insurers to group health plans and directly to individual policyholders in the individual market. Additionally, the SBC must be provided by insurers and group health plans to all participants and beneficiaries including subscribers and their dependents during the initial enrollment and upon renewal.  Additionally, the proposed rules require that group health plans and issuers provide 60-day advance notice of a material modification to the plan as reflected in the SBC. The 60-day advance notice does not apply to renewals. This notice may be sent as a separate notice describing the material modification or by providing an updated SBC reflecting the modification.
 

SBAM praises Snyder’s selection of Brian Calley for lieutenant governor

Photo by mlive.comSBAM President and CEO Rob Fowler told Crain’s Detroit Business that Brian Calley (who was honored by SBAM in 2008 as the organization’s Legislator of the Year) “speaks public policy, but he lives in the business world. I think that’s a real asset for the Snyder ticket.” (read more here)

Calley's selection has also been praised by The Detroit News.

SBAM has endorsed Rick Snyder for Governor.
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