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Other than maybe one internet post on wral.com there hasn’t been too much debate over what our legislature is doing.   I’m so freaking happy that someone is going to be on the news tonight on NC17 @ 6pm.  If you don’t know what’s going on, please tune in.   In an email sent to the networking group LinkingRaleighNC, this individual sums the events nicely:

Please turn to NBC17 this evening at 6pm. There is a very important issue regarding new taxes that the NC General Assembly will attempt to pass and take effect on July 1. I have been asked to come to discuss the effect this will have on affiliate marketers with Donald Jones.

Amazon.com, which has a very extensive affiliate network, has announced that if this law is passed they will close all NC based affiliate accounts, cutting off a large number of NC Small Businesses from this revenue stream. There are a number of local NC businesses that are growing due to their affiliate networks. This bill will affect them as well.

Here is the general summary of NC Senate Bill 202 Section 27C.2
Go to pg 268 to read the bill http://bit.ly/xRjx2

*Make two higher tax brackets for upper income people
*Raise sales tax by 1/4 percentage point
*Impose sales tax on service contracts, repair, maintenance and installation services
*Impose sales tax on courier services (FedEx, UPS, DHL, etc)
*Impose sales tax on digital products – music and movie downloads, ebooks, software, ringtones, etc.
*Impose sales tax on companies with affiliate marketers within NC.
*Charge sales tax on movies, theme parks, races, sporting events, gym memberships, cover charges and so forth and so on.
*Increase liquor tax by 1 1/2 percentage points

If you do not support this bill please take a moment to sign this petition:
http://www.petitionspot.com/petitions/ncaffiliatetax/

Whether you support this act or not please contact the following representatives to let them know how you feel about this.
Representative Paul Luebke (the Chair of the House Finance Committee)
(919) 733-7663
Paul.Luebke@ncleg.net

Senator David Hoyle* (the Chair of the Senate Finance Committee)
(919) 733-5734
David.Hoyle@ncleg.net

Even if you don’t partake in internet affiliate programs, can you say that you support the other taxes they’re proposing?

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Trying to make up for budget short falls, NC legislature has a bill that is fore-casted to be signed in the next 2 weeks.  This will directly impact residents generating revenue from Amazon affiliate programs.  A local CEO is attempting to fight the battle here.

A little background on the economic impact of taxing the internet.

Directly from the bill:

A retailer is presumed to be soliciting or transacting business by an independent contractor, agent, or other representative if the retailer enters into an agreement with a resident of this State under which the resident, for a commission or other consideration, directly or indirectly refers potential customers, whether by a link on an Internet Web site or otherwise, to the retailer, if the cumulative gross receipts from sales by the retailer to purchasers in this State who are referred to the retailer by all residents with this type of agreement with the retailer is in excess of ten thousand dollars ($10,000) during the preceding four quarterly periods. This presumption may be rebutted by proof that the resident with whom the retailer has an agreement did not engage in any solicitation in the State on behalf of the seller that would satisfy the nexus requirement of the United States Constitution during the four quarterly periods in question.

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The US Chamber of Commerce is launching a campaign to defend free enterprise.  Read the press release here.

“We’re launching this campaign because those who make or influence economic policy must understand that a productive, competitive private sector is not something they can take for granted,” added Donohue.  “It is built on a system of incentives that offers opportunity and rewards for those who work hard and take risks. Take away those incentives through an avalanche of new rules, restrictions, mandates, and taxes and you will seriously undermine the wealth and job-creating capacity of the nation.”

“Dire economic circumstances have certainly justified some out-of-the-ordinary remedial actions by government,” he explained. “But enough is enough. If we don’t stop the rapidly growing influence of government over private sector activity, we will squander America’s unmatched capacity to innovate and create a standard of living and free society that are the envy of the world.”

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According to a study by Sage Software and AMI-Partners, more than 260,000 small businesses in the US and Canada employ social networking tactics, too.

If you look at the article I posted earlier on small business blogging, you can see that 260,000 small businesses is <1% of small businesses in the US.  If you’re not using a form of social media, whether it’s Twitter, LinkedIn or Facebook you’re missing a chance to differentiate your business from everyone else.

The survey included job sites which offers little for really interacting with your customers so to me that data point isn’t relevant to marketing.   Nonetheless, interesting that so few businesses are using the free resources readily available to them.

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Good site on learning about VC and raising capital.  Be sure to check out the graphical examples.

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If you’re looking to start a business, spend the time to watch the entire video on Guy’s blog.  Starting at 19 minutes, each of the entrepreneurs is asked about start-up costs.   There’s a wide range from $0 to $100,000.

There’s also an interesting take on VC funding.  I recently completed the entrepreneurship portion of a MBA program and there’s a lot of focus on VC.  Mainly because the technologies supplied to the program are capital intensive (high technology).  However, that’s just not going to work for most people and I personally would prefer not to rely on VC for a new start-up (I agree with James Hong - start around 32 minutes in the video clip).  Read a quick take on “normal” ownership dilution here.

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Really good, go here.

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SBA.gov is a tremendous resource for information and statistics.   You can find a report for your home state here.  Very helpful if you have a product/service targeting small businesses and you’re trying to identify market size.

The report highlights some really interesting statistics about the state of North Carolina:

• North Carolina had 173,409 small employers in 2006, representing 98.1% of the state’s employers and 48.6% of its private sector employment.

• The health care and social assistance industry was the state’s largest small business employer in 2006; manufacturing was the largest overall employer (Table 1).

• Small businesses created 54.8% of the state’s net new jobs from 2004 to 2005 (Table 2).

• North Carolina’s real gross state product increased by 2.2% in 2007. By comparison, growth in the Southeast region was 1.5% and the United States, 2.0%. (Source: U.S. Dept. of Commerce: Bureau of Economic Analysis)

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I have some friends that refuse to eat at “chain” restaurants, or what they deem as chains, because they aren’t “local” or they aren’t a small business type restaurant.  However, I think this is a flawed view of a lot of eating establishments.  I am a huge advocate of small businesses and want to support them in every way possible.  So here’s my argument.

Let’s take Subway, which is what would be considered a chain according to my friend’s logic.   This information is from Entrepreneur Magazine’s Franchise Profiles (good resource by the way):

First, yes in 2005, if you found that one little franchise in the right hand column under Company Owned, you did indeed dine at a corporate owned restaurant.   But the other 18,678 stores are owned/operated by individuals or individuals who have formed companies to run multiple franchises.  It very well could be Bob next door or Mary down the street.  By you dining at one of those stores, you are contributing to the revenue for an individual who decided to take the franchise route instead of building a business from scratch.  Most franchise owners want their own business, but also want the structure, marketing and support that a franchise provides.   Ask yourself, by not dining at your local Subway, Firehouse Subs, Jimmy Johns, etc, are you really helping local owners or hurting them?

Second, take a look at the history for Subway:

In 1965, 17-year-old Fred DeLuca and family friend Peter Buck opened Pete’s Super Submarines in Bridgeport, Connecticut. With a loan from Buck for only $1,000, DeLuca hoped the tiny sandwich shop would earn enough to put him through college. After struggling through the first few years, the founders changed the company’s name to Subway and began franchising in 1974.

DeLuca and Buck were regular people that started a small local business, and it got big, really big.  So yes, when I eat at Subway, I know my money will get filtered to a larger company through franchise fees and what not, but it was started by an entrepreneur and franchises are still run by individual entrepreneurs.

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When you read about entrepreneurship people say the best way to get started is when you’re trying to find a solution to something and you say “I wish someone would…”.  I present the Dog-o-Matic.   Naysayers probably told the entrepreneur this was crazy, but he found a solution and ran with it.

Read the aricle before you freak out about cruelty to animals or even the idea of putting your dog through a car wash.

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