Problems, We’ve Got Problems
From the outside looking in, the answer may seem surprising. When asked earlier this year to name the biggest problem facing their companies, the answer from a group of 3,530 small-business owners nationwide was not finding good employees, competition from overseas or even high taxes.
Their top concern, according to a survey conducted by the National Federation of Independent Business and Wells Fargo, was the expense of being in business, and the entrepreneurs singled out those factors “that are difficult to control, such as health insurance, energy and inflation.”
The survey is conducted every four years, and the high cost of health care has been the No. 1 in the last five surveys.
“For four years, the economy provided a good, stable foundation for small-business owners to do business, but as it started to take a negative turn over the last several months, they felt the effects of rising costs of doing business,” said Bruce D. Phillips, senior fellow at the business federation’s Research Foundation and co-author of the report with Holly Wade, a policy analyst for the federation. “As the economic outcome remains uncertain, small-business owners are searching for innovative ways to reduce expenses and increase sales.”
FITNESS HITCH To understand why it is so difficult for a business owner to reduce health care costs, you need look no further than the current issue of Fortune Small Business.
Common sense says employees who are healthier and in better shape file fewer claims than those who are not, reducing the cost of their employer’s insurance.
And so, as the article by Mina Kimes titled “Lose Weight or Else” points out, a number of employers are offering incentives for their workers to improve their lifestyles.
For example, at one company profiled, employees receive “a $25-a-month discount on health insurance premiums and cash rewards of $160 a year” in exchange for going to the gym and stopping smoking.
The problem with that?
“Some wellness programs might violate the federal Americans With Disabilities Act and the Health Insurance Portability and Accountability Act,” Ms. Kimes writes. “For example, if an employee is physically unable to participate in a fitness program, is she being punished by having to pay the full insurance premium? And can workers be fired for continuing to smoke?”
WHEN INFLATION IS GOOD The Small Business Administration has increased its revenue-based size standards by nearly 9 percent to account for the inflation that has occurred since 2005.
The standards are used to determine if a business is small for its industry and therefore qualifies for government small-business programs.
Under the inflation-adjusted size standards, retailers with up to $7 million in annual revenue, for example, will be considered small businesses, according to Mass High Tech: The Journal of New England Technology. For computer systems design services, the new small-business threshold is $25 million in annual revenue.
ENERGY VAMPIRES There is one simple if annoying way to reduce your company’s energy costs: simply unplug office machines when they are not in use (like when you go home for the day).
Turning the devices off is not enough because they will continue to function to some degree. (The clock on the microwave in the company kitchen is still on.)
Good magazine reports that companies could save the following sums annually by unplugging each of these devices:
Computer: $34.21
Laptop: $15.90
Laser Printer: $12.43
LCD Monitor: $2.51
LAST CALL It seems like only yesterday, but as Entrepreneur notes, it was 40 years ago that Robert Propst, head of research at the office furniture maker Herman Miller, invented the cubicle that made possible both Scott Adams’s “Dilbert” comic strip and the cult classic movie “Office Space.”
Oh, for those of you who were wondering, the magazine writes that by 2006 “cubicles were estimated to account for the lion’s share of office furniture sales — about $3 billion a year.”
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