Based on a recent discussion, I have been contemplating the problem of fellowship in the church, given that we don’t all agree on doctrinal or behavioral issues. There is a tacit tendency to fellowship those whom we agree with on important doctrinal or behavioral issues, but this raises the issue – what is important?Read More
Dealing with Small Business Situations that Get Complicated Because You’re Too Big and Too Small at the Same Time.
This is a rough draft describing an issue that has come up a few times in my consulting practice at Nectar Bridge.
Country Time Lemonade made the USA Today this summer with an offer to pay fines for kids running lemonade stands. In the manner of HOA presidents and other kill-joys everywhere, it seems that “unlicensed” (in quotes because, by definition, lemonade stands are unlicensed, ad-hoc efforts) lemonade stands attract more scrutiny than in the past. Trying to figure out what this says about us as a society is outside the scope of this article. My focus is on how this stands in for a problem that small businesses face each day. I’m not sure that I have a solution, but I do have some opinions.
Let’s start with a couple of scenarios:
- You meet a friend for lunch and he or she notices that you have a copy of a book they’ve been meaning to read in the back seat of your car. “Hey, are you reading that?” they ask. You reply that you have found John Grisham’s latest to be tougher going than you realized, but are trying to finish it because you paid $32.95 for it at the bookstore. They offer you $10 plus they’ll pick up the tab for lunch. No problem – they haven’t outlawed casual sales between friends yet. The only bookkeeping that may be required is if you decide to deposit the $10 bill at the bank. More likely you’ll spend it on parking and gum.
- You are Amazon, and you’re thinking of opening bookstores at airports. You will task your legal, retail, and tax teams with plugging in whatever resources you need to legally sell books in these venues, knowing that if you miss a single step you’ll be in the news, and not in a good way. No problem – your legal, retail and tax teams deal with this every day. They will ensure that your cash registers are set up with the right local tax rate for the state, county, city, and perhaps the “Airport Economic (dis)Incentive Opportunity Zone Franchise and Concession Surcharge” for each separate store. You’ll probably start by piloting the program (no pun intended) at the airport in Houston, TX.
Stuck in the Middle
Now for a third scenario – you are a self-published author who sells a paperback book at events where you are invited to speak. You might sell 100 books at events, or you might sell 5. And you are a business with one employee – you.
Depending on the location of the venue, you may have a difficult time being in perfect compliance with all of the laws. The speaking engagement itself was a service, so you don’t have to deal with sales taxes. Licensing, i.e. the question of whether you needed a business license to physically appear in the venue, probably depends on who you ask, truthfully.
Your exposure goes up considerably based on the size of the venue (not necessarily the size of your small operation within the venue). So if you are the aforementioned incidental bookseller at a widely promoted event, the chances that some enterprising agent of the city, county, or state you’re appearing in will “catch” you doing this go up substantially. On the other hand, if you’re invited by a private company for an in-house meeting that will take place in a Hampton Inn meeting room, you’re probably going to fly under the radar.
Disclaimers So Far
I will be adding to this article and/or writing some additional posts on this subject. I am aware that I’ve raised a question without providing a satisfactory answer. Some thoughts in closing:
- This is not legal advice (so far it’s not advice at all).
- I do not advocate willfully violating the law, and in fact I’m sympathetic to the perceived need of local governments to charge taxes.
- I don’t think most small businesses are trying to violate the law either; I think they’re somewhere between ignorant of the laws and struggling to get adequate information to ensure compliance.
- There is a perception that if you contact local authorities, the answer is always going to be “yes, you need a license/permit/fill out returns until the end of time,” and this perception is somewhat true to my own experience. I’ve had many a conversation with a local authority when contemplating some sort of remote work/sales/hiring that has gone this way. You are not typically able to lobby for a “common sense” streamlining or avoidance of the issues.
- One of the problems is that the aforementioned public servant’s “template” for these transactions never fits the scope of what you’re actually trying to do. If you want to sell books at a meeting, they pull out the paperwork for opening a bookstore. If you want to hire a remote developer, they approach it like you’re starting an IT firm. Not always, but there is that risk.
- Even if you talk to a representative who is highly sympathetic, they themselves will sometimes couch their advice in terms like “I didn’t tell you this but…” or “We probably won’t catch you, but there’s always that risk…”
- Finally, my opinion is that you unfortunately cannot resolve these issues “in general.” You will need to do a little research for each situation you are considering.
Signing off for now; more as I do some additional research. Just for the lulz and for my own future reference, I leave you with the Alabama Sales Tax Code. Read it and get back to me…Read More
In a previous post I left an issue hanging, and true to form left it hanging about a month (maybe more).* I meant to just hyperlink it, but WP does this trick now where you get a whole block preview of it, like this:
And to quote myself on that issue to save you from going back and reading it (although you really ought to, it’s pretty good), I said:
G. Smith, consultant
I’ll give you my thoughts on how the proposal should promise resolution and define the methods, NOT be a fleshed-out plan.
So here’s the thing: knowledge work, or proposing to write a plan of action and/or organize work on someone else’s benefit for a valuable result, is a bit different than, say, offering to pour someone a new driveway. The person who pours driveways for a living comes out, looks at the driveway, scratches his or her head, hopefully writes some things down, goes back to his or her truck, Miata, Dodge Viper, or the like, and either writes a proposal on the spot or goes back to an office and writes one up.Read More
(Open up full post to see terrible video quality)
I well remember when a guy I was working with started talking about doing promotional videos with his cell phone and wound up with thousands of dollars of cameras, tripods, lights, microphones, lenses… I’m trying to avoid doing that. I have, however, decided I needed to be doing videos to promote Nectar Bridge, and also recently had to update my Adobe subscription to include Premiere Pro. I already owned a decent video camera (a Canon 70D, which is a prosumer level SLR which also shoots 1080p video) and a Tascam stereo recorder and microphone.
So I’ve been learning to create titles, pull together multiple media sources, etc. Now all I have to do is learn to light my videos. And operate a Power Point presentation while talking. And learn to talk faster. And…Read More