You might open a newspaper soon to see an ad like the one at right which appeared in my local paper a few days ago.  It encourages you to “Stand With Main Street” to protest “special treatment” of Amazon.com that allows them to forgo the collection of sales tax on online purchases, resulting in an unfair advantage over “every Hoosier brick and mortar retailer.”  I don’t usually see full-page ads related to Internet commerce in a market this size, so I thought I’d investigate the issues at stake.

The question of taxing e-commerce transactions is a bit complicated to be sure.  If you have a strong and concisely-worded position on it, you’re probably running for national political office, or a Libertarian, or both.

On one hand we can see the clear financial and psychological advantage that an online retailer has with customers who are weighing a purchase from a local store that charges tax against an online store that doesn’t, and maybe offers the item at a slightly lower price too. At the same time, that online retailer may be benefitting from the infrastructure that sales taxes others are collecting help pay for (setting up warehouses, trucking goods around state roads, etc.).

On the other hand, we know that laws around state sales taxation were created prior to the age of the Internet and that the models of online business and affiliate sales have completely changed the way the world does business, and current attempts to rewrite them in order to create short-term bandaids on ailing state economies are probably not in the best interest of business innovation, especially when they favor large retailers (online and off) and send small businesses and people who make a living as Amazon.com or eBay affiliates into a quagmire of tax collection bureaucracy.

(In my company’s work building online stores for our clients, we’ve experienced this firsthand; helping a small business calculate the city, county and state tax rates that affect what they’re selling customers and then keeping that information current can take up a lot of their time.  Services like taxcloud.net are helping make it easier.)

Some states are moving toward “origin-based sourcing” for taxation, where the tax rate is based on the county/state where the vendor selling the goods is located.  This keeps the taxation process simple (the retailer has to know their local rate and doesn’t have to worry about where the buyer lives or what the rates are there) and encourages governments to keep their tax rates competitive for businesses that might locate there.

Indiana is still a “destination” state, where the tax rate is based on where the goods are being sent.  Indiana Congressman Mike Pence, not generally known for advocating taxation, is supporting the move to make Amazon.com and others pay sales tax so that the government isn’t “picking winners and losers.”  But as others point out, the playing field of retail taxation is already off-kilter in favor of big businesses, which get tax credits, exclusions and special pricing that make it very hard for mom-and-pop shops to compete with them.

Back and forth, back and forth.

I don’t have a strong feeling about what direction we should go (hence disqualifying me from running for office), other than that all of this highlights how complex and outdated the modern system of taxation is, for online commerce and pretty much everything else.  When small businesses or people selling used exercise equipment from their basements have to hire tax law professionals just to sell online and be fully compliant, we’re doing something wrong.  I’m not sure the “Stand With Main Street” ad advances the conversation any, but it hopefully encourages more awareness about what’s at stake.

Earlier today, I sat down with Ron and Tom to ask about how giving away a whole restaurant works, plans for the future of the Deli, and what Tom will do with all of his spare time (and cheesy jokes) in life after small business ownership; here are some excerpts from the conversation:

www.youtube.com/watch?v=lRnKMIDW5gk

I love this city!  Thanks to Tom, Ron, Rachel, and the entire staff of Tom’s Deli for living out a great vision for small business and community building in Richmond, Indiana.

This morning when I spoke with Tom, the owner of Tom’s New York Deli here in Richmond, he talked of troubling health issues and financial factors in his decision, but he seemed as energetic and excited as ever.  He opened the restaurant in December of 1991 and it’s been a fixture on Main Street in the downtown business district ever since.  Professionals, passers-through, families and sports teams alike frequent the establishment, which is known for its great sandwiches, corny jokes and extensive collection of local and national memorabilia.

But as he looks toward the next phase of his own life, instead of trying to sell the small restaurant to the highest bidder, or close it down altogether, he’s ready to give it away to the person who would bring the best vision for its future.

It’s all a part of Tom’s desire to see the small business culture in the downtown area thrive in the face of a new economic reality.  If he can find someone with a little bit of money and a lot of energy, he’d rather see them spend that money on making the Deli even better, instead of financing the sale in the first place.  And in the meantime, the Deli will keep operating as usual.

Are you interested in owning and running a quirky little deli in a small town in the Midwest?  Tom’s taking applications, but he’s not just looking for an impressive resume; he’ll be looking for the person with the best plan and passion to build on what he’s already started.

Contact:
Tom Amyx, Tom’s New York Deli
820 East Main Street
Richmond, IN 47374
(765) 962-4441
tfamyx@gmail.com

The article contains some interviews with downtown business owners, some perspective on the history of the Main Street organization there, and some talk of renewed activity from merchants and business owners (myself among them) in helping make the area thrive.  But there’s something missing from the picture the article paints.

One key angle that the article glosses over is the role that the rest of the community plays in creating and maintaining a thriving downtown.  While there’s certainly some role for business owners and merchants to play in creating a thriving downtown, it’s not entirely their burden to bear.  Retail districts live and die by the shopping choices of their customers, and so it seems important to recognize in any conversation about the health of a downtown that at least some of it is dictated by the “consumer culture” of the surrounding community.

It would be interesting to interview some “regular citizens” and ask them where they tend to shop, and how they perceive the downtown area.  “Given the choice between going downtown to support a business there and going to the mall or a big box store, how do you decide?”  Are they willing to pay a little more for products and services knowing those dollars stay in the community longer (thus supporting the long-term health of the area), or will they always prioritize convenience and the lowest available price?

It also seems worth looking at the environment of governmental and political support surrounding downtown.  Is it possible that city, county and state laws might be negatively impacting the ability of downtown business to thrive?  Is it possible that our approach to zoning, transportation, taxpayer-funded economic development and taxation are favoring non-local chain businesses over those who would choose to start and grow a small business in the place they live?  Is it possible that politics and personalities are at times standing in the way of a thriving central business district instead of nurturing it?

I’ve blogged about these ideas before:

The value we get from a strong and diverse local business community is hard to see when compared as a “bottom line deal” against the attractions of the “big box” stores. And I’m not suggesting that these larger retailers don’t have a place in a strong local economy. But my hope is that we’ll see the Target store closing as yet another indicator of an important trend. By putting so many of our eggs in baskets that lack the personal ties and community investments that our local businesses are built around, we set ourselves up for even greater disappointments and more noticeable disappearance of the business ethic, entrepreneurship, and innovative spirit around which Richmond has historically been built.

There’s no question that the economic health of our downtown is based on complex systems with lots of variables.  The business owners and downtown merchants are mostly already doing their part – they’re running their businesses and they’re engaged in the life of the business district and the wider community.  As a small business owner myself, I know that there’s probably not a whole lot of time left over for those hard-working folks to ALSO do the marketing, advocacy, legislative and policy work needed to help downtown compete against strip malls and big box stores.

So what role does the rest of the Richmond community have in creating a thriving main street area?  How do your choices make a difference in the health of downtown?

There’s a new amusement park ride opening up in town!  It’ll take you on a thrilling journey through ups and downs of successful projects, communication failures, happy long-term partnerships, and total failures in competence.  It’s called THE CONTRACTOR EXPERIENCE and you can hop on it today by opening up the phone book and calling pretty much any contractor you want to try to get some work done on your home or business!

Okay, I know that it might be a little pretentious or worse for me to sit on my high blogging horse and tell the folks who are willing to do some pretty hard, dirty work how to do their jobs when I’m not able or willing to do them myself.  But at the same time, I can’t help but see it from the perspective of how poorly some of these folks are running their small local businesses, and how their customer service values take a total back seat to their own preferred ways of doing things.  Some war stories:

The most common failure in competence that I experience is that the contractor doesn’t even show up at all.  These are people who have access to the same scheduling and calendaring technologies as the rest of us (paper and pen much loved among them), and who still can’t seem to make it work when they agree to show up at a certain time and place.  With one contractor recently, I’ve had them not show up once, and then show up late to the rescheduled appointment.  He then missed a follow-up appointment, and after I called three times to get some sort of explanation, I still haven’t gotten a call back.  If I were trying to make a really bad impression on a potential client, that would be a great way to do it.  How can you run a business that way?

Another failure I regularly experience is that the contractor doesn’t listen to what’s being asked of them, or doesn’t hear the customer’s particular interests and needs.  I tend to be on the overly-organized side of things, and so even with my written-down, clearly spelled out requests, I still often have to correct the contractor’s course once or twice in the estimating and/or work phases.  I know there’s some amount of give and take that’s normal here, but too often for me it’s all give and no take.

And then there’s just total dishonesty, abject incompetence, etc.  I’ve blogged about some of that before.  It’s also included things like using my lawn for cigarette butt storage, or showing up to work in an altered state.   Here’s another episode:

ME ON DAY ONE: While you’re replacing that window, please make sure you put a big cover down over the new carpet here, okay?

CONTRACTOR ON DAY ONE: Oh yeah, definitely, we’ll put a big tarp out.

ME ON DAY TWO: I see you don’t have a tarp out and that you’ve started pulling apart the old window.  I’m worried about dirt and debris getting in the carpet.

CONTRACTOR ON DAY TWO: Oh yeah, we’ll definitely get that cleaned up and don’t worry about it.

ME ON DAY THREE: (grumble grumble grumble)

ME ON DAY FOUR: I see you’re done now, and there’s this big dirt spot on the floor where you were working that isn’t vacuuming out.  What happened?

CONTRACTOR ON DAY FOUR: Oh, that must have been there before, I don’t think we did that.

I mean, come ON!

The hard part is that it takes so much time and “overhead” sometimes to even find the right point of contact for a job, I’m willing to stretch my tolerance of this stuff pretty far in order to not have the churn of saying “well I guess that person isn’t interested, I’ll just find someone else.”  And sometimes there ISN’T a someone else.  The contractor who didn’t show up this morning (“ah,” you say, “that’s why he’s writing this”) is someone who I know, really like personally, and who is uniquely qualified in the area for the particular work I’m interested in.  For relational and practical reasons, I can’t just say “next” and move on.

No, not all contractors are bad and some of them are even quite excellent.  I recently had a GREAT experience with a contractor who was friendly, listened well, always showed up when he said he would, and did excellent work for a reasonable price.  I have whisked him and his family away to an undisclosed location for preservation, as this is clearly the exception and not the rule, at least here in Richmond.

So, as to avoid making this post entirely complaints, I’ll offer some simple suggestions to contractors for improving THE CONTRACTOR EXPERIENCE:

1. Show up when you say you’re going to show up, on time. If you make an appointment, please write it down somewhere you’ll see it again, and if you have to reschedule, please call your customer in advance, and be ready with a few new times to reschedule.
2. Make sure you’ve heard the customer’s technical requests, but also make sure you know what their larger goals are. If they’re clearly trying to “make this room more cozy” or “create a more useful workspace,” there are opportunities there for you to respond to their “big picture” needs, and perhaps even make a little more money in the process.
3. Treat the space like it’s your own. I won’t try to be any more specific on that one, but if you’re in someone’s house or business, and you’re about to tear some stuff apart or make some changes that they’ll have to see every day of their lives, put yourselves in their shoes and ask “how would I do this in my personal space?”

On a larger scale, I wish that there was some better notion of standards or certification for contractors in my community.  I know there are websites and associations where you can rate contractors, file complaints, etc. but in this town, for now, it seems like we’re just one bent nail short of total chaos when it comes to having any hope of knowing what kind of quality you’ll get when you make that call.  The good contractors out there deserve better, and the bad ones have gotten away with too much for too long.

Just as I was finishing this post up, the contractor who missed this morning’s appointment called.  He’d gotten the days mixed up, and we’re rescheduling accordingly.  Life goes on.

“If you read my previous post about 10 Reasons to Work at Summersault, you may have noted Reason #5: In-depth performance reviews provide you with concrete professional goals and feedback on your successes. As we wrap up our Fall review cycle for staff here, I thought I’d say a little more about just what that process involves.”

Continue reading Staff evaluations: giving feedback, building strong teams.

[Paul] Brittenham opened the restaurant with his brother-in-law — Lee Schwegman, thus the name — in 1948 after surviving the attack on Pearl Harbor and five years in the army during World War II. He has kept the ham and eggs and coffee coming and the customers moving on ever since then. But Thursday was his last day behind the counter. Brittenham is hanging up his spatula and retiring at 89.

It’s worth noting too that today is the 15th anniversary of the opening of Tom’s New York Deli, a frequent Uptown lunch spot for some Summersault staff and a place we love to take visitors. Owner Tom Amyx and his staff have always treated us well since our early days of starting up our own business in the business district, and I’m so glad that they continue to survive in the face of chain restaurants and fast food.

Here’s to local restauranteurs!

For better or worse, we (myself included) are often willing to make trade-offs against this kind of consideration because these stores promise us great value and unmatched shopping convenience. But it seems it should greatly concern us when one of these locations, which typically do quite well in cities like Richmond, can’t even make a profit here. I would like to think that Target has seen increased competition from local businesses, but I suspect instead that it suffered at the hands of its own “big box” peers. And so when it is no longer just a matter of big stores driving out local businesses, but is now a matter of big stores driving out other big stores, perhaps we should look harder at what kind of economy and retail community we are trying to build.

The value we get from a strong and diverse local business community is hard to see when compared as a “bottom line deal” against the attractions of the “big box” stores. And I’m not suggesting that these larger retailers don’t have a place in a strong local economy. But my hope is that we’ll see the Target store closing as yet another indicator of an important trend. By putting so many of our eggs in baskets that lack the personal ties and community investments that our local businesses are built around, we set ourselves up for even greater disappointments and more noticeable disappearance of the business ethic, entrepreneurship, and innovative spirit around which Richmond has historically been built.

The closing of the Target store is a significant loss, but what it says about our economic priorities is the real story.

This article was submitted to the Palladium-Item as a Letter to the Editor on November 7, 2004, but exceeded their 300 word limit.

It still strikes me how little we knew about everything that goes into running a business when we founded the technology company I work for, Summersault, in 1997. We were very confident about the services we wanted to provide and very focused on the clients with whom we wanted to work, but had plenty to learn about accounting, legal matters, hiring employees, and all of the other necessary but complex areas of knowledge one must dive into when doing business.

We had the good fortune to be associated with another technology company in town that was willing to help us get on our feet. They provided us with a small bit of office space, a few basic utilities and services, access to office equipment – all at very reasonable rates, often allowing us to defer hefty capital purchases while we were in our delicate initial years.

Perhaps most importantly, they provided some perspective and wisdom about starting a technology company in Richmond, Indiana. In essence, this company incubated Summersault to the point we had some experience with those parts of running a business that entrepreneurs never start out thinking about. They eliminated many of the barriers that start-up businesses face, and increased our chances of survival many times over. This arrangement was an informal one that we felt lucky to come by.

Starting this year, entrepreneurs starting up businesses in Richmond won’t have to count on luck. The Uptown Innovation Center is a facility devoted to the incubation of new businesses in our area. As Summersault’s benefactor did, the UIC will work with individuals to make their dreams a reality by providing below-market office space, access to tools and technology for managing a business, training and counseling on a wide variety of topics, and much more. Businesses that are incubated have a much higher survival rate than those that are not, and when a start-up business succeeds, it brings new economic and social wealth to the community where it lives. The UIC is our community’s newest way of affirming to the innovators among us: “we want you to succeed.”

I wish the Uptown Innovation Center had been around when we first started Summersault, but it is comforting to know that entrepreneurs in the region now have this incredible resource at their disposal, removing barriers and providing a helping hand towards successes that benefit the long-term health of our community. If you haven’t already, I would encourage you to stop by the Center for a tour and more information.

Chris Hardie is Principal of Summersault Website Development.

At the local bank, they’re nice folks, and they do their job, but there’s a lot of staff turnover, and it seems every time I go in they have to look up in a big binder of notes how to do the banking procedure I want them to perform. But, it’s not really a bad experience, it’s just a bland experience – wait in line, do your thang, leave. Nothing to complain about.

Then I walked down the block to the big national bank and as soon as I walked in I got a hello from a staff person who knows me. No standing in line, and the teller helping me not only answered my question but (gasp) offered some suggestions about how I could do what I wanted to do more efficiently. Then on the way out the door, another staff member pulled me aside to make sure I knew about a new service they were offering that she thought might help streamline things at my business.

It was a warm fuzzy experience (as much as one can have at a bank, let’s not get carried away), but it made me appreciate that it’s not always fair to determine the coolness of a vendor just because they’re small and local. The people in the big bank live around here too, and their collective formation of a local branch is just as local as the “truly local” bank in most ways. One might wonder why the local bank has less success than the big one keeping good people around. Maybe the big bank is exploiting hungry children in some third-world country so they can afford to attract those folks more easily.

Ah yes, speculative black-and-white cynicism is so much more fun than acknowledging the complex and richly shaded grey areas of life.