The plight of the local small business

"I can't get in to see the right person at ______ to talk with them about doing business." I've heard that comment dozens of times from local small business managers as they try to make a sale to purchasing decision-makers at local larger businesses/industry/organizations. Hopefully, we at the Greater Owensboro Chamber of Commerce put a small but mighty dent in that plight last Thursday with the first "Owensboro Buys It!" expo.

An offshoot of the six-year-old "Owensboro Has It!" buy-local campaign, this event started early last summer when more than 100 small business Chamber members learned how to build their own two-minute "elevator pitch." They were then required to attend at least two Chamber focused-networking events to practice their pitch. About 80 businesses qualified to attend Thursday's expo and meet in five-minute, one-on-one meetings with purchasing personnel from nearly 30 large local businesses/industries/organizations that agreed to participate.

From most accounts, the small businesses appreciated the opportunity and many told me after their meetings that they expected to gain business from it. While that was music to my ears, comments I heard from the purchasers were more telling. "This went better than I expected," "I guess I didn't realize what we had here," "Next year we're going to bring more people," was what I heard. Put another way, many large companies with purchasing power to help local small businesses simply don't know what's under their nose. It's not just companies; many residents fall into the same category.

As the chamber of commerce guy, that fact of life makes me frown. Why do many people not look locally when they need a box of paper clips or an electrical contractor or a guitar? I realize this isn't just an Owensboro issue, but I do believe it's prevalent here. For those of you do think local when you buy, thank you. For those of you who don't, remember the plight of the small local business.

Cap'n'trade a business buster in several ways

Some in the media have reported in recent days about a handful of large utilities and the Mac and iphone maker Apple announcing they will drop their membership in the U.S. Chamber over the chamber's determined ways to derail the federal cap'n'trade regulation. Boiled down to its simplest form, cap'n'trade would tax high emission states like Kentucky and Indiana (see graphic) in a noble but misleading gesture to help the environment. Kentucky and Indiana get most of their electricity form burning coal in power plants; various studies draw different conclusions, but one says Kentucky will lose 21,000 jobs if cap'n'trade becomes law. Electric rates in Kentucky are expected to increase by at least one-third and possibly much more.

Business associations like chambers of commerce try to get their members "on the same page" over common issues. The problem is that what can be good for the "mom'n'pop" store may not be positive for a large corporation or vice versa. Indeed, while increased electricity rates would no doubt harm nearly all business—including the concentration of aluminum smelters in Western Kentucky—through higher power bills, some large utilities are shrewd and large enough to cut their own deals in the legislation; some utilities will make more money with cap'n'trade by selling emissions credits; hence, they have much to gain with cap'n'trade. And now, a company like Apple that likes to think of itself as "environmentally conscious" publicly distances itself from the U.S. Chamber. I don't believe Apple has any manufacturing facilities in Kentucky or Indiana.

Business interests are often diverse and cap'n'trade has become a good example of the difficult nature of getting all of them coordinated behind the same goal. My opinion is decidedly pro-business and pro-Kentucky on cap'n'trade. I'm all for "saving" the environment, but the legislation is in no way binding on other countries. Much of the developing world has shown no interest in enacting similar emissions limits. In other words, the U.S. could curtail its emissions while the rest of the world does not. I doubt "the environment" separates what the U.S. does vs. the rest of the world.

Secondly, electric rates will no doubt rise under cap'n'trade, especially in coal country such as Kentucky. Low power costs have been the state's one true competitive advantage in economic development for many years. Take that away and high energy consumers like manufacturers will have one big reason to locate elsewhere, perhaps overseas.

The original "social media"

Here Comes Everybody is among the handful of social media books that I'm currently reading to bring myself up to speed on what tools like Facebook, Twitter and others mean to the landscape today. While some still shun these technologies, the growing numbers who are using them are doing some very creative things to reach out to their "friends" and build connections and followers. Likewise, chambers of commerce everywhere are tussling with social media and know they can't afford to ignore these new ways for people to connect without a formal organization.

As we at the Greater Owensboro Chamber released our annual legislative and local issues survey this past Friday, I couldn't help but smile thinking at how online surveys could be considered "old school" these days. We've done our survey for the past six years to gather input from our members, and we've always had at least a 20% response rate, which is good. We consider the collective thoughts of our members to be very important leading into the Kentucky General Assembly and the myriad issues that inevitably pop up along the way.

Yes, the new social media tools offer the ability for anyone to provide input. Everybody can be a writer, a blogger, post their thoughts and feelings. We've been doing that via online surveys well before Facebook and Twitter were conceived. That makes me smile too.

The cliff

The Advocacy Task Force of the Chamber of Commerce met today and one of the topics was the 2010 Kentucky General Assembly that begins in January. It will be the even-numbered year long session which means it's budget time. Law makers will craft a new two-year state spending plan, which in recent years has been difficult to reach.

This summer, the legislature came back into special session to plug the estimated $1 billion shortfall from the economic downturn that was staring the state in the face for the year that started July 1st. Thanks to $742 million in federal stimulus dollars, the hole was relatively easy to plug, and law makers even decided to take in less revenue by exempting military personnel from the state income tax.

Increasingly, though, I hear people talk about "the cliff." For years, legislators have been able to cobble together dimes and quarters from a wide array of state revenue pots, rainy day funds and other places to make end's meet. The stimulus dollars were "the solve" this year, but though we're hearing about economic recovery, the state's income continues to underperform. "The cliff" is the time Frankfort observers see as the day fast approaching when the cupboard is bare but the bills still need to be paid. "The cliff" was a topic today in an interim budget committee hearing. Read the C-J story here: http://tinyurl.com/nzlaw3

Which leads us back to the 2010 legislative session. Certainly, there will be those calling for raising taxes. I suspect the GOP-led Senate will decide a renewed "no tax increase" zest is their best route, particularly with Democrats having picked up two seats this year in special elections in that chamber. Just how tall is that cliff?