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BRIEFLY:
SBA launches YouTube channel
The U.S. Small Business Administration has begun posting informational videos on YouTube as it joins an increasing trend within the federal government to use the popular video-sharing web platform to reach a larger audience.
"With millions of visitors, most of them under 35, YouTube offers a prime opportunity to use current technology and the appeal of a popular online platform to further promote the agency's programs and services," said SBA Administrator Karen G. Mills. "By expanding its outreach, SBA will be providing more current and potential entrepreneurs with the necessary tools to start, grow and succeed in their businesses."
The SBA YouTube channel ( http://www.youtube.com/sba
) debuted with a 60-second introduction to SBA, its programs and services, and a 10-part "Delivering Success" series co-produced with the U.S. Postal Service.
Future content will include a variety of videos with more in-depth information about SBA programs and services to inform current and potential entrepreneurs. Topics will cover how small businesses can take advantage of the Recovery Act loan programs, government contracting opportunities, exporting to increase market share, counseling and training on how to start and grow a small business, and small business success stories.
Seven Marketing Tactics That Work in a Recession . . .
Article available from Business.gov at: http://community2.business.gov/t5/The-Industry-Word/7-Marketing-Tactics-That-Work-in-a-Recession/ba-p/5301#A13.
It's not too late to join IMA's Energy Program . . .
Learn more at a Webinar, September 9th
It comes as no surprise that Illinois manufacturers are paying close attention to the relationship between volatile energy prices and their bottom line. In order to survive, today's most successful manufacturers are rethinking and employing smart new energy strategies.
Together, the Illinois Manufacturers Association (IMA) and Constellation NewEnergy (CNE) have collaborated to design an Energy Program that provides benefits to both to the association and its members. As part of this program we are working together to organize educational seminars and briefings on current energy issues impacting your businesses.
This webinar has been put together for those of you that are new to the IMA Energy Program and will help explain how your business can benefit from it. We plan to discuss the numerous products and pricing choices IMA members have available to them, along with energy strategies that could be considered.
By providing this information, our hope is that every IMA member will understand that a solid energy strategy can provide the edge they need to beat their competition, and have a long-lasting impact on the future success of your company.
Sign up today for this complimentary event at http://www.newenergy.com/ima
RSM McGladrey presents . . . Human Capital and Compensation Trends During Difficult Economic Times
Webinar details: Wednesday, September 16, 2009, 10:00 to 11:00 am (CT)
You will receive log-in information in a confirmation e-mail after you sign up.
Cost: free
The economic downturn has caused all organizations to closely examine their workforce and associated costs. Unemployment has reached levels not seen in decades. This session will discuss implications of the current economy on the manufacturing industry and preview the results of the IMA's 2009-2010 Compensation Survey. Covered will be strategies to help you balance the short-term business requirements (such as reducing costs) with the long-term strategic considerations. Our approach will be to present recent trends, highlight client examples of strategies that are working today, and share best practices including emerging trends in human capital management and current and anticipated salary movement and related implications. Register today at:
www.regonline.com/humancapitaltrends.
New from the IMA . . .
PAY-AS-YOU-GO WORKERS' COMPENSATION INSURANCE
zero downpayment • expanded eligibility • minimized audit exposure
For a no-obligation quote, please visit http://www.insurelinx.com/IMA
For more information, contact Mark Frech at 800-875-4462, ext. 3022
or email mfrech@ima-net.org
Can you demonstrate long-term viability?
Demonstrating long-term viability is more important than ever for suppliers. It's critical to understand what information your customers are considering and how they'll evaluate your enduring potential.
In these challenging times, there's little room for error. Companies must evaluate all aspects of their businesses for weakness and potential risks. The ongoing struggles of the U.S. automotive industry have highlighted the importance of the supply base and its ability to survive. OEMs and Tier 1 suppliers have gained a greater appreciation and understanding of the importance of identifying and supporting viable, long-term suppliers.
Identifying which suppliers are viable, long-term supply chain candidates versus those that aren't can be a difficult task. Many manufacturers have initiated supplier risk assessment programs to evaluate the health of their supply base. As a supplier, it's critical to understand what information your customers are considering and how they'll be evaluating your business's potential as a long-term, viable supplier.
Keys to survival
The key to surviving in a difficult economy comes down to two things: short-term liquidity and a strong balance sheet. It may come as a surprise, but the balance sheet is often a better indicator of financial strength than earnings. In a struggling economic environment, customers are most interested in your ability to weather the storm, not necessarily your current profitability. One of the keys to evaluating where a business is heading is it's financial trends. The following metrics are frequently used by customers when evaluating their suppliers:
- Current Ratio
- Debt to Equity
- Debt Service Coverage Ratio
- Operating Income (Loss)
- Net Income (Loss)
- Altman Z-Score
- Value-Add as a Percentage of Sales
Altman's Z-Score for predicting bankruptcy is a formula for the measurement of the financial health of a company that forecasts the probability of a company entering bankruptcy within a two year period. This metric only provides a snapshot of where a company stands and can be misleading if viewed at a single point in time. Assessing the Z-Score as a trend, on the other hand, provides insight into where a business is heading and is a better indicator of future financial strength.
Another useful financial metric is value-add as a percentage of sales. Value-add is calculated as sales price less material cost. If a supplier's value-add is trending down, the supplier is providing less and less value to its customer and moving more toward becoming a pass-through entity. Suppliers that provide little value to the manufacturing cycle are often not sustainable when volumes decrease.
Importance of your bank relationship
Because a supplier's bank generally plays an integral role in its long-term viability, customers frequently monitor a supplier's banking relationship for indicators of weakness. Issues such as violating debt covenants and forbearance agreements are often signs that a business is struggling. Your customer is aware that many banks have little tolerance for struggling businesses in high-risk industries. They will likely attempt to address the situation quickly before risking a production shut-down caused by a liquidity crisis associated with insufficient credit availability .
Continuing as a viable supplier
How can you ensure that your customers view you as a viable, enduring supplier? The first step is to begin monitoring the metrics and ratios listed above. Even if your customer hasn't asked you to submit financial information as part of a supplier assessment program, tracking the strength of your business, basic liquidity, and risk trends is essential for a high-performing business. Strong companies perform trend analyses on a regular basis and monitor their results closely. If liquidity and profitability begin to deteriorate, ratio and trend analysis can act as an early warning system, alerting management that action is necessary.
Mitigating supply chain risk
In these difficult economic times, many OEMs and tiered suppliers are worried that their key suppliers may not be there when they need them, leading to production delays and missed customer shipments. A supplier risk assessment process can help ensure the timely receipt of materials, parts, and services an organization requires in order to operate efficiently and profitably. By collecting indicators of operational and financial health as well as bankruptcy predictors and scoring each supplier relative to risk, organizations will identify the following:
- Suppliers who require immediate review for resourcing
- Those who need deeper assessment and closer monitoring for signs of further deterioration
- Those who should be considered for increased sourcing
The assessment and monitoring process is designed to identify problems before they negatively affect business and a Customer is the "last one out." Plante & Moran has provided assistance to OEM and Tier 1 suppliers in understanding supply chain risk through supplier risk assessments.
If your business begins to experience hardship, early action can mean the difference between survival and failure. We've seen many businesses end up in liquidation because they ignored early warning signs and delayed immediate and decisive action. Those that are proactive and address concerns as they arise are the suppliers that will ultimately be viable in the supply chain for years to come.
To find out more, contact: Andrew Davignon, Consultant, Restructuring & Operations Improvement,
andrew.davignon@plantemoran.com
or Jamey Schalter, Senior Consultant, Restructuring & Operations Improvement,
jamey.schalter@plantemoran.com.
Webinars for manufacturers: Topics 4 the times from PlanteMoran — Prepare for the upswing . . .
Balancing cash flow and cost reduction: Critical steps to succeed in the next economic upswing
Monday, September 21, 1:00-2:00 pm CT
For more information and to register, visit http://www.conferenceservers.com/brands/INF/eATConference/maskpath.html?id=4759558c8c&l=en-US
A team of nationally-recognized manufacturing and distribution experts will help you select the most effective cost reduction programs, as well as suggest how to manage them so that you will not jeopardize your company's ability to take immediate and full advantage of an upswing. Plante & Moran's manufacturing and distribution experts will help you answer important questions like: Where will the cash come from to fund inventories and receivables when demand begins to rise?
IFRS: Is simpler better?
Thursday, October 22, 2009, 9:00-10:00 am CT
For more information and to register, visit http://www.plantemoran.com/topics-4-the-times/ifrs-is-simpler-better/Pages/home.aspx
A team of accounting experts will discuss the pros and cons of the newly introduced international accounting language (IFRS) for small- and medium-sized companies. Could it be the answer to increasing demand for little GAAP? IFRS is the financial reporting language in 100 countries.
What's new on the tax front?
Thursday, November 17, 2009, 1:00-2:00 pm CT
For more information and to register, visit http://www.plantemoran.com/topics-4-the-times/whats-new-on-the-tax-front/Pages/Home.aspx
A team of experts specializing in federal, state, local, and international tax will cover issues that will affect your business profits and your personal income. You can depend on them to take the mystery out of year-end tax planning and explain the impact of emerging legislation. They have been watching the tax code evolve and will talk about amending old strategies to reflect the changes and adopting new strategies in response to new laws.
For additional "Topics 4 the times" Webinars from PlanteMoran, visit
http://www.plantemoran.com/topics-4-the-times/Pages/home.aspx?WT.mc_id=topics4thetimes
Survey: New growth areas are a priority for manufacturers
By Brad DeNoyer, CPA, Partner, Baker Tilly Manufacturing Industry
While signs of gradual economic recovery are starting to appear, manufacturers are pessimistic and exploring new growth areas while waiting for a strong rebound in customer demand.
Baker Tilly, an independent member of Baker Tilly International, recently surveyed manufacturing executives across the nation to gain additional insights on the state of the industry. Survey results may be found at
http://www.bakertilly.com/manufacturing-survey.
Manufacturers that are surviving the recession have some common traits. In working with our clients, we've seen firms be aggressive yet flexible in managing staffing and cutting costs and by now, many manufacturers in Illinois and across the country have right-sized their operations. We have also found that the survivers are being creative in their growth strategies to help position their organizations for future success. In fact, our survey found that 65 percent of executives are considering increasing the diversity of products or customers in response to the economy.
Key findings from the survey are:
- Compared to their economic outlook overall, executives are more pessimistic about the manufacturing sector with slightly less than half (47 percent) expressing optimism in the survey. The key factor dampening the manufacturing outlook is the lack of customer demand, which was cited by nearly half of respondents as the greatest challenge to the expansion of their company. Choosing from a list of eight challenges, 45 percent of executives said customer demand was the greatest barrier to expansion of their firm.
- Other issues cited as the greatest challenge include the availability of loans and credit (14 percent), business taxes (10 percent), trade policy and foreign competition (9 percent) and complying with government regulation (6 percent).
- Despite the pressure to reduce costs, executives said they are continuing to invest in their companies. The most common investments are in quality improvement systems (51 percent).
- Other areas of investment include: Research and development (48 percent), Capital improvement (40 percent), Skills training (36 percent), Green programs (31 percent), Risk management (28 percent), and Foreign manufacturing capabilities (13 percent).
- Executives from large and medium firms said the poor economy has spurred them to consider global expansion. Four in ten executives from medium and large companies said the economic downturn has caused them to look for growth opportunities overseas and 42 percent of large firms are investing in foreign manufacturing capabilities.
- Executives involved in overseas activities said they plan to focus primarily on China (selected by 44 percent of executives), Mexico (40 percent),Eastern Europe (27 percent), and India (23 percent).
KRC Research conducted the national telephone survey of 300 senior executives of U.S. manufacturing companies in June 2009 on behalf of Baker Tilly.
Senate climate change bill delayed
Democratic leaders said Monday, September 1, that a Senate climate bill will not be ready until the end of September, according to a report on TheHill.com.
The bill was expected to be written by the time lawmakers returned to Washington next week, but lead authors Barbara Boxer and John Kerry said it will not be introduced until the end of the month, meaning an even tighter schedule for passing the bill before Copenhagen climate negotiations in December — the stated goal of the Obama administration and House and Senate leadership.
Meanwhile, other Democratic Senators have been "fine-tuning" their cap-and-trade messages, according to a New York Times report.
IRS net operating loss carryback option ends soon
Time is running out for many small businesses wishing to take advantage of the expanded business loss carry back option included in this year's recovery law. Eligible individuals have until October 15 to choose this expanded carry back option. Eligible calendar-year corporations have until September 15. This carry back provision offers small businesses that lost money in 2008 an excellent way to quickly get some much needed cash if they were profitable in previous years. Under the American Recovery and Reinvestment Act (ARRA), many small businesses that had expenses exceeding their income for 2008 can choose to carry the resulting loss back for up to five years, instead of the usual two. This means that a business that had a net operating loss (NOL) in 2008 could carry that loss as far back as tax-year 2003, rather than the usual 2006. Not only could this mean a special tax refund, but the refund could be larger, because the loss is being spread over as many as five tax years, rather than just two. To learn more about this carry back option, go to
http://www.irs.gov/newsroom/article/0,,id=211964,00.html.
Webinar topic: Prepare your employees and your business for pandemic flu with help from the American Red Cross and OSHA
Thursday, September 24, 20091:00 pm (CT)
In June, the World Health Organization (WHO) raised the worldwide pandemic alert level to Phase Six, a designation indicating that a global pandemic is underway. More than 170 countries are now reporting cases of H1N1 Influenza, a virus the WHO anticipates will persist into the upcoming influenza season.
As health experts around the world seek to better understand the scope and severity of the flu pandemic, this is a critical time for businesses to review and update their emergency preparedness plans.
Join experts from the American Red Cross and OSHA for a free Webcast on flu preparedness, where you'll hear about the latest developments and resources available to help you:
- Educate employees about how to prepare for and respond effectively to pandemic flu
- Aid in business sustainability in the face of pandemic flu
- Learn about OSHA's new pandemic flu products and resources
This Webcast will also provide you with an orientation to a new American Red Cross pandemic flu preparedness program that you can deliver to your employees. The program covers:
What to expect during a flu pandemic
- The difference between seasonal flu and pandemic flu
- How the influenza virus spreads
- Steps to reduce the spread of flu in the workplace
- What questions to ask about workplace policies, practices and protocols related to the potential of a flu pandemic
The first 100 people to register for the Webcast will receive a free Germ Guard Pack. To promote healthier environments, the American Red Cross has developed a Germ Guard Personal Protection Pack to help combat the spread of germs and block airborne particles. The contents provide increased protection at work, home, school or on the go, and the lightweight design makes it easy to grab, pack and carry.
Speakers include experts from the American Red Cross and OSHA. A Q&A session will be held during the last 15 minutes of the Webinar.
Date: Thursday, September 24, 2009 — Time: 1:00 pm (CT). Register today at:
http://www.1105info.com/t.do?id=3204737:2911415.
IRS deadline for export benefits approaching fast
Are you directly or indirectly exporting property produced or manufactured in the United States? If so, you only have a few weeks to claim a powerful export tax incentive, the Extraterritorial Income Exclusion ("EIE").
alliantgroup is ready to assist you in claiming EIE benefits, which are available to you for previous years, but only if you start the study process now.
And with EIE benefits going away soon, IC-DISC, the last remaining export incentive, can provide tremendous export-related tax benefits going forward.
This is a powerful export tax incentive . . . but remember, the clock is ticking.
For more information, contact Jim Young, Associate Director, alliantgroup, LP, 311 South Wacker Drive, Suite 2275, Chicago, IL 60606. Phone: 312-386-9770, Fax: 312.386.9771,
http://www.alliantgroup.com.
DATES OF NOTE:
More information/events may be found at http://www.ima-net.org/calendar.cfm and
http://www.ima-net.org/MIT/open.cfm
September 11, 2009
MPAC Golf Outing
Willow Crest Golf Course, Oak Brook
Join your peers and support MPAC at the annual golf outing. Spend the day networking with IMA members on Willow Crest's 18-hole championship golf course. Located in Oak Brook at the Oak Brook Hills Marriott Resort. Noon — Lunch; 1:00 PM — Shotgun start; 5:30 PM — Networking reception. Sponsorship opportunities are available. Visit
https://www.ima-net.org/mpacgolf09.cfm
to register. For more information, contact: Kimberly McNamara, 800-482-0462, Ext. 2109, email:
kmcnamara@ima-net.org.
September 16, 2009
IMA-MIT Event: Mentoring Skills for High Performance, DePaul University O'Hare Campus, 3166 S. River Rd, Des Plaines
Participants will successfully establish mentoring relationships, ensuring optimal development skills for identified growth requirements.
October 2, 2009
IMA-MIT Event: Customer Service Skills and Excellence — DePaul University O'Hare Campus, 3166 River Rd, Des Plaines
Complaints to Better Business Bureaus and state regulatory agencies are at an all time high, and growing! Statistically, a dissatisfied customer will tell on average 12 people about their negative service experience and 91 will stop doing business with the company altogether. Study after study indicates that World Class Customer Service will provide the most valued differentiator between your organization and the competition.
October 2-4, 2009
IMA's Young Leaders Council Fall Conference
Eagle Ridge Resort • Galena
Sign up today at: https://www.ima-net.org/ylc09.cfm
October 21, 2009: Top 10 Ways Manufacturers Can Avoid Liability for Employment Claims — Northern Illinois University–Naperville campus
1120 E. Diehl Rd., Naperville, 9:00 am–Noon
Avoiding liability for employment claims is even more critical for manufacturers in this challenging economy. This interactive workshop led by Daniel Kaufman, Michael Best & Friedrich LLP, will begin with an overview of the top ten ways to avoid such liability. The best practices discussed in this interactive format will highlight the practical steps manufacturers can take to reduce and manage the risk of employment liability. Cost: $125 IMA members; each additional attendee $100; $150 Non-members. For more information, contact: Kimberly McNamara, 800-482-0462, Ext. 2109, email:
kmcnamara@ima-net.org.
November 5, 2009: Illinois Sales & Use Tax
Northern Illinois University–Naperville campus
1120 E. Diehl Rd., Naperville, 8:30 am–12:30 pm
The Manufacturers Purchase Credit, Graphic Arts Machinery & Equipment exemption, and Investment Tax Credit will be available through 2014. Join your peers and find out more about Illinois taxes specific to manufacturing. Joe Bigane, Wolf & Co. will once again lead an informative and up-to-date discussion. Cost: $125 IMA members; each additional attendee $100; $150 Non-members. For more information, contact: Kimberly McNamara, 800-482-0462, Ext. 2109, email:
kmcnamara@ima-net.org.
November 10, 2009
IMA-MIT Event: Sales Skills for Non Sales Professionals — DePaul University O'Hare Campus, 3166 S. River Rd., Des Plaines
This one-day workshop has been specifically designed to help non-sales personnel realize, and take advantage of, sales opportunities as they occur. Determine when it is appropriate to "sell" and how to avoid being perceived as "pushy."
Sign-up online for IMA publications
The IMA communicates weekly with IMA members, policy-makers and others interested in IMA activities. IMA publications include: Executive Memo, Human Resources Memo, Healthcare Memo, Tax Policy Memo, Sustainable Memo and The Illinois Manufacturer magazine. All are published electronically with the exception of the magazine, which is published quarterly and mailed through the USPS. Take a moment to visit
http://www.ima-net.org/membership/preferences.cfm
to sign up for the IMA publications that are right for you.
Introducing FedEx Advantage® for IMA members . . .
IMA and FedEx are proud to announce a new member benefit. As an IMA member, you are now eligible to receive valuable discounts of up to 29% on select FedEx® shipping services and can also take advantage of additional savings on FedEx Freight® and FedEx National LTLSM services:
- FedEx Express®: from 19% to 29% on select services
- FedEx Ground®: from 5% to 20% on select services
- Additional savings on FedEx Freight® and FedEx National LTLSM services
Visit https://advantagemember.visionary.com/4533
and enter passcode [VM6MXK] for more information or to enroll. If you have additional questions, please call 1-800-MEMBERS (1-800-636-2377, 7:00 a.m.– 5 p.m. CST, M-F) to speak to a dedicated member service representative.
Join the IMA Energy Program . . .
IMA members looking to compare their electric supply options can go to http://www.newenergy.com/ima
and receive a free, no obligation rate quote.
OfficeMax Advantage can save you 30% or more on your office supplies . . .
IMA members and OfficeMax — a first-class partnership
Go to: http://www.ima-net.org/membership/programs.cfm
to download your OfficeMax Retail Connect Card and start saving today!
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