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The Best Way to Get Paid
Gene Marks says the surefire way to deal with out-of-control accounts receivable is to never have any accounts receivable.
Here are today’s highlights:
To grow its economy, Canada is deliberately seeking a big surge in immigration.
An app called Coffee Talk promises to help business owners cope with two implacable trends: remote work and artificial intelligence.
If you’re wondering where to devote your social media energy, the answer is probably LinkedIn.
So far, a New Jersey restaurateur is refusing to back down in his IP battle with Taco Bell.
Gene Marks has some suggestions for making sure your customers pay up: “Do your customers pay their invoices within 30 days? Consider yourself lucky if they do. According to one recent study conducted by financial tech platform PYMTS and collection platform YayPay, a whopping 93 percent of businesses surveyed experience late payments from customers. This is not just a small business problem either: The average days outstanding for invoices at companies listed in the S&P 500 now exceeds 55 days.”
“My company requires our clients to pay in advance by purchasing blocks of time. When the block is used up, we provide an accounting to the client and agree on a new block. That way we’re never pulling money out of our own pocket.”
“It’s not easy for some, but many smart business managers I know in law firms, construction companies and contractors charge in advance for their work through retainers or deposits. Getting cash in the bank helps to minimize the cost of a potential collection issue in the future.”
“Many of my clients use their customer relationship management systems to schedule follow-up calls and reminders for certain customers and to set up alerts and workflows to remind in advance when invoices are coming due. Others leverage credit collection systems like Growfin and Versapay, which, depending on your company’s invoice volume, can help manage collections with more automated tracking and collaboration.” READ MORE
Canada is recruiting our immigrants: “Canada has launched an ambitious program to recruit highly skilled immigrants from all over the world — including from the United States, where our sclerotic immigration system makes it difficult for foreign tech workers to obtain work visas. Last month, Canada offered a three-year work permit to anyone holding a U.S. H-1B visa, the most common entry permit for immigrants working in the tech sector. The program, aimed partly at workers laid off in Silicon Valley’s recent downturn, drew 10,000 applicants in its first 48 hours — ‘a strong indication of just how competitive Canada is on the global stage,’ a spokesman for the country’s immigration ministry said. It was also a reflection of frustration among migrants who find the U.S. visa system difficult and slow. According to one estimate, only about one in 10 people who register for the annual H-1B lottery get a visa.”
“Since 1990, U.S. law has had a fixed cap of 65,000 new H-1B visas every year, plus 20,000 for holders of master’s or doctoral degrees from American universities. U.S. tech industry groups have long complained that those limits are too low, but efforts to raise them have been stymied by the partisan divide over immigration policy.”
“In contrast, Canada is deliberately seeking a big surge in immigration as part of a broader strategy to grow its economy. The Liberal Party government of Prime Minister Justin Trudeau has boosted immigration more than 40 percent in the last five years, admitting more than 400,000 new permanent residents in 2021.” READ MORE
There’s an app designed to help employees gather at the virtual water cooler: “Doug Camplejohn is the founder and CEO of Airspeed, a platform dedicated to creating apps that improve employee connection and recognition in the workplace. Their latest launch, ‘Coffee Talk,’ is an AI-powered app for Slack that matches employees across different teams and seniority levels for weekly or biweekly conversations, either in-person or over Zoom. After learning more about the employee and what topics they would like to discuss, Airspeed's AI not only offers a list of matches but provides conversation starters, offers meeting times that work around both parties' schedules and uses feedback to create better matches.”
“‘This app is really designed to help you connect with folks in your company that you might not ordinarily interact with,’ says Camplejohn. ‘Especially if your company is working hybrid or remote these days, you have less opportunities to just bump into somebody in the cafeteria like you might have in the past.’"
“Coffee Talk can also serve as an opportunity to introduce AI to an entire workforce — an introduction that is necessary now that AI tools are advancing at lightning speed, underlines Camplejohn.”
“Camplejohn warns employers that they are witnessing the meeting of two macro trends no one can outrun: remote work and AI. Employees need the tools to thrive outside the office, and AI can help, if employers are willing to integrate the technology into their workflow.” READ MORE
The long-running debate about the federal minimum wage has been all but forgotten: “Under New Hampshire law, Janette Desmond can pay the employees who scoop ice cream and cut fudge at her Portsmouth sweet shop as little as $7.25 an hour. But with the state unemployment rate under 2 percent, the dynamics of supply and demand trump the minimum wage: At Ms. Desmond’s store, teenagers working their first summer jobs earn at least $14 an hour. ‘I could take a billboard out on I-95 saying we’re hiring, $7.25 an hour,’ Ms. Desmond said. ‘You know who would apply? Nobody. You couldn’t hire anybody at $7.25 an hour.’ The red-hot labor market of the past two years has led to rapid pay increases, particularly in retail, hospitality and other low-wage industries. It has also rendered the minimum wage increasingly meaningless.”
“Nationally, only about 68,000 people on average earned the federal minimum wage in the first seven months of 2023, according to a New York Times analysis of government data. That is less than one of every 1,000 hourly workers. Walmart, once noted for its rock-bottom wages, pays workers at least $14 an hour, even where it can legally pay roughly half that.”
“As a result, the minimum wage has faded from the economic policy debate. President Biden, who tried and failed to pass a $15 minimum wage during his first year in office, now rarely mentions it, although he has made the economy the centerpiece of his re-election effort.”
“The question is what will happen when the labor market cools. In inflation-adjusted terms, the federal minimum is worth less than at any time since 1949. That means that workers in states like Pennsylvania and New Hampshire could struggle to hold on to their recent gains if employers regain leverage.” READ MORE
Marijuana retailers continue to pay much higher federal taxes than other retailers: “Theory Wellness operates like any other Massachusetts business. It abides by state licensing regulations, building codes, and labor laws. But under federal tax law, because the business sells cannabis, Theory Wellness CEO Brandon Pollock is treated no differently than a heroin street dealer. If Theory Wellness were selling vitamins, hemp, or the proverbial widget, it would have simply paid the tax rate of 21 percent in federal taxes in 2022. Because it sells cannabis, it effectively paid 40 percent, Pollock said.”
“The reason is an ill-applied tax law referred to as 280E, named for the relevant section in the U.S. tax code that does not allow filers to take deductions and credits for a business that involves trafficking in a controlled substance.”
“So Pollock can’t deduct the salaries he pays his retail employees or the money he spends on advertising as a business expense, making his profits appear far higher to the IRS than they actually are.”
“The tax discrepancy is among the many absurdities created by having the federal government classify as illegal a drug that 40 states and Washington, D.C., allow in some form. The tax law was written in 1982 after a court case where a drug dealer who was caught selling cocaine, amphetamines, and marijuana and forced to pay back taxes tried to deduct as a business expense his costs for travel, phone calls, and packaging.” READ MORE
For many, LinkedIn is increasingly the place to be: “The biggest social media platforms all have their niches. Twitter is for arguing with strangers. Instagram is for showing off the best of your 500 selfies. Facebook is for learning too much about an acquaintance from college. And LinkedIn is for updating the obligatory professional profile when you’re looking for a job, then receiving constant emails prompting you to congratulate someone on their ‘work anniversary.’ Or at least that’s how it used to be. As other networks stagnate, shift their algorithms, or burn themselves to the ground, LinkedIn is becoming a site where regular people actually want to hang out and post their thoughts. It might even be cool.”
“For social media users looking to engage in some old-fashioned self-promotional posting, LinkedIn is the only place left. ‘On Instagram or TikTok there’s more frustration, because what worked more than a year ago, or even six months ago, that got success and got tons of eyeballs doesn’t today,’ says [Selena Rezvani, an influencer with 100,000 LinkedIn subscribers]. ‘There’s more of a steadiness with LinkedIn.’”
“Writing earnestly on LinkedIn was once derided as awkward and professionally desperate—as in the 2017 ‘broetry’ era, when the site’s feed was populated by self-described gurus and growth hackers. Now, trying to become a so-called thinkfluencer seems strategic and at least marginally socially acceptable.”
“LinkedIn’s business model relies on selling subscriptions to salespeople and recruiters looking to find partners or job candidates. This gives it a tendency toward stability, because it doesn’t need to rely so heavily on the constant attention that helps ad-supported networks make money. It’s a model that seems to be working: LinkedIn’s revenue rose to $15 billion in Microsoft’s most recent fiscal year, almost triple what it had been five years earlier.”
“‘On LinkedIn you see people framing things with a little more tact when they disagree,’ Rezvani says. ‘Their employer might see it.’” READ MORE
Juicy Marbles is selling plant-based ribs with edible bones: “Slovenian-based vegan meat company Juicy Marbles is launching a limited batch of plant-based ribs with edible bones on August 28 in the U.K., U.S., and E.U., the company said. The product will only be available to customers who sign up for an exclusive email link, as the first batch has limited quantities. The new product for Juicy Marbles comes as many players in the plant-based arena are looking to innovate as a way to stand out in a depressed market. With consumers growing skeptical of plant-based meat alternative’s texture and taste, and inflationary pressures leading to more mindful grocery shopping patterns, alternative meat sales in U.S. retail locations have fallen by 19.8 percent year-over-year, according to data from Circana.”
“After the launch of the first batch at the end of August, Juicy Marbles will gather feedback from consumers to tweak the recipe, name, and packaging before a full launch, of which the date has yet to be announced, the company told the Guardian.
“The rib ‘bones’ are made of predominantly soy-based plant protein. Once consumers finish eating the ‘meat’ off, the bones can be transformed into ‘puffy, crisped snacks,’ by air-frying, roasting, or frying them.” READ MORE
A Miami real estate broker who misused $381,000 in Covid-19 relief funds is facing a sentence of 3.5 years: “Daniela Rendon, 31, was indicted in February on charges of seven counts of wire fraud, two counts of money laundering and one count of aggravated identity theft, according to a news release from the U.S. Attorney's Office, Southern District of Florida. Rendon pleaded guilty in April to one charge of wire fraud, which holds a maximum penalty of 20 years, according to the Miami Herald. During her sentencing in Miami Federal court on Thursday, per the outlet, Rendon claimed she had unlawfully applied for the Covid-19 relief funds because she believed ‘everybody was doing it.’”
“The U.S. Attorney's Office in the Southern District of Florida said she submitted fraudulent applications seeking Covid-19 relief funds from the Small Business Administration and Paycheck Protection Program for her real estate business by falsifying her revenue and payroll and submitting fraudulent IRS tax forms.”
“Rendon received $381,000 in fraudulent funds and pretended to disburse the funds throughout her business by distributing checks to herself, family members, and friends after enrolling with a payroll processor.”
“She then used the money to buy luxury items like a 2021 Bentley Bentayga, pay her rent on her luxury Biscayne Bay apartment, and pay for cosmetic dermatology procedures, among other things.”
“In addition to the prison sentence, Rendon was ordered to pay back $198,990 to the U.S. government.” READ MORE
A New Jersey restaurant owner is continuing his long-running fight with Taco Bell over Taco Tuesdays: “Gregory Gregory is a man of many titles: a grandfather, a Jersey Shore restaurateur and raconteur, a 71-year-old with the same first and last name. ... But he is best known for something else: Gregory has promoted [his] bar as the home of the original Taco Tuesday, as well as the country's first trademarked use of a phrase that's grown into a weekly American cultural phenomenon. Since that first Taco Tuesday night in 1979, Gregory estimates that the bar has served more than 2 million tacos in what has become a Somers Point tradition for generations of families and singles on a budget, and 20-somethings needing to soak up the booze and bad decisions.”
“The future of Gregory’s Taco Tuesday trademark in the state of New Jersey now faces uncertainty amid Taco Bell’s petition to the U.S. Patent and Trademark Office in May seeking to cancel the trademark.”
“Taco Bell, which serves more than 40 million customers in the United States each week, has argued that the Taco Tuesday phrase has become so generic that the trademark should be liberated to allow any of the hundreds of restaurants, bars and cantinas in the country that already ignore the Taco Tuesday trademark to use it in their marketing without fear of any potential legal action.”
“‘Every day is taco day at Taco Bell, so I don't know why they have to take Taco Tuesday from us,’ said Steve Altamuro, a family friend and attorney for Gregory in the legal fight against Taco Bell. ‘They have Taco Wednesday, Thursday, Friday, Saturday, Sunday, you name it. I don't know what they're trying to accomplish.’"
“Gregory acknowledges he does not know how long his business can keep up a legal fight with a conglomerate like Taco Bell, especially if the legal expenses creep into the range of six figures.” READ MORE
THE 21 HATS PODCAST
The Toughest Conversation: This week, Paul Downs, Jay Goltz, and Laura Zander don’t hold back. Laura and Jay both say their sales are coming in well below expectations. Not surprisingly, Jay has a five-point checklist that he’s using to assess and address his shortfall. Laura’s situation involves a marketing team that she says has been feeling stressed and is coming apart, with lots of crying and arguing. “They’re just collapsing,” she tells us. Paul, meanwhile, says his sales aren’t bad, but he’s got one employee who’s been holding them back. The employee, who’s been with Paul for 10 years, has been spiraling of late, says Paul, who’s dreading what he calls “the toughest conversation,” a conversation he fears will leave the employee devastated.”
“In such situations, Jay says, he’s found it helpful to rank himself from one to 10 on the hardass scale: If Mr. Rogers is a 1 and Jack Welch—the take-no-prisoners former CEO of GE—is a 10, where do you want to be? “If you pick four or five,” Jay says, “you're probably gonna go out of business.”
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Thanks for reading, everyone. — Loren