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SMALL BUSINESS TRENDS brings you daily updates on trends that influence the global small business market.
Anita Campbell, Editor
Past life: CEO, corporate executive, tech entrepreneur, retailer, general counsel, marketer, HR ... (more)
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November 1st: Torsten Jacobi, CEO of Creative Weblogging, joins host Anita Campbell. Sponsored by Six Disciplines. Show details.
Friday, October 31, 2003
Small Business Vulnerable to Identity Theft
As if small business didn't have enough to worry about, here's another concern.

Small companies that do a lot of business online are as susceptible to identity theft as consumers. Especially the kind of identity theft that is carried out through "spoofing" or "phishing."

Spoofing and phishing occurs when thieves send fake emails or set up fake Web sites purporting to belong to eBay, PayPal, AOL and other legitimate businesses. The unwary are fooled into giving out sensitive information, including passwords and credit card numbers.

Since many small businesses use eBay, PayPal, AOL and other big eCommerce service providers that are typically the prime subjects of spoofs, small businesses are just as vulnerable to these online scams as consumers. After all, to a thief, a business credit card number or a business account password is as valuable or MORE valuable than a consumer's information.

Of course, for those entrepreneurs who find opportunity at their doorsteps no matter what, identity theft spells opportunity. For instance, FightforMe.com is a group of attorneys who promise to defend those accused of identity theft crimes. Then there's MailFrontier.com and others who've rolled out anti-scam products. And I am sure we will see more of these kinds of services crop up as scams continue and enterprising individuals and businesses spot an opportunity to provide a new product or service.

Read more in SmallBusinessComputing.com.

By Anita Campbell | Permalink | |
Thursday, October 30, 2003
Penetrating the SMB Market Requires Channel Partners
According to a report by the Yankee Group, a telecommunications and networking research firm, sales optimism and activity picked up in the small and midsize business channel in the last six months.

Despite this optimism, the SMB market dynamics are still challenging. The sales cycle remains long and "the channel must creatively and persuasively sell to customers with tight budgets."

There are 5.9 Million small and mid-sized businesses (defined by the Yankee Group as having 2 to 2,500 employees) in the United States. Because the market is fragmented, it is cost prohibitive for many large telecomm and networking vendors and service providers to sell directly into SMBs. Instead, they must rely on local solution providers to sell into this market.

"Vendors depend on the channel more than ever to push new products into this market," says Helen Chan, Yankee Group Small & Medium Business Strategies senior analyst. "Competition is always increasing, as even enterprise-focused vendors attempt to move downmarket. This inundates the channel with a confusing choice of vendors and products. Vendors must understand the needs of the channel in order to cultivate long-term, profitable relationships. By providing more than just the traditional product rebates and volume discounts, vendors can help channel partners transition to a services revenue model."

Read the full press release.

By Anita Campbell | Permalink | |
Arbitrary Law Enforcement Hampers Small Business
Small business in many parts of the world is hampered by corrupt legal officials or laws that are arbitrarily imposed.

The recent arrest of Russian business tycoon Mikhail Khodorkovsky is a high profile example of what small businesses face daily in countries where the law is for sale.

Small business people in Russia and other countries say corruption and arbitrary enforcement of laws is one of the biggest drags on growth. Small businesses are particularly vulnerable because they lack the clout or funds to protect themselves from bribe-seekers and corrupt court decisions.

According to Andrei Nasonov, head of Opora, a small business association in Moscow, "From the federal prosecutor to the local police, it's the same behavior: arbitrary interpretation of laws and violations of procedural norms."

Wall Street Journal subscribers, read more in an article by Jeanne Whalen.

By Anita Campbell | Permalink | |
Wednesday, October 29, 2003
Key Bank Supports Small Business
Key Bank has once again improved its Web site dedicated to small business, at www.key.com/smallbiz. The site contains a lot of information about growing and managing a business, and not simply product information. The site even includes an interactive tool that small business owners can use to develop a simple business plan--and it's free.

Key also has a section of the site dedicated to women, at www.key.com/women. Included in this section are links to Key's supplier diversity initiative, which supports women-owned businesses.

Key Bank is one of the nation's largest banks and largest small business lenders. Yet another giant going after the SMB market.

By Anita Campbell | Permalink | |
Urban Sprawl Trend Could Limit SBA Financing
Earlier this year, the SBA settled a lawsuit claiming that its lending practices encouraged urban sprawl and negatively impacted the environment. The settlement requires the SBA to establish future procedures for conducting environmental reviews of individual SBA 7(a) loans.

The lawsuit took place over what could become the new millenium's key environmental battleground in the United States-- urban sprawl. The lawsuit claimed that most SBA loans were made to suburban or rural areas and promoted urban sprawl. Urban sprawl, they claim, contributes to low-density, automobile-dependent new development, which leads to the loss of prime farmland and wildlife habitat, air and water pollution and increased congestion.

What's interesting is that there's not even agreement that urban sprawl is bad. The Small Business Survival Council says "Sprawl is usually equated with growth, and there's nothing wrong with that."

The SBA conceded that its environmental review procedures needed revision, but denied that SBA loans were responsible for urban sprawl. The SBA says it is local land use decisions that determine the extent of urban sprawl, not SBA loans.

The upshot? This settlement could make it harder for small businesses to get SBA 7(a) loans in the future. Especially in environmentally sensitive areas near wetlands, farmland, etc. Read more.

By Anita Campbell | Permalink | |
Tuesday, October 28, 2003
Globalization Trend Creating Translation Boom
The forces of globalization and the Internet (those two again!) are driving a boom in the translation business.

As companies sell more products across country lines, often using the Internet, translators become more important.

According to a June 30, 2003 article in the Miami Herald, "The tech revolution is transforming the translation and interpreting business, once a niche industry for bilingual people who offered their services to businesses, government agencies and individuals in their communities. Now digital technology, Internet-based marketing strategies, and e-mail are turning the business into a nimble, tech-intensive international industry that favors management know-how and quality control. "

The translation industry is one of the few that is still dominated mostly by small and medium-sized players. As with any growing industry, it is starting to see some consolidation.

Read more.

By Anita Campbell | Permalink | |
Monday, October 27, 2003
Small Businesses Part of Global Marketplace
The following comments appeared in the Small Business Advocate Newsletter. They reflect the converging forces of globalization and the Internet on the SMB market:

"Hopefully it won't come as a surprise that your small business is part of a global marketplace. That means your competitors are across town, across the country, and across the planet. Plus there's a new Main Street where competitors set up shop in a market called cyberspace, where customers and businesses get together by doing eBusiness.

eBusiness is the overarching perspective of the online marketplace, and includes three primary activities:

1. eCommerce - where customers make purchases and lay their money down online.
2. eShopping - where customers educate themselves online, both in terms of product options and technical information.
3. eCustomer Service - where businesses employ online technology to serve customers in activities that do not require human involvement, like a Frequently Asked Questions resource.

This new global and cyber reality is creating both threats and opportunities. Small businesses must be prepared to challenge the threats and pursue the opportunities."


By Anita Campbell | Permalink | |
Online Ads Lucrative for SMBs
Contextual-ad services are the hot new thing among small and independent Web sites. Even small Web sites with no advertising sales force can generate noticeable revenue from the ads placed on their sites.

Contextual-ad services provide Web sites with text link ads that are relevant to the site's content. Some of the services even give the Web site owner the ability to block competitors' ads or offensive ads.

Contextual-ads generate more money because the ad services use search engine technology to make sure the ads relate to the content of the particular page on which the ads are served. In turn, that increases the number of click-throughs. The more click-throughs, the more revenue the site earns.

These services are far more lucrative than link exchanges or affiliate ne