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Suggest who benefits‘At 5 O’Clock, I’m Going to Send Everybody an Email’
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Suggest questionThis week, in episode 240, Paul Downs tells Jaci Russo and Sarah Segal about laying off a third of his workforce. “Here's the problem in a nutshell,” he says. “Last year, January to March, we sold $1.356 million. This year, January to March: $680,000. March is on track to be the worst month I've had since I started taking records.” Paul also tells the owners that he used to have a rainy-day fund for such occasions, but he used it to renovate his house. He does think the layoffs and other cash savings have put him in a strong enough position to hang in there until business picks up. “We’re getting calls,” he says, “we’re just not getting orders.” He’s also trying out a digital marketing service that can identify and contact anyone who spends even just a few seconds on his website. Plus: Paul tells us that sometimes, when forced to lay off people, you learn things about your operation that you might not otherwise have known—like that you’ve been overpaying your sales tax by at least $30,000 a year for quite some time.
About 21 Hats
The proponents of employee stock ownership plans can make them sound like the greatest thing ever. A business owner can take a big chunk of money off the table—or even all of it—while still getting to run the business. And there are some pretty great tax breaks. Oh, and it will also solve income inequality in America. On the other hand, if ESOPs are so smart, why are there so few of them?
Jim Kalb of Triad Components Group in San Diego and Jeff Taylor of Crafts Technology in Chicago have both implemented ESOPs. Jay Goltz of the Goltz Group in Chicago has reached his 60s without a succession plan, and he’s considering his options. In this 21 Hats Conversation, you get to listen in on a street-smart discussion of the pluses and minuses of ESOPs from the business owner’s point of view.