Proposed Tax Breaks

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The Senate is currently considering a plan to link the much-ballyhooed federal minimum wage increase to a package of tax breaks designed to mollify small business owners. According to a press release from Senator Max Baucus of Montana, the chairman of the Finance Committee, the provisions include:

1. Extending for the next five years the "Work Opportunity" Tax Credit, which can be claimed by employers who hire workers off welfare, for example. The bill would also broaden this group to include returning veterans.

2. Extending by one year the tax rule that allows small businesses to bundle as much as $112,000 in expenses into one annual deduction.

3. Extending by one year the rules that allow entrepreneurs to deduct expenses incurred while refurbishing leased facilities or in some cases facilities that you own or build.

4. Allowing a larger group of companies to use the simplified cash method of accounting for tax purposes.

5. Making S Corp status available to more new and existing businesses.

6. Creating a certification process for professional employer organizations or PEOs, which serve as the employer of record for companies that want to outsource basic human resources functions.

What do you think? First, are tax breaks a fair trade for higher minimum wages? Second, which of these provisions do you find most appealing? Third, are any of these proposals, in your view, a bad idea?

Inc.com

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Local man to take invention to national exhibit

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By HALEY HUGHES

Staff writer

It may very well be the next big thing.

From fledgling inventor Donald Waters comes Timbertite, a new way for commercial truck drivers to secure dunnage to their vehicles. Dunnage is a term for spare pieces of scrap wood that is used to support loads, like cargo that is transported on a 18-wheel flatbed truck.

Typically, trucking companies and their drivers secure dunnage under the beds of trucks with either rope or elastic cord. But the knots often shake loose with the movement of the truck, especially over uneven roads.

"Cargo needs a means of securement and needs a means of proper securement," said Waters, who is from Beech Island. "Until now there's no way to store them. I literally just touched a cord and it came loose. I'm a thinker. That just got my little brain thinking."

What encouraged him even more was an experience while he himself was driving a truck on a construction site.

"The dunnage that I had secured under my trailer became loose and slid to the passenger side, hitting a bridge support as I passed through a construction site," he said. "It was enough to get me thinking even more. I didn't want to improve a product. I wanted to create a product."

The Timbertite features a 5,000-pound capacity polyester strap and a compression spring to maintain tension. All one has to do is secure the hook into the eyebolt on the spring assembly and tighten as desired.

"I designed every part of it," Waters said. "Nothing is store bought. There were a few prototypes that got thrown away. Now I've got it to where I want it."

As far as he knows, rope or elastic cord does not meet the standards of securing cargo on commercial trucks. Waters feels Timbertite meets or exceeds such standards.

Timbertite received its patent in 1999 but now Waters is looking for a licensee or a manufacturer. He will be attending INPEX — the Invention and New Product Exhibition — in Pittsburgh, Pa., on June 6-9 in hopes of doing just that.

"I'm very much looking forward to the show in Pittsburgh," he said. "I think it's an asset of safety to the trucking industry. I'll feel good about myself if I've known I've done something to make safety better."

Local man to take invention to national exhibit

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Is a Super Bowl Ad Really Worth the Cost?

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One Super Bowl ad runs $2.6 million. Is it a good investment? What else might an advertiser do with that kind of cash? Do the people’s favorite ads even get the best results?

Super Bowl ads have, for years, been little more than a beauty contest for advertising agencies. When a company selects an agency's ad to represent it during the Super Bowl, it’s sort of like choosing a girl to represent a state in the Miss America pageant. Super Bowl ads are an iconic, cultural phenomenon that makes very little sense; essentially, they're the advertising equivalent of bathing-suit-clad girls with big eyes and high heels talking about their dreams of world peace.

Over a year, the price of one Super Bowl ad could provide your company exposure to 50 percent of the population of Southern California. It would buy you enough radio repetition for the average listener to hear your ad four times a week, 52 weeks a year throughout Los Angeles, San Diego, Orange County and the Inland Empire (Riverside and San Bernardino). Altogether, $2.6 million could buy you several thousand ads, which would reach a total of nearly 15 million people.

Paying $2.6 million for an ad to air during the Super Bowl might possibly be the dumbest thing you could do with $2.6 million. Or the smartest. It all depends on what you communicate in the ad.

The Dumbest Super Bowl Ad of 2007: FedEx Ground
Although this was one of the more clever and entertaining ads this season, it'll also prove to be counterproductive. Remember the ad? A bunch of people are sitting in a conference room …

MANAGER: FedEx saved us with their overnight service, so we’ve added FedEx Ground for everyday shipping.

JOEL: Ground? That doesn’t sound fast.

RELAXED GUY LEISURELY HOLDING COFFEE: Actually, Joel, FedEx Ground is faster than you think.

MANAGER: We can’t judge things by their name. Don’t you agree, Harry?

EXTREMELY HAIRY GUY: Absolutely.

MANAGER: Eileen?

GIRL LEANING HARD ON HARRY: Of course.

MANAGER: Joy?

JOY: (Gives an effervescent giggle with a beaming smile)

MANAGER: Bob?

BOB: (Bobs his head up and down in an extreme fashion)

GUY WITH HUGE DOUBLE CHIN: You see, Joel, we all agree that FedEx Ground is fast, despite the name “Ground.”

MANAGER: Well said, Mr. Turkeyneck.

The ad ends with the FedEx logo revolving quickly to reveal four variations--FedEx Ground, FedEx Express, FedEx Kinko’s and FedEx Freight--while an off-camera announcer says, "FedEx Ground. Fast. Reliable. And for less than you think."

Here are the major problems with the ad:

1. The ad clearly illustrates that Joel was right; you can judge things by their name.
2. The people arguing that FedEx Ground is fast “despite the name” appear bizarre and ridiculous. Joel is the only normal person in the room. We identify with Joel, not with the others.
3. “For less than you think” is ambiguous ad-speak. Specifics are always more powerful than generalities. “For as little as $2 a package” is specific. And far more impressive.
4. The ending of the ad is soft and unfocused. We’re not yet convinced that FedEx Ground is a worthy alternative to UPS, and it seems that FedEx isn't completely convinced either. In the end, the company wants to be sure that we realize there are at least three other FedEx options: FedEx Express, FedEx Kinkos and FedEx Freight.

The Smartest Super Bowl Ad of 2007: Two Lions for Taco Bell
Remember the ad? A pair of lions are looking at a group of campers in the distance eating lunch while on safari. The lions smell the new steak taquito from Taco Bell. The rest of the ad is one lion trying to teach the other how to pronounce “carne asada,” the type of steak used in the taquito.

Here’s what makes the ad work:

1. A lion is king of the jungle; its opinion is respected.
2. Lions are meat-eaters, absolute carnivores.
3. Viewers learn how to pronounce a strangely spelled word--carne asada--thereby increasing their comfort level when ordering the item at Taco Bell.
4. The ad ends with a mouthwatering close-up of freshly grilled carne asada steak as it's being sliced. You definitely want to taste it.
5. The ad is focused on one thing: the carne asada steak taquito. Taco Bell’s agency had the wisdom not to include any images or descriptions of other Taco Bell products.

TV is an impact medium. But there will be no impact if the viewer isn’t paying attention or if your ad's message is unfocused. The Super Bowl is the one event each year that guarantees viewers will be paying attention. We tune in as much for the ads as for the game.

Are your ads entertaining but counterproductive, like the FedEx ad? Or are they entertaining, focused and convincing like the Taco Bell ad?

Follow the lead of FedEx Ground if your goal is to entertain America. But if you want to sell product, I suggest you study Taco Bell's script.

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Roy Williams is Entrepreneur.com's "Advertising" columnist and the founder and president of international ad agency Wizard of Ads. Roy is also the author of numerous books on improving your advertising efforts, including The Wizard of Ads and Secret Formulas of the Wizard of Ads.

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