The U.S. federal government owes 1,281 small businesses approximately $3 million collectively in termination fees. The small businesses are ones that were approved to sell to the government on the GSA’s Multiple Award Schedule, but had their contracts terminated.
The failure to pay was uncovered after a year-long investigation by the U.S. House Committee on Small Business. House Small Business Chairman Sam Graves (R-MO) announced the findings.
Why the Fees Are Owed
The fees are related to guaranteed minimum sales that the government committed to make to small businesses approved under the General Services Administration’s Multiple Award schedule. The 1,281 small businesses that got on the GSA schedule but didn’t get at least $25,000 in annual sales from the government, are each due a $2,500 termination fee (minus any amounts actually sold by them).
If you’re wondering why the government committed to guaranteed minimum sales, it has to do with the government’s goal to have a portion of government contracts go to small businesses. The termination fees are designed to encourage government contracting with small businesses.
Of the 19,000 or so businesses contracted through GSA, the majority — 80 percent — are smaller firms.
The GSA schedule is like a pre-approved vendor catalog that government departments can buy through. Getting on the Schedule doesn’t guarantee the government will buy anything from your business. But there is a distinct advantage to getting on the GSA Schedule: it makes it easier and faster for government departments to purchase from your business.
However, you are dealing with a large bureaucracy. There’s cost associated with navigating the process just to get on the GSA Schedule in the first place. According to a spokesman for the House Committee, it can cost small businesses between $6,000 to $40,000 for a standard GSA proposal. That means if you don’t get sufficient GSA sales you’ve probably lost money.
Discovery by the House Small Business Committee
The nonpayment was discovered when the House Committee looked into the small-business impact of GSA’s proposal to cancel a large number of contracts in the future. During that review last year, Chairman Graves noticed that GSA was not taking the termination fees into account — and in fact had not been paying them as required, since 2008.
But the good news for these small businesses is that the GSA has agreed to pay the back termination fees.
“Contracting with small businesses is good for the economy and it’s good for the taxpayer because small companies bring cost-savings to the federal government,” Graves said in a statement. “But when federal agencies don’t live up to their end of the bargain, small businesses are discouraged from competing and taxpayers lose the benefits of government efficiency. Although we’re extremely disappointed that this error has occurred, the General Services Administration has owned up to their mistake and will distribute payment this year.”
A spokesman for the House Committee says they do not have a specific timetable for the GSA’s repayment this year.
Changes Going Forward
The GSA said in its response to the Committee that it will change its small-business practices going forward. For one thing, it will not require contractors to request a guaranteed minimum payment, although they must meet all other requirements.
Also, the GSA will focus on improving education and communication with small businesses in the future, by:
(1) educating small businesses so they can better determine whether it’s even worthwhile to pursue getting on the GSA schedule in the first place; and
(2) outreach to those already on the GSA schedule that are not meeting minimum sales, to educate and try to help them succeed.
The GSA’s letter to the House Committee on Small Business is below.
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Since last week, lots of legitimate business accounts have been suspended and then unsuspended on Twitter. Here’s more on what’s been happening and what to do if you find yourself in the same situation.
Legitimate Business Accounts Getting Suspended
It’s been fairly common for pure spam accounts to get suspended. Most Twitter users applaud spam crackdowns.
But what’s less common is when legitimate small business users get their Twitter accounts suspended.
That happened just this week in the business community, with numerous reports of business users getting suspended. It even happened to a small account used by a member of the Small Business Trends team. It also happened to another sizable account of one of our best contributors.
Luckily, all of the accounts we know of were reinstated. No one seems to know why they were suspended in the first place. Here are some of the reactions to this latest round of suspensions:
Anatomy of a Twitter Suspension in Error
Small Business Trends contributor and branding consultant Deborah Shane discovered her Twitter account suspended at about 9 p.m. on May 7.
Shane reviewed the Twitter rules and quickly determined she had not intentionally (or to her knowledge — unintentionally) violated any of the rules. She filled out and submitted the “file a report” form that appeared when she tried to log into her account.
In the online form, she politely asked why her account had been suspended. She stated that she had not violated any Twitter rules. She explained that her Twitter account was vital for operation of her business and asked how to get reinstated.
Though she couldn’t use her Twitter account, of course, Shane immediately started leveraging her other networks, including LinkedIn, to try to communicate with someone at Twitter. ”What I find very troubling is the complete lack of any human communication whatsoever. It’s all automated,” said Shane.
Others she had communicated with had had similar experiences and told her the service would likely be reinstated within about 48 hours.
Sure enough, by the early evening of May 9, about 48 hours after her account had been suspended, Shane found she had been reinstated. She has concluded the suspension was an error based on information provided to her in an automated email from the company.
Twitter has a long list of violations in its rules that will get accounts suspended and put you in Twitter jail. Let’s take a look at some of these.
One grounds for suspension is “aggressive following.” A Twitter best practices page defines this behavior as “indiscriminately following hundreds of accounts just to garner attention. However, following a few users if their accounts seem interesting is normal and is not considered aggressive.”
Call us crazy, but we thought the whole point of Twitter was following others! All kidding aside, it appears that following too many other accounts too quickly, is what will get you in trouble.
Another behavior Twitter discourages is “follow churn.” Twitter defines this as “repeatedly following and un-following large numbers of other users.” We’re not sure why people would do this. It may be a misguided attempt to get around Twitter follow limits (Twitter limits how many you can follow in proportion to how many follow you). So you follow people, and as soon as they follow you back, then you unfollow them so you can follow others. Of course, this kind of behavior is risky, not to mention rude. You could get banned.
Having your Twitter account compromised or hacked can also lead to suspension. In this case, suspension is a good thing. It protects everyone from malware and other issues. Suspension in this case is less painful than your reputation getting smeared when all your followers get spammed with offensive stuff from your account.
Political pundits using Twitter sometimes push things to the limit with behavior that can lead to suspension. This post on RedState discusses examples of intentionally trying to get other users kicked off Twitter, in order to silence political foes. However, most business users don’t engage in that kind of deliberate targeting behavior.
Small business users understand the value of Twitter. Many small business owners and entrepreneurs spend considerable time and money building a Twitter following. They don’t want to risk suspensions from deliberate behaviors.
True, there are aggressive online marketers who push the envelope. But most Main Street small businesses don’t want to take such risks.
So back to the question. What caused the recent round of Twitter suspensions of non-spam business accounts?
Over the years it’s been reported that Twitter has automated algorithms to detect violations of its rules. It’s quite possible that an algorithm was somehow tripped in error snagging all these business accounts. Or it could simply have been a systems glitch of some kind. (We contacted Twitter for an explanation but received no response.)
More Rules: Why a Twitter Account Can Be Suspended
The Twitter Rules page gives a list of limitations on how to use Twitter. Ignoring these could get you into trouble. They include:
- Impersonation — You can’t intentionally try to deceive other users into believing you’re another person.
- Trademark — You can’t claim a user name that another business or user has legal right to use.
- Private information — You can’t share other people’s sensitive information like credit card numbers, street address or Social Security/National Identity numbers on the site.
- Violence and Threats — You can’t use Twitter to threaten others.
- Copyright — Twitter has a procedure for handling claims of infringement as a result of something posted to your Twitter account.
- Unlawful use — You can’t use Twitter in a way that would either break the law or cause it to be broken.
- Misuse of Twitter Badges — You can’t use official badges such as the Verified badge unless Twitter has given them to you.
There is also a list of activities Twitter considers spamming. The list is extensive.
You might be surprised by what Twitter says it will take into account as evidence of ”spam.” Most business users are.
Take a few minutes to study this list. Note that the rules do not say that each of the items is by itself spam — just that they are “factors” Twitter will take into account in determining whether the account is spam.
We imagine that Twitter looks at an account in its entirety to determine spamming. Otherwise, a lot of business accounts (even from mega-brands) would be considered spam for such behaviors as primarily tweeting out links rather than personal updates. Yes, that’s on the spam list.
Try to look objectively at your own account. If you or your staff members are intentionally engaging in multiple behaviors on the Twitter spam list — you are living on borrowed time. Make changes before you get suspended.
How to Deal with a Twitter Suspension
First, don’t panic! Being suspended from Twitter can be scary, especially if Twitter is part of your marketing and customer service outreach.
But it’s important to keep your cool. Don’t rant and rave at Twitter, or get abusive. Remain polite and businesslike.
We know you feel outraged. You may even feel betrayed if you’ve spent a lot of time touting the benefits of Twitter for business. But letting emotions rule will not help. Follow these steps:
Step 1 — Carefully review all of Twitter’s guidelines again to be sure you have not violated the rules, even accidentally.
Step 2 — Fill out the form provided when you attempt to log in, to appeal the account suspension. Be sure to explain that you have followed all guidelines as far as you know. Ask for a way to resolve the situation as quickly as possible.
Step 3 – Monitor the email inbox associated with your Twitter account, too. You may get one or more automated responses from Twitter that you MUST respond to, or they will consider your appeal closed.
Step 4 — Give it time. Many members have reported reinstatement can take up to 48 hours. But some accounts have been reinstated in just a few hours’ time. If you discover and report the suspension outside of regular business hours, expect it to take longer.
Tip: Don’t freak out if your Twitter account returns with zero followers at first! This appears to be normal in most cases, especially if the suspension was an error. You probably will not have to beg everyone to follow you again. Give it a few hours and your Twitters followers will all likely be back. It happened that way in all the erroneous Twitter suspensions we learned about from business owners.
Remember, you’re not alone. Other business users have been in your shoes and survived.
Have you had your Twitter account suspended? Have any advice to share? Please post it in the comments below.
Twitter, Twitter bird, Jail Photos via Shutterstock
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For a long time I deisgned my own websites. I could never code them, but I always felt like I could design one. I’d spent hours in Photoshop pushing pixels, choosing colors, finding fonts (and apparently alliterating), only to find myself irritable and frustrated.
A few years ago, I finally gave in and started working with a really good designer who’s instincts I now trust (even if I still like to tinker a bit). One of the things I learned about was white space and the idea of letting things breathe a little bit instead of cramming as much as possible into a space.
That being said, if your sales graph’s white space is getting bigger – maybe you’ve got bigger problems.
The post The Plus Side to Low Sales: More White Space appeared first on Small Business Trends.