R. Michael Johnson on the Impact of New Heathcare Legislation

Risk: Tax Increase On Unearned Income (from BusinessWeek “How Health-Care Reform Will Affect Small Business” by Karen Klien)

“In the past three years, my health costs have increased each year by double digits. That cuts right into the profit margins of my company,” Hay says. “For any small business, whether it has 10 or 500 employees, it’s a challenge having enough working capital. But to be competitive and attract the same employees as the bigger guys, we have to offer the same benefits package they do.”

Another worry plagues R. Michael Johnson, president and CEO of Cox Industries, a midsized lumber company in Orangeberg, S.C. He provides a generous benefit package for his 400 employees, but the company relies on family shareholders and outside investors, some of whom will be affected by the tax increase on unearned income for wealthy individuals.

“The 3.8% tax on unearned income will increase the earnings requirements on [subchapter S corporations] such as Cox to satisfy the risk our shareholders take by investing in small businesses like ours,” Johnson wrote in an e-mail. “This small percentage seems benign, due to the small number and putting it on ‘unearned income,’ but this income is earned. In fact, our team works hard every week to earn this income and reward the shareholders that patiently leave their capital in the business.”

Another thing that worries Johnson is his calculation that he might save up to $2 million if he were to drop his employee benefits and instead pay the $2,000 per-head penalty. “We are not even remotely considering this option, but I hate to think that new legislation would actually make dropping our plan more appealing to businesses like ours,” Johnson says.

Read the entire article.

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Incredible Testimonial about Island Swings by Cox and Hurricane Floyd

I just wanted to tell you my story about my swing (Island furniture by Cox). My son was born in March 1993, so for my 1st Mother’s Day, my husband bought me an Island Furniture by Cox swing for Mother’s Day from my son.  We enjoyed many hours swinging.  When we purchased 5 acres of land and built a house we moved to the swing to our new property and enjoyed even more hours swinging.  September 16, 1999 Hurricane Floyd hit us hard with flood waters and we lost everything we had.  The hurricane blew my swing over and into our pond and then the flood came and that was it, I thought it was gone forever. We now live approximately 170 miles away.

This past Thanksgiving (2009) at age 16 my son wanted to go back to see the place were we use to live.  Our flooded house had been burned down and everything on our land was removed.  (We were in the buyout so that no one could ever live on the land again and go through we our family had been through, so now the land is owned by the State of NC.)

 

When we arrived at the place our beautiful home use to stand my son was in awe, as we were touring the property we walked over to the pond and he said, “Mom is that a swing in the water at the end of the pond?” And there it was, my 1st swing turned over and partially buried in the mud of the pond, I said, “Oh my goodness son that is the swing you gave me on my 1st Mother’s Day”.  Well since it was Thanksgiving Day and we were expected at my in-law’s home for supper we were not really dressed to be playing around a pond.  But that didn’t matter, my son and I trompted through the mud to were the swing was.  As we were surveying the damage he pulled the swing up and it was still attached to the frame with very rusted chain.  He and I was able to pick the swing up and carry it out of the pond area, then we went back for the frame.  Oh, the swing was a mess covered in mud and debris, but it was still sturdy so my husband let me bring it to our current home.  We scrubbed and scrubbed to remove all the goop and mud, but finally it look almost like new.  My husband bought new chains and hooks and 10 years and 2 months later I was swinging in my 1st swing again. My son “swang” with me for the first time, since the flood of Hurricane Floyd, in my now most prized possession.  It does not look like new but as I said before the only thing we had to replace were the rusted chains and hooks.  I have attached 2 pictures for you to see what it looks like today.

 

I just want to thank you for building such a good and sturdy piece of furniture. It withstood the hurricanes and flooding 1993.

 

Sarah L. (Emerald Isle, NC)

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Cox Industries Featured in Bloomberg Business Week

When the Third Generation Runs the Family Biz

Few family businesses survive into a third generation. To make it work, incoming leaders must embrace new technology, say entrepreneurs and experts

By Karen E. Klein

In 2008, when R. Michael Johnson—Mikee to everyone who knows him—took over the pressure-treated lumber company his grandfather founded in 1952, he had a great idea: laptops for all managers and sales staff.

“You would have thought the world was coming apart,” says Johnson, CEO and president of Cox Industries in Orangeburg, S.C. One salesman—convinced that the computer would be used to track his movements outside the office—up and quit. A buyer who’d been with the company for 35 years said he’d like a fax machine, but couldn’t see why he needed a computer when he’d managed just fine without one for so long.

to read more in Bloomberg BusinessWeek click here

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Cox Industries Teams with Furman University on Corporate Sustainability

GREENVILLE, S.C. -As companies become increasingly focused on implementing sustainable business strategies, Furman University will offer a new program this fall that will help executives manage the challenges of a socially conscious business environment.

 The intensive, five-session course, offered by Furman’s Center for Corporate and Professional Development in cooperation with the David E. Shi Center for Sustainability, will lead to a Post Graduate Diploma in Corporate Sustainability. “Corporate sustainability is being embraced across the country not only because it’s the right thing to do, but because it makes business sense,” said Brad Bechtold, director of Continuing Education at Furman. “It lowers business costs, improves productivity and enhances reputation. This new program will provide the tools, techniques and strategic thinking that businesses need to build a coherent sustainability strategy.” Bechtold said the course will offer a broad overview of sustainability as well as a detailed review of major practices in sustainability. It will also identify the sustainable business strategies that offer the most effective return on investment and demonstrate how sustainability can become an ongoing strategic business practice.

 “This program is aimed at business people who are in charge of defining and implementing sustainability initiatives for their organizations,” Bechtold said. “And since there is a dearth of academic and corporate education programs that provide this kind of knowledge, we believe this program is something the business community will embrace.”The program, which begins Sept. 16 and ends Dec. 10, totals 70 contact hours and 7.0 Continuing Education Units. Each of the five sessions includes a Thursday (8:30 a.m. to 4:30 p.m.) and Friday (8:30 a.m. to 2:30 p.m.) seminar at the Younts Conference Center.

 The program will be taught by John Meindl, senior associate with the Center for Corporate and Professional Development; Dr. Wade Worthen, professor of biology at Furman; Barry Breede, CEO of Sustainable Management Systems of Greenville; and Michael Johnson, CEO of Cox Industries.

 Cost for the program is $3,950 per person.

For more information, contact Furman’s Center for Corporate and Professional Development at 864-294- 3136 or visit the Furman website at www.furman.edu/cpd/.

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