Most businesses don’t become a mainstream success overnight. But for the Mom and Pop Shops contending with big box retailers, the Internet has helped them to quickly bring their products to a diverse online marketplace with immense buying power. Tools-Plus, located in Prospect, Connecticut, is one of those cases where the Internet has been its saving grace when a Home Depot moved directly across the street.
The hand and power tool store was founded in 1979 when its owners Eric and Jeanne Savelle sold tools out of hotels throughout the Northeast and from their own home. The business has transitioned since those humble beginnings to a 12,000 square foot facility where it enjoyed local success until Home Depot moved in. To compete and stay alive they expanded the business to the Internet.
Moving to the online marketplace in addition to maintaining their brick and mortar store wasn’t an easy transition but it has paid off. So with legislation like the Marketplace Fairness Act dangling in Congress, its businesses like Tools-Plus that will be subject to complex software integration issues, compliance costs, increased audits and mandated costs. These are challenges that the Savelle’s believe could be the final nail in the coffin for Tools-Plus. In their own words: “Compliance and implementation costs will crush us.”
Here we have an example of an American business that has had to be creative in order to remain resilient in a poor economy, with a mega-retailer just a stones throw away. Surely, being able to sell goods online has helped them grapple with these changes.
Sadly this potential new tax system, which will force them to collect and pay use tax (monthly) to 46 different states with 46 different sets of laws, taxes and variations of so-called “free software,” could likely be the reason they can’t bounce back.