April 2008
Taking new and existing businesses to next level
By Tom Laventure, Staff Writer (Daily Journal)
Entrepreneurs show success when taking advantage of free consulting services and programs
Jenny Dougherty is working to help would-be businesses get off to the right start, and existing business owners to improve their skills and advance to the next level. In her half-time position at the Small Business Development Center, she says she has already made a positive impact on the local economy in her first six months on the job. The SBDC is located at the Koochiching Economic Development Authority Office at 405 Third Street.
The biggest challenge Dougherty has is getting people with an idea for a business to attend informational classes at Rainy River Community College. "I haven't seen a bad idea come through here," said Dougherty. "The SBDC is designed to improve the economic vitality, sustainability and success of Minnesota's small business community. It is funded through the U.S. Small Business Administration, Minnesota Department of Employment and Economic Development, the KEDA and local area banks.
Dougherty said the goal for SBDC is to foster an entrepreneurial mindset with activities that will encourage existing business expansion and job growth with more income. She provides clients with confidential business development counseling at no cost to the client. She also conducts or arranges for professional instruction with business situation assessments, business planning, financial analysis, loan packaging, and marketing.
"Taking them to the next level is a primary focus," she said.
Dougherty helps local banks by providing the training and projection assistance that the banks cannot afford to conduct with potential clients. She helps clients prepare solid business plans and financial projections. She instructs on the necessity of insurances and the legal steps that are vital to a sound business. Identifying areas of risk and other needs early on and getting consultation with professionals will increase a businesses success potential, she said. "This is a planning process and the person with the most information will come out ahead," said Dougherty. "Every idea is a good idea and we try to match client needs with the appropriate services and loan packaging."
Before they go on to the first phase, Dougherty sends the client through a chart-style test, with four questions about basic management, products or services that will help determine if the idea is ready for the business plan stage. Then she will assist with a feasibility analysis, market research, financial projections, budgeting, e-commerce, strategic planning, and QuickBooks training.
In many cases, an entrepreneur specializes in some skill or capacity and they want to turn an idea based on this labor or service into their own business. Dougherty says this often requires additional skills and could mean learning more about customer relations, marketing and basic accounting.
Sometimes it's an accounting or a time management issue that entrepreneurs need help in identifying their priorities and strategies. They need to make the decision of whether they want to take on all the roles themselves or budget to have these services and have somebody else do it for them, she said. Dougherty has worked with 38 new clients so far. Eight of them have a business idea ready for a feasibility analysis. In addition to the business plan, Dougherty explores financing potential and said that without cash or collateral, or bad credit, even a good idea will have trouble. "There is no free money," she added.
Five of Dougherty's clients are an existing business less than a year-old, and 24 more have been in business for more than a year. They sought help with setting up better accounting systems, with budgets or with revising a marketing plan or expansion. She has helped her clients obtain more than $320,000 in capital investment. Her goal is $1 million for 2008. She has a list of 10 alternative lender sources and can assist with matching to other resources. Dougherty emphasized that because these are difficult economic times with a high unemployment rate and a declining population in International Falls, there are opportunities available as the area's Job Opportunity Building Zone, or JOBZ. Locating in the zone can make available tax incentives for hiring local workers and preferred contractors.
"We are at an advantage over people in the cities that are not in that zone," she said. "People need to take advantage of that. " Dougherty said that in a tourism driven economy, businesses need to manage their cash flows or will struggle in the off season. Their projections will help in planning for the off season, and if they need to borrow, they can plan for it.
The demographics of Borderland have Dougherty pointing at providing goods and services to the special needs of an aging population. She also says tourist businesses need to identify opportunities that occur in the shoulder and off seasons. "It's tough in a declining population and there are things we could do to capture more tourist business," she said. "The biggest opportunity is to grow the winter business. Get the snowmobilers, the cross-country skiers and the ice fishermen. There has to be a joint project to create infrastructure."
Call Dougherty at (218)283-8585 or (218)324-1151 to schedule an appointment or e-mail at:
keda@businessupnorth.com.
