Smith Mountain Lake Entrepreneur Express, November 15, 2011 Presentation
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  • 1. Hardy, VirginiaNovember 15, 2011
  • 2. WELCOME Annette StamusSmith Mountain Lake Chamber of Commerce
  • 3. What Do TheseEntrepreneurs Have in Common?
  • 4. SUCCESS!
  • 5. SUCCESS!
  • 6. Remember as a start-upyour place in the food chain
  • 7. GET PREPARED…DOYOUR HOMEWORKOR……..
  • 8. How to Start and Operate A Business
  • 9. HOW TO START AND OPERATE A SMALL BUSINESS By Dick EphgraveDirector, Longwood University Small Business Development Center, Martinsville, VA
  • 10. What is the SBDC?• Small Business Development Center• VSBDC Mission – To foster small business success and grow Virginia’s economy• Vision – To be the small business resource of first choice in Virginia Where business comes to talk business.
  • 11. SBDC’s Goals• Increase new business success rate• Increase client’s revenue and profitability (new and existing businesses)• Assist existing businesses to grow by creating and retaining jobs, and increasing capital investments in the business Where business comes to talk business.
  • 12. How the SBDC can Benefit you Through one-on-one, Confidential and FREE Counseling, the SBDC can help you with…• Basic Business Information for start-ups as well as existing businesses• Business Planning• Training/Workshops- variety of topics• Networking Assistance• Basics of Navigating the financial process• Financial Analysis of your business• Marketing Ideas and Plans• Permits, Licenses and taxes• ETC Where business comes to talk business.
  • 13. Why do I need a Business Plan?• To develop your own plan (roadmap) for YOUR Business idea.• To determine if the business idea is financially feasible.• To seek financing from a bank, SBA, and/or private investors.• To provide you with a management tool• To give you an objective view of your business idea Where business comes to talk business.
  • 14. What goes into a Business Plan?• Executive Summary• Table of Contents (optional)• Description of the Business• Description of Products and/or Services• Marketing Plan/Advertising• Industry Analysis• Customers• Competition Analysis• Location• Suppliers/Subcontractors• Organization and Management• Financial Plan Where business comes to talk business.
  • 15. VSBDC Office Dick Ephgrave, DirectorLongwood Small Business Development Center 115 Broad Street, PO Box 709 Martinsville, VA 24114 Phone: 276-632-4462 E-mail: ephgraverg@longwood.edu
  • 16. Entrepreneur Express SCORE Roanoke November 2011
  • 17. About SCORESCORE was formed in 1964 as a resource partner of the Small Business Administration. SCOREs mission is to help new and existing small businesses succeed.Facts (2010) 13,000 volunteer across 350 chapters Volunteers donate 1 million hours of service 501,000 total services delivered annually 360,000 people served annually
  • 18. Our Clients Early stage entrepreneurs, who are considering to start a business but need help in defining their ideas, building a Business Plan, and obtaining financing. Start-up businesses, who are seeking to grow their business and manage their finances. Established businesses, who are seeking to grow and increase their customer base.
  • 19. Our Services Mentoring: SCORE provides free, confidential counseling in each of its 360 Chapters and also via the internet through www.score.org . Workshops: Score provides training sessions on a variety of topics, from Business Plans to Marketing, to Financing. SCORE can provide customized seminars for community partners.
  • 20. SCOREs Online Presence SCORE has a tremendous online presence:  Tutorials and self study classes  Online workshops  Online mentoring: search for a mentor by their expertise and subject matter specialities. SCORE website for SCORE volunteers provides great support:  Training courses  News and updates  Peer learning
  • 21. Why SCORE Adds Value Entrepreneurs are usually expert in their chosen field, but rarely have mastery of the entire range of business skills. Success in business requires performing a wide range of tasks:  Marketing  Sales  Operations  Accounting, Finance, Legal, HR, Regulatory, Tax... Seasoned SCORE mentors can point out areas of strength and weakness, recommend actions, and point the way to other resources.
  • 22. Code of Ethics SCORE has a strict Code Of Ethics to protect our clients. All volunteers need to agree and sign annually. Key points:  SCORE mentors are unable to make money in any way from SCORE clients.  Volunteers may not use our client or member databases for commercial reasons.
  • 23. Steps For Creating Your Business Choose the Structure • Proprietorship, partnership, LLC, etc. Register • Name, trademarks, corporation Obtain Tax IDs • Federal and Virginia Obtain licenses • City/County/Town business license • Occupation specific licenses (Virginia)
  • 24. Business Licensing and Registration State, county, city, and town may have requirements. Why? – Taxation – Zoning – Regulate certain activities
  • 25. Business Licensing and Registration Check with your local county / city / town – Most have information on their websites Web site for Virginia Department of Business Assistance: http://www.dba.state.va.us/  Great source of information!
  • 26. Pricing Price minus Cost = Profit . Setting prices is vital to the success of any business. Things that affect pricing: – Competition – Customer preferences – Costs – Contractual and legal requirements Each market is different.
  • 27. Pricing Common errors: – Not understanding your costs. – Not understanding the value of your product or service. – Reluctance to lose any sale, leading to excessive discounting. – Reluctance to discount under any circumstances.
  • 28. Management Practices Im a small business. Am I involved in “Management”? Management is the acquisition, deployment, and use of resources to achieve an organizations goals. – Resources include labor, money, equipment, buildings, etc. – Relationships with customers and suppliers are also resources that need managing. Yes, small business people are in “Management”!
  • 29. Management Practices Do the Right Things. – Must make choices on what to do. Do Things Right. – There are better and worse ways to accomplish tasks. Doing the Right Thing, badly, is not helpful. Do the Right Things, Right, Right Now. – Take action and get things done. – Time is a valuable resource.
  • 30. SCORE Roanoke Chapter Overview Office location, open 10AM-3PM M-F: 105 Franklin Rd, SW, Suite 150 Roanoke VA 24011 540-857-2834 info@scoreroanokeva.org Call for an appointment. Mentoring sessions can take place at our office, your place of business, or another site.
  • 31. Growing YourBusiness/Marketing Strategies
  • 32. Tourism Business Development & Marketing Assistance Randall A. RoseDevelopment Specialist – Partnership Marketing Virginia Tourism Corporation rrose@virginia.org 276-322-2044 www.vatc.org (industry) www.virginia.org (consumer)
  • 33. • Virginia Tourism Corporation Overview• Tourism Business Opportunities• Marketing Your Small Business rrose@virginia.org 276-322-2044 www.vatc.org (industry) www.virginia.org (consumer)
  • 34. • 18.9 billion in revenue• supported 204,000 jobs• provided $1.3 billion in state and local tax revenue Impact of Tourism in VA - 2010
  • 35. • Advertising• Customer Service & Industry Relations• Electronic Marketing• Film Office• Marketing & Promotion• Public Relations• Research• Tourism Development• OthersVirginia Tourism Corp. Services
  • 36. • Planning Assistance• Marketing Guidance• Workshops• Marketing/Advertising BenefitsBusiness Assistance
  • 37. • Wilderness Road Heritage Trail• Virginia Coal Heritage Trail• ‘Round the Mountain• Heartwood• Spearhead Trails• Crooked Road• Fish Virginia First Development & Partnership Marketing
  • 38. • Franklin County • Pulaski County• Roanoke County • City of Radford• Craig County • Giles County• Patrick County • Tazewell County• Floyd County • Carroll County Locality Tourism Planning
  • 39. • Marketing Leverage ProgramFunding
  • 40. •Canoe Rentals and Tours•Fishing and Boating Rentals•Bicycle Tours and Outfitters•Adventure/Nature Camps Tourism Business Opportunities
  • 41. •Wineries/Vineyards •Corn Maze •Pumpkin Patch •Pick Your Own •Animal Parks •Herb/Flower Farms •Christmas Trees FarmsAgri-tourism
  • 42. •Bed & Breakfast Inns•Cabins and Cottages•Lodges•Campgrounds•Horse Campgrounds•Horse Stables/Barns•House Boats•Green LodgingUnique Lodging Opportunities
  • 43. •Music/Theater Venues •Artisan Studios/Galleries •Heritage Sites •Tea Rooms •Breweries/Pubs •Eclectic Restaurants •Shopping •SpasAttractions
  • 44. Caterers Cleaning Services Food/Drink Distributors Electricians Restaurant Equipment Plumbers Security Systems Pool Maintenance Convenient Stores Lawn Care Web Site Designers Auto Repair Ad Agencies Events Planners Travel Agencies Florists Motorcoach Companies Linen Services Car Rental OfficesSupporting Businesses
  • 45. • Visit www.vatc.org & www.virginia.org• Sign up for the Dashboard e-newsletter• Attend at VTC Help Desk event• Establish relationships with all VTC divisions – tap into our services (i.e. marketing, advertising, research, etc.)Learn More About VTC Services
  • 46. Now,let’s talk about marketing your small business
  • 47. Can you answer thesetwo questions? • What is Marketing? • What is the difference between Marketing and Advertising?
  • 48. 6 Questions You Should Answer • What are you trying to accomplish? • Who is your target audience? • What message will move your audience? • What vehicles do you have to deliver the message? • What are your resources? • How do you measure your performance/success?Marketing Plan
  • 49. What are you tryingto accomplish?• What is your mission and vision?• Are you the largest, cheapest, best service, best quality?• Sales goals?MarketingPlanning
  • 50. Who is your target audience? • by demographics • by geography • by needs and wants • now and in the futureMarketingPlanning
  • 51. What message will move your audience?• Your brand• Your tagline/slogan/message• What do you want people to say about your business?MarketingPlanning
  • 52. What vehicles do youhave to deliver the message?• Website • Social Media• E-mail • Tradeshows• Advertising • Newsletters• Public RelationsMarketingPlanning
  • 53. What are your resources?• Budget/Money• Owner/Employee Skills• Friends/Family• Partnerships• Local/State/Federal Assistance• Chambers of Commerce, Business Associations, etc.MarketingPlanning
  • 54. How will you measure yourmarketing performance?• Electronic Marketing Tools• Data Collection• Research Mechanisms• Surveys• Informal Questioning• Sales DataMarketingPlanning
  • 55. Have a Calendar/Schedule Include: • Anticipated Ad Placement • Press Releases • Social Media Updates/Posts • Promotions • Other Scheduled StrategiesMarketingPlanning
  • 56. Marketing Plans Change • Because of business growth • Because of research • Because of economic factors • Because of technology (social media) • Because there is always changeMarketingPlanning
  • 57. Virginia’s Recent Ad Campaign
  • 58. Traditional Methods • Direct Mail • Sales/Promotions • Referrals • Phone CallsMarketing Tips
  • 59. Branding (it’s not just a logo)Marketing Tips
  • 60. Customer Service• Train and Empower Staff• Gauge Performance• Have Customer Service Plan (Goals, Objectives)Marketing Tips
  • 61. Electronic Marketing • Website • E-mail • E-newsletters • E-adsMarketing Tips
  • 62. Targeting Niches &Groups By Interest• Traditional Music (Crooked Road)• Cultural Heritage (Coal Heritage Trail)• Anglers (Fish Virginia First)• Outdoor Enthusiasts• Weddings/Meetings/Group ToursMarketing Tips
  • 63. Social MediaMarketing Tips
  • 64. Public RelationsMarketing Tips
  • 65. • Determine Ways to Stand Out /Be Unique• Be Creative• Have Fun!Marketing Tips
  • 66. Tourism Business Development & Marketing Assistance Randall A. RoseDevelopment Specialist – Partnership Marketing Virginia Tourism Corporation rrose@virginia.org 276-322-2044 www.vatc.org (industry) www.virginia.org (consumer)
  • 67. Financing & Managing Resources
  • 68. Helpful Hints for Financing Your Business Tommye Arnold Community Relations Officer© 2009 Wells Fargo Bank, N.A. All rights reserved. For public use.
  • 69. Helpful Hint #1 Get Your Financial House In Order  Obtain a copy of your personal credit report. • Check for any inaccuracies or mistakes. • Make certain that all accounts are current and there are no outstanding judgments or liens. • If there is any derogatory information, be proactive and prepare to explain the problems and why the problem is not likely to occur again.  Gather personal and/or business records • For the past three years, including: • Tax returns, financial statements with schedules and attachments, and interim year-to-date financial statements. • Any other financial documents that might help a lender. • Neatly photocopy all of the documents and prepare them for your presentation.© 2009 Wells Fargo Bank, N.A. All rights reserved. For public use. 73
  • 70. Helpful Hint #2 Understand What Your Lender is looking for  Be specific in what you are asking for • Know how much you need • Be prepared to support all costs with estimates, invoices, or contracts • Never tell a lender that you want to borrow as much money as possible.  Primary source of repayment • Be able to demonstrate how you will pay back the loan • Debt Service Coverage = Earnings before Interest, Taxes, and Depreciation / Total Debt Service • Debt to Income= Debt service / Income available to service debt  Secondary source of repayment (back up plan) • Be prepared to be able to demonstrate how your lender will be paid back if income falls short • Be prepared to have guarantors and possible collateral© 2009 Wells Fargo Bank, N.A. All rights reserved. For public use. 74
  • 71. Primary Source of Repayment Business Net Income + Outside Income (W-2) Interest Expense + Depreciation / Amortization + Earning Before Interest, Depreciation, & Amortization (EBIDA) DIVIDED BY Annual Debt Service Payments or Interest Expense plus Current Maturities of Long Term Debt Equals = Debt Service Coverage (Target > 1.40 to 1.0)© 2009 Wells Fargo Bank, N.A. All rights reserved. For public use. 75
  • 72. Helpful Hint #3 Recognize Your Strengths And Weaknesses  Bank underwriters are paid to identify risk • Business owners tend to be optimistic • Be prepared for scrutiny • Address your strengths and challenges realistically & honestly  Most common weaknesses lenders find are: • Inability to demonstrate repayment ability • Insufficient collateral • Lack of management experience • Insufficient cash injection • Poor personal credit  Dont get scared; just get prepared • Depending on the severity of any particular weakness, you can often overcome it if you are prepared with a particularly noteworthy and compensating strength.© 2009 Wells Fargo Bank, N.A. All rights reserved. For public use. 76
  • 73. Sources of Financing  Credit Cards o Most expensive o Credit lines may be cut unexpectedly o Most risk  Personal Savings o Lowest expense o Lowest risk o Do not use all of your savings for start up costs  Bank financing o Low cost o Shorter term o Higher equity requirements  Small Business Administration guaranteed loans o Low cost o Longer terms o Reduced equity requirements o Lower risk to partner Banks o Multiple plans to address real estate, equipment, and working capital needs  Non-profit community lenders (People Inc, etc)© 2009 Wells Fargo Bank, N.A. All rights reserved. For public use. 77
  • 74. Why NOW is the Best Time EVER to get a SBA Loan?  More companies than ever are eligible  Tangible net worth <$8.5MM  Net profits <$3MM in each of last two years  Transaction costs are at an all time low  SBA has waived the guarantee fee – usually ~2 points  Interest rates are at all time lows  Congress is now acting to increase lending limits, waive fees, and bolster lending!© 2009 Wells Fargo Bank, N.A. All rights reserved. For public use. 78
  • 75. Advantages to SBA Loans  Lower down payment  Up to 90% financing on Owner Occupied Real Estate  Up to 85% financing on Business Acquisition  Up to 90% financing on Partner Buy Out  Longer amortization  20 – 25 Year Term on Owner Occupied Real Estate  10 Year Term on Business Acquisition or Refinance  Can lend with collateral shortfall  SBA does not have specific LTV  Must take “All available collateral”© 2009 Wells Fargo Bank, N.A. All rights reserved. For public use. 79
  • 76. Tommye Arnold Community Relations Officer Wachovia Bank 601 State St – 3rd Floor Bristol, VA 24201 (276) 645 – 5130 tommye.arnold@wellsfargo.com© 2009 Wells Fargo Bank, N.A. All rights reserved. For public use.
  • 77. Other Business ResourcesSandy Ratliff, Business Services Manager Virginia Department of Business Assistance 276-676-3768 sandy.ratliff@vdba.virginia.gov www.vdba.virginia.gov www.vastartup.org
  • 78. The Virginia Department of Business AssistanceVDBA supports economic development in the Commonwealth by working with new and existing businesses to provide business and economic development communities with:• workforce incentives• financing• business information and counseling• state procurement assistance• educational opportunitieswww.vdba.virginia.gov
  • 79. Ask VBIC = 866-248-8814
  • 80. Business Information ServicesTo help businesses get started and to grow.Formation Assistance Virginia Business Information Center (VBIC) 1-866-248-8814 Bridges the 26 state agencies, over 110 regulatory programs and over 300 forms that may touch a Virginia business Questions on registration, taxation, licensingInteractive business plan available online atwww.vdba.virginia.gov or www.vastartup.org 5 Step process to a business plan
  • 81. Ask VBIC = 866-248-8814
  • 82. Growing Your $ales - State  Governor’s Executive Order 33  $5 billion market  Access to buyers from 171 state agencies  Additional $5 billion from local governments  575 localities using eVA system.  Small Business Goal – 40%  Over 50,070 registered suppliers  Over 22,686 participating buyers Ask VBIC = 866- 248-8814
  • 83. • Examples of Purchasing: – Soft Drinks • 07/01/2010 – 06/30/2011 = $1,651,245 – 1,015 PO’s – Souvenirs: Promotional, Advertising, etc. • 07/01/2010 – 06/30/2011 = $379,138 - 394 PO’s – Grounds Maintenance: Mowing, Edging, Plant (Not Tree) Trimming, etc. • 07/01/2010 – 06/30/2011 = $10,328,901 - 788 PO’s – Tires and Tubes, Passenger Vehicles • 07/01/2010 – 06/30/2011 = $519,410 - 393 PO’s – Concessions, Catering, Vending: Mobile and Stationary • 07/01/2010 – 06/30/2011 = $23,874,228 – 10,193 PO’s – Building Maintenance • 07/01/2010 – 06/30/2011 = $40,240,266 - 5136 PO’s – Earth Moving Equipment Rental • 07/01/2010 – 06/30/2011 = $15,452,634 - 764 PO’s – Janitorial/Custodial Services • 07/01/2010 – 06/30/2011 = $5,336,396 - 887 PO’s
  • 84. One–on-One Counseling SessionsNeed Based: – Accessing New Markets/Sales Growth – Tailored Sales Development Solutions – Financing Resources – Social Media for Your Business To schedule an appointment, contact: Sandy Ratliff, Business Services Manager 276-676-3768 Email: sandy.ratliff@vdba.virginia.gov
  • 85. Entrepreneur Workshops• Partnership with Service Providers and localities• Workshop Types: – Starting and growing a business – How to sell to the Commonwealth – Social media for business – iPad for business – Business of restaurants• List of events: – www.vastartup.org
  • 86. Virginia Jobs Investment Program• Workforce recruiting and training – Create minimum 25 net new jobs within 12 months and capital investment of at least $1,000,000 – Minimum entry-level wage of $10.00/hr required. Only full- time jobs are eligible.• Small business workforce recruiting and training – 250 employees or less, hiring at least 5 new full time employees within 12 months of operation and capital investment of at least $100,000 – Minimum entry-level wage of $10.00/hr required. Only full- time jobs are eligible.• Retraining – Small businesses that are retooling and installing new technologies – Company must retrain minimum 10 full-time employees.
  • 87. Financing Programs• Direct Lending: In partnership with banks and other lenders, we provide direct loans in economic development transactions. We also provide direct loans under specific programs designed to promote environmental stewardship and assist licensed daycare centers and family home providers.• Indirect Lending: We provide loan guarantees or other types of credit enhancements to commercial banks in order to increase access to capital for businesses.• Conduit Financing: We are the statewide conduit issuer of tax-exempt industrial development bonds for manufacturers and 501c3 organizations.
  • 88. OTHER AVAILABLE RESOURCES• Virginia Department of Labor – Apprenticeship Program – Combination of on-the-job training and classroom instruction. – Advantage of skilled workforce and reduced turnover. – http://www.doli.virginia.gov• Virginia Department of Agriculture & Consumer Affairs – Virginia’s Finest Trademark = Marketing program that promotes foods and foods products grown in Virginia. – Facilitates expansion of agricultural businesses. http://www.vdacs.virginia.gov
  • 89. A regional business incubator serving the City of Martinsville, Henry, Patrick and Franklin Counties
  • 90. What is Business Incubation? Business support process that accelerates the successful development of start-up companies by providing entrepreneurs with an array of targeted resources and services A business incubator’s main goal is to produce successful firms that will leave the program financially viable and freestanding
  • 91. Services Favorable Rental Rates Mentoring Services Broad Band Internet Access Shared Resources  Conference and training rooms  Shared receptionist  Business equipment "Virtual Incubator" Available
  • 92. Benefits Financial, professional, and technical services assistance Access to facilities and equipment not otherwise available Increased visibility Environment where small businesses can share experiences and reduce the risks involved in business startup 87% of incubator graduates succeed!
  • 93. WPBDC 23,500 square foot facility in Uptown Martinsville 11 Tenants 1 Virtual tenants 20 Graduates 231 jobs created
  • 94. Questions? Robbin Hall Executive Director West Piedmont Business Development Center 22 E. Church St. Martinsville, VA 24112 276.403.5085 rhall@wpbdc.org
  • 95. Starting and Growing a Business• Business Formation Assistance – Small Business Development Center Network = www.virginiasbdc.org – SCORE = www.score.org – Virginia Business Information Center = 866-248-8814 – Virginia Central Business Portal = www.business.virginia.gov – Virginia Business Incubator Association = http://www.vbia.org/
  • 96. Marketing Resources• SCORE = www.score.org• Virginia Tourism Corporation = www.vatc.org• Virginia Department of Agriculture – Virginia’s Finest Trademark = www.vdacs.virginia.gov
  • 97. Financing Resources• Virginia Small Business Financing Authority = www.vdba.virginia.gov• Small Business Development Center = www.virginiasbdc.org• Small Business Administration = www.sba.gov• Local Economic Development Office or Chamber of Commerce
  • 98. “If you always do what you’vealways done, You will alwaysget what you’ve always got!”
  • 99. Lets Connect: Sandy Ratliff The Virginia Department of Business Assistance 276-676-3768 sandy.ratliff@vdba.virginia.gov Online: Twitter: http://twitter.com/sandyratliffFacebook: http://www.facebook.com/sandy.ratliffLinkedIn - http://www.linkedin.com/in/sandyratliffYouTube - http://www.youtube.com/user/vastartup
  • 100. Survey CompletionsPlease take a moment to complete our survey!
  • 101. CONTACTS• Sandy Ratliff, Virginia Department of Business Assistance = 276-676-3768 or VBIC = 866-248- 8814• Randy Rose, Virginia Tourism Corporation = 276- 322-2044• Dick Ephgrave, Longwood SBDC = 276-632-4462• Maynard Wiff, SCORE = 540-857-2834• Tommye Arnold, Wachovia Bank = 276-645-5130• Robin Hall, West Piedmont Business Development Center = 276-638-2523• Annette Stamus, Smith Mountain Lake County Chamber = 540-721-1203