Friday, February 06, 2009
Starting a new business takes planning
But there is free advice available locally for people who want to try their hands at entrepreneurship.
The latest from The Ticker blog
Business counselor Tom Tanner told a cautionary tale.
A crowd in record-breaking numbers listened Thursday in Roanoke during a free, three-hour, state-run "entrepreneurial express workshop."
Organizers attributed the turnout in large part to an economy that has tossed thousands of regional employees out on the street and robbed sleep from many small-business owners. Virginia Western Community College hosted the event.
The audience of about 140 people included, among others, people recently laid off and contemplating their future, owners of small businesses trying to keep the doors open, a few budding entrepreneurs, a few brave souls with startups and a Virginia Tech business class.
Roanoke County resident Lynn Akers attended.
"Well, I've been out of work for about two months and I wanted to see what I could learn here," Akers said. "I've had a few ideas through the years about a couple of products."
An occupational health and safety professional, Akers said he is hunting for a new job but wanted to learn more about entrepreneurship.
After Tanner's presentation, Akers said he was struck by the intense preparation required before responsibly starting a business.
"I really feel respect for the guy who goes out there on his own," he said.
Tanner's tale
Unfortunately, some guys, and gals, go out there without a clue.
Tanner, a business counselor for the Roanoke Regional Small Business Development Center, recalled one such unfortunate.
Tanner changed the client's name to "Smith."
One of Smith's friends had suggested he open a new business. The friend predicted great success. Smith plunged. He arranged a home equity credit line, signed leases, printed business cards and opened.
Customers didn't show. Smith scattershot a little advertising. No response.
Finally, he trudged into the business development center.
Tanner asked to see Smith's business plan. He didn't have one. He asked for Smith's market analysis and marketing plan. He had neither. How about cash flow projections? Nope.
Tanner recalled, "He said to me, 'I wish I'd come to see you sooner.' "
Then, Tanner asked the crowd for a show of hands from those who had developed a business plan before opening a business or contemplating such a move.
One hand shot up. Tanner shook his head.
During a break, Hardy resident Tom Howell said Tanner's presentation was both enlightening and a tad unnerving.
"I'm daunted by the business plan, the cash flow projection and all the other things you need to do," said Howell, who is "trying to get a new idea started."
"But it's great to get some help, especially free help," he said.
Business counseling -- free.
There is no charge for one-on-one counseling through the small-business development center, which relies on funding from the U.S. Small Business Administration but receives local tax money, too.
Business counseling is free also through Score -- an acronym for the Service Corps of Retired Executives. Score partners with the Small Business Administration.
John Hunter, a counselor for Score's Roanoke chapter, reviewed some reasons people risk entrepreneurship. Be your own boss, he said. Bring an idea to fruition. Achieve financial independence and, sometimes, turn a hobby into a profitable business.
But, like Tanner, Hunter said getting there requires abundant preparation.
Hanging in there
Many attendees were people with small businesses trying to cope with the recession.
State numbers suggest small businesses account for about 99.2 percent of businesses in Virginia, which defines a small business as one with 250 employees or less.
That definition fit two businessmen in the crowd -- home repairs contractor Steve Coffey of Natural Bridge and painting contractor Jeff Cass, who operates Paint By Design of Roanoke.
Both men said they came to the workshop hoping to learn how to better market their businesses and reach new clients.
Afterward, Cass said he felt re-energized. He had been feeling discouraged because work dropped so precipitously. He had been thinking about looking for a regular job.
"But I don't want to have to do that. I really like working for myself."
Tanner might have chided Cass when the morning began. Why? Paint By Design can't be found in the phone book or on the Internet.
Cass said he will soon create a Web site.
