15. “A business plan…covers the
financial aspects of starting or
expanding your business—how
much money you need and how
you’ll pay it back.”
Mike McKeever in How to Write a
Business Plan. Nolo Press, 2008.
Have been a business librarian at CCPL for just over 5 years. It wasn’t my plan or goal to be a business librarian. I don’t have much special training to be a business librarian; few business librarians do.Why am I telling you all this?Fear not! Generalists can learn to answer business reference questions on the job.
We’re going to talk about the financial planning needs of small business….
And the Library resources, such as books and DISCUS databases, plus the outside business assistance resources, that we can point our patrons towards.
They’re just like you & me.Most have no formal business management training.Many have never run a business before.Most of the businesses & hopeful future owners are involved with microbusinesses, that is, their biz’ net worth is<$250k.Many of these people plan to run their business from their home, or will employ a very small number of workers.Many of these businesses grow out of hobbies or are what I’ve heard one procurement office describe as “wanting to create a job for themselves, not run a business”
Shel Silverstein understood the soul of someone who wants to open a small business. This quote from the introduction for Where the Sidewalk Ends neatly sums them up.They are dreamers!I don’t mean to imply that there is anything wrong with small business dreams.Actually, without the dreams, the entrepreneur has no passion for what they do and will fail.But you need more than just passion to get a business off the ground & keep it healthy.
Most of the would-be entrepreneurs you serve will underestimate how hard it is to run a business & overestimate their ability to handle it.Hopefully, they will talk to experts to discover if their business is feasible.Some will plow ahead with it anyway. Some will retool until they do have a workable idea.Some will get right through to the place where the money needs to be spent, and then they won’t be able to fund the business.Some will realize they don’t want to work 90 hour weeks without sight of a vacation for many months.Many will not follow through with their business idea at all.Of those who follow through, most will fail quickly.
HOWever…every so often someone you help will go on to become a great success.It’s worth it to help every patron, successful or not.If after you help them, they eventually decide not to go into business after all, you’ve helped them save a bundle of money…as little as a couple thousand to as much as $100,000 for something like a full-service restaurant.If they make it big, they’ll remember that you helped them. And you’ll have helped create jobs. Any you will in turn have helped your local economy.
For your patron to have the best chance of success, they need a team of experts behind them, teaching them what to do to maximize their chance of success. Some of the best resources we can give to our patrons are free—referrals to local business assistance organizations that have free or low-cost help from business experts.As we go along, we’ll talk about the sorts of organizations that are out there in the community. They are likely to be receptive to learning about library resources are out there to help small businesses. They’re generally more than happy to send people to the library if they know we have something specific to help the entrepreneur.
First…. Startup assistanceStartup help - Business Financing - TaxesDisaster Planning - Employee costs - RetirementLibrarian’s Resources
So your patron has an idea for a business. Before they come to the library, they’re usually sure about the type of business they want to start, but that’s about it.They’re in the startup phase, which is the phase that most people are in when they seek involved business information from the library.
Let’s talk about the usual suspects for the startup/planning phase. Here are some Dummies titles in your collection.
I highly recommend the Nolo Press books. They are affordable for the library, readable, are written by lawyers with experience in the field. They include forms on CD that might be helpful. I can’t say enough good things about these books.That last book up there on the right? That’s about business plans. What’s a business plan?...
“The worst term paper you will ever write” – everything you have in your heard about the business you want to start in 1 documentWhether they know it or not, they’re about to write a business plan, which I define as “basically the worst term paper you will ever write in your life”, in that it’s crucial to the success of their dream, but it’s not always an easy process.Basically the bplan will make them lay out on paper everything to do with their startup & first year of business, including the business’ finances. The plan will move them from the “magic bean buyer” phase to the reality of whether the business idea can ever break even & make a profit.
There are other sections to a business plan, but the meat of it is the financial component. The marketing, SWOT analysis, and other written portions are important, too, but this is the section that makes or breaks the plan. Hardest to figure out when someone is starting a new business. No past years’ performance to go by.
In DISCUS’ Job & Career resources, check out the Career eBook Collection….
Anatomy of a Business Plan comes highly recommended by SCORE counselors that I’ve worked with. There’s an ebook copy in this collection, so you have ready access to this title.
Also from DISCUS, take a look at the Small Business Resource Center…
SBRC includes499 sample business plans, from the print volumes of Business Plans Handbook-Plans are real; identifying details altered for privacy reasons-Search by type of business or browse all bplans-Most plans include at least part of the financial statement sections of plans
SCORE also recommends bplans.com. The site tries to sell you some other business planning services, but if you ignore the ads, patrons can take look at a wide variety of business plans by type of business. I believe there is some overlap here between Business Plans Handbook.
Always recommend local business assistance organizations to prospective business owners when they ask you about how to start a business.SCORE = can do absolute beginner’s needs. Funded by the SBA to help people figure out if they even want to really do this.SBDC = More advanced technical assistance. Help with loan packaging for banks, doing business with the government, etc.
The SC Commerce Department has this PDF online, the SC Business Resource Directory. Has a lot of useful information for startups, including lists of other SC resource organizations good for helping with all business topics, especially the business planning stage.
http://www.score.org/resources/business-plans-financial-statements-template-gallerySCORE also has downloadable business plans & financial statement templates on their site. These are free and very useful.A word about SCORE. SCORE stands for “service corps of retired executives” SCORE is funded by the SBA and has chapters across the country. They members are business people, frequently retired, with business expertise & a desire to give back to the community.I recommend SCORE to anyone who comes to the library who asks how to start a small business. They can also offer counseling to people in nonprofit situations, too.
http://www.sba.gov/category/navigation-structure/starting-managing-business/starting-business/writing-business-planSBA itself also offers guidance for the business planning process on their national website. The articles in this section are a helpful overview of the planning process.
As part of the business planning process, SCORE or other business counselors will advice clients to find ratios for their industry. These ratios help them determine some of the financials in the business plan for a startup, and for an existing business, they can help determine the financial health of the business.No one title has every industry.Banks use the RMA in the center, but it doesn’t cover every possible industry. Their ratios are based on financials submitted by public & private companies with the promise that their data remains anonymous. So if there’s an industry where people could guess the name of the company, they do not print the ratios.Industry Norms goes by SICRMA is the banker’s preference & it the most intimidating to useAlmanac is easier to read, but doesn’t cover as many as RMA.
Alternatively, you can try the BizStats.com site recommended be Celia Ross, a business librarian who teaches Business Reference 101 for ALA. These are not as extensive, obviously, since they’re free, but worth a look if you can’t find ratios otherwise.www.bizstats.com/industry-financials.php
Personal creditBefore starting a business, entrepreneurs NEED to check their credit score, just like they’d do before making any other major financial decision. -Annualcreditreport.com = truly free -FICO score check = you have to purchase it directly from the credit agencies-People with bad personal credit NEED to take care of that problem BEFORE trying to start their business.
If individuals have problems with credit, they should look for trustworthy financial counseling agencies in their area or online who offer counseling to help with credit issues.Nfcc.org is one trustworthy source. NFCC doesn’t have office or affiliate in the Georgetown area. However, the Family Services, Inc. in Charleston is the closest agency that offers online & phone counseling. You may already be aware of efforts in your area. Check to see if there are closer options.
Business credit-Just like consumers, individual businesses have credit ratings, too.-DandB.com = business credit agency-Buying them is way more expensive than individual credit reports. No law saying they have to give businesses a copy for free like with consumers.-D.U.N.S. numbers = public number allowing others to track a business’ credit history. Can contact DandB to get a DUNS number for new biz. Sometimes see the DUNS listed in Ref books, esp. if they’re published by D&B, obviously.
To find even more information on finance resources for small business, here are a few professional resources for you to check outStartup funding - Business Financing - TaxesDisaster Planning - Employee costs - RetirementLibrarian’s Resources
http://youtu.be/U470xXKfDyEVideo by the Kauffman foundation is well worth the couple minutes it’ll take to watch it. Covers in a nutshell the problem of entrepreneurs & money.
You use your own savings, credit cards to fund you business. Eeek! That’s a little scary. If you don’t have enough $, as the video says, you will tap your family & friends next to see what you can get from them.Truth: patrons will NEED to have their own skin in the game regardless of whether they plan to borrow money to startup. No one will do a 100% loan to fund a business plan. Just not gonna happen. Sorry!
-Turndowns might not be your fault (overexposure to 1 industry)-Start where you currently bank-Local banks & credit unions may be easier to work with-Collateral is needed & it’s not always the same as for a personal loan-Cash works great as collateral—a good idea for building business credit.
-SBA funds loans, but not directly. SBA guarantees the bank payment in case the business defaults on the loan. -SBA Loan descriptions & SBA lender banks in SC: http://smallbusiness3.com/pdf/english/southcarolina.pdf-SBA.gov – scroll down & enter ZIP code to find local SBDC & other resources for help-SBA.gov/sc-This free PDF is an EXCELLENT starting place for all startup topics for first time entrepreneurs. Check with local SBA office to see if they have print copies you can have. If not, point people to the PDF. It’s updated every other year.
-Asthe video says: Vulture, I mean Venture Capitalists give businesses money in exchange for part ownership. They either expect their large investment back with interest in a couple years, or they expect to own your business. Most small businesses shouldn’t go here.-Most public libraries aren’t going the resources in this pathfinder from Harvard Business School’s Baker|Bloomberg Library. Then again, you won’t get asked about it much. This is a good guide to the resources out there, though, if you’re ever asked.
-Similar to Venture Capitalists, but they’re investing their own money-Many want to give back to their local community, but they still need their investment back.-Kauffman Foundation’s Angel Resource Institute is a reliable source of info for entrepreneurs & a directory of angel investors by region.http://www.angelresourceinstitute.org/listing-of-groups
COGs exist around the state. They are cooperative efforts between local governments to promote economic development in each region.Waccamaw Regional Council of Governments (COG) has a Revolving Loan Fund to lend money at a low interest rate to businesses in the area for the purpose of job creation.http://www.wrcog.org/revolving-loan-fund/This is an example of some types of nonbank loans that are out there.
Creatives have pioneered a way to crowdsource financing for specific projects. Kickstarter.com lets creatives finance everything from printing a novel to financing an open source network alternative to Facebook called Diaspora.-Diaspora: Some computer science students wanted an open-source alternative to Facebook. Their Diaspora campaign happened to be running just when FB committed another of their routine privacy blunders. They needed $10k; received $200k+ for their idea.http://www.kickstarter.com/projects/196017994/diaspora-the-personally-controlled-do-it-all-distr
-Diaspora: Some computer science students wanted an open-source alternative to Facebook. Their Diaspora campaign happened to be running just when FB committed another of their routine privacy blunders. They needed $10k; received $200k+ for their idea.http://www.kickstarter.com/projects/196017994/diaspora-the-personally-controlled-do-it-all-distr
Truth is? Those business startup grants don’t exist. There are sharks out there trying to convince people otherwise. The article by Mary Dickerson with the Charleston Metro Chamber of Commerce is the truth behind the myth of free grant money to start a business.http://www.charlestoncurrents.com/issue/09_issues/09.0309.htm
Grants.gov is the grant reality for everyone. Startup grants basically don’t exist. Some grants do exist for people interested in major job creation in already established businesses.SBA.gov has info about small business grants, such as they are, linked from the menu bar on the site.
FoundationCenter.org and GrantSpace.org are useful for nonprofits, but that’s a bit outside of our scope. Just know that they exist & that your patrons in the nonprofit sector live & die on grant money & donations. CCPL, SCSL, and Florence County PL are FC Cooperating Libraries in SC.
While we’re talking about government grants…..Matthew Lesko, seen here with that dratted Free Money to Change Your Life book, is not exactly telling the truth. His book promotes outdated, unfunded items skimmed from the Catalog of Federal Domestic Assistance. I highly suggest that you weed his items if any exist in your libraries.
….and send people to Grants.gov, or possibly the CFDA if they need to find government grants.
To find even more information on finance resources for small business, here are a few professional resources for you to check outStartup funding - Business Financing - TaxesDisaster Planning - Employee costs - RetirementLibrarian’s Resources
http://www.irs.gov/businesses/small/IRS site can help businesses understand their taxes; have info on every tax-related topicPro tip: Every small business regardless of size needs a team of 4: Accountant – attorney – banker – insurance agent
Can also get this tax workshop on CD ROM.Also offered in person at sites around the state, but 2012 schedule isn’t up yet.
Social Security & Medicare taxes for yourself & for your employees.
sctax.org is another important site for business taxpayers. The site includes online filing for certain business taxes, forms, publications, and a link to SCBOS which we’ll talk about in a minute
sctax.org also has a list of classes for a variety of business tax related topics offered by the SCDOR in 2012.Corporate tax, sales tax, withholding tax, a special small business tax workshop, online tutorials and tax manuals.
SCBOS has the goal of being the 1 stop shop for all business-related transactions with the state. Business can do a lot of things through SCBOS, including business filings with the Secretary of State and SCDOR business tax filings. SCBOS offers webinars to help small business people learn to use the service.Pro tip: Small business resource community says that every business must have an accountant, an attorney, an insurance agent, and a banker & they assert that you need to have an ongoing relationship with them beginning in the startup phase. Their job is to help you look after your business’ finances. Owners can do their own taxes technically, but they should rely on their accountant for tax help.
To find even more information on finance resources for small business, here are a few professional resources for you to check outStartup funding - Business Financing - TaxesDisaster Planning - Employee costs - RetirementLibrarian’s Resources
http://www.ready.gov/business - covers all the steps businesses need to think about in order to prepare for a disasterIncludes links to PDFs of an-emergency response plan-business continuity plan
SBA disaster loans - http://www.sba.gov/category/navigation-structure/loans-grants/small-business-loans/disaster-loans-low interest loans to help business recover from a disaster.-loans for declared disaster areas-”economic injury” – due to disaster, not just physical losses-military reservist economic injury – an essential employee who’s a reservist was deployed to active duty.
To find even more information on finance resources for small business, here are a few professional resources for you to check outStartup funding - Business Financing - TaxesDisaster Planning - Employee costs - RetirementLibrarian’s Resources
SC Works / One Stop Career Centers’ Business Servicesgeorgetownworkforce.org/ojt.htmWorkforce training:-help finding employees & paying for on the job training-help with conducting & paying for current employees’ on the job training
Find your local Career One Stops here
Wages are the most obvious cost of having employees. The Department of Labor has information about minimum wage, back pay, record keeping & reporting & a variety of other topics helpful for small business owners.
Health Insurance - http://www.ehealthinsurance.com – Recommended by the Kauffman Foundation’s Angel Resource Institute. Owners can use this service to find a group health, dental, vision insurance plan for themselves & to offer to their employees. Individuals can find additional types of insurance here, too.
Small businesses have a variety of insurance to think about, not just health insurance!-Key man insurance – coverage from business insurance companies in case an essential employee becomes incapacitated-Unemployment insurance – Check with DEW for information - http://dew.sc.gov/emp-land.asp-Worker’s Comp Insurance – Check with Commission for information - http://www.wcc.sc.gov
SBRC includesthe 3rd edition of the Entrepreneur and Small Business Problem Sovler.Check for articles such as “Business Insurance—What You Need and What You Do Not Need”. This is one of the best books out there for figuring out the hardest business problems. The Pricing chapter is especially helpful.
SBRC includesthe 2 volume reference book Encyclopedia of Small Business. This is a great basics guide for many costs associated with employees. You can search just this title for a certain topic by using advanced search, or you can search the whole database to cast a wider net for issues related to employees.
To find even more information on finance resources for small business, here are a few professional resources for you to check outStartup funding - Business Financing - TaxesDisaster Planning - Employee costs - RetirementLibrarian’s Resources
Don’t want to get too in-depth with general retirement resources, as I suspect that’s already covered as part of your Smart Investing campaign. Just keep in mind those sources work well for small business people, too.
But that’s not to say there aren’t specialized needs for business owners. Chapters from the book Beyond 401 (k)s for small business owners : a practical guide to incentive, deferred compensation and retirement plans are available in SBRC. Use Publication Search, then click the year of publication to see the full text of all chapters for the book
To find even more information on finance resources for small business, here are a few professional resources for you to check outStartup funding - Business Financing - TaxesDisaster Planning - Employee costs - RetirementLibrarian’s Resources
BUSLIB-L – the listserv for business librarians. Mostly academic and corporate, but very knowledgeable, helpful people and a HUGE searchable archive.
Still useful for things like how to read the WSJ stock pages, interpreting older print & microform resources, and other arcana.Justified and Ancient
2 sections: core list is first, with a section of essays about business services in many type of library settings.New edition published last November. Hooray!
Luise Weiss from the Middle Country PL on Long Island talks in-depth about programming, marketing, networking & partnerships so that PL’s can serve small business. Her county has an unusual business library, co-located with a Business Resources Center that offers job training, SCORE counseling, etc.NOT just recommending it because she interviewed me. Lots of sound advice about marketing business library resources to small business communitySCSL has this one as part of their professional ebook collection for SC Librarians. Check with your ILL librarian for instructions on downloading this or any title from SCSL’s Overdrive collection.