Keep your Business Healthy With The Right Funding

Jennifer McCluskey

Having access to the correct type of funding stream at the right time can be very important for keeping your business healthy. Even if you don’t need funding right now, a great regular health habit for your business is developing and maintaining a solid relationship with your bank. When you find that your business is ready for additional capital to be able to grow, you have several options: 

Loans vs. Lines of Credit 

    There are several differences between loans and lines of credit. A loan is usually a large chunk of money that is given to you by the bank to buy something specific, for which you repay principal and interest for a set time period. Loans are usually best for larger purchases like land, buildings, larger equipment, etc. When starting a business, working capital (A.K.A money to start and keep your business going for the first few months) can be built into a business loan, too. 

    A line of credit can be more useful when a shorter repayment term is anticipated. For instance, if a lawn care business needs equipment in the spring and knows they will make enough money in the summer to pay the equipment off, a line of credit might be a good idea. Or another example is if a business is doing a project for a government entity, often the business will not be paid for the project until 30 or 60 days after completion. In that case, the business could use a line of credit to cover materials, supplies, and salaries until the bill from the government entity is paid. Usually, a loan is for something specific, while a line of credit can be for pretty much anything the business owner needs, once it is set up. Another useful thing about a line of credit is that it is a revolving account that lets the borrowers draw, repay and redraw from available funds throughout the life of the line of credit. Payment and interest will only be due on the amount spent. Lines of credit will likely have a higher interest rate, however, and may be harder to get if the business owner does not have good credit or less solid performance. There often needs to be some collateral available to secure the line of credit. 

Other Types of Business Funding 

    You can seek a loan from your bank or from other banks in the area that do business lending, or there are alternative lending sources available. Sometimes your county or your town will have a loan or grant program, so it’s always worthwhile to stop by your local economic development office or SBDC to find out what funding options are available to you in your county. Contrary to popular belief there are not many grants available, and those that are often have stringent requirements like job creation. Most grants available for business owners in our area are obtained by municipalities from the state and are administered on the local level. There are a few others, such as ACCES-VR’s small grant program for people with disabilities to start a business, and larger government SBIR and STTR programs for tech companies. In St. Lawrence and Jefferson counties, there are also some small grants for artists through the SLC Arts Council. 

    Some kinds of businesses, specifically those that are scalable and may involve a patentable product or service, may be of interest to an investor. Local investment groups will usually need a business plan as well as a pitch presentation. Obtaining this kind of funding can be a challenge, but rewarding. Similar kinds of businesses, like those that have a fun product or are in the tech arena, may be able to get some funding through crowd funding, but that requires a very strong marketing strategy and the right kind of product. Loans and lines of credit have a broader application and are (relatively) easier to get. 

    If you are looking for funding for your business and would like to learn more, contact the SUNY Canton SBDC at (315) 386-7312, SUNY Canton SBDC at Clinton Community College at (518) 324-7232, or the Watertown SBDC at JCC (315) 782-9262 for free business counseling. 

Adjusting Business Plan for Seasonal Changes

Jennifer McCluskey

Many businesses, especially here in Canton and Potsdam which have large college student populations, struggle with slower summer months.  Others in more touristy areas, such as near Higley or out in Clayton or Alex Bay, have the opposite seasonal changes.  A survey from Wells Fargo reported that 45 percent of business owners say they reliably have several times of the year that are faster and slower than others.  But no matter when your business’s slow season is there are many strategies for dealing with slower seasonal sales. 

    One strategy is to close up shop during the slow months. You’ll keep having to pay rent, but utilities, employees, and other costs will be gone or minimal.  This is the strategy that is often employed in some predominantly tourist areas.  However, if your product can serve locals as well, possibly staying open when everyone else is closed might lead to some small profits, or possibly large ones if there is an ice fishing derby or some other event. The Wells Fargo survey mentioned previously also reported that 62 percent of small business owners said they reduce their capital expenditures during slow seasons, and 43 percent said they reduce hours for their employees.

    Another strategy is to set money aside during the high sales months.  This is hard for many business owners.  Forty-one percent of business owners surveyed said seasonal differences make it more difficult to manage cash flow.  Planning can be difficult when you don’t know what’s right around the bend, or if you’re just barely making it during the better parts of the year.  If this is the case for your business, you may want to use your slow season to take a hard look at your financials and see if there are ways you can trim costs during the rest of the year so that you can be better prepared for next year’s downturns, or create a financial budget if you’re just winging it.  Make sure you are realistic with your cash flow projections for the future by having a good idea of past trends and sales in both slow and peak times. Update your forecasts regularly to make sure you are on top of any changes in trends.  Your SBDC advisor can help create and analyze projected budgets. 

    You may be able to delay some expenses until different times of year.  Talk to some of your vendors, for example your insurance company, to see if you could pay at a different time of year.  Even if they say no, I’m sure they won’t mind if you pay your bill ahead of time in the spring so that you’re all set when it’s due in the summer.  Another idea to improve cash flow during slow months is to collect a deposit from customers, for example half down and half on delivery.  This works especially well when there is a substantial gap between booking your service and service delivery. 

    Also, develop a positive relationship with your bank.  There are possibilities of obtaining a seasonal line of credit to get equipment and other items you need to get ready for your high season and then pay it off when the sales start coming in.  This could work well for something like a lawn care business which will need new equipment in the spring but won’t have money to pay for it until the summer. During slower times of the year, one in five business owners (21 percent) reported increasing their use of business lines of credit or business credit cards to bridge cash flow gaps. During busier times, two-thirds (64 percent) said they pay down debt or reduce their use of credit.   

    If you would like assistance planning for seasonal changes in your business cash flow, you can get in touch with your local Small Business Development Center office.  You can contact the SUNY Canton SBDC at (315) 386-7312, SUNY Canton SBDC at Clinton Community College at (518) 324-7232, or the Watertown SBDC at JCC (315) 782-9262 for free business counseling.  The Wells Fargo survey referenced can be viewed at https://wellsfargoworks.com/small-business-optimism-reaches-highest-point-in-a-decade.

               

How to Find the Best Location For Your Business

Jennifer McCluskey

At the Small Business Development Center, we work with a lot of business owners who are looking to move into a downtown space and trying to decide the best town or location for their business. What some business owners don’t know is that through our Research Network we have access to many different statistical databases. We can use these databases to get our clients much of the statistical information they would need to make an informed decision about where to start their new brick-and-mortar business, or which location would be right to move or expand their business. Some of the statistics that can be vital for making this decision are as follows:

    Traffic Counts:  The state Department of Transportation keeps a website which can map down to very precise detail how many cars travel down a specific street or through an intersection so that you, as the business owner, can know how many vehicles drive past your potential location. The DOT traffic website is free for anyone to use, so this is information you can get on your own, or the SBDC can compile it for you.

    Pedestrian Counts:  Sometimes just knowing how many cars drive past a location is not enough, you may need to know how much foot traffic there is. Some of the larger cities may have this information, but in the north country business owners may need to develop their own pedestrian count study. The SBDC can help you with strategies to design an accurate pedestrian count that won’t require you to sit out there all day, and will help get a more complete representation of where people go over time.

    Demographic Data:  The SBDC Research Network has paid for access to several databases that provide a wealth of knowledge about the people that live in a particular area. Knowing the ages, income ranges, ethnicity and buying patterns of a community is vital information for local business owners. We can create a customized geography around your business or potential location, looking at a radius of less than a mile to up to 150 miles away, or we can explore the population of a town, county or state. These databases take information from the U.S. Census Bureau and private sources to examine how many households there are in the area, what income ranges are, the daytime population of workers in an area versus the night time population of residents, and also demographic information like age, ethnic background and more. These numbers can help you see if your target population is active in the downtown area you are examining. We can also show this data in map form, so you can get an idea, say, of which areas of a city contain residents who earn higher incomes.

    These tools can also provide information about consumer spending and behavior patterns in an area. If, for example, you sell a healthy snack product, the database can tell you how many people in a local area are trying to eat healthy and lose weight, and how much the average household spends on snacks. There are a wide range of expenditures and behaviors covered, including restaurant, food and beverage, household items and services, recreation and medical services.

    As your SBDC business advisor, we can also get general industry trends, to give you an idea of what to look for in your industry and how technology, marketing, and other changes may lead to a shift in how you do business as you expand.

                When you don’t know what you don’t know about expanding your business, consulting us at the SBDC can be a great option for free business counseling and access to market research.  To set up an appointment for confidential business counseling and support, you can contact the SUNY Canton SBDC at (315) 386-7312 or the Watertown SBDC at JCC (315) 782-9262.

Jennifer McCluskey is a certified business advisor with the New York State Small Business Development Center at SUNY Canton. Contact her McCluskeyj@canton.edu.

New Business Advisor Advances Online Marketing Strategies

Jennifer McCluskey

Brick-and-mortar stores looking to revitalize our downtowns sometimes overlook the power of the internet in bringing in new customers. I have seen several stores in the north country that don’t have a solid website or engaging social media. If this is the case for your shop or business, it might be time to think about improving your online presence. Think about this: If a tourist drives by, will your pizza place pop up on their smartphone when they are looking for lunch? If not, your local Small Business Development Centers can help you bring in more tourists and more locals, too, by assisting you with your online marketing strategy.
     At the SUNY Canton SBDC, we have a new business advisor who is doing just that. Her name is Renee Goodnow and she is working with small businesses in St. Lawrence County to help them improve their online and social media presence. The position was funded through a grant from the Alcoa Foundation, which is looking to help small businesses in the region expand their services beyond brick-and-mortar stores into e-commerce, where they can reach a significantly larger customer base.
     Renee has a background in industrial design and has also helped run a local small business, so she comes to the SBDC with a wide range of skills that she will use to assist business owners in meeting their internet marketing goals. Renee can assist with website design, the revamping of an old website for a more modern look, and also help you learn how to market the site to reach more customers. For those of you who would like a website or a stronger social media presence, but don’t have the time to do it yourself, Renee can help you get connected with a local web developer who can be a long-term resource for your business.
     Renee can also connect your business with local resources in the community, such as photographers and videographers, who can improve the way your business communicates visually with the world. She can help you craft your message and your brand by helping you communicate what is unique about your business. She can also help with logo design, or hook your business up with a local company for logo and other branding designs. Just as with the rest of the services the Small Business Development Center provides, there is no charge for this assistance.
     Renee can meet with you one-on-one and can assess your needs. Some of the ways she is helping clients already include:

• Working with several business owners to help them develop their first websites.
• Talking with business owners about setting up and marketing their business Facebook pages.
• Helping business owners decide which social media outlets are right for them and how to maximize their presence on each.
• Logo development.
• Assistance with creating compelling photographs and videos for marketing.
• Teaching business owners how to rank higher on search engines through search engine optimization (SEO) techniques.

     Renee also will be setting up free training at different locations around the county to help business owners learn how to better market themselves online. The first training in January about social media marketing, presented by Molly Williams from Railroad Productions, was a great success drawing over 30 business owners who learned how to use Facebook, Instagram, and other social media outlets to better share their voice and their brand with customers. The second training in March, with co-presenters Nate Lashomb from the Massena Chamber of Commerce and Jason Hendricks from H3 Designs, also drew a wide variety of business customers and covered a lot of information about web design and search engine optimization.
     If you are interested in developing your social media presence, brand, or would like to have Renee assist your business in improving your online presence, you can contact her at the Small Business Development Center at SUNY Canton at (315) 386-7312 or via email goodnowr@canton.edu. Keep an eye on the SBDC’s Facebook page to find out about more upcoming trainings. The Watertown SBDC at Jefferson Community College also has many resources available to assist your business with your online presence, and can be reached at 315-782-9262.

 Jennifer mccluskey is a certified business advisor with the New York State Small Business Development Center at SUNY Canton. Contact her at McCluskeyj@canton.edu. 

Don’t forget Facebook in media mix

Jennifer McCluskey

Jennifer McCluskey

As you are planning out your business’s advertising budget for next year, you may want to consider adding targeted Facebook ads if you have not done so already.

Being able to be very specific in defining a target audience is one of the reasons many businesses are turning to Facebook for advertising in addition to their more traditional advertising methods. For example, you can set up an audience of men ages 18 to 22 who like snowmobiling and live within either a 10 mile radius of Gouverneur or a 20-mile radius of Watertown. You can be as specific or as broad as you like, depending on the certain type of customer you are trying to reach.

If you’ve never set up a targeted audience for your Facebook ads before, here’s how you do it. At the lower-left corner of your Facebook page, there should be a blue button that says “Promote.” Facebook likes to move stuff around regularly, so if it’s not there, it will be somewhere on the page. Click it, click “see all promotions,” go to the bottom of the screen and click “Go to Ads Manager.” The dropdown menu in the upper left hand corner of your Ads Manager should give you a link to set up an audience. If it does not, click “Create Ad,” and choose an objective to be able to see the audience creator.

There are several ways to develop an audience. One way is to upload information about customers, and Facebook will match that to other people who share the same demographics and interest. Alternatively, you can create an audience of people who have interacted with your Facebook page, mobile app, or visited your website. Beyond those criteria, you can target customers based on their age, gender, and location. You can also use the detailed targeting search bar to find people that match certain interests. This is where the fun part begins. Start typing a phrase and see what comes up. Some examples are parents of teenagers age 13 to 18, people who are interested in magnum ice cream, people who are interested in handmade jewelry, people whose home value is more than $200,000, and people who are credit card “high spenders.” Yes, it is pretty scary how much information Facebook has about us. The list goes on and on, so you can craft an audience that is detailed as much as you want.

You can also choose to include or exclude people who like your page, or send the ad to friends of people who like your page. You can choose to have your ad or boosted post come up within your audience’s newsfeed (it will say “sponsored” above the ad) or in the sidebar. Ads in the newsfeed are a little more subtle, but it might be worth trying both to see which is most effective. You can also choose to have your ads show up on Instagram as well.

Once you have created an audience you can save it for future use. It can be useful to test several different audiences to see which works best to meet your goal. Continue to add audiences for variety, so you won’t be showing the ad to the same people every time.

Finally, and most importantly, you want to make sure you have a measurable goal to know if your marketing is effective. Your goal may be to get more clicks through to your website, to get more emails or calls from customers, and of course to make more sales. You will want to track the results from your ad campaign. Facebook has some insights in the ads manager, but you can also use website analyzers like Google Analytics to track clicks to your website from Facebook. You can also include a coupon code with your ad so that you will know how many actual customers come in because of it. It is also good to test two different ads, audiences, etc. to find out what works the best to bring in more customers.

Feel free to get in touch with us at the SBDC if you want help designing your Facebook ads or if you want any other assistance for your business. We are always here to help. The Small Business Development Center has offices at SUNY Canton (315) 386-7312 and at JCC in Watertown (315) 782-9262.

Strengthen your brand with Instagram

Jennifer McCluskey

Jennifer McCluskey

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August 2016: Small Business Success

Understand options for crowdfunding

Jennifer McCluskey

Jennifer McCluskey

Crowdfunding, using various internet platforms like GoFundMe and Kickstarter to reach multiple investors, has been increasing by leaps and bounds over the last few years. So is crowdfunding a possibility for your business?

Certain types of products or businesses work better for crowdfunding than others. New and exciting businesses and products, nonprofits that can help people connect to a cause, or anything else that could get regular people excited to donate their hard-earned money may do well with crowdfunding. [Read more…]

June 2016: Small Business Success

Selling a business takes many steps

Jennifer McCluskey

Jennifer McCluskey

At the Small Business Development Center, we work with many clients who are trying to buy a business. However, business owners who plan to sell their business can also benefit from a solid plan. If you are thinking of selling your business now, or at some time in the future, there are specific actions you can take and documents you can begin to prepare that will make this transition go smoothly. [Read more…]

April 2016: Small Business Success

Resources for small business funding

Jennifer McCluskey

Jennifer McCluskey

In our local area, there are several different avenues a business owner can use to fund a start-up or growing small business. I touched on a few resources in a previous column, but there are several others you might want to be aware of. Depending on the needs of the business, the type of business and the size of the project, one funding resource might be better than another. At the Small Business Development Center, we can help direct business owners to the best fit for a project. [Read more…]

February 2016: Small Business Success

Maximize your SEO and boost business

Jennifer McCluskey

Jennifer McCluskey

Getting your website onto the first page of a customer’s online search results through Google, Bing, or another search engine is an important part of any online marketing campaign. This is called “Search Engine Optimization”, and is the best way to reach customers who are searching for your product or service online. You can pay for ad space, above and to the right of the main (organic) search page, but there are also things that you or your Web developer can do to make your website rank well in the middle of the page. Whether you do your website yourself or you have someone do it for you, it can be helpful to know about these concepts to make sure your website is performing optimally. [Read more…]