By Laura Raines For the AJC Sunday, January 25, 2009
The economic headlines are all doom and gloom — bank failures, store closings, bankruptcies, unemployment. Would anyone even think about starting a business today?
Yes... And some people should, said Lydia Jones, director of the Kennesaw State University Small Business Development Center. “We’re seeing markets and industries contract. Many small businesses are hurting. Those that aren’t strong enough won’t survive. Others will make it but won’t grow. In times when the economy is booming or tanking, we are covered up with people seeking our advice and assistance,” Jones said.
Despite the negative news, Jones is a firm believer in small business. “I’ve seen small businesses turn on a dime when big business couldn’t or wouldn’t change. Small-business owners are so open to new ideas and ways of doing things — they’re like sponges — and we need them right now.”
For all the belt-tightening and small-business pain, she’s also seeing owners innovating and grabbing for opportunity amid the chaos. “People start businesses in all economies,” Jones said. She’s seeing new enterprises succeed in the bio-tech, green/energy-saving, training and service sectors. So when she sees someone come in “with blinders on,” meaning that the person has such passion for his business idea that he is willing to take huge risks, she encourages him to go forward — with caution.
“I advise entrepreneurs to plan more thoroughly than ever before, because there are more challenges facing them in this economy,” Jones said. “They can’t leave any questions unanswered when lending communities are still so cautious and customers less willing to spend money. You have to have a very strong package to present to lenders or investors.” You also need more contingency plans than usual.
Courses (such as the Entrepreneur Success Series) and counseling available through Georgia’s 17 small-business development centers help people strengthen their business plans. Small-business owners can also find help through local chambers of commerce, city and county economic development departments, SCORE: Counselors to America’s Small Business, the Edge Connection, and many Internet sites.
The Terry College of Business entrepreneurship program at the University of Georgia is hosting a monthly series of seminars called “UGA Startups” for would-be business owners in Atlanta. The first seminar, on franchising, will be at the Terry Executive Education Center in Buckhead on Thursday.
“We’ve been overwhelmed by phone calls from people who have been laid off and wonder what to do next, since jobs aren’t plentiful. We wanted to create a safe atmosphere [no solicitations] where people could bring their concerns and fears and receive coaching about how to start a business or purchase a franchise,” said Chris Hanks, Terry College of Business entrepreneurship program director. Hanks’ program plans to offer participants help beyond lectures and panel discussions; including a network of experts and contacts, opportunities for coaching and mentoring, and even practical advice on financing. “If people are really interested in starting a new venture and will do the things they need to do, I won’t quit until that business is launched,” Hanks said.
“The beauty of a business plan is that you start with a blank sheet of paper and you get to choose what types of things you’ll be doing in the future, the kind of life you want to live. The business is simply the vehicle to get you there.”
In a recession, entrepreneurs face more challenges and have less room for error. “They have to be more creative about financing,” Hanks said. “Venture capitalists are still lending, but they are being a lot more careful.” Home equity and bank credit options are contracting as well.
Hanks has seen a tanning-bed facility get started by pre-selling subscriptions, a restaurant launch through selling VIP memberships, and people trade and barter for services. With baby boomers retiring, there are more opportunities to buy an existing business, and franchising is more attractive in a down economy.
“In 2000-01, we had a recession and then 9/11 happened and things got bad,” said Jim Raubolt, a consultant with Axxiom Franchise Advisors, who has owned franchises in the telecom, automotive and medical sectors. “In the next five years, franchising grew by 18 percent. Buying a franchise makes sense for a vertical worker in a declining industry or an older worker who has been laid off,” Raubolt said.
“You could spend a year trying to replace the high-paying job you lost, or you could buy a franchise and start creating a revenue stream.”
Franchises offer people an opportunity to run their own business with backup. “New business owners often wonder where to turn for direction and guidance. Those systems are built into a franchise,” Raubolt said.
“Now is a good time to buy because franchising companies are bending over backward to cut fees, and as the economy rebounds, so will businesses. Now is a good time to get in.”
Raubolt advises people to do as much due diligence as possible, including visiting and talking with existing franchise-holders or volunteering with a similar company. Funding will be more difficult, but there are legal ways to tap into retirement plans for franchising, he said.
“Atlanta is a remarkable market. More franchising companies are headquartered here than any other city,” Raubolt said. “It’s also a phenomenal city for supporting entrepreneurs. There are great opportunities for networking at all levels.”
In 2005, two business members of the Georgia Coach Association, Debby Stone and Michelle Goss, founded GROWE to provide education, mentoring and support to women entrepreneurs and executives.
“For many people, this could be the best time to start a business, especially if they can do it with the lowest overhead possible. It takes awhile to get one off the ground anyway, so why not start now?” said Goss, owner of the Leader’s Edge.
With sales way down in his company, one sales colleague found he had more free time, so he is using his nights and weekends to craft a strategy to start the business he wants to be in.
Goss suggests that clients and GROWE members first define what success means to them before deciding to be an entrepreneur. It’s not for everyone, and anyone coming from a corporate background will find the challenges very different. “One of the biggest challenges is attitude. There is so much negativity out there in the workplace. Be aware of today’s fear factor and what triggers fear in yourself,” Goss said. “One way to combat fear is to surround yourself with positive people or find a supportive environment where you can bounce ideas off others. A support network can help you plan, point out your blind spots and help you access your own creativity to find solutions for your venture.”
GROWE organizes members in small groups so there can be dynamic and in-depth discussion, facilitated by a professional coach. They meet monthly, and the cross-pollination of ideas from new and experienced business owners creates synergy. “The members help each other,” Goss said. “They often find that new ideas and approaches come from the group to make their jobs easier.”
Hanks believes that there may be more businesses launched because people are seeing fewer opportunities in the jobs market. “This is the time to learn from the success of others. We still have a vibrant entrepreneurial community here,” he said.
The Article Source Is: http://www.ajc.com
No comments:
Post a Comment