Small Business Summit Offers Tips for SuccessBy
The U.S. Chamber of Commerce hosted the Small Business Summit in Washington, D.C., in October 2018. There, a diverse array of businesses shared their experiences in a structured forum geared toward listening to the voices of small business owners.
It was an opportunity for accounting and finance personnel and owners of small businesses to network and exchange ideas. The summit provided a platform to ask questions and express concerns, better understand the economic conditions in which small businesses operate, and learn from the multitude of success stories throughout the United States.
Among the many presenters at the summit were two presidential Cabinet members, U.S. Department of Labor Secretary Alexander Acosta and Administrator of the U.S. Small Business Administration (SBA) Linda McMahon. Both touted the current administration’s continuing deregulation efforts as a contributor to small business success.
According to the Small Business Index published by MetLife and the U.S. Chamber of Commerce, there’s a consensus of optimism among small business owners in the U.S., suggesting increased confidence in their economic outlook and overall business health. With gross domestic product (GDP) growth trending around 3% this year, 54% of small businesses surveyed said they believe tax reform will help the U.S. economy, and 47% said they anticipate that it will also help their business.
One area that concerns many in small businesses is healthcare. Secretary Acosta announced his plans to introduce Association Health Plans (AHPs), which will give state and local Chambers of Commerce the ability to offer healthcare plans as if they were the employer of the small businesses in their community. This initiative is intended to extend the negotiated benefits to sole proprietors and others within that community at lower rates through collective bargaining.
Obtaining necessary financing can often be a formidable challenge for small businesses. The age of a small business can weigh heavily on its ability to receive the full amount of a loan or credit line requested. The success rate for receiving the full amounts requested declines from 75% for small businesses 20 years or older to only 51% for businesses that are 10 years or younger, according to the Q3 2018 Small Business Index.
Presenters Jana Hocker, the chief compliance officer of QuickBooks Financing at Intuit, and Ross Carey, executive VP of the business banking division at U.S. Bank, noted that there are steps small business owners can take to maximize their ability to secure financing. In a “Building My Business” breakout session hosted by Tom Quaadman, executive VP of the Center for Capital Markets Competitiveness at the U.S. Chamber of Commerce, Hocker and Carey provided the following advice for entrepreneurs:
- Keep organized. Be sure to separate your business expenses from personal expenses.
- Maintain a good credit score (and monitor it frequently) for both your personal and business finances.
- Establish a relationship with and stay connected to a banker you trust. Developing a strong, communicative relationship helps banks to understand your business and encourages them to partner with you. In general, the more the loan officer knows about you and your business, the more they are willing to help.
- If you own a mature small business, use your banking relationships to help guide you through a possible transition of business ownership, retirement planning, and business investment planning.
- Don’t max out your resources, whether they’re savings, credit cards, or borrowing from friends or family. Doing so will make you a less attractive risk for originators reviewing subsequent loan applications. Carrying a lot of debt early on looks bad in the eyes of a banker.
Banks are responding to the disruption in their loan markets attributed to microlending by fintech and crowdfunding. This has forced them to reevaluate how they collaborate with customers. Increased competition clearly has put customers in the driver’s seat as they consider competitive alternatives to meet their funding needs.
Summit speakers Shawn DuBravac, president of the Avrio Institute, and Jessica Moser, senior VP of small business solutions at MetLife, discussed key recruitment considerations for small businesses, addressing the strong influx of Millennials to the workforce. Through incentives such as workplace flexibility, work-life balance or blending, and a sense of community responsibility, small businesses can adapt to the evolving employment landscape and achieve a competitive advantage that will help attract talented individuals who want to see the broader impact of their work.
Often seeking to shift the dynamics of conventional working environments, Millennial workers see the workplace as a meaningful part of their personal identity. Millennials want to feel valued for the work they perform and prefer to work for a company that shares their individual values. As Millennials come to dominate the workforce within the next decade or so, small businesses are advised to listen closely to that generation’s needs and consider ways to address their desire for flexibility to attract the best talent available.
The summit celebrated many success stories of small business owners and those rising to fame within their respective industries. Offering advice and lessons to guide the entrepreneurial audience, the speakers shared insights such as:
- Leverage your network for expertise on subjects you simply don’t have expertise in;
- Assess your technology and determine where you are vs. where you need to be;
- Remember your passion and what you stand for, remind yourself why you launched your business in the first place and of your individual vision, and reinforce this message to yourself, your employees, and your potential customers;
- Maintain authenticityas a key branding component;
- Create win-win supply chains that benefit communities as well as your business;
- Don’t underestimate the power of fortitude in driving small business success;
- Chase opportunities and pursue your goals;
- Develop and sustain high-quality standards;
- Maintain a strong website, email, and social media presence, a crucial marketing tactic that contributes to increased revenue; and
- In a world of cyberattacks, even small businesses must frequently assess the vulnerability of their digital environment.
The U.S. Chamber of Commerce reports that small business represents nearly 50% of the U.S. economy. Success in the small business community translates to a stronger national economy. The U.S. Chamber of Commerce’s Small Business Summit provided intelligence that should set expectations for sustained growth in the small business sector.