Taking Advantage of a Potential Increase in Small Business Spending
10/16/2008 08:30
By Bill Cooey, e3datasolutions
While last week’s drop in the stock market raised concerns and panic among investors, Monday’s meteoric rise made some pundits downright giddy in thinking the market has found a bottom. Perhaps this “either/or” view of the market masks the inevitable ─ a volatile slow creep to a worsening economy that will be more evident one year from now. The causes of the damage that has taken place since last fall may not be erased quite so easily. This economy needs something tangible to get us moving again. The good news is that this is an election year and we have candidates who need your vote. As a consequence of the “newly realized” economic problems, there will be promises of stimulus for taxpayers and business, more government spending, and political reform so that this problem never happens again. I guess maybe “two out of three ain’t bad.” One idea being floated by both campaigns as well as the current administration is that it will take investment in small business to help get the ball rolling. One party is asking for temporary removal of the 10-percent penalty for early withdrawal from retirement accounts. The other party is proposing that the SBA step in and make direct loans to new businesses that are having difficulty obtaining loans through conventional means. Either way, the goal of both parties is to free up cash for investment in small businesses, which in turn will expand and spend that money on inventory and services. So how will you position your company to take advantage of the revenue being generated from the stimulus? Perhaps one potential target for marketing dollars could be dedicated to partnering with the SBA and more specifically the volunteer organization that deals face to face with over 150,000 small businesses annually. SCORE, the Service Corps of Retired Executives, has nearly 400 chapters across the country whose volunteers provide pro bono business counseling to nearly every client the SBA considers for assistance. As a volunteer organization, SCORE depends upon contributions and partnering programs for support that gives a company the perfect opportunity to put itself in front of the decision makers who will be spending money on new business or expansion next year. Small business, though, can be a difficult market to work. The truth is that more than 95 percent of small businesses fail within five years. Some of this can be attributed to inexperience, bad planning, wrong product, lofty goals, you name it. Such a high turnover rate has been one of the reasons that service providers limit the amount of energy they will put into the sector. More time and effort is spent working the large enterprise accounts as the return is perceived to be more consistent and long-lived. Should service providers also extend their sales efforts by working with the small business owner in ways that help ensure their continued growth? The more that account representatives can become true partners in the success of their small business clients, the more churn will be minimized and subsequent sales efficiencies realized. One final note is that this new revenue in and of itself will not make or break most service providers. The goal of the stimulus, though, is not to be the cure but instead to be a catalyst to help change the overall perception of gloom and doom. Investor sentiment always follows the herd mentality, which more than anything will work against all businesses, large and small, until it changes for the positive. Right now anything we can do to get money moving will help. How will your company rise to this challenge? Bill Cooey is the principal owner of e3datasolutions LLC. The company designs technology solutions that help companies exceed their goals through efficient and improved interaction with their customers, employees, vendors, and stakeholders.
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