When my husband and I decided to purchase a pizza franchise, we had little knowledge about the Small Business Development Center (SBDC) program and its free assistance. When I later became an SBDC consultant, I realized how much we could have benefited from meeting with an SBDC advisor during the planning stage of our small business venture.
If you are contemplating launching a small business, consider seeking free and confidential consulting services from your local Small Business Development Center (SBDC). They can provide invaluable assistance and support tailored to your specific needs.
Business Ownership Considerations
An SBDC consultant can assist you in understanding the demands, risks, and rewards of owning your own business. It is crucial to consider how running your business will impact your family and lifestyle. For example, restaurant owners should be prepared to be present during the busiest periods, which typically occur in the evenings and on weekends. Similarly, accountants should expect to work long hours from January to mid-April. In addition to being directly involved in their businesses, business owners must also oversee employees, manage finances, handle inventory, create work schedules, promote their business, and handle numerous other responsibilities. The hours can be long and may infringe on personal and family time.
Realistic Business Loan Preparation
Just like many of our clients, Steve and I were unaware of the differences between a business loan and a personal loan. We prepared for it similarly to a personal loan but added a business plan. We should have realized that lenders needed more assurances beyond a good credit score and the ability to repay the loan. We had to convince the lender that (1) there was a demand for our products and services, (2) we knew our target clients and how to reach them, and (3) we could generate enough sales to comfortably make the loan payments. The SBDC consultant would have coached us on those 3 points and assisted us in creating 24 months of cash flow projections and validating our revenue projections.
Bank Selection
We chose a bank to apply for a loan because it was the bank used by our franchise corporation, one of the country’s largest national banks. However, we didn’t understand that each region operated independently. The bankers we spoke with knew nothing about our franchise and didn’t seem interested in a loan for a “small” business like ours. The whole process was frustrating, and in the end, the denial letter wasn’t even for our business. We should have applied to a local or regional bank. Even then, it would have been difficult to find a bank willing to lend to a start-up restaurant on our own. Today, after being a consultant for 17 years, I know how to direct clients to the banks most likely to assist them.
Research
Business planning includes defining your target customer and researching whether your local demographics include your target customer group. It also involves research into the industry you will enter. Is the industry growing? What are the trends? What are the primary products and services in your industry? You also need to know who your competitors are. Your local SBDC can provide industry reports and request local research from the national research center.
Business Plan Development and Cash Flow Forecast
Your SBDC consultant can assist you in developing your business plan, reviewing your draft, and providing feedback. Your plan will encompass an introduction to your company and ownership, a description of your products and services, an analysis of your competitors’ strengths and weaknesses, and details on how you will market your company to attract your target customers. Additionally, an SBDC consultant can help you prepare your 24-month cash flow forecast. The research they provide can aid you in writing your business plan and in estimating projected revenues.
When you decide to embark on the journey of starting your own business, it’s important to remember that you don’t have to navigate this path by yourself. Make sure to tap into the valuable resources your local small business development center provides to get the support and guidance you need.
Susan's Reflections 
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