If you’re like a growing number of small-business owners, you might be thinking now is your time to shine.
The optimism that small-business owners are feeling these days is unprecedented. According to a survey by the National Federation of Independent Business, 32 percent of entrepreneurs surveyed felt now is a good time to expand, which is a record in the survey’s 45-year history.
If you’re one of these fortunate small-business owners, it can be easy to fall in love with the idea of expanding, especially if you’re at a stage where you’re turning away business. Things are going great, so why not strike while the iron is hot? At the same time, this can feel a little precarious: What if the expanding turns into a killing-the-goose-with-the-golden-egg kind of deal? Here are some other key questions that deserve a deep dive before you decide to expand:
Is your current enterprise relatively profitable? Understanding what’s driving these market forces in your community will help you sort out whether this growth is part of a temporary surge, or if the time is right for long-term growth.
Do you have a ready workforce? Evaluate your current employees and identify people who can grow into larger roles. Even more importantly, understand how many more employees you’ll need, and whether the low employment rates we’ve been seeing would hold back the ability to expand. Entrepreneurs in the NFIB survey said finding quality employees was a greater concern to them than taxes and regulations.
Are you running out of space? If so, would you build, or would you refurbish existing facilities?
What is the health of your operating system? Is there a process that can accommodate the growth, or does it all hang together with institutional knowledge with a dose of flying by the seat of your pants?
When seeking answers to these questions, don’t overlook the many resources in your backyard. Rural Minnesota has many organizations and resources dedicated to helping small-business owners grow and thrive, offering expert (and confidential) advice and resources, along with grants and revolving loans. Here are just a few worth checking out:
Initiative Foundation: Supported by donors and the McKnight Foundation, Minnesota’s rural counties are served by six regional Initiative Foundations that invest in communities through grants, loans, programming and more.
Small-Business Development Centers: Minnesota also has seven regional SBDC officesserving its rural counties. Contact the office in your region to get guidance from a professional business consultant to help you find additional sources of capital to grow and expand. Plus, it’s free.
Economic development: Many Minnesota communities offer grants, revolving loans and more through government-sponsored economic development programs or nonprofit partnerships to help new and expanding businesses. Contact the economic development organization in your community.
SBA loans: Expansion often means a scramble to finance new buildings and equipment. But entrepreneurs may not qualify for a conventional loan at affordable terms. The U.S. Small Business Administration (SBA) offers several kinds of government guaranteed loans that offers entrepreneurs lower interest rates and longer loan terms. As an SBA Preferred Lender, Minnwest Bank can provide expert advice and can approve loans on behalf of the SBA, giving you a local facilitator.
At Minnwest Bank, we live and work in your community, so we want to help you build it. Visit one of our commercial bankers to learn more about your options to help you make the best informed decision — and reach your potential.