How Small Businesses Can Set Themselves Up for Success in 2022 with SBA’s Terri Denison

Transcription:

Mark Collier:
Welcome back into The Playbook, Terri.

Terri Denison:
Great to be back.

Mark Collier:
All right. So before we get to talking about what’s coming up in 2022, can you give us kind of a quick status on the SBA COVID relief efforts for small businesses?

Terri Denison:
Sure, of course. On December 31st, our economic injury disaster loans for the COVID-19 relief ended in terms of taking in new applications.

Mark Collier:
Ah, okay. So no new applications as of December 31.

Terri Denison:
Correct.

Mark Collier:
Okay. Fantastic.

Terri Denison:
But the good news is, if you had an application in, on or before that date, we will continue to still process those applications that had been received, as well as entertain reconsideration requests and appeals on declined applications and requests for increases in existing EIDL.

Mark Collier:
That’s important because a lot of people think, okay, well, I haven’t got a new application in, but I would like to potentially get an increase. So, that would be done through your website, in terms of requesting an increase? How would the business owners go about doing that?

Terri Denison:
Yes, actually they would do that through the online portal-

Mark Collier:
Okay, perfect.

Terri Denison:
… Where the applications are submitted.

Mark Collier:
Okay. Very good. Very good. All right. So a lot of lessons from last year, a learning curve from both 2020 and 2021. What lessons, from your perspective can small business community take away from the COVID-19 pandemic experience?

Terri Denison:
Oh, I think at the top of the list is the vital importance of contingency planning and risk management.

Mark Collier:
Yes. Yes, Terri. Absolutely.

Terri Denison:
A lot of times when business plans, those in there, I know those that don’t do that. And that’s another show. But those who do business planning a lot of time focus on what needs to happen for things to go right.

Mark Collier:
Yes, absolutely.

Terri Denison:
But they don’t take the same amount of effort to look at what happens if things don’t go according to plan.

Mark Collier:
Yes.

Terri Denison:
So being able to look at a variety of scenarios with your business. What if my revenues go down 30%, or my costs go up 20%?

Mark Collier:
Yes.

Terri Denison:
Exactly how is my business going to look?

Mark Collier:
Oh yeah.

Terri Denison:
Not just a vague, well, it’s not going to go well.

Mark Collier:
Yeah. Yeah.

Terri Denison:
You know exactly how that’s going to impact your business and then start developing a strategy on how you would address that.

Mark Collier:
Yes. Yes. Ma’am. It would say proactive, be proactive, be proactive. I think that’s… I agree with you. That’s one of the major takeaways from last year’s pandemic.

Terri Denison:
Then I think the other major takeaway is the need to have those key business relationships in place before the need for them.

Mark Collier:
Yes.

Terri Denison:
A prime example was with commercial lending. When PPP, Paycheck Protection Program, one of the COVID 19 programs.

Mark Collier:
Yes.

Terri Denison:
Came out. Lot of the lenders were focusing on their existing clients.

Mark Collier:
Correct.

Terri Denison:
So we had a lot of people in a panic. Do you know of any lender that will take us on even though we don’t have a relationship with them. And it was kind of like musical chairs, when the music stops, if you don’t have a chair.

Mark Collier:
That’s right. Well, what the SBA did, they handled that very well because I think you guys enlisted partnerships with some of the online platforms like Quicken and some others where people who did not have those traditional banking relationships were able to go. So I think that option for businesses who weren’t banking anywhere was a good one. I think I want to commend the SBA for setting up those relationships.

Terri Denison:
Thank you. But I think also it’s important to still have that human element.

Mark Collier:
Agree.

Terri Denison:
Because a lot of time businesses have particular needs or challenges that you can’t really address on an electronic platform.

Mark Collier:
Good point. Good point.

Terri Denison:
So you still need an individual lender, I think, that can help you with any questions you have or provide advice.

Mark Collier:
All right. Makes sense. So what was the SBA program activity, kind of COVID 19 relief and regular SBA programs. What was it like here last year in Georgia?

Terri Denison:
Ooh, Georgia, very active. In terms of the COVID 19 relief when you look at all the program that were offered.

Mark Collier:
Yes.

Terri Denison:
PPP, EIDL, some of the other programs like the Shirted Venues, Operators Brand, and the Restaurant Revitalization Fund. All that combined was about 23 billion dollars.

Mark Collier:
23 billion to Georgia alone?

Terri Denison:
Just to Georgia alone.

Mark Collier:
Phenomenal. Phenomenal work.

Terri Denison:
What I find even more interesting though, is the level of activity with our standard non-COVID related programs.

Mark Collier:
Okay. Did that fall or rise during the pandemic?

Terri Denison:
Interestingly enough. In 2020, it was just a little shy, normally in pre-pandemic, we would do anywhere from 1.2 to 1.4 billion.

Mark Collier:
Okay.

Terri Denison:
In the regular SBA lending programs. In 20, we did 1.1.

Mark Collier:
Okay. Okay. Not through fault.

Terri Denison:
And that was at the height, right as the pandemic started and some of the more challenging times of the pandemic. In 2021, we actually set a record, over $2 billion.

Mark Collier:
Wow, in non-COVID relief activity.

Terri Denison:
Yeah.

Mark Collier:
Wow.

Terri Denison:
And I think that’s important to note because that tells me, that even with the economic chaos that’s going on, there are still niches or places of opportunity.

Mark Collier:
Correct.

Terri Denison:
That people saw, either I need to revamp my business, or my business model, and I need funds to help do that.

Mark Collier:
Sure.

Terri Denison:
Or, I’m seeing where some of my competitors are no longer operating.

Mark Collier:
Right.

Terri Denison:
I can pick up some assets for my business and position myself for growth, post pandemic.

Mark Collier:
Interesting.

Terri Denison:
So that would require capital. And then some people actually left, talk about the great resignation.

Mark Collier:
Yeah. Great resignation and migration.

Terri Denison:
Yeah. Nationally, about a third of those individuals that have participated in the great resignation have actually started their own businesses.

Mark Collier:
Okay. All right.

Terri Denison:
So all of that, I think, is what’s behind those still higher figures.

Mark Collier:
And I’m sure those were kind of surprising. Were they surprising to you?

Terri Denison:
Very surprising.

Mark Collier:
Okay. All right. Well, very good.

Mark Collier:
So what are some of the things that, let’s kind of look forward now, that small businesses should be doing kind of post pandemic as we move into 2022 and beyond.

Terri Denison:
Okay. Well, first thing is to really look at your business plan.

Mark Collier:
Yes.

Terri Denison:
And of course I’m working on the assumption that you have one, if you don’t, that’s another conversation. You definitely need to work on one, but it’s a time to kind of look at your business strategy.

Mark Collier:
Yes, absolutely.

Terri Denison:
And what adjustments you need to make. Are there new opportunities or new markets?

Mark Collier:
All right.

Terri Denison:
That you can enter in to?

Mark Collier:
Sure.

Terri Denison:
Couple things to think about. I always try to encourage business and small businesses, exporting for example.

Mark Collier:
Yes. Yep. Yep.

Terri Denison:
Most of the world’s consumer power is outside of the United States.

Mark Collier:
That’s a great point, Terry, and a lot of people don’t understand that. I mean, there’s a big, big, wide world out here and the consumers, and with the advent of the internet, your marketplace is now global.

Terri Denison:
Exactly.

Mark Collier:
So it makes perfect sense to look at potentially exporting opportunities.

Terri Denison:
And there’re all kind of need statistics about businesses that do export-

Mark Collier:
Yes.

Terri Denison:
… Are able to offer higher wages to their employees. They have more financial stability.

Mark Collier:
Mm-hmm

Terri Denison:
You kind of guard against if things aren’t going well here in the US, it may not necessarily be the case or as severe at other markets.

Mark Collier:
No, that’s right. I mean, you touched on another great point diversification of your markets. You just don’t want to rely on the US market alone. You got to think outside the box.

Terri Denison:
Yeah. I would say also to look at your record keeping and your infrastructure of your business.

Mark Collier:
Good, good.

Terri Denison:
Are your record keeping systems, have they really kept up with where your business is now? Just because you started out with one, you may have outgrown it and you need to re-look at that.

Mark Collier:
Yeah.

Terri Denison:
How can you leverage technology to make your business more efficient and free up effort and time that you can then invest in other ways?

Mark Collier:
That’s right.

Terri Denison:
To help your business continue to grow.

Mark Collier:
To help drive the revenue and a great point you brought up. I mean, this, as we sit here in the studio today, it’s right at the beginning of 2022. So those strategic planning considerations are at the forefront of most business owners minds. So now’s the time to do it.

Terri Denison:
Yes sir.

Mark Collier:
Start planning. All right, so under the American Rescue Plan that passed in 2021, the Community Navigator’s Pilot Program was created. Can you explain what that program is, and what it does, and where we are in its implementation here in Georgia?

Terri Denison:
Sure. The Community Navigators Program was created to designate community-based organizations, local and state agencies, to have them, as it was suggested, help small businesses navigate.

Mark Collier:
Yes.

Terri Denison:
The whole federal, or even state and local government maze, in terms of programs and resources for small business.

Mark Collier:
Okay.

Terri Denison:
You and I work in this space so we know where everything is and how to access.

Mark Collier:
Right.

Terri Denison:
But a lot of times entrepreneurs are not familiar.

Mark Collier:
That’s true.

Terri Denison:
Or they feel intimidated.

Mark Collier:
Yes.

Terri Denison:
Going before the government to try and access key resources and programs.

Mark Collier:
Okay.

Terri Denison:
So the Navigators are the intermediaries.

Mark Collier:
Okay.

Terri Denison:
That have the trust and confidence of these small business communities, especially in historically underserved communities, both terms of demographic, diverse owned businesses, but also geographically, for example, rural businesses.

Mark Collier:
Right. Right.

Terri Denison:
So they serve as that guide to help these small business owners figure out what they need and how to help them access it.

Mark Collier:
Okay. So the Navigators, so these are established obviously either nonprofits, or maybe for-profit companies, that are going to act as boots on the ground in terms of delivering those resources, as you said, those relationships are already there in the communities. So they’re a natural conduit for the SBA to partner with. I mean, I think it’s going to be a phenomenal program.

Terri Denison:
We have two here.

Mark Collier:
Oh, two.

Terri Denison:
Two awardees. Yes.

Mark Collier:
Very, very good.

Terri Denison:
Yeah. Georgia Migrant Enterprise Network or GMEN.

Mark Collier:
I interviewed the executive director some time ago prior to that.

Terri Denison:
So they’re one of the selectee’s and also Fulton county.

Mark Collier:
Oh, Fulton county proper?

Terri Denison:
Yes.

Mark Collier:
The actual county, the government.

Terri Denison:
And then, in addition to those two Georgia base awardees, there were several national level awardees that have a national coverage that will have a footprint-

Mark Collier:
Okay.

Terri Denison:
… Here in Georgia.

Mark Collier:
Very good.

Terri Denison:
So we’re very well represented with the program here.

Mark Collier:
That’s great. Now a quick follow up question.

Terri Denison:
Sure.

Mark Collier:
Pilot program means initial. So are more of these programs planned or coming down the pipe, are they going to have other rounds of Navigator grants?

Terri Denison:
We’ll have to wait and see. I’ve not heard that, but this is a two year project. So hopefully, that will show that it’s beneficial and could possibly be renewed. But even if it’s not, it’s established some really key networks.

Mark Collier:
Yes.

Terri Denison:
With us and more community based organizations, local agencies, that can go on beyond that program.

Mark Collier:
I mean this is going to be an impact program, I think. And I think it’s a great program and I just want to commend the SBA for rolling it out.

Mark Collier:
All right. So what are some other things, great things the SBA is going to be doing in 2022? What other programs or initiatives are you guys planning and thinking about?

Terri Denison:
Sure. Well, at the end of, or late last year, of course, there was legislation passed that increased, in the realm of federal contracting, the goal for federal contract dollars going to small disadvantaged businesses.

Mark Collier:
Okay.

Terri Denison:
Traditionally that goal has been 5% of federal dollars.

Mark Collier:
Mm-hmm

Terri Denison:
It was increased to 11% for this fiscal year.

Mark Collier:
More than double. That is great news.

Terri Denison:
And then ultimately, I think by 2025, that goal will be 15%.

Mark Collier:
Phenomenal.

Terri Denison:
So that is really is going to put more of an impetus on federal agencies.

Mark Collier:
Yep.

Terri Denison:
To spend with SDBS, as we call them, Small Disadvantaged Businesses.

Mark Collier:
I’ll tell you why that’s important because they oftentimes compete at a disadvantage.

Terri Denison:
Yeah.

Mark Collier:
In terms of access to capital and other things. So for the SBA to step up and really emphasize the importance of including them at the table. I think that again, a phenomenal, phenomenal concept.

Terri Denison:
Yeah. And we’re also looking at access to capital always.

Mark Collier:
Yes.

Terri Denison:
And I think it’s been there, but definitely more of an emphasis, as we go into 2022.

Mark Collier:
Mm-hmm

Terri Denison:
Looking at how we can support access to capital, especially in that 50,000 to say 350.

Mark Collier:
Okay.

Terri Denison:
350,000.

Mark Collier:
Of revenue?

Terri Denison:
No, actually lending.

Mark Collier:
Oh, lending. Okay. Okay. All right.

Terri Denison:
Because that seems to be a tough niche.

Mark Collier:
Yeah.

Terri Denison:
You got micro lending that covers 50,000 below.

Mark Collier:
Right, right.

Terri Denison:
Maybe the SBA 7A or 504 loan programs in the 350 and above. But a lot of entrepreneurs, especially entrepreneurs and underserved markets-

Mark Collier:
Sure.

Terri Denison:
… What they really need is that between 50,003 and 350. So there are some efforts underway to look at how we can do that.

Mark Collier:
Okay.

Terri Denison:
More, and we can support that. We’re also looking at our Emerging Leaders Program, which is a business education program geared towards businesses that already have been established. That want to expand, position themselves, to scale. So we will be having a new contractor take that program over.

Mark Collier:
Okay.

Terri Denison:
And really kind of looking at reinventing it based on the situation and the world in which we live now.

Mark Collier:
Right.

Terri Denison:
It was created back in 2008.

Mark Collier:
Okay. Interesting.

Terri Denison:
So I’m looking forward to that. So that will probably be some time in the spring. I mean, excuse me, fall of 2022. And then we’re also looking at how to revamp our online training presence.

Mark Collier:
Okay. Yes, yes. Yeah. COVID kind of thrust everyone into the online world, online training world.

Terri Denison:
Yes, yes.

Mark Collier:
But I’ll tell you, you touched on something very important, that the sustainability, I mean, it’s not just enough to get more businesses in business, but it doesn’t make sense for them to get in business than go out of business. So that continuing technical support, things with that new program and things that we do at UGSGBDC is vital because you want to have sustainability, you want to have businesses that are going to grow, scale, and prosper.

Terri Denison:
Yeah. And we benefit, of course, when they do that, because if their true job creators yes. Then that’s something that’s going to have impact throughout the community.

Mark Collier:
Absolutely.

Terri Denison:
Not that sole proprietors have a great role in our economy.

Mark Collier:
Right.

Terri Denison:
But there are limitations to how that impacts the greater economy.

Mark Collier:
Absolutely. So, the audience would kind of like to keep up with what’s going on at the SBA. What’s the best way they can do that?

Terri Denison:
Sure. If they go to our website. For the Georgia district office of SBA, which is www.sba.gov.

Mark Collier:
Okay.

Terri Denison:
Forward slash GA for Georgia.

Mark Collier:
All right.

Terri Denison:
They can go there and they can sign up for our updates.

Mark Collier:
Okay.

Terri Denison:
Which we send out biweekly.

Mark Collier:
All right.

Terri Denison:
As well as any special offerings that are coming down the pike.

Mark Collier:
Okay. All right.

Terri Denison:
They can also follow us on Twitter.

Mark Collier:
All right.

Terri Denison:
And our handle is @SBA_Georgia, Georgia spelled out. And they can also send us an email if they have questions.

Mark Collier:
Okay.

Terri Denison:
Or need some guidance, Georgia@sba.gov.

Mark Collier:
All right.

Terri Denison:
Or, give us a call.

Mark Collier:
All right.

Terri Denison:
404-331-0100.

Mark Collier:
All right. Well, Terry Denison, Georgia district director at the SBA here in Atlanta. I want to thank you for taking the time out of your very busy schedule to come in. Kind of updating me as to what the SBA has been doing and some of their forward thinking programs. And as always, you guys at the forefront of helping small businesses and we appreciate the continued partnership.

Terri Denison:
Thank you so much.