By Aila Boyd and Claire Kivior
Botetourt County held a Small Business Summit last Thursday at the Greenfield Education and Training Center in Daleville.
“The Board of Supervisors is so interested in small business development,” Gary Larrowe, the county administrator, said during the summit. He went on to note that the Botetourt County Economic Development Authority is equally invested in small business development.
“You need to think about the small businesses in order to create the big ones. You can’t just be one way,” he said.
He noted that he’s “thankful” for the leadership that Ken McFadyen, the director of economic development for Botetourt County, has demonstrated when it comes to nurturing small and big businesses alike.
At the Botetourt County Board of Supervisors meeting last month, McFadyen and Heather Fay, assistant director of economic developments for Botetourt County, discussed their department’s efforts to support local small businesses.
“We have a small business economy in our community,” said McFadyen, emphasizing the significance of small businesses in Botetourt County. As of 2017, there were over 750 small businesses in the area who employed an average 14 employees. Ninety-five percent of these businesses have 49 or fewer employees, and 77 percent of these businesses had 10 or fewer employees. Many of these companies offer professional services, or do construction, or retail. “There is no magic number in terms of what constitutes a small business is,” explains McFadyen. “It is what you intend it to be.”
McFadyen said that he wants to emphasize small businesses but still wants to ensure that larger businesses will not be forgotten. In the past, he said, the county’s Economic Development Department has done a good job supporting larger businesses.
“Primary services we can provide to our small businesses include technical assistance with planning, financial planning and accounting, marketing assistance and related types of supports,” McFaylen continued. To do so, they partnered with outside organizations for assistance.
McFadyen explained that the number one reason why small businesses fail is because of a limited cash flow. “We must assist our business in these challenges and overcome these obstacles,” says McFadyen.
To combat this issue, the Economic Development Department is introducing a small business incentive program. According to McFadyen, the goal of the incentive program is to “decrease potential failure rates and increasing the likelihood of success in our small businesses.” To do so, the Economic Development Department plans to “connect Botetourt businesses with legal and accounting services, decrease the chance of failure and increase the likelihood of success of the business, and facilitate ongoing professional relationships among businesses.”
The incentive program will allocate $500 per client, Botetourt County residents or Botetourt County licensed business operators, to be used in attorney and accountant fees. That’s approximately two to three hours with an accountant to set up their books, and two for an attorney to file articles of incorporation. The department’s budget through the end of the year will accept 11 qualifying small businesses for this grant. The department believes the grant is a worthy investment. McFadyen wants the grant program to be as inclusive as possible, so the program will have pre-established rates with accountants and attorneys who are interested in participating in the area. He also noted that the assumption is that clients will be recommended to apply for the incentive by one of the small business development entities in the area. “They will need to have a business plan and be poised and ready for that next step which will be facilitated by an attorney or an accountant,” he said.
The selection process will ensure that the 11 businesses are “bankable,” McFadyen said. If more than 11 qualified small businesses apply, McFadyen agreed that he will come back before the Board of Supervisors and request that additional funds be allocated. An average of 20 Botetourt-based businesses are going through some sort of small business development program annually, he said in order to shed light on the number of businesses that will potentially be eligible for the incentive each year.
To simplify matters more for business owners, a lending resource directory for Botetourt County businesses was created. “We have been working with local and state lenders to develop a further relation with these folks,” Fay described. “We have developed a Botetourt business lending resource directory…working with each lender to develop the data.”
The lending resource directory provides a broad overview of each lender and what resources that they currently provide. Fay hopes that the directory will be used as “a tool used to encourage conversation among our current and future small business owners pursuing financial options, regional entrepreneurship partners.”
The lenders “reviewed and provided data for us. They have been incredibly curious about other opportunities…. continuing to encourage and promote small business opportunities in the county,” explained Fay. “They have all been great to work with and continue to help us grow.”
Both McFadyen and Fay, as well as the rest of the department are working hard to eliminate any roadblocks for small business in Botetourt. With the continuous expansion of the incentive program, they hope Botetourt will prove to be a thriving economic center for small businesses.