by Keith Beebe
SUGAR GROVE—The Small Business Development Center at Waubonsee Community College (WCC) averaged close to 20 business start-ups between 2007 and 2009, and then had a whopping 39 start-ups in 2010.
What were the reasons for such a huge jump in numbers? Harriet Parker, manager of WCC’s Small Business Development Center, believes it was due to the district Waubonsee is located in, as well as the community college’s excellent rapport with local business groups.
“The area I cover—(a district that includes) southern Kane, Kendall, and southeastern DeKalb counties—includes some of the fastest growing regions in the state and even the country,” she said. “I have developed strong relationships and a good reputation with other business partners in the region, including Economic Development agencies, Chambers of Commerce, commercial bankers, etc., and referrals have been building over the five-plus years I have been here.”
Parker said WCC’s Small Business Development Center had a big spike in traffic in 2009, as many people exiting from the corporate world began using their severance pay and savings to establish their own businesses.
Waubonsee’s center, one of 40 in Illinois, is a grant-funded program that offers its services free of charge. According to Parker, the Small Business Development Center works with both start-up clients and actual established businesses, and also assists in marketing strategies, general business operations, and financial forecasting and analysis.
“We serve as a business planner, analyst, researcher, sounding board, resource referral and even as personal counselor—unlicensed, of course,” Parker said. “We also offer some workshops on a variety of small business topics, and a monthly e-newsletter.”
The Small Business Development Center program is nationwide and used in all 50 states. And though the Waubonsee center boasts standout numbers, the community college’s program isn’t competitive with other local centers.
“We are a network of resources and frequently reach out to other centers for expertise outside our own,” Parker said. “We have a very close relationship with the SBDCs at Elgin Community College, College of DuPage and Joliet Jr. College.”
Parker said the current downtrodden economy has increased start-up business traffic at WCC’s center.
“As the risk scale tips, where the risk of being employed in corporate grows, it begins to balance with the risk of starting a business, making entrepreneurship more palatable for people who may want to start their own (business) but are hesitant to take the risk,” she said.
As for the main challenges to starting up a business, two areas—access to capital and decreased discretionary spending—are currently key speed bumps for entrepreneurs. According to Parker, start-up businesses have been mostly relegated to the use of their own capital, friends and family, and micro-loan financing to start their business, as home equity loans, once a prime resource for start-up businesses, are now virtually nonexistent, as is the use of property to collateralize a business loan.
“(In regards to decreased discretionary spending), you have to really understand and focus your market in order to be competitive,” Parker said. “Also, while there are exceptions, I see most businesses taking at least two years to reach profitability, which means that you have to have enough capital to penetrate that market and establish a solid customer base.”