Most of the time that you read about the U.S. Small Business Administration in the news, the topic is small business lending or perhaps the federal budget.
You may even have wondered why there’s so much fuss about the SBA. If you’re not in the market for a loan, you may wonder what good is it?
Earlier this year, the National Association for the Self-Employed found in a member survey that less than 20% of microbusiness owners had ever made use of any of the SBA’s other programs. Why not? Well, about half of them (49%) said they didn’t know about them.
On the other hand, only 14% said they didn’t need the help, thus exploding another myth.
Most telling was that 62% of survey respondents rated those federal small business programs somewhat or very valuable, while a whopping 81% felt that increased funding for them should be a priority for the Obama Administration.
What these numbers suggest is that there are a lot of small business owners out there who need various sorts of help, that said help is available at no direct cost to them, and that too few of them know about the programs but most consider them a good investment.
In short, and contrary to what most small business owners are said to believe, the federal government is not completely useless.
For example, an oft-sited statistic from a 1980 Dun & Bradstreet report notes that 44% of small business failures come about due to lack of business management experience or training. That means that small business owners can increase their chances of success significantly by taking it upon themselves to learn how to run a business.
That sort of training is available for free through SBA entrepreneurial development programs like the Small Business Development Centers (SBDC).
The SBDC program is the grandfather of the SBA’s entrepreneurial development programs, established in 1980. It is an outstandingly successful program that typically returns a minimum of $2 to the federal treasury for ever $1 spent on it, and saves or creates countless small business jobs on an annual basis.
The SBDC network is affiliated with colleges and universities or with state economic development departments around the country. There are SBDC state affiliates associated with such august institutions as Howard University in Washington, D.C. and the University of Pennsylvania’s prestigious Wharton School of Business in Philadelphia.
As you might imagine, the services offered by the SBDC network – comprised of over 1,000 locations around the country – are very much in demand right now. That, in its turn, is putting something of a strain on the resources of the SBDCs; the network has not even received an inflationary increase in its funding since fiscal 2000.
Meeting demand is a cause for concern, according to Don Wilson, president of the Association of Small Business Development Centers.
“We’re so concerned, particularly about the huge number of unemployed that are out there looking for help in going into self-employment, plus businesses that are hanging on by their fingernails who don’t know where to go for help,” Wilson told me during a recent telephone interview.
It’s a peculiar conundrum for the administrators of the program. They are aware that relatively few small business owners know about them but, without the resources to meet increased demand, can you market your services with a clear conscience?
Even without a marketing budget, the SBDC network is seeing a decided increase in the number of small business clients and recently displaced workers seeking their services. Network centers offer workshops and classes in various aspects of business management, such as cash flow management, inventory management and cost containment measures.
They also offer one-on-one counseling, which is a big hit among their small business clients and is one of the main reasons why the program is so successful. To find an SBDC near you, visit their web site at www.asbdc-us.org.
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About the Author: Dawn Rivers Baker, an award-winning small business journalist, regularly reports and analyzes small business policy and research as the Publisher of the MicroEnterprise Journal, where the nation’s business meets microbusiness. She also publishes the Journal Blog.