Backroads Business

Diversifying Farm Operations

by Karen Wylie on April 6, 2009

agritourism-farms At the national level, we talk casually about billions and trillions of dollars.

And not too long ago, it was difficult to obtain small business loans for less than $250,000.00.

Which just goes to show, what a difference a few dollars can make in the lives of small business owners who want to better their lives.

Recently, fifty farmers in the western North Carolina mountains received funding to help them diversify their operations. A total of $225,000 was provided by the NC Tobacco Trust Commission and disbursed by Western North Carolina Agricultural Options in $3,000, $6,000, and $9,000 grants.

Since 2003, the Trust Fund Commission has supported WNC AgOptions, a N.C. Cooperative Extension program that provides resources to farmers diversifying or expanding their operations, particularly those transitioning from tobacco production.

Many of the farm recipients were seeking grants to add or expand related streams of income or stabliize year round employment. Grant recipients plan to transition farm land into U-Pick areas, expand existing herb and bee operations, or saw their own lumber to create outbuildings for agritourism activities.

You can read more about the creative business plans of these farms here.

Tagged as: Agritourism, farms, planning, rural business, Seasonal Business

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Profit in Business

by Karen Wylie on April 5, 2009

small town inspiration

“Profit in business comes
from repeat customers,
customers that boast
about your project or service,
and that bring friends with them.”

W. Edwards Deming
American Consultant,
Stastistician and Educator
1900-1993

Tagged as: business inspiration

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Rural Business Weekly News – April 4, 2009

by Karen Wylie on April 4, 2009

rural business weekly news Here are a few interesting blogs and online articles published this week with news that relate to Rural Business, ending April 4, 2009:

This week the U.S. Senate confirmed by unanimous consent Karen Gordon Mills as the 23rd Administrator of the Small Business Administration (SBA).

Several reports this week on the changing demographics of rural America, affecting who our customers, neighbors and employees might be. It seems that quite a number of U.S. veterans choosing to leave urban areas for rural America has increased more than 20 percent over the last ten years. One possible reason cited is that many veterans prefer to remain located around military bases after retirement, and many bases in urban areas (especially along the West Coast) have been closed. Apparently relocation to the southeastern US and to Idaho and Utah are the most commonly selected areas.

Earlier this week, I wrote about frustration in Great Britain regarding second home owners in rural areas, when their part time residence has effect on the ability of local businesses to survive year round.

And quite literally in a New York Minute, you can read an update on rural demographics across the country, and how our rural communities are home to residents who are older, more ethnically diverse, and more likely to be female than in the recent
past. The increasing racial diversity of rural areas, along with younger generations leaving and immigrant populations arriving, create challenges that most of rural America is already confronting. And even blogging about, as in Living Single in Small Town America.

Rural America received some news that sounded promising this week from Verizon Wireless, which announced plans to begin introduction of a wireless network in the 700 MHZ spectrum in 2010:

‘The licenses we bought in the 700MHz auction cover the whole US,’ says Tony Melone, a Verizon Wireless VP. ‘And we plan to roll out LTE [high-speed mobile service] throughout the entire country, including places where we don’t offer our [current] cell phone service today.’

Because the [700 MHz] spectrum is in a lower frequency, it can transmit signals over longer distances and penetrate through obstacles, and because the signals travel longer distances, Verizon can deploy fewer cell towers than if it used spectrum from a higher frequency band, which means it can provide coverage at a lower cost.”

However, there are those who say that the battle over rural broadband is just beginning and that Verizon, AT&T and other large wireless carriers and cable companies are actually blocking the Rural Broadband Stimulus:

“Verizon, Comcast, AT&T and other large wireless carriers and cable companies are behind lobbying efforts in state legislatures around the country to prohibit local governments from using federal stimulus money to build and manage their own broadband networks, critics contend. So far, they seem to be succeeding.

The federal broadband stimulus package provides $7.2 billion for projects that bring high-speed Internet connectivity to rural areas and towns in remote locations. The law gives priority to projects sponsored by governments in partnership with local Internet service providers (ISPs), but stimulus money can also go to national ISPs if there are no competing local projects.

Public interest groups and consumer advocates contend that incumbent ISPs are trying to prevent states from funding projects managed by local government entities, even in partnership with private companies.”

Just what we need, another delay to rural broadband. First no money, and now the money allocated to rural America is going to be fought over!

Tagged as: rural business, rural business owners

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New SBA Administrator Confirmed

by Karen Wylie on April 3, 2009

rural america politics The U.S. Senate today confirmed by unanimous consent President Barack Obama’s nomination of Karen Gordon Mills as the 23rd Administrator of the U.S. Small Business Administration.

As Administrator of the SBA, Mills will direct a federal agency with more than 2,000 full-time employees, with a leading role in helping small business owners and entrepreneurs secure financing, technical assistance and training, and federal contracts.

“Small business is the backbone of the American economy,” Mills said upon her confirmation. “The SBA has a vital role to play in supporting our nation’s small businesses so that they can be the key driver in getting our economy moving again. I look forward to leading this critical agency at this important time.

“I was there on the factory floor in Arkansas and Ohio working to weather the recession of the early ‘90s,” she said. “Those experiences give me a deep understanding of what our small businesses need today to survive this downturn and to prosper in the years ahead. Since then, I have helped grow companies in organic food, and women’s media, and spent time in rural Maine working with our boat builders and composite technology to help them compete throughout the globe.

“The sum of my experience is this: I am a believer in American small business. I am a believer in America’s ability to manufacture goods and services that are world class, and I am a believer in America’s spirit of entrepreneurship. This spirit is one of our country’s greatest assets and we need to cultivate it today, more than ever.”

Mills holds a degree in economics from Harvard University and an MBA from Harvard Business School, where she was a Baker Scholar. Mills and her husband Barry Mills, president of Bowdoin College in Brunswick, Maine, have three sons. In 2007, Mills was named Chair of the Council on Competitiveness and the Economy in Maine, which was focused on attracting investment in rural and regional development.

Click here to read Mills’ complete Statement to the Senate Committee on Small Business and Entrepreneurship. 

Tagged as: rural business, rural politics

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Five Obstacles To Every Sale

by Karen Wylie on April 2, 2009

sales-cash-register

“Every sale has five basic obstacles:
no need, no money,
no hurry, no desire,
no trust.”

Zig Ziglar
American Motivational Speaker and Author

Tagged as: Rural Economy, sales

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When Customers Prefer Stores to Online Shopping

by Karen Wylie on April 1, 2009

small-town retail According to a recent A.C. Nielson survey, customers have very specific reasons for choosing to buy in person at a “brick and mortar” store instead of online.

The most common reasons why people prefer to shop in a store are:

“58% of the people wanted to physically evaluate the product before purchasing.”

“52% didn’t want to wait for the product to ship.”

“43% didn’t want to pay shipping and handling.”

“27% wanted to talk to a sales person in person, before purchasing.”

“23% thought they could find a better price in store.”

“14% weren’t sure anyone would be home when the item was delivered by a third-party shipper.”

“11% wanted to support a local business.”

“5% listed none of the above.”

How can you use this information to increase your sales and local customers?

Tagged as: rural business, Small Town Retail

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Do Second Home Owners Kill Rural Villages?

by Karen Wylie on March 31, 2009

rural life rural economy Do second home owners kill villages?

In an article on the British Broadcasting Corporation’s (BBC) blog, that’s the question asked.

Apparently Great Britain is struggling with changing rural industry, like so many other areas in the United States and around the world. Manufacturing no longer exists, tourism is becoming more important, and young people are moving out of rural areas. The elderly and retired are moving to rural villages in record numbers.

With a proposed bad on the purchase of second homes, the British government has officially responded by saying that banning second home owners from buying in rural areas would not provide more affordable homes to locals, saying it believes “there are more innovative ways” of providing assistance “without interfering with the legitimate right” to own more than one home.

The original report, prepared by Liberal Democrat MP Matthew Taylor, called for a selective “ban” on the purchase of second homes:

“But in some communities, when there are too many second home owners,” Taylor says, “the community itself dies. And while it is not in a huge number of areas, in those places we should say enough is enough.”

So do second home owners add or detract from rural areas? Are the communities and economies in which they choose to invest being destroyed by the very nature of their seasonal visits?

BBC reporter Jon Kay visited the village of Exford on Exmoor to see what the full-time residents thought of second home owners. What struck him was how few of the cottages had lights on or smoke coming out of the chimneys.

Mark, an Exford resident in his 20s, says: “It’s a nightmare. This problem has been growing for the last decade. House prices don’t reflect people’s incomes.”

Another resident is equally critical of the housing market.

She says: “[Second home owners] are taking the housing that we would like to have available for our locals but they just out-price us so our children grow up and can’t stay put.”

A third resident explains the effects. “The newsagents has gone, the garage has gone and if a lot of these properties were filled, perhaps these businesses could have been kept going,” he says.

In one house for sale, 25 prospective buyers looked round the property – not one of them a local resident.”

So what is the role of second home owners in your rural community?

And what effect do second home owners have on your business and the local economy?

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Tagged as: Rural Economy, Rural Life

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Renegotiating Your Fixed Costs

by Karen Wylie on March 30, 2009

rural business fixed costs An interesting read today in The New York Times, in “Nothing is Set in Stone, So Renegotiate:”

“Maybe your fixed costs are not as fixed you think.

With the recession continuing in full force, you may find that everyone — from the company that supplies your office with water to your neighborhood banker — is willing to renegotiate their existing arrangements with you to keep your business.

Closely analyze every contract you have and look for places where you think you can get a cost reduction. Then ask for better terms.”

The article provides several ideas along with additional web resources to help you prepare for discussions with landlords and others with whom you have a financial relationship or partnership. One specific area, negotiating to get lower rent, is especially timely:

“Tenants frequently have the upper hand in a renegotiation scenario,” write the people at Gaebler.com, a business incubator and holding company. “Unless the local commercial real estate market is red hot, landlords are hesitant to risk incurring an extended vacancy period by allowing the space to turn over.”

You can certainly ask for an immediate rent reduction, citing the tough economic conditions you face. The landlord is going to be more willing to grant it, however, if you agree to extend your lease at the new, lower terms.

“The best time to renegotiate a lease is six months to a year before your current lease expires. If the renegotiation fails, you will at least have enough time to properly consider alternative locations.”

As the author says – it may look and sound simple, but renegotiation of financial matters is rarely easy. Just sometimes necessary.

Tagged as: rural business, Rural Economy

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Celebrate Mom and Pop Businesses – Big Isn’t Always Better

by Karen Wylie on March 29, 2009

Happy National Mom and Pop Business Owners Day to all husband-wife teams and family owned businesses out there.

March 29th marks the annual observance of National Mom and Pop Business Owners Day to recognize family owned and operated businesses across the country.

The observance of a National Mom and Pop Business Owners Day was the brainchild of a Florida man named Rick Segel, in honor of a women’s hat shop called Ruth’s that his parents opened on March 29, 1939, in Everett, Massachusetts. The business moved to Medford, Massachusetts and grew into a women’s specialty clothing store of 10,000 square feet and $2 million dollars in sales before it closed in 1997.

The purpose of this holiday, according to the Holiday Insights Web site:

“National Mom and Pop Business Owners Day celebrates small business owners. These individuals spend countless hours nurturing and growing their young enterprises. The workload demands, and lack of a hired staff, often translates into long and late hours, and many missed family and personal events. But, all in all, they love what they do. After all, they are their own boss.

New businesses have always been a vital, yet not fully appreciated, part of the U.S. economy. On they retail side, they bring different and unique products to the marketplace. They provide stellar and personal service support. When you call, you are more likely to get a real, live person. And unlike big national chains, they know their products. They are outstanding performers in niche markets. In manufacturing, they create many new concepts and ideas, making them creators of new products.”

A couple other ‘mom and pop’ business stories were written to celebrate this holiday.

The Athens, Georgia News Courier even published a special section today devoted to small business and the National Mom and Pop Business Owners Day.

And in Roane County, West Virginia, a mom and pop business received special recognition in their local newspaper article for preserving a local landmark business in “Couple revives Mom-and-Pop store – Roane County store offers a little bit of everything:”

“The Walton Thriftway is an old-time country general store. Morgan sells groceries – meat, dairy, vegetables, and so on. You can also buy hand-carved Amish furniture and wood, pellet and gas stoves. Want to rent a movie? He’s got those. In the back, a deli serves everything from sliced meats and cheeses to fast-food style hamburgers, tacos, pizzas, and ice cream. He provides tables and chairs for in-store dining and there’s a self-serve “coffee bar” at the front.

In a connected building off the back, a complete hardware store offers a variety of tools and equipment, paint, plumbing and electrical items as well as a full line of livestock feeds along with hay and propane. If he doesn’t have it, he’ll order it. In the spring, you can get a bunny.

Upstairs, you’ll find a large antique and consignment store and a quilt shop, Sew Many Things, run by Morgan’s wife, Elonda. The quilt shop offers quilt kits, classes, and fabric supplies.

Business is booming in the store, located in a town small enough to count its population in the hundreds.

“We’re not feeling the recession,” he said. “People don’t want to spend the gas to drive to the big stores. They want to shop close to home.”

Hopefully you can celebrate National Mom and Pop Business Owners Day everyday by shopping mom and pop businesses in your town all year round.

Tagged as: mom & pop business, mom and pop business

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Rural Business Weekly News – March 28, 2009

by Karen Wylie on March 28, 2009

rural small business news Here are a few interesting blogs and online articles published this week that relate to Rural Small Business, ending March 28, 2009:

If you’re looking for an update on how the recession’s going this week, you’ve got several resources to take a look at.

To start with you can take a look at an article online at Forbes Magazine called The Recovery Has Arrived.

Although the author finds many signs of a recovering economy, he thinks these signals are really due to us just adapting to the bad situation and making the best of it – not to anything improving:

“The news of course has been horrible for months, but the numbers aren’t showing further deterioration; that means the economy has absorbed the bad news and has largely adjusted.”

Apparently the industries benefitting from our current economic conditions include road construction, bridge building, and health care, whereas industries associated with luxury living – equine businesses, landscape turf management, and the recreational vehicle industry with motor boats and Winnebagos are having the worst time. Day Care operations are also struggling in communities where they are viewed by some customers as ‘optional’ and not lifestyle requirements.

Not surprisingly, pawnshops report great sales with some up 60% as desparate people hock whatever they need to sell, and shoe repair shops are up 40% and find increased interest in their craft among younger generation.

Is Regulating the Credit Card Industry Good or Bad for Small Business? Not surprisingly, small business owners have pretty strong feelings on the issue as they endure increases in transaction fees that are supposedly needed to protect them against fraudulent transactions, but then charged for those transactions nonetheless. Small businesses also report that their credit limits are being drastically reduced, interest rates increased for no apparent reason, and accounts suddenly closed.

A new 34-page report by the Small Business and Entrepreneurship Council argues against government regulation of the credit card industry, claiming that it ultimately hurts small businesses, by making it harder for card issuers to stay competitive and offer the most flexible terms and best rates to businesses. The report can be downloaded here.

The rural economy has held strong over the last few months and appeared to be less affected than the overall national economy. However, in January apparently job losses in rural America and exurban America were more severe than city job loss for the first time.

Unemployment may be rising but apparently rural stock prices are too, at least according to the ‘Yonder 40 Stock Index’ a group of forty stocks selected to reflect the rural economy. Regardless of the economy’s ups and downs, it’s important that we keep looking on the bright side as we were reminded just last month:

“The rural economy may be as nasty as rusted wire,
but, hey, you can always hunt.”