SANTA CRUZ — Emili Willet opened her baby products and services store in Santa Cruz in part because she couldn’t find what she wanted locally, and she dreamed of being able to provide the community with the resources she had wanted as a new mother.
That kind of contribution to society and the economy is what the National Small Business Week, sponsored by the Small Business Administration in Washington, D.C., aims to honor. National Small Business Week this year is Tuesday through Thursday.
"It’s a celebration of small business and of the people who make small business work," said Karen Calcagno, chapter chairwoman of Santa Cruz County’s SCORE, a nationwide business counseling association based in Washington, D.C., and funded by the Small Business Administration.
For more than 40 years, U.S. presidents have issued proclamations calling for Small Business Week. During festivities in Washington, D.C., this year, President Bush will address the group and the SCORE chapter of the year will be recognized, along with many of the nation’s most successful entrepreneurs and small-business leaders.
Small business is recognized nationally for good reason. According to the Small Business Administration Web site, small businesses:
· Provide approximately 75 percent of the net new jobs added to the economy.
· Represent 99.7 percent of all employers.
· Employ 50 percent of the private work force.
· Provide 41 percent of private sales in the country.
· Accounted for 39 percent of jobs in high-tech sectors in 2001.
· Accounted for 52 percent of private sector output in 1999.
· Represented 97 percent of all U.S. exporters.
Small business is big business in Santa Cruz County. The Santa Cruz marketplace has twice the number of sole proprietorships as the state average for markets this size, according to Greg Carter, executive director of the Santa Cruz Chamber of Commerce.
"Small business are the backbone of our economy, they really drive the Santa Cruz marketplace," said Carter.
SCORE nationwide helped 335,000 entrepreneurs last year through its combination of workshops for aspiring entrepreneurs and small-business owners, advice and individual counseling, according to Calcagno, a small-business owner and SCORE counselor since 1992. The national organization started in 1964, and nationwide there are 389 chapter offices and 10,500 counselors. All counselors are volunteers.
In Santa Cruz County, SCORE has one chapter office and 12 counselors, most of whom are active business owners. The county chapter helped about 200 people last year, said Calcagno.
Getting to the root
"We try to get to the root of the matter" with questions about how to market successfully, what to do if a business owner has hit a plateau or how to cope with feelings of being overwhelmed, said Calcagno.
Willet, owner of A Mother’s Place in downtown Santa Cruz, which opened in October, had meaty questions for SCORE counselors.
She wanted to know "if the business was viable," said Willet, who had been laid off from her previous job, "and then of course if I included all the expenses, fees and taxes into my plan. Because that can totally throw off your budget."
Willet attended a SCORE Pre-Business Workshop before opening her business. She connected with the Small Business Development Center at Cabrillo College and subsequently received individual SCORE counseling for a review of her business plan.
"They made sure I was fully committed before I got into it," said Willet. "It tested my limits."
Success for Willet has been partly emotional.
"I’m happy," she said. "I love what I do. That allows me to make the business a success because it’s a positive influence on my customers."
Also, she said, it’s become a community resource and source of support for parents, offering community classes and a space for breast feeding, which is a sign of its success to her, since that was part of her original goal.
The business is a financial success, as well, breaking even in its second month and going up each month thereafter. It is now profitable, said Willet.
For Aptos business owner Cayce Ellison, the questions for SCORE were more basic.
"Like business licensing, fictitious business name, permit, all that kind of stuff, even questions about startup costs and legitimate ways of advertising," said Ellison, a former art teacher and now owner of Blue Apple Studios children’s art studio. "I just didn’t have a clue on all of that."
Ellison, like Willet, attended a SCORE Pre-Business Workshop before opening her business. Then she had individual counseling to iron out a few of the details.
The main thing Ellison said she took from the counseling was the confidence that she could start her business and be successful.
"Karen, specifically, made it all sound really easy and that I could do it," said Ellison.
The year-old business is profitable, and Ellison has repeat clients and a waiting list. She recently met with SCORE again for a year review.
Any discussion of small business inevitably comes to the topic of failure, with perception of the failure rate varying widely but most anecdotal views casting it as quite high.
The Office of Advocacy for the Small Business Administration collects information on "survival rates" rather than failure rates, according to John McDowell, spokesperson for the office.
"They aren’t large, but they are much larger than people think they are," said McDowell.
According to McDowell, survival rates for new employer firms are:
· 66 percent remain open two years after startup.
· 50 percent remain open four years after startup.
· 40 percent remain open six years after startup.
"We don’t call it failure rates, we call it closures," said McDowell. "Businesses close for a variety of reasons, not necessarily because they fail. It could be a change of ownership, it could be because the owner looked around and decided he could make more money somewhere else, it could be because of a move."
In Calcagno’s experience, a growing number of people locally are starting businesses as kind of a second life or career, which helps put them past the starry-eyed phase of the dream of working for themselves.
"They’re no longer working in Silicon Valley, so they’re older and have more life experience, but they don’t necessarily have more business experience," said Calcagno. "So they get to that reality factor faster, which I think is a good thing. That level of maturity is very helpful."
Carter of the Santa Cruz Chamber says remaining viable as a small business creates an ongoing challenge to be innovative, efficient and forward-looking. Still, he said, local business owners create opportunity for employment in diverse ways.
"I love working with them," he said. "I think they’re clever, I think they’re driven, I love the passion they bring to the community, and from a chamber perspective it’s inspiring to work with."