If there’s such a thing as a best friend to business, the US Small Business Administration would be the one sticking by in good times and bad. The SBA has been helping small businesses around the nation for over 60 years, including ones right here in New Hampshire. Greta Johannson is the district director of the SBA for New Hampshire. She heads the hardworking and enthusiastic team here in the Granite State, which ensures that businesses know about the programs and services available. She also works with lenders, SBA resources partners, economic development agencies (like us!) and others to foster entrepreneurship and business growth.
Greta Johansson ~ US SBA
1. What would you say are the top two or three things that make New Hampshire ideal for starting and/or growing a small business?
I learned very early on that people in New Hampshire know people – the ‘six degrees of separation’ is more like 2 or 3 degrees here. The edge this provides to people starting or growing a business is that they often need only ask one or two questions of one or two people to find themselves connected with a wide network of resources. And there are many resources worth tapping into, which is another strength here.
There is also, statewide, a very strong sense of identity and community. People support each other – they shop in their neighbors’ stores, dine at their neighbors’ restaurants, look for contractors and services from within their communities – there is a strong local-to-local economy. Simultaneously, New Hampshire is well suited within the region, with easy direct access to Boston, a significant cross-border relationship with Canada and a healthy exporting economy.
And while no state was exempt from the recession, New Hampshire maintained one of the lowest unemployment rates in the country throughout, and continues to do so today. While this contributes to a hiring challenge for some businesses, it also reflects greater economic stability even in the rough times, always a good thing for starting or growing a business.
2. Lending is a large part of how the SBA supports small businesses. How has the SBA lending landscape changed over the last few years and what’s important for business owners to know in order to be successful in applying for SBA loans?
One thing we noticed is that following the recession our lending increased nationally, but our volume of smaller loans did not rebound. To help spur smaller loan growth, we have waived the upfront guaranty fee on 7(a) loans of $150,000 or less, reducing the cost of borrowing for the business. We have waived the annual service fee on the same loans, reducing costs for the lenders to help them be more competitive and active in the small loan arena.
We had these fee waivers in place during our fiscal year 2015, which ended Sept. 30, and are happy to have them in place again for 2016. In 2015, we estimate a fee savings to business borrowers of approximately $270,000. Business owners also have a wide range of lenders to choose from – 66 different lenders participated last year in our two primary loan programs, 7(a) and 504.
It is important for business owners to understand that SBA is not the lender; SBA loans are issued by private sector lenders – we provide the lenders with incentives to make it possible for them to expand their small business lending. Having a business banking relationship and a well-prepared business plan before making a loan request are two valuable assets for a business owner. We have partners who can help you with being prepared. We have SCORE, with six chapters of dedicated volunteers across the state; the New Hampshire Small Business Development Center, a state-federal-university partnership, providing small business advisors across the state, and this year we welcomed two new partners into New Hampshire. The Center for Women and Enterprise is a well-established organization that opened its fourth SBA Women’s Business Center in Nashua last spring; and we have a new Veterans Business Outreach Center, the VBOC New England – this organization will be serving the six New England states and you will see more of its activity in New Hampshire over the course of this year.
To recap – it’s a great time to borrow as costs for small loans are reduced, interest rates remain low and there are many SBA-active lenders; and there are free and confidential advisors ready to help you.
3. Can you share a recent New Hampshire SBA success story to illustrate one or more of the ways the SBA contributes to small biz success in the state?
Each year we hold a celebration during Small Business Week (the first week of May), where we have the honor of recognizing some of New Hampshire’s finest. Our 2015 Small Business Person of the Year was Scott Johnson of Certified Retail Solutions (CRS) in Dover. Scott was able to work with an SBA lender and the city of Dover to develop a larger property for his business, beneficial to the town and CRS. We also recognized a family owned business, a veteran owned business, two women owned businesses, a young entrepreneur, and a subcontractor of the year – these businesses used a wide range of services including counseling, financing, government contracting and disaster assistance.
Richard Tango-Lowy, a Master Chocolatier and owner of Dancing Lion Chocolate in Manchester, was able to work with several resources, beginning with the New Hampshire Small Business Development Center. From there he connected with the state’s International Trade Resource Center as well as the US Department of Commerce’s US Commercial Services. Richard was also able to use two SBA loan products – the 504 program to purchase/renovate his business location and an SBA Export Express loan to facilitate his first exports.
4. Earlier in your SBA career, you worked in the SBA’s Office of Disaster Assistance. What are some of the services the SBA would provide during a disaster event in New Hampshire?
SBA’s role following a disaster is a recovery role to help with the longer-term rebuilding efforts. When FEMA issues a Presidential Declaration following a major disaster, SBA’s program is activated. There are also occasions when damages are not severe enough for FEMA, but SBA can take a look and sometimes issue a disaster declaration triggering only SBA’s program.
When either of these events happens, there is a very experienced and dedicated group of employees whose sole function is administering SBA’s disaster loan assistance. These are direct, low-cost loans with generous repayment terms to help with rebuilding/replacement costs for businesses, homeowners or renters who were under-insured. Specialists would be onsite initially and for as long as needed.
But ideally, we would like everyone to be both well-insured and prepared. Businesses are particularly vulnerable to being unable to recover, and the odds of recovery grow slimmer with each day a business is out of operation. SBA has partnered with Agility Recovery to conduct preparedness webinars, and there are many online resources. There are resources with the Red Cross; there is www.ready.gov as well as www.preparemybusiness.org; and locally we have www.readynh.gov. Insurance companies will also have information available about guarding against or minimizing the impact of certain risks.
I mentioned our two new partners in an earlier question, which is exciting for us and we are looking forward to expanding our outreach and advisory capacity. Also, we very recently received another SBA Microlender in the state. Our Microloan program is designed to provide small loans, not to exceed $50,000, for small businesses that are viable, yet remain outside the comfort zone for most conventional commercial lenders. Northern Community Investment Corp. has served the northern three counties for many years, but we have not had anyone offering this product in the rest of New Hampshire.
ACCION East is a well-established alternative lender that has been providing SBA Microloans in other areas, including Massachusetts, for some time. ACCION East was recently approved to add New Hampshire to its service area, which means the entire state will now be covered by at least one SBA Microlender.
And, we have formalized a Veterans Small Business Week to be held each year during the first week of November. We will have several veteran-focused events that week, including our first “Reboot to Business,” an educational program for veterans or spouses of veterans who are looking to start a business or are in the early months of operations. This Reboot program will be held in Concord, and we encourage anyone interested in participating to contact our office by calling 603-225-1400 or visiting www.sba.gov/nh.