The SBA (Small Business Administration) is an organization that is suppose to help small business owners and entrepreneurs get the necessary tools and funding they need to successfully start and run their small business operations. Lately however, there has been a great deal of frustration felt by many small business owners that have looked toward the SBA for assistance. According to a report in the NY Times this past week, “recent policy changes and severe budget and staffing cuts in the last six years have left the agency unable to fulfill its mission to provide programs and services to the nation's 25 million small companies, which the agency defines as businesses with 500 or fewer workers. Since 2001, the agency's budget has been sliced nearly in half, to $464 million in the proposed 2008 budget. Staff cuts have been almost as deep, with the agency losing 31 percent of its work force.”
The SBA is also has seen an increase in their fees on their most common loan packages the 7(a) program and a decline in the amount of banks participating in the SBA’s loan program. These changes have all accounted for the loss in potential contracts for small business owners, and have many small business owners looking toward other sources for funding.
What is a small business owner/entrepreneur to do? Many small business owners have turned to the credit card industry and are using debt to finance operations and provide more capital for their businesses. The only problem with this strategy is that the interest rates on the credit cards are considerably higher than those on the SBA loans.
The Brico Group, Inc. will address these and other issues in our Small Business Seminar Series at the College Park Library this month. The first seminar will begin June 12th. Small business owners and entrepreneurs will get information regarding what the SBA can really do for them right now, and also what banks are entrepreneur friendly. Be sure to join us for these informative seminars.
Keeping your Business N Synergy
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