Small Business Development Center
At Chemeketa Center for Business & Industry
chemeketa students

Confidential Business Advising Offered to Business Owners in Yamhill County

By Chemeketa SBDC

The Chemeketa Small Business Development Center (SBDC), with support from the McMinnville Area Chamber of Commerce, is pleased to announce the hire of a McMinnville-based business advisor Larry Strober who will be counseling business owners in Yamhill County. There is no cost to business owners for this service.

“We are thrilled to have an advisor on board to serve business owners in Yamhill County,” Marcia Bagnall, Chemeketa SBDC Director, said. “While the SBDC has worked with many businesses in Yamhill County over the years, it will be nice for the Yamhill business community to have support closer to home.”

Mr. Strober will be meeting with business owners one-on-one to discuss business strategies, expansion, hiring and other HR matters, financial issues, marketing needs, and other business-related issues. He has over thirty years of senior management experience with emerging companies, and has expertise in business planning and business turnaround. “I’m looking forward to helping strengthen local businesses and seeing them thrive,” he said.

Business owners may contact Mr. Strober directly at 415-720-8262 to set up an appointment, or call the McMinnville Chamber to be directed to him.

“We are excited to partner with the Chemeketa SBDC to bring this very valuable resource to Yamhill County,” Nathan Knottingham, President/CEO of the McMinnville Chamber, said. “The McMinnville Area Chamber of Commerce is committed to building a strong local economy and supporting resources like business advising, which is free of charge to businesses thanks to the support of Chemeketa, and fills a very real need for many of our small businesses and entrepreneurs in this area.”

The Chemeketa SBDC is 1 of 19 SBDCs throughout Oregon that provide assistance to new and established small businesses.  The Chemeketa SBDC is a part of the Chemeketa Center for Business & Industry, located at 626 High Street NE in Salem. Over the past 30 years they have provided training, resources, and advising to thousands of business owners in Marion, Polk, and Yamhill counties.   For more information about the SBDC, visit, call 503-399-5088, or email


Keeping Your Customer Pipeline Full

By Chemeketa SBDC

The economic recovery seems to be in full swing and the customers are coming back. This is good news! You may have just about as much work as you can handle these days. Or perhaps you do some of the time, and then make a marketing surge to fill the pipeline when things are slack.

But that’s the problem, right? When you’re really busy you don’t have time to market. And when you’re not busy enough it’s because you weren’t marketing during the boom weeks. The fact is that you need to market continually (boom times and lean times) in order to keep your sales pipeline full.

So how do you do that?

Always be thinking about marketing your business and attracting new customers. It should be top of mind all the time. Don’t skip networking events. Don’t slack off on continually getting your name in front of current and potential customers. You can’t afford it!

Reach out to former customers and try to get them to come back. Use social media, email newsletters and other forms of communication to keep in touch with them and invite them to reconnect with you.

Create a system to put customers on a waiting list if they come to you when you’re too busy to handle them. Don’t let them slip away because they won’t come back.

Consider getting additional help to handle overflow times. That way you can meet a customer’s need when the need is there. If you put a customer off because you’re too busy, they’ll just go somewhere else instead.

Think about creating tiered pricing so that you can adjust your prices up or down depending on what your demand is at the moment. This is a strategy to adjust as you go so that you always have customers coming in.

Ask yourself if you can turn some of your customers into a recurring and predictable income stream, and away from a one-off occasional buyer. The more “bread and butter” customers you have, the easier it will be to smooth out your pipeline and forecast workflow and resource needs.

Five Steps to Project Your Business’ Sales

By Chemeketa SBDC

Every business owner should be forecasting sales. You may use actual numbers if you have historical financial records. But what do you do if you have nothing to refer back to? You will need to determine how many potential customers are there and how many of these potential customers are likely to buy from you, decide the average sale per customer, and then project this out for the year. Try this:

First, determine the total number of potential customers living in your territory. (Don’t forget — the more clearly you can define your customer — the more realistic your research!)

If you sell to the general public, you need to find the information from the new U.S. Census data for your market area. You can find this information on the Web ( or at the library. If you sell to other businesses, there are many potential sources of information. One of the best is a trade association that represents your industry. You can also find this information through a Web search or at the public library.

Once you have determined the total number of potential customers living within your geographical area, you have the base to begin narrowing down your target market.

Second, determine the number that will likely buy from you. You need to be realistic. Consider your competition (both in number and quality), consider that some of the people will not buy from you or your competition, and consider people will find substitutes for your product. What percentage of the total available population will you be able to attract?

Third, determine your average customer sales per year. How many purchases will your average customer make in a year? How much will they spend on each purchase? Is this a repeat business or once and only once? Does the average customer buy the same product/service, or will they need other complementary services? Trade associations are good sources of information to help answer these questions.

Fourth, determine your annual sales volume. You have determined the number of customers and determined the average amount each customer will spend per year. Multiply these two numbers together to calculate your expected annual sales volume.

Finally, evaluate the annual sales volume figure. Does the number you calculated make sense? If not, go back and work the numbers again. What assumptions have you made about your customers? How accurate or risky are these assumptions? You can guess, and this is not a bad place to start. But — then — you need to back up your assumptions with actual figures to gain the greatest degree of reality for your projections.

Networking: Beneficial Relationships, Not Sleazy Sales People

By Chemeketa SBDC

When you hear the word “networking,” what do you think of? I used to think it meant sleazy sales people trying to manipulate others into buying their junk. Boy was I wrong! Networking is really another way of saying you’re going to establish a mutually beneficial relationship with other business people and potential customers.

The key here is mutually beneficial. The relationship has to work for everyone concerned. It has to benefit everyone. And that sounds like a good thing to me.

So why do this? Well, networking with individuals and groups is a great way to become more attuned to the issues that affect you and your business. From your own managerial issues and questions to your customers — their needs, concerns, and preferences — you don’t have to be alone in your business. There are a lot of knowledgeable people out there, so tap into them.

For the purposes of this article, I’m not going to include the organizations where you share leads (although they have a place in your consideration as well). I’m going to focus on the places and groups designed to help business owners network with one another, and to use these peer networks for both personal development and to grow their company.

Here are several types of national networking groups:

Professional Societies: Nearly every type of business has a national association that represents their members’ interests. Most have local chapters with regular meetings and activities. Along with providing a great source of contacts, professional societies offer volunteer opportunities where you can demonstrate your initiative, cooperative spirit, and leadership qualities.

Target Specific: There are several groups that promote networking among specific types of businesses or different types of business owners. Examples would include the National Association of Women’s Business Owners (

Chambers of Commerce: These groups offer valuable exposure in a particular community or region. While other members may (or may not) be in your target market, they can provide valuable opportunities for you to “show their stuff” via trade fairs, demonstrations, and media features. There are nine Chambers in Marion, Polk and Yamhill counties. Seek out the closest one and learn about the benefits of membership.

Remember, being in business for yourself doesn’t have to mean by yourself. Seek out like-minded business owners and put the power of networking to work for you. Today!

Hiring Strategies

By Chemeketa SBDC

Knowing whom to hire is a critical factor for every expanding business. As you already know, the image and reputation of your company depends on how your customers view your employees. Your job begins long before the new employee is greeting your public.

The hiring process is not (or shouldn’t be) haphazard. Before you begin, decide why you are bringing on a new employee — define the job. Determine the experience or education level truly required. And know the appropriate salary and benefits for the job. (Appropriate is not only the market rate but your ability to pay and equity within your company.)

If you have not formulated a personnel policy, now is the time. What are the hours to be worked each week, the number of days per week, holiday work and the time and method for overtime pay, fringe benefits, vacation and sick leave, time off for personal needs, training, retirement, a grievance procedure, performance review and promotion, and termination. This may seem overwhelming but it is better to “put up the stop sign before there is a fatal accident,” so to speak.

Often in a small business you will hire a person for a certain job (or tasks) but you should also expect, articulate and cross-train for the most efficient utilization of that employee. Can they pinch-hit for other staff? Is there room to “grow your own” managers? Think not only about the training they will need to get them up to speed on their assigned responsibilities, but also the next steps — what else do they need to learn do within the company?

Rather than deciding who to hire based on intuition, establish an entire hiring process that enables you to determine their worthiness for the position. Review their resume, application and work samples; test the applicant if appropriate for the position; interview the candidate; and check his or her work references. Do not focus on what the candidate has done; rather, find out how they did it.

Interview the candidate, not their resume. Observe and deliberately consider interpersonal skills and motivation level. When it comes time for the hiring decision, your instincts of people will come into play, your ability to separate “good” employees from “bad” ones. However, a word of warning: do not hire someone you believe will turn around. Time is too precious and too expensive to waste on anyone who cannot contribute 100 percent.

There is always concern about what questions are legal in an interview. While is it important to know the laws related to job discrimination, you may be overwhelmed by the “what if” scenarios. According to one expert, there are two simple rules to test whether or not to ask a question. First, is it job related? If it is not, do not ask. Second, is the question presented only to a specific type of candidate? If it is, do not ask.

Make your employee expansion a process. Formalize the entire procedure — you can tweak it over time but establish a system for hiring before you begin.

Reality of Grants

By Chemeketa SBDC

DO NOT expect a grant to get your for-profit business started — despite those TV commercials late at night where the gentleman is screaming at you that the federal government wants to give you $50,000 to start your own coffee house!

Think about it, if there was really FREE money available to start a new business, there would be 250 million Americans in line ahead of you! If you haven’t figured it out yet, federal grants (despite the TV guy) are a myth, foundation grants are narrowly defined and virtually no one gives money for small business start-ups.

So, how does this myth persist? Because there are some (rare) federal grant programs that are awarded to the for-profit business. These grants are based on the needs of the federal program for a product or process — not the needs of the business — and they are seeking someone that can develop these products.

If you find that you can respond to the needs (generally a request for proposal — RFP), you need to know that applying for a grant is very different than applying for a loan.

Before developing a grant proposal, it is vitally important to understand the goals of the particular federal agency or private organization, and of the grant program itself. This can be accomplished through Internet research and discussions with the information contact listed in each resource description. You may find that, in order for a particular project to be eligible for funding, the original concept may need to be modified to meet the criteria of the grant program.

In allocating funds, grant makers base their decisions on the applicant’s ability to fit its proposed activities within the grant maker’s interest areas. If you want to see information about federal grants, go to

Other web sites for exploring grants:

Note: There are approximately 7,000 private foundations in America; some offer grants for specific business activities that relate to whatever activity they espouse. If you are aware of a foundation that offers grants in the area of business that you want to pursue, I suggest you contact them directly to obtain the details for applying. Again, these grants are most often awarded to non-profit agencies that compliment the mission of the awarding foundation.

The Trouble with the Low-Cost Game

By Chemeketa SBDC

Don’t have enough customers so it’s time to lower prices, right? Well, maybe. You may be tempted to do this in your business, especially if a competitor has lowered prices. But you run the risk of lowering yourself right out of business.

Carefully consider other options; perhaps there are better ways to remain competitive. And if you need to lower prices, do so with a clear idea of where that might take your business.

• Review each step of your supply chain, from your vendors on through to your customers. Why are there not enough customers? Are you losing current customers because they’re dissatisfied? Chances are there’s more to it than your prices. Find the areas of weakness and shore them up.

• Find ways to cut costs where your competition can’t. This increases your margins and consequently your cash. If you need to cut prices as a last resort, you’ll be sitting in a better position. You may think you’ve cut costs to the bone, but take another look.

• Examine your business model. Are there strategic changes you can make instead of tinkering with pricing? Are your current offerings what the market really wants? You may have a problem with what you’re selling instead of how much you’re charging for it.

• See if you can raise prices in a complementary service or good if you need to lower them on a core good or service. A coffee shop might leave the coffee pricing alone, but slightly increase prices for pastries. This results in the same revenue per customer. On the surface it appears as if you are competitively priced, but you’re not paying the penalty for those low prices.

• Selectively lower prices for only some of your customer base, or for only a limited time as an incentive. Make sure that what you gain (in customer loyalty or in increased purchases of ancillary goods) makes up for the loss from the price reductions. Be strategic about this.

• Have a clear idea of just how low you can go, if you choose to engage in a price war. Know your limits. Remember that smaller businesses will lose this arms race much faster than larger and better capitalized businesses.


How Much Money to Launch a New Venture?

By Chemeketa SBDC

Trying to determine how much money you will need to launch a new business can be a daunting task. While I find that new entrepreneurs are comfortable writing the business plan narrative (who, what, where, when and why) when given the right tools, developing a budget often seems to be a venture into a dark abyss. This is also the case when expanding a business or introducing a new product to the market. It isn’t that you don’t know or cannot find out the costs — it is about how to organize the financial needs.

The first part of your start-up budget is relatively straightforward. The first items in your budget should be those costs that you will pay only once. These are the costs to get you into business. If at all possible, these expenses should come from your equity investment and not from borrowed funds. A combination of investment and loans is possible, but borrowing all the money to pay for start-up costs may create early cash flow problems as you need to pay your debt service before income has a chance to grow past the break-even point into profitability.

The costs involved in start-up may include: legal and accounting charges for incorporation or partnership agreements, fees to government entities for licenses or permits, rental and security deposits, site preparation including leasehold improvements, furniture and fixtures, utility deposits and telephone installation, and printed materials including business cards, letterhead and marketing materials. And, of course, the necessary machinery and equipment and your initial inventory. The only way to determine these costs are to do your homework. You must call, write, or visit each of the vendors, explain what you are developing and get a quote or approximate price for a specific task.

Next, make a list of all the equipment (assets) you need to get this project off the ground. You must again research the cost and get quotes on specific items. Pro forma invoices are always good to get for the project file so you can have current information on hand, have something to compare other offers and/or even have for future reference should you choose not to proceed at this time.

You will also need to know how much inventory you need on hand to develop the business and to keep the shelves stocked appropriately until such time that sales can cover the cost of restocking. Price out each item individually and by bulk purchase to know your options and increase your flexibility.

The most difficult component of your start-up budget will be to determine how much cash you will need for working capital. This is the money you need to fund early losses and to smooth out your cash flow. You need to run a cash flow projection (beginning cash plus income, less cost of goods, less expenses) on a monthly basis for minimally one year to determine how much money is “in the bank.” You will most likely see potential “overdraws.” This is where your working capital requirements are established. There are only two ways to fund these overdraws — with capital infusion or by acquiring debt (not paying your vendors). So, plan on having (possibly borrowing) sufficient capital in reserve to fund early losses and to pay necessary expenses as your cash flow begins to build.


Make a New Year’s Resolution for Your Business

By Chemeketa SBDC

It’s that time of year again, when the old year is wrapping up and the new is just around the corner. The time of year when those resolutions about losing weight and spending less money are top of mind.

Business owners make resolutions at this time of year too. Smart ones will be setting goals and lining out action steps to go with their choices of course. But let’s start with a list of questions that every entrepreneur should take a look at right now. Some may or may not apply to your particular situation. Just pick a few for serious consideration. And then resolve to do something about them.

  • How can I be more proactive and less reactive?
  • What tough decision do I need to make (in January!) that will have an effect on the rest of the year?
  • Am I operating my business more like a hobby than a business?
  • Will I do a major campaign or major push of some kind this year?
  • Is my staffing at the right levels?
  • Is it time to shake up my marketing, perhaps add a big dose of social media?
  • Are my employees and I wearing appropriate clothing every single day, clothing that carries a clear message about my business values?
  • Am I measuring the right things?
  • Do I have sloppy work habits that are impeding my ability to run my business in an efficient and effective manner?
  • Am I thinking big enough?
  • What is the one thing that I can do this coming year that will make the biggest impact on my business?
  • Why don’t I have systems in place that make operations more efficient?
  • Do I run my business with a heavy dose of wishful thinking instead of running it on actual facts?
  • Do I have the right customers?
  • Will I be in business a year from now if I keep doing what I am doing, and doing it in the way I’m currently doing it?
  • How committed am I to making this business a success?
  • What help do I need and where will I get it?
  • Does my business need to be scaled up, or scaled down in the next year?
  • What got me into this business in the first place, and is it still relevant today?


Six Key Ideas to Grow Your Business

By Chemeketa SBDC

Your ability to think, analyze and decide is the key determining factor of your profitability.

To help you sharpen this ability, here are some key principles for business success that are relevant and important at every stage of your business life. If ever you aren’t happy with the business results you’re getting, revisit these key points.

1. The Product Must Satisfy A Current Need — The first principle to consider in selecting any new product or service is to determine if it fills a genuine, existing need customers have right now. A new product or service must solve a problem of some kind for the customer or make his/her life or work better in a cost‐effective way. You must be very clear, from the beginning, about exactly what your product or service does to improve the quality of the life or work of your customer.

2. Offer Good Quality At A Fair Price — The second principle for business success with any product or service is that it must be of good quality at a fair price. If it’s in competition with other similar products or services, it must have what’s called a Unique Selling Proposition ‐ some feature or benefit that makes it different from and superior to others out there.

3. 3. Be Careful With Your Money — Tight financial controls and good budgeting are essential. Successful companies use accurate bookkeeping and accounting systems. They put these systems in place at the very beginning and carefully record every penny they spend. Cash flow is a critical measure and determining factor of business success. Always carefully consider every expenditure. The basic rule for entrepreneurial success is this: Only spend money to earn money.

4. Get Efficient Through Technology — Working hard is important, but there’s one thing even more important — working smart. That’s what technology helps you do. You get more done, you get it done easier and you get it done better. By using technology you’re able to do some things that would simply be impossible without it. There is an array of technology tools that allow you to build your business in extremely smart ways. Be sure to take full advantage of them.

5. Maximize Your Marketing — Perhaps one of the most important principles for business success is strong momentum in the sales department. This requires an emphasis on marketing that permeates the entire organization. Everybody must think about selling and satisfying customers all day long. Create a daily sales checklist, set performance goals, and unify everyone’s effort by sharing goals team‐wide.

6. Create A Culture — This is about cultivating passion in both your team and customer base. Your culture clarifies your identity, your values and your beliefs, in addition to more basic things like the products or services you offer and how you price them. Some growth strategies are obvious and have immediate results. Others, like creating a culture, have more indirect results, but are still extremely important.