SEMI-ANNUAL PERFORMANCE REPORT

January 1, 2005 – June 31, 2005

COOPERATIVE AGREEGMENT 5-603001-Z-0024-16

Submitted by:

Minnesota Department of Employment and Economic Development

332 Minnesota Street, Suite E200

St. Paul, Minnesota 55101

July 29, 2005

1

TABLE OF CONTENTS

TABLE OF CONTENTS

MILESTONE ACCOMPLISHMENTS

Counseling Milestones

Training Milestones

Regional Milestone Accomplishments

Counseling and Training Reports

MAJOR ACTIVITIES AND ACCOMPLISHMENTS

100Advocacy

200Capital Formation

300Innovation and Technology Transfer

400International Trade

500Minority Business Assistance......

600Resource Development

700Procurement

800Special Emphasis Groups

900Economic Development, faith based and community initiatives

1000Research

1100Other Activity

1200Success Stories

1300Travel

1400Problems

1500Financial Reports

1600Women Owned Businesses

1700Economic Impact

1800Veteran andservice connected-disabled veteran-owned businesses, reservists on active duty and other reserve component members of the u.s. military

1900Manufacturing

2000Online Activity

APPENDIX A

Summary of SBA Quarterly Case Report

Summary of SBA Quarterly Training Report

APPENDIX B

Form SF 269, Financial Status Report

SBA Form 2113, Program Income Report

Schedule of Indirect Costs

Form SF 272, Federal Cash Transactions Report

1

MILESTONE ACCOMPLISHMENTS

Counseling Milestones

The Minnesota Small Business Development Center (MNSBDC) network delivered 17,047 hours of counseling to 2,114 clients during the first half of 2005. This represents 75 percent of the clients and 52.3 percent of the counseling hours planned for the year. As TABLE 1 below demonstrates, the MNSBDC program is on target to meet its counseling goals by the end of the program year.

Existing Business Clients

Existing business clients represented 57.2 percent of the clients counseled and 43.5 percent of the counseling hours delivered, respectively. It is the strategic objective of the MNSBDC program that existing business clients represent 70 percent or more of counseling resources (i.e. counseling hours). As TABLE 1 below indicates, some of the regional service centers achieved this goal. Centers not accomplishing this level of service are taking steps toward meeting this objective by the end of the year.

Hours per Client

MNSBDCs delivered an average of 8.1 hours of counseling per client. The network goal average for counseling hours per client is 12.0. As TABLE 1 below indicates, some of the regional service centers achieved this goal. Centers not accomplishing this level of service are taking steps toward meeting this objective by the end of the year.

Training Milestones

The MNSBDC network delivered 264 training seminars to 2,983 business owners and prospective business owners during the first half of 2005. This represents 158.1 percent of the training seminars and 59.8 percent of the training attendees planned for the year. As TABLE 1 below demonstrates, the MNSBDC program is on target to exceed its training goals before the end of the program year.

Regional Milestone Accomplishments

The following table provides a region-by-region analysis of Milestone Accomplishments through June 30, 2005.



Counseling and Training Reports

Counseling and training reports for the periods January 1 through March 31, 2005 and April 1 through June 30, 2005 were entered into the SBA MIS system within the time periods specified in the Cooperative Agreement. A summary of the quarterly counseling and training reports made are provided in APPENDIX A.

MAJOR ACTIVITIES AND ACCOMPLISHMENTS

This section discusses SBDC activities and accomplishments in each of the SBA-defined activity areas. Planned activities are summarized from the 2005-2007 proposal incorporated by reference into the Cooperative Agreement.

100Advocacy

Planned Activities

The Minnesota SBDC network planned to represent small business interests, improve the climate for small business, and contribute to the vitality of the small business sector in the following ways:

  • Make presentations to local business or economic development organizations regarding small business issues or SBDC services.
  • Invite representatives of local business and economic development organizations, lenders, (including SBA preferred lenders) elected officials and other partnering organizations to the SBDC to better understand SBDC offerings.
  • Publish newsletters and offer articles for publication concerning issues of importance to the small business community.
  • Nominate candidates for Small Business Week awards.
  • Lead or participate in Small Business Week activities at the local level, e.g., local recognition events and forums focusing on small business issues.
  • Sponsor and represent the SBDC at small business functions within the service area, e.g., “Business After Hours” meetings, Chamber of Commerce events, economic development conferences and small business resource fairs.
  • When permitted, provide testimony or presentations to state and government officials.

Accomplishments

MNSBDCs actively promoted the needs of small businesses and services of the SBDC through presentations to a variety of organizations in their service areas. Organizations included economic development organizations, Chambers of Commerce, Initiative Foundations, Reservations, Workforce Centers, lending business service organizations, college and university administrators, city and county officials, and civic, business and industry groups. These presentations were an opportunity to discuss small business needs from the perspective of both the recipient organizations and the SBDC, and to identify unmet business needs. As a result of these interactions, collaborative efforts with these organizations have allowed the SBDC to better respond to the needs of its clients and Minnesota’s small business community.

The following are some examples of regional efforts made to promote the needs of small business and the services offered by the SBDC program.

BEMIDJI

BRAINERD

DULUTH

MOORHEAD

REGION NINE

ROCHESTER

ST. CLOUD

ST. THOMAS

SOUTHWEST

MNSBDCs invited representatives of local business and economic development organizations to their locations and made local visits to help them understand the SBDC and its program offerings. Organizations invited and participating in such partnership meetings include representatives of local community banks, Economic Development Agency personnel, Indian tribal members, elected officials, and other key partner organizations. The following are some regional examples of invitations made to these groups to learn more about the SBDC program and the services it offers.

BEMIDJI

BRAINERD

DULUTH

MOORHEAD

REGION NINE

ROCHESTER

ST. CLOUD

ST. THOMAS

SOUTHWEST

MNSBDCs published newsletters and contributed articles for publication to various media. Host institution communications offices and the SBA district office information officer were especially helpful in publicizing SBDC success stories. SBDCs contributed articles on small business issues to local printed publications. Several centers were the interview subject for radio and television media. The following are some regional examples of contributions made by local centers.

BEMIDJI

BRAINERD

DULUTH

MOORHEAD

REGION NINE

ROCHESTER

ST. CLOUD

ST. THOMAS

SOUTHWEST

MNSBDCs actively supported Small Business Week activities by nominating candidates for Small Business Week awards, serving on local planning and candidate selection committees, and co-sponsoring local recognition events. The following are some regional examples of efforts taken to recognize small business during Small Business Week events.

BEMIDJI

BRAINERD

DULUTH

MOORHEAD

REGION NINE

ROCHESTER

ST. CLOUD

ST. THOMAS

SOUTHWEST

MNSBDC personnel represented the SBDC at a number of local small business functions during the program year. In May, lead office personnel attended the SBA Champion Awards Luncheon during which a MNSBDC nominated finalist was awarded the Family-Owned Small Business of the Year award. The lead office also participated in the Rural Entrepreneurship Across Minnesota meeting. Ideas of how to effectively and efficiently serve state’s rural small business community were discussed at the meeting by key regional economic development representatives. The following are regional examples of efforts made to represent the SBDC at small business events.

BEMIDJI

BRAINERD

DULUTH

MOORHEAD

REGION NINE

ROCHESTER

ST. CLOUD

ST. THOMAS

SOUTHWEST

While attending an ASBDC membership meeting, lead center personnel took the opportunity to meet with staff members of four Minnesota House and Senate representatives at the Washington DC offices to inform them about SBDC services and to consider collaborative efforts in the future. Other MNSBDC personnel informed local elected officials about its business development services in a number of ways. Some examples are:

BEMIDJI

BRAINERD

DULUTH

MOORHEAD

REGION NINE

ROCHESTER

ST. CLOUD

ST. THOMAS

SOUTHWEST

200Capital Formation

Planned Activities

The MNSBDC network planned to assist small businesses in accessing capital and maintaining relationships with sources of capital in the following ways:

  • Continue to offer financial analysis and loan packaging as one of the core services of the MNSBDC program.
  • Offer workshops and seminars on small business capital formation topics.
  • Maintain existing relationships with sources of capital, and establish new relations, to promote mutual understanding of programs and services, and encourage cross-referrals. Examples are commercial lenders, venture capital investors, certified development companies, Initiative Foundations, state and federal loan programs, state and local economic development officials and organizations, and programs specifically targeted to underserved populations.
  • Provide training to counselors regarding public and private sector financing programs, including traditional sources of financing as well as emerging or innovative sources.
  • Provide information to counselors and clients on financing programs and capital formation using both printed and electronic media.
  • Assist the district SBA office in offering lender training throughout the state.

Accomplishments

MNSBDCs counseled 844 small business clients delivering 5,300.50 hours on issues related to capital formation during the first half of 2005. This represents 39.9 percent of our clients needing assistance in this area requiring 31.1 percent of our counseling resources, i.e. counseling hours.

MNSBDCs assisted with the completion and approval of 265 loan packages or applications for financing during the first six months of 2005. As a direct result of this assistance, 379 small business clients obtained and invested over $54 million in capital and equity into the start-up and expansion of their businesses during the first half of 2005. The following chart demonstrates capital obtained by region during this period.


MNSBDCs also sponsored 41 training seminars on financing and accounting issues, delivering 163 training hours to 672 attendees during the first half of 2005.

These outcomes continue to demonstrate that assistance in the acquisition of capital is a business need, which the MNSBDC is successfully meeting.

MNSBDCs continued to maintain relationships with sources of capital through regular meetings and networking events. Center personnel have also worked to establish relationships with new sources of capital within the region. These relationships promote communication and understanding of the SBDC program and are an opportunity to promote SBA loan programs. As a result of these activities, lenders are a primary source of referral to the SBDC. Following are some regional examples of continuing relationships with local sources of capital.

BEMIDJI

BRAINERD

DULUTH

MOORHEAD

REGION NINE

ROCHESTER

ST. CLOUD

ST. THOMAS

SOUTHWEST

MNSBDCs continued to explore new avenues of capital within their region in the following ways.

BEMIDJI

BRAINERD

DULUTH

MOORHEAD

REGION NINE

ROCHESTER

ST. CLOUD

ST. THOMAS

SOUTHWEST

The lead center continues to provide centers with information about SBA programs, including 504, 8(a) certification, and 7(a) loan program updates. The following are some regional examples of efforts made in keeping counselors informed regarding these sources.

BEMIDJI

BRAINERD

DULUTH

MOORHEAD

REGION NINE

ROCHESTER

ST. CLOUD

ST. THOMAS

SOUTHWEST

The following are some regional examples of efforts made to inform clients of public and private sources of financing.

BEMIDJI

BRAINERD

DULUTH

MOORHEAD

REGION NINE

ROCHESTER

ST. CLOUD

ST. THOMAS

SOUTHWEST

MNSBDCs continued to cosponsor with the Minneapolis SBA district office to offer SBA lender-training programs that were attended by banking representatives. Center counselors also attended SBA lender training events to insure SBDC clients are provided with up-to-date and accurate information. The following are regional examples of these and other lender related training efforts.

BEMIDJI

BRAINERD

DULUTH

MOORHEAD

REGION NINE

ROCHESTER

ST. CLOUD

ST. THOMAS

SOUTHWEST

300Innovation and Technology Transfer

Planned Activities

Small Business needs assessments conducted by the Minnesota SBDC network indicate the primary need of small companies in the technology area is understanding and implementing technology solutions to business problems. Accordingly, the SBDC network will assist clients in the area of innovation and technology transfer in the following ways:

  • Offer technology assessments and counseling regarding appropriate and profitable applications of technology, using the model developed by the Duluth center in its 21st Century Arrowhead Initiative.
  • Offer seminars on topics such as e-commerce, Internet marketing (business-to-consumer and business-to-business), technology-based productivity enhancements, and other technology-related topics, in collaboration with Minnesota Technology, Inc. and other local partners.
  • Continue existing relationships, and develop new relationships with technology-oriented organizations such as Minnesota Technology, Inc., science and engineering departments of host institutions, private and public sector technology organizations and other, in order to expand the array of technology-based expertise available to small companies.
  • Provide information about and maintain a referral relationship with the SBIR/STTR program offered by Minnesota Project Innovation, Inc.
  • Provide information and assistance to inventors, including making referrals to inventor assistance programs and developing lists of resources available to inventors.
  • Participate in the investigation in the use of electronic counseling and evaluate its effectiveness. Within resource limitations, if conclusion indicates need, expand its availability and use.
  • Within resource limitations, expand the availability to clients of business planning tools and other electronic resources through SBDC web sites.
  • Promote the services of the Business Information Center (BIC) in St. Paul and the Tribal Business Information Center in Cass Lake. Make referrals as appropriate.
  • Investigate the establishment of “mini-BICs” located in each SBDC region.
  • Continue working with the Northern Tier High Tech Corridor (NTHT) initiative sponsored by the Blandin Foundation. This initiative provides internet-based access to resources of interest to businesses, economic developers, and communities.
  • Investigate the feasibility of linking all SBDC service centers and personnel through a common Internet-based web site, e.g. development of NTHT communities. If feasible, investigate value and pursue funding opportunities to maintain the site. Expand availability to clients to the extent possible within resource limitations.

Accomplishments

MNSBDCs regularly provide counseling or assessment guidance for small businesses seeking to incorporate or expand technology in their business. MNSBDCs counseled 224 small business clients delivering 995.60 hours on technology-related issues during the first half of 2005. This represents 10.5 percent of our clients needing assistance in this area requiring 6 percent of our counseling resources, i.e. counseling hours, respectively. Counseling included services such as technology assessments, implementation of computerized accounting and management information systems, web site development, and training on QuickBooks and other accounting software.

MNSBDCs also sponsored 119 training seminars (44%), delivering 378 training hours (45%) to 797 attendees (26.7%) during the first half of 2005, reflecting substantial demand for information on technology and the use of computers.

The following are regional examples of efforts made to provide technology assessments or counseling regarding appropriate and profitable applications of technology.

BEMIDJI

BRAINERD

DULUTH

MOORHEAD

REGION NINE

ROCHESTER

ST. CLOUD

ST. THOMAS

SOUTHWEST

MNSBDCs have strong established relationships and continue to build new relationships with technology-oriented organizations to meet the technology needs of its clients and the small business community. The following are regional examples of efforts made to maintain existing relationships and establish new relationships with local technology-oriented organizations in order to expand the array of technology-based expertise available to the small business community.

BEMIDJI

BRAINERD

DULUTH

MOORHEAD

REGION NINE

ROCHESTER

ST. CLOUD

ST. THOMAS

SOUTHWEST

MNSBDCs assisted inventors in a variety of ways, including assessment of market potential, development of a business plan, processes of protecting intellectual property and maintaining resource listings to make referrals to appropriate resources for inventors. The following are regional examples made to assist inventors.

BEMIDJI

BRAINERD

DULUTH

MOORHEAD

REGION NINE

ROCHESTER

ST. CLOUD

ST. THOMAS

SOUTHWEST

MNSBDCs counseled 197 clients delivering 452.50 counseling hours using e-mail during the first half of 2005. Centers indicate that the use of e-mail following an initial face-to-face counseling session is essential in providing timely and efficient service delivery in reaching clients in sparsely populated rural areas. The use of e-mail counseling saves time for both center clients as well as consultants. The following are regional examples concerning the use of email and electronic counseling when delivering service.

BEMIDJI

BRAINERD

DULUTH

MOORHEAD

REGION NINE

ROCHESTER

ST. CLOUD

ST. THOMAS

SOUTHWEST

MNSBDCs continue to investigate opportunities for distance learning and sponsor or cosponsor events when appropriate. Following are regional examples of local efforts.

BEMIDJI

BRAINERD

DULUTH

MOORHEAD

REGION NINE

ROCHESTER

ST. CLOUD

ST. THOMAS

SOUTHWEST

MNSBDCs have made electronic resources available to clients in the following ways.

BEMIDJI

BRAINERD

DULUTH

MOORHEAD

REGION NINE

ROCHESTER

ST. CLOUD

ST. THOMAS

SOUTHWEST

MNSBDCs have actively promoted the services of the Business Planning Center (BPC) and the Tribal Business Information Center (TBIC) in Cass Lake, and have made referrals as appropriate. The following are regional examples of the relationships maintained with these resources.

BEMIDJI