EXETER, N.H., Oct. 7 /PRNewswire/ - It's not just big business in the U.S. that is requiring a bailout. There are more than 30 million small businesses across America being negatively impacted by current economic conditions. Access to credit is drying up. Loans backed by the U.S. Small Business Administration (SBA) have decreased by 30%. Declining home values are contributing to declining collateral values, which mean that entrepreneurs have less to offer banks as backup for a loan.
Compounding the problem is that tighter business credit means entrepreneurs are turning to personal credit and savings to finance operations. Higher personal debt and shrinking assets are further contributing to reduced creditworthiness. Rising energy and food costs are competing for limited dollars forcing many entrepreneurs to choose between sustaining the family and sustaining the business.
If small business is indeed the backbone of the U.S. economy, who is going to bail them out?
"We're hearing from small businesses all over the country at an alarming rate that are panicked and uncertain about how they are going to survive under current economic conditions," said Deborah Osgood, cofounder of Knowledge Institute, Inc., a philanthropic organization that specializes in economic development. "The challenge for us right now is to help them to learn about and effectively navigate what resources are available that can help to stave off their needing to file bankruptcy or simply close their doors."
The means to bailout these small businesses in crisis has been put in place by Knowledge Institute through a collaborative effort between government, public nonprofit agencies and private sector corporations. The fact is that there are thousands of government and other public programs funded by U.S. tax dollars that provide free and low-cost help to support all aspects of business startup and growth including business planning, funding, marketing, import/export and other forms of targeted assistance.
The problem is that these programs are difficult to find, understand and access. To overcome these obstacles, Osgood and her business partner and husband, Dr. William Osgood, have co-opted other private sector corporations in sponsoring the creation and ongoing support of buzgate.org, an online community that identifies, catalogs and translates these programs making them available, understandable and accessible to everyone, everywhere at no charge via the Internet.
"It is critical that government, economic development agencies and private corporations work together to support the health and vitality of our small businesses right now," said Dr. Osgood. "This sector employs over 116 million people and represents over half of our nation's gross national product (GNP). Failure to keep this engine strong will have profound and far reaching negative affects on all aspects of our economy and our communities."
In a recent buzgate.org survey of small business users, over 54% respondents said that access to capital was a primary concern. Michael and Cheri Reid from Alabama wrote, "Our small local trucking business opened in 2006 with 5 employees. Due to the excessive cost of fuel throughout 2007 and with our excellent credit, our banker encouraged us to apply for an SBA-backed bank loan and then subsequently declined the loan citing current market conditions. With no loan and our personal credit maxed out, we laid off our last employee and stand to lose everything that we've worked for over the past twenty years."
Buzgate.org responded to this situation within 24 hours, identifying additional financing venues including access to an angel funding network, factoring, commercial mortgage options, peer-to-peer lending and a business loan network. Also introduced was SCORE, a national network of experienced business counselors who volunteer their time to help anyone with most aspects of business management either face-to-face or through email.
"Running a business always has challenges, particularly a relatively young one in an industry as dynamic as multimedia online presentations," said Michael Grosso, founder and president of KinetiCast. "Given the current economic climate, it is even more critical to be able to turn to a network like buzgate.org and find answers and local contacts needed to not only respond to market shifts, but to also support continued growth."
Unlike the big business bailout that will cost taxpayers billions of dollars with questionable results, making use of free and low-cost business assistance resources that already exist through a public/private initiative that is privately sustained, isn't going to cost taxpayers another dime and yet provides small businesses with the very help they require for surviving the current economic crisis. To learn more, visit http://www.buzgate.org.
buzgate.org is a public/private initiative created by Knowledge Institute, Inc. to serve as a national resource and referral network in support of small business startup, growth and sustainability. Network access is available to all individuals via the Internet at no cost, and is fully supported by private sponsorships. Visit http://www.buzgate.org for more information.
Deborah Osgood, Knowledge Institute
603.658.0340 or firstname.lastname@example.org
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SOURCE Knowledge Institute
Posted at http://www.forbes.com/prnewswire/feeds/prnewswire/2008/10/07/prnewswire200810070700PR_NEWS_USPR_____NETU020.html