Press Release
So you want to open a business or expand one. As always, money’s an issue.
Who do you call?
The Northeast Nebraska Economic Development District in Norfolk can help navigate the financial sea by making loans and leveraging that money with private financing from banks.
It’s not a simple process. The agency employs a loan specialist who can help take prospective business operators through the steps and come up with a business plan.
A pool of about $800,000 is available from a revolving loan fund. As money is repaid on outstanding loans, the funds can be lent out again for new and expanding businesses.
“I think it’s a wonderful program,” said Thomas Higginbotham Jr., agency director. “It’s a tool out there that allows these entrepreneurs another source of funds to get their business going or expanded.”
The first step is the process is writing a sound business splan.
“It’s so we know you have a good, solid plan for cash flow and marketing. If not, we work with Loren Kucera at Wayne State College (Nebraska Business Development Center) to put a business plan together,” Higginbotham said.
Other steps that follow include figuring out a budget, approaching a bank for help on financing and determining how much personal capital is available. “Then we fill in the gap and see what we can do,” he said.
There is also a credit report check before the application goes to the Revolving Loan Fund Board, made up of bankers, realtors and business people from the region. Following a positive recommendation, the application is ratified by the agency’s board of directors with loan closing to follow.
While a lot of groundwork has to be done, that doesn’t necessarily translate into months before the money is in hand.
“It’s likely we could do everything within 30 days, depending if the client is on top of things,” Higginbotham said. “Having a business plan really helps. If you don’t, it might be a 60- to 90-day process.”
Loan applications are rarely rejected by the board because of all the work that has to be done first. Early on, an applicant can usually tell if he or she is likely to qualify.
The district hasn’t had to turn anyone away because it doesn’t have enough money to lend, Higginbotham said, and applications are usually always in the pipeline.
“There is a lot of demand. That’s why we try to make good loans so we can recapture that money and help the need out there,” he said.
The district is working on obtaining more funds for an intermediate-term lending program.
Jeff Christensen, the district’s business loan specialist, offered a few tips, saying it doesn’t pay to procrastinate, and don’t give up.
“One of the things I would emphasize is to plan ahead. Take action ahead of time as much as possible,” he said. “A newer business, a word of caution is that banks might be a little more skeptical, so persevere.”
Some of the smaller businesses also may not have enough working capital.
“They come up on the short end of having enough cash to pay bills,” he said.
- Story Courtesy of the Norfolk Daily News
