Minority Business Center helps small businesses stay competitive
The class watched attentively as Lynn Karam scrawled numbers across the whiteboard. She stepped back and pointed at a number, “Ok,” she said. “Say you started a company in 2001 with $12,000 of your own capital. And over the years, you put in more money.” She wrote a few more dates and money amounts on the board. “And now, in 2017, your company is worth $1 million and you have an offer to buy. Great, right?” Karam crossed her arms and waited for an answer. The students thought, then nodded.
Karam turned back to look at the board, “But if you didn’t keep track of how much you’d invested in the company, how are you supposed to know how much you should get from the sale?” She jabbed at the numbers on the board with her dry-erase marker. “This is why financial records are important.”
Karam’s presentation was part of the ‘Making your Business Bankable’ event at the Minority Business Center’s Business Bootcamp. It’s a two-day class geared towards helping local small businesses manage their finances, from bookkeeping to balance sheets, and even taxes. The class was small — only two businesses attended. But those two businesses said that Karam’s teaching was influential.
Diane Moore was early for the second day of class. She started Clean Work Solutions, a janitorial and commercial cleaning company, last year.
“After class yesterday, I felt that there were important changes to be made in my business,” she said. “It’s exciting. I’m looking forward to getting my accounting and finances in order. To go for contracts, I need all of my paperwork.”
The contracts she referred to are city and state contracts, and winning the work can lead to pitfalls for small businesses. These contracts for work at the city or state level, like paving a road, or cleaning a government building, are great opportunities for small businesses. But, because of their size, accepting one takes some prior planning.
“When a business wins a contract, the city doesn’t pay right away. It can take 30 to 60 days,” explained Sharon Higgins, the Project Director of the Minority Business Development Agency at the South Bronx Overall Economic Development Corporation, (SoBRO).
This means that businesses have to support themselves as they work, so most elect to take out a loan. If they don’t have their finances in order, they could be denied by banks and miss out on the contract.
“These contracts are huge opportunities for growth. We help owners be aware, and savvy, in how they conduct their business so that they can take advantage of these opportunities,” Higgins added.
Higgins and Karam both noted that the small turnout was lower than they’d hoped, but not unexpected.
“People are afraid of numbers,” Karam said, adding that while she wanted to help more people, in smaller classes she is able to give students more individual advice.
In the future, Higgins said: “we want to make it clear that the finance topics aren’t as intimidating as people think.”
The class was valuable for new businesses and for established companies, too – Karam said that she is careful to plan for all needs and levels. David Coreas, the Business Operations manager for Sprout, a construction company that renovates charter schools, said he attended to learn how to help Sprout better manage their finances as they grow. He wants to start doing financial analysis at work, using the skills he learned in this class.
“Our business is about delivering savings to clients, not just profitability. That’s why we need financial analysis – to make informed decisions going forward,” Coreas said, sitting at the long conference table, notes in hand.
For the company to one day accomplish its goal of building a charter school from the ground up, Coreas said he needs to take strategic steps like those suggested at the class. Without classes at SoBRO, it would be much harder for them to get expert advice like Karam’s for free, he adds.
Karam, who owns her own consulting firm, LEK Management Inc., will be back to teach Business Bootcamp again. She acknowledges that while not everyone is as excited about business financials as she is, she said she takes the classes seriously.
“I do these classes,” she said, “because I know I’m giving business owners the tools they need to succeed.”