Volume 5, No. 2
February 2013
Business Kelso Longview
Connection Chamber of Commerce
Calendar Tuesday February 12 - 5:30-7:30 p.m. Business After Hours Co-hosted by Grounds for Opportunity and Family Health Center Grounds for Opportunity Cafe 413 South Pacific Ave., Kelso $15 advance/$20 at the door
Wednesday February 13 - 11 a.m. Ribbon Cutting Coleman Cellular 200 Kelso Dr., #222, Kelso
Thursday February 21 - 5:30-7 p.m. Lower Columbia Professionals Night at Pie@Trio’s Pizzeria 614 Commerce Ave., Longview $10 advance/$15 at the door
Lace up and march into Small Business Boot Camp
I
f there’s one thing Bill Marcum has learned from his more than 30 years in newspapers it’s small businesses can use a helping hand to be successful. That’s why Marcum, Kelso-Longview Chamber of Commerce President and CEO, and Lower Columbia College President Chris Bailey put their heads together and are hosting Small Business Boot Camp. Local leaders who are experts in their field facilitate each of the three series programs – financial, human resources and marketing and sales. “I know most small business owners. They are passionate about what they like to do,” Marcum said. “But, when it comes to the business side they struggle with it.” Marcum said there’s money available to start a business, but very few affordable educational programs available to help owners with the tools and tips to keep their dream running. He believes the Chamber should be more than a social networking organization; it can fill the post ribbon-cutting void by providing practical, inexpensive programs like Small Business Boot Camp. “The Chamber’s duty is to create something to help educate you as an
Please see Boot Camp, page 5
You’ve Never Seen Anything Like This!
Kelso Longview Business Connection
February 2013
Lower Columbia College ensuring graduates meet businesses’ future needs By Dani Trimble Work Based Learning Manager Lower Columbia College Last week I met with a local employer who had recently hired a Lower Columbia College graduate. As we chatted about his business needs, I was impressed by his commitment to invest in his employees and the vision he has for his company moving forward. One of his primary concerns is ensuring that he will be able to hire and retain qualified employees in the future. Are you worried about the future pipeline of employees in your industry or do you have difficulty hiring skilled workers from our local community? Lower Columbia College has long been dedicated to providing high quality programs that align with industry needs. Given the economic climate of the past few years, this mission
is heavily integrated in our strategic initiatives and is crucial – not only for the survival of the college, but of our community as well. One focus of this strategy is to make sure that the college’s curriculum is consistent with standards in your industry and that it remains current and relevant as your business changes. Our staff and faculty highly value your input in an effort to guarantee that the learning taught in the classroom aligns with your needs in the real world. And if you feel Lower Columbia College does not offer programs or produce graduates that support your industry needs, we look forward to the opportunity to collaborate on ways to improve. We would love to hear from you in keeping the ‘community’ in community college. For more information or ques-
tions about how Lower Columbia College can partner with you to serve your business needs, please contact: Dani Trimble Work Based Learning Manager Lower Columbia College dtrimble@lowercolumbia.edu 360-442-2332
Check out our jobs board online at www.lowercolumbia.edu/hireconnections to post available positions, applications and more. If you are interested in participating in the Southwest Washington Career and Employment Fair March 13, please contact Jenny Smith at jsmith@lowercolumbia.edu or 360442-2330 for more information.
Coming Soon Early in 2013 the PUD will offer customers paperless billing.
Watch for it!
www.cowlitzpud.org
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Business Connection
February 2013
WorkSource takes stress out of recruiting By Darcy Hoffman Southwest Business Liaison WorkSource
your business. How much does it cost? I’m glad you asked! Essentially, you’ve already paid for our services through your business tax dollars, so you will not be asked for a penny more. You might as well take advantage of what you’ve already paid for right?
Here we are…our third installment of helpful information for local businesses about WorkSource. Today, I’m going to tell you about our recruiting services.
To get connected to a Business Services Consultant whose expertise lies in your industry, and who can connect you to our recruiting and On-the-Job Training services, contact me, Darcy Hoffman, Business Services Manager, at 360-735-5038 or dhoffman@esd. wa.gov.
But before I do that I want to first plug last month’s article about our financial services (because it’s incredibly important that you know about this – I can’t stress it enough). Here goes… Ahem…attention southwest Washington businesses. WorkSource has funds available to help you train your new hires to be a productive employees for you. We’ll compensate you for the time it takes to get your new hires from the point of costing you money to making you money (or, about 1 to 6 months if you want to get serious about it). If you are hiring a new employee, you might be eligible to receive up to $5,000 in wage reimbursements. Call us before your new hires start work so we can connect you to these funds.
you
Okay, now on to the subject for today…recruiting services. Have you found it difficult and inefficient to post your job openings through online job boards – maybe even ours? Have you found that the applicants aren’t qualified for your jobs…maybe not even in the realm of being qualified for your jobs? Or maybe you have found that you receive hundreds of applicants and just don’t have the time to sort through them, knowing that only a small handful will meet your requirements? If the answer is yes to any one of these questions, we can help.
health.
You know . We know Let’s get together!
Emotional Well-being 101 Business Series
Classes designed for the health of your workforce.
Domestic Violence in the Workplace Wednesday, March 6, Noon – 1:00 p.m.
Your own Business Services Consultant, whose expertise is in your industry, can post your positions on our website for you; they also have access to job seeker records that you don’t and can easily run a search of our customers to locate potential matches. The difference between your consultant posting the job and you posting the job (no matter where you have tried posting) is this…we require applicants to apply directly through us where they are interviewed to determine whether or not they meet your qualifications and whether or not they would be a fit for your company (and yes, they’re interviewed by real people). Your applicant traffic is essentially directed through us, saving you the time to focus on your core competencies.
Dealing with Difficult People Wednesday, April 3, Noon – 1:00 p.m. Working with You Is Killing Me! Wednesday, May 1, Noon – 1:00 p.m. Classes are held in the Women’s Health Pavilion.
1660 Delaware Street (across from PeaceHealth St. John)
Presented by Michele Waltz, EAP Counselor, PeaceHealth St. John For information or to register, visit www.peacehealth.org/st-john or call 360-501-3701.
The more information that you can share with your consultant about your company, the culture, the jobs, the people, the business model and the core values, the better we can help you find the right people, the first time. We are here, waiting to get to know you and
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Kelso Longview Business Connection
Boot Camp, from page 1 owner/ manager. To help you run your business, help you manage employees and make it more profitable.�
February 2013
mon HR Mistakes, The New Marijuana Law, Attract and Keep your Best Employees and Firing in an at Will State June 5.
per session limit, but each of those 25 is encouraged to bring a friend, spouse or business employee for free. Classes are also offered individually, $25 each for members and $35 for nonmembers. Small Business Boot Camp is also available to members of outside Chambers and non-chamber members.
Each session takes place on Wednesday mornings from 7:30 to 9 in the Heritage Room at Lower Columbia College Administration Building.
The final Six Pack, Market and Sales, starts with Marketing Sept. 4 and 11, followed by Social Media Marketing, Sales People, Sales 101 and Customer Service Oct. 9.
The Financial Six Pack begins March 6 with Cash is King, followed by Budgeting, Income Taxes, Monthly Financial Statements, QuickBooks and 2013 Legislative Session April 10.
Each is designed to be discussion based, not a lecture, Marcum said. Each Six Pack is designed to provide business leaders and employees with tools they can use immediately.
For those who attend at least one Six Pack there’s a Bonus Boot Camp, Oct. 23, Critical Thinking and Problem Solving with Chris Bailey at no additional cost.
Six Pack No. 2, Human Resources, begins May 1 with Hiring the Right Person, Employee Handbook, Most Com-
The classes are also affordable. Each Six Pack costs members $100 and nonmembers $160. There is a 25 person
For more information, see the advertisement on page 13. Register online at www.kelsolongviewchamber.org.
The Sky is the Limit! We started in a garage in April 2007. Twin City Bank has provided us the necessary funding to grow our business into a multi-million dollar company. By early fall Twin City Bank will help us move into our new 15,000 square foot facility with room to continue our growth. Jon Hansen, General Manager Sid Somers and Steve Norby Fabricast Valve
729 Vandercook Way Longview, WA 98632 1-800-319-2265 | 360-414-4101 Creating products to fuel the world
www.knifegates.com
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twincitybank.com
Kelso Longview Business Connection
February 2013
Business Toolbox
Tips for business buyers and sellers Get Your Books in Order Buyers evaluating your business will generally require at least three years of financial information including tax returns, profit and loss statements, and a current balance sheet. Have the most recent 12 months financial statements by month as buyers will want to see any seasonal fluctuation. Have a list of the assets for sale and either the current book value or a supportable value of each. Other information that might be valuable for a buyer can include: • permits • patents • licensing • leases • customer and vendor contracts • supplier lists • marketing materials Note: Given the sensitive nature of the information that is usual and customary to share with a potential buyer, it is wise to have a confidentiality agreement in place with anyone (people or entities) with whom you are sharing the information. Also, sharing of this information beyond general overview should be reserved for those interested parties who demonstrate more than a cursory interest in your business and appear to have the capacity to execute such a transaction.
By Jerry D. Petrick For sellers, you’ve worked long and hard to build up a good business. Maybe the business is hugely profitable, or maybe from a financial perspective the business may have paid you a modest salary over the years, but maybe not more. You may be ready to retire, move onto another challenge, or perhaps you are burned out. You are wondering if you can and should sell the business. Will you be able to get some return for your investment? How do you come up with a price? How do you market the business? How do you negotiate with potential buyers? What steps do you take to close the deal? Where are the hidden traps? Selling your business can be financially rewarding as well as give you the personal satisfaction that what you created will endure beyond you. Your customers will be happy, and the jobs your business provides will continue. Plus you’ll give someone else a chance to be a small business owner. Here are some tips on selling your business that can help you achieve your goals. What do you need to do to get your business ready to sell? Ideally, entrepreneurs should plan ahead if they are going to sell their business. This commonly requires a look one to two years into the future. To get the best price and ensure continued success of the business you are selling usually involves specific activities which may include getting the business to be more profitable to writing documentation that will assist a buyer – an employee manual, standard operating procedures, or technical manuals for example. Initial questions to ask yourself: • Why are you selling your business? Most buyers will ask you this question. Are you retiring? Looking for a new challenge? Burned out? Having financial difficulties? • Why should they buy your business? Why should someone buy your business rather than starting from scratch or buying something else? Your assets might include a sound reputation, a loyal customer base, industry knowledge, established suppliers, and good employees. In addition to those possible assets, consider how much cash the business will generate for a new owner. We discuss that factor under valuation. • Is this the right time to sell? How is the economy doing? What is the industry outlook for your industry/market/business? Have you been able to show profits for the past several years? Are there similar businesses on the market?
Get a Business Valuation Placing a dollar value on the worth of a business is a complex process involving many factors. One of the first things you should do is get a realistic idea of what your business is worth. A professional valuation will help you set your asking price and give you the basis for evaluating buyer offers. It will also tell you if there are weak areas you can correct before you put the business on the market. Sellers often overprice their business — they have put their hard work into the business and have a difficult time realizing if profitability is low, that the business may not be worth as much as they think or expect. Being aware of the factors that go into valuing a business can be of help. Valuations can be obtained from a number of sources, ranging from local accounting firms to regional business brokers and investment
Please see Petrick, page 7
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Business Connection
Petrick, from page 6 banking firms. Assemble Your Advisory Team Your advisory team includes your attorney, your accountant, possibly a business broker or realtor, your banker, and your SBDC Advisor. Marketing Your Business for Sale Determine your strategy, prepare the marketing package, and implement your action plan. One question you should answer early on is: do you plan to use an agent or broker to help with the deal? If not, are you comfortable negotiating with potential buyers? If you have emotional attachment to the business, it may be helpful to have an intermediary for the transaction. Be Prepared for Prospects Make sure you will be available to answer prospective buyers’ questions and meet with them. Keep your business ready to be shown at any time. Keep in mind, prospective buyers may contact your business as potential customers (in fact, they may actually be current customers or suppliers to your business). Evaluating an Offer What is the proposed purchase price? What are the terms? Will you be asked to finance all or part of the purchase? Many times a lender will want the seller to finance part of the sale to ensure that the seller has an interest in helping the business continue to be a successful one. Will you be available after the sale to help train the new owner or answer questions? How will the transition period be handled? What are the qualifications of the buyer? Does he or she have experience in owning or managing a small business? Any experi-
February 2013
ence in this industry? How will the buyer finance the deal? Does it seem reasonable that he or she will be able to secure the financing they need? What will be used for collateral? Does the buyer have sufficient cash for a down payment and perhaps for working capital? How good is the buyer’s credit? For Buyers Perhaps you have considered starting your own business, but you realize there is good competition in the area. Perhaps you also know you are an excellent manager, but starting something from scratch is not one of your strengths. Whatever your reasons, you’ve become aware of a business for sale and are not sure how to proceed. How do you evaluate the price? What about financing? What contingencies will you need? What about training, and learning about the business? Buying a business can be an excellent way to be a small business owner. It may also be less risky since you should be buying a “successful formula.” Some initial questions to consider: • Is this the right business for you? If so, why? • What will owning this business be like? (hours, stress, rewards, challenges) – what would a ‘day in the life’ be like? Can you shadow the owner to better understand the reality of business ownership? • Do you have experience in this industry? • Have you owned a business before? • Why THIS particular business? What else is available in the market? • Why should you buy an established business rather than start one from scratch? Assets of an established business can include their customer base, industry goodwill, established suppliers, and good employees. In addition, you are buying an identified cash flow. Other advantages
7
of buying a business are time saving and reduced risk. Cons include reduced reward (perhaps), and higher cost (the cost of buying a business is usually greater than starting one). What are you actually buying? Ask the owner for the business records. You’ll want to see their financial information delineated above. Do you know what you are looking for? Is it good or bad? What is a fair price? Request a specific list of all the assets you will be buying and what they are worth. Is real property included? Inventory? Equipment? Generally you will be buying only the assets and goodwill and not liabilities. FOR SELLERS AND BUYERS: Valuation “What is the business REALLY worth?” Placing a dollar value on the worth of a business is a complex process involving many factors. If you are the seller you will need to determine an asking price. Valuations can be obtained from a number of sources, ranging from local accounting firms to regional business brokers and investment banking firms. Your SBDC Advisor can explain to you, using your financial data, the most commonly used valuation techniques. There are a lot of ways to value a business. There is no “right” way. Ultimately, a business is worth whatever you think it is worth, based on your criteria AND a buyer is willing and able to pay for your business. Let’s review some basics of business valuation to help you get started. • Asset Value: You can start by looking at the value of the business’ assets. What does the business own? Equipment? Inventory? Real estate? Vehicles? This rationale says that a business is at least worth its liquidation value. If you were starting a business
Please see Petrick, page 25
Connect with Legislators Legislative Briefing Breakfast Every Monday, 7:00 a.m., Monticello Hotel 28 people attended the first session this week, don’t miss out!
Each week, contact is made with our local legislators, either in person or by conference call, for an update on the bills and issues currently under consideration. As a business, you often feel the impact from some of the decisions made by our State Legislators on your ability to do business in Washington State. These breakfast briefings give you an opportunity to discuss personally with your elected officials that impact and seek options that provide for better business operations in Washington. So Step-Up and Step-Out and be a part of something that can help businesses in Washington. Let your voice be heard. January - April Legislative Update Breakfast Mondays Monticello Hotel, LaRiviere Room 7:00 a.m.
April - December Legislative Committee Meetings Last Monday of each month Monticello Hotel, LaRiviere Room 12:00 Noon
Kelso Longview Business Connection
February 2013
Good at what you do and good at what you might do By Chuck Nau
sonalities of each of your staff, listening to individuals is the most important. Much like when you were selling, there were times to sell and times to ask questions and listen. Remember, too, that to be a good listener you should always strive to be objective. Good listening skills are paramount to looking for ways to improve productivity, identify and solve problems, plus develop your people.
You love to sell...whether it’s a product in your store or one your business offers or a service your company provides. Even in a tough economy like today, you thrive on the challenge and opportunity. Your associates and your owner or senior management team have repeatedly told you that you are good at what you do. You are beginning to wonder if you would be good at more than you are doing now. Maybe you could manage others – perhaps you could lead and manage other salespeople. Or more recently, you have been named manager, a first time event for you. You were named manager due in a large part to your success in the selling arena and as a representative of your employer. In either situation, you feel very competent and confident, even when business is tough to get. But now you are moving on to a new challenge and you’re somewhat unsure about just what it is that management entails. In the past, your independence, attention to detail, strong organizational skills, perfectionist streak, and the ability to get it done (in most cases by yourself!) have served you well. However, your movement from “one who does” to “one who manages” is going to require a willingness to change, a focus on energy, and a steady and dependable perseverance. Regardless of the size or scope of your retail business, the service sector you are in, the management team, or your newly assigned staff, the following recommendations will serve you well in your personal and professional growth in becoming an effective and respected manager and leader. •
•
“Nothing I say today will teach me anything, if I am going to learn something today, I need to LISTEN!”
Move off the field, into the dugout. You’re no longer a player or a doer, you are now the coach. Let go and coach your new staff. Develop a strong ability to communicate ideas and views so others will understand and accept them. Encourage initiative, while minimizing staff frustration. Listen. Of all the sources of information to help you know, understand, and evaluate the abilities and per-
•
Embrace Conflict. Conflict or complaints from customers, vendors, your staff members and others about fellow employees or systems or procedural requirements are going to happen. Be prepared to handle the conflict fairly, positively, and in a timely fashion. Work to have all parties involved focus on the issues at hand rather than the personalities in the disagreement. Listen, and listen again!
•
Start Strong, don’t be easy, unsure, or misdirected. Communicate your expectations, particularly in this challenging economic environment. When an employee or group of employees does not meet them, a casual reminder (...our work day is 8 to 5) rather than discipline may be all that it takes. However, when discipline is warranted, don’t hesitate to step up. As a collegiate soccer referee, I learned long ago that if a referee does not enforce the laws of the game, those players who were wronged would begin defending themselves. Discipline sets the parameters it also confirms who is in charge and keeps everyone on track.
•
The More You Are Successful, The Louder Your Critics Will Be. Expect people to disagree with you. Be willing to defend what you believe is right and be flexible enough to know when to compromise.
Please see Nau, page 10
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Kelso Longview Business Connection
February 2013
Nau, from page 9 •
•
Goals - Expectations - Dreams. Begin developing, outlining, and communicating your goals and expectations (and those of the business, too) to your staff and others. Double check that they are S.M.A.R.T.: specific, measurable, agreed upon (in the company, or among the staff), realistic, and time sensitive. Assess and Enhance Your Resources, both your people and your physical resources. Observe, understand, and decide when it is best to utilize your staff ’s strengths, as individuals or as a group. Be sure
• Design/Build
• Commercial Construction • Municipal Construction
you have thought through both individual and group reaction to your ideas or goals, or any changes in policies. •
Plan - Plan - Plan. Plan your work and work your plan. Assign activities and assign responsibilities and continually seek feedback. Many staff members when asked will say that they want their new manager to succeed as their leader...usually they will also say that they are going to be sure she earns it!
Management is a challenge. It is also hard work. But though the rewards are usually hard earned they are well deserved. Have fun! And good luck.
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Toll Free: 1-800-533-2867 360-423-2245 www.pnecorp.com
Call today to see how we can help you.
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© Murray & Nau, Inc. Chuck Nau of Murray & Nau, Inc. is a Seattle area based consultant and sales and management trainer. He is a 25-year veteran of advertising, sales, media and management, who knows and understands the everyday challenges of starting up, growing, and surviving in today’s ever changing retail climate. He has spoken to and conducted workshops for a number of local retail and chamber organizations, national publishing groups, national retailers and manufacturers, state press associations, and newspaper groups. Comments and questions are welcome and may be directed to Chuck via email: murnau@nwlink.com or at 425-6030984.
Kelso Longview Business Connection
February 2013
President and CEO’s Message
Upswing for Chamber bodes well for coming year By Bill Marcum Kelso Longview Chamber of Commerce President and CEO
members and lost some long-time members; however, the net growth for the year was 26.
The Kelso Longview Chamber of Commerce had a good 2012.
The year 2013 should continue to see a growth in membership. I see the main reason for this growth is our membership packages, which are no longer based on the number of employees your business has, but on the amount of participation and involvement you and your company plan with the Chamber. We have packages starting at $275 for the bare bones, all the way up to the Diamond Club Membership package. We’d like to take this opportunity to offer a big thank you to PeaceHealth for becoming our first Diamond Club Member.
Financial As you can see in the graphic, the Chamber had a financial gain for 2012 of $11,909. One of the main reasons for this gain is the Special Events category, up almost $40,000 Chamber Annual Report more than 2011. There are three major factors for this increase. One, the Business 2 Business Expo was a joint effort in 2010 and 2011 with Cowlitz County Tourism and in 2012 the Chamber was the sole entity to put on this event. Second, the Chamber Golf Classic netted $13,000 compared to $4,500 in 2011 and third was the Jingle All The Way 5K event in December. This event drew more than 800 participants and helped net the Chamber almost $8,000.
2012
Revenue 2012 Actual
Another reason for our growth is the installation of the monthly payment option for members. Instead of having to pay one lump sum membership payment to the Chamber, a business can now set up a monthly payment option. That option is an ACH debit from your account or an ACH to your credit card each month. A membership now is as little as $26 per month. This has helped many of our small members continue their membership while freeing up their cash flow.
Membership
$143,299
Admin Fees
$16,167
Advertising
$37,383
Special Events
$99,261
Other Revenues
$8,681
Total Revenue
$304,791
We also saw an entirely new staff join the Chamber of Commerce in 2012, including me. I started a year ago on January 23.
Operating Expenses
$231,150
Special Events
$57,913
Brooke Fisher, project manager, and Amy Hallock, bookkeeper, joined the team in June 2012. Amy works part time at the Chamber office and part time with Longview Tire. Thanks Dave White for letting Amy work both jobs.
Other Expenses
$3,819
Total Expenses
$292,882
Expenses
Net Profit $11,909
So, you can see how important these three events are to the financial standing of the Chamber.
Membership Membership increased from 501 to 527 during the year. As with many membership organizations we gained a few new
At the end of 2011, the Chamber and the County ended its relationship with the Cowlitz County Tourism. The Chamber had been managing the Tourism Department for the county and as of the start of 2012 the Chamber was no longer involved in the operation of County Tourism. The Chamber does still have an administrative agreement with the City of Kelso to operate the Kelso Visitors Center. And as many of you know, the City of Kelso and the Chamber are in discussions with Cowlitz County about a possible new structure at the same location that will house the Kelso Longview Chamber of Commerce, the Kelso Visitors Center
Please see Annual Report, page 14
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Business Connection
February 2013
Burning issue with permit process how long before plans move forward By Ted Sprague President – Cowlitz Economic Development Council
Yes, there are going to be impacts from the proposed $650 million development, but we cannot even begin the discussion about mitigation until the process is allowed to proceed and impact questions are addressed.
Washington’s investments in infrastructure, its fortunate geographic location that enables job-creating trade exports, and our beautiful environment are three important reasons that the most innovative and creative workers and CEOs want to live here.
Our organization has not taken a stand on coal exports as of yet, but we stand firmly behind allowing our state’s rigorous process to work. Whether this coal-export project is approved or not, regulators need to get on with a realistic and firm path forward.
But even the Evergreen State cannot seem to overcome the regulatory quagmire that is blocking jobs and economic development. Most people in Cowlitz County have been following the progress of Millennium Bulk Terminals and the plodding permit process impacting the jobs and tax revenues this $650 million investment would create. This lack of regulatory direction could have a ripple effect on others looking to invest in our state.
For more information or to get in touch with staff, please go to our website – www.cowlitzedc.com.
Get High-Speed Internet
At its existing terminal near Longview Millennium currently imports bulk products that support hundreds of jobs in Washington. Millennium’s business plan is to expand its terminal to bring in more bulk products to serve our recovering economy throughout the state. Millennium submitted its permits in February of 2012. Millennium also committed to conduct a full environmental impact statement (EIS) on both stages of its project. Eleven months later, in this muddling economy, a project that could provide family wage jobs in a part of the state that is desperate for them is stuck in neutral. If regulators are to say “no” to this project, so be it, but we need an answer so we can get to work marketing this site to other businesses in two to three years. Otherwise, we risk missing out on this investment cycle.
GET ON WITH LIFE. Get High-Speed Internet for a fast, worry-free connection in your business or home.
All of the hand wringing that project opponents are engaged in, and the questions they are raising, will be studied in the environmental review process, but to get there we have to move the process forward.
Call Today!
Let’s be realistic, these are not new issues to evaluate. Our nation has been hauling coal on railroads since there were railroads; we even haul coal in this state today. We’ve been using the Columbia River to ship goods since Lewis and Clark.
360 414-5990 www.cni.net
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Easy to Order Call for a FREE Site Survey
Small Business
BOOT CAMP Wednesday Mornings ★ Lower Columbia College 7:30 am - 9 am ★ Heritage Room (LCC Admin. Building)
Six Pack
-
$
100 Member Price
160 Non-Member Price
$
Register Online Today!
Tools You Can Use to Help Your Business Lim
it 25 p Cam er p Se ssio n!
Immediately!!
Financial Six Pack
March 6 Cash is King - Understanding your business’s cash generating capability and value. Facilitator: Frank McShane, Cascade Networks March 13 Budgeting - Income, Expenses and Pay Roll. Room Main 147. Facilitator: David Futcher, Futcher-Henry CPA March 20 Income Taxes - City, State & Federal. Facilitator: Jerri Henry, Futcher-Henry CPA March 27 Monthly Financial Statements - How to read them and what to look for? Facilitator: Joel Hanson, KLOG-KUKN-the WAVE April 3 QuickBooks - Using it? Any reports any time. Simple. LAB at WorkSource. Facilitator: Frank McShane, Cascade Networks April 10 2013 Legislative Session: How is it going to affect my bottom-line? Facilitator: Gary Chandler, Vice-President Government Affairs AWB
BONUS
Boot Camp
NO Charge if YOU have attended at least one Six Pack ! Wed., Oct. 23 Critical Thinking and Problem Solving -Utilize your own think tank to solve Critical issues. Facilitator: Chris Bailey, President Lower Columbia College
360-423-8400
Human Resources Six Pak
Marketing and Sales Six Pack
Sept. 4 Marketing - Behind the scenes, analysis, budgeting and understanding Facilitator: Chuck Nau, Murray Nau, Inc. Sept. 11 Marketing - On Stage, Strategies, tactics, implementation Facilitator: Chuck Nau, Murray Nau, Inc. Sept. 18 Social Media Marketing - What is it really and why do I need it? Facilitator: Norma Davey, KLOG, KUKN and the WAVE Sept. 25 Sales People - Value, expectations, inspection of those expectations Facilitator: Bill Marcum, Kelso Longview Chamber Oct. 2 Sales 101 - Bring your sales people any and all. This session is for them. Facilitator: Chuck Nau, Murray Nau, Inc. Oct. 9 Customer Service - How to answer the phone to working with difficult customers. Facilitator: Chris Bailey, President Lower Columbia College Bring any and all of your employees, this involves the entire business.
May 1 Hiring the Right Person - Does the person fit the job? Company? Facilitator: Darcy Hoffman, WorkSource May 8 Employee Handbook -Important? You Bet! Facilitator: Don Schilling, HR Director, Weyerhaeuser May 15 Most Common HR Mistakes -They could cost you money. Facilitator: Christopher Bradberry, COO Fibre Federal Credit Union; Stephanie West, HR Manager May 22 The New Marijuana Law -How to protect your business/employees. Facilitator: Robbie Berg, HR Director, Cowlitz PUD May 29 Attract and Keep your best Employees - What the experts say. Facilitator: Kendra Sprague, HR & Legal Affairs Director, Lower Columbia College June 5 Firing in an at will state - Risks and Rewards. Facilitator: Kim Divine, HR Director, Red Canoe Credit Union
Chamber Members Non-Chamber Members
ring … B per, p u Sign ookkee r, ge rb you r mana you spouse e! r you a charg xtr no e
100 per Six Pack
$
or $25 per Camp
160 per Six Pack
$
or $35 per Camp
Register Online Today!
www.kelsolongviewchamber.org
Kelso Longview Business Connection
February 2013
Annual Report, from page 11
We hope the name change, time change and elimination of the Business After Hours from the event will bring more business people in to find businesses located right here that provide services or products they might be getting outside the county. We are expecting 115 to 120 local businesses to be showcased.
and Cowlitz County Tourism information.
Special Events 2013 Another reason for membership growth will be determined by the success the Small Business Boot Camp set to start March 6.
Speaking of Business After Hours, we currently have all our 2013 events booked please see page 18 for the list of businesses and dates. We also have our list of events for the entire year planned and you can see that on page 26.
These 90-minute workshops will provide small business owners/managers with hands-on information that will help their business be more successful. Right now the Chamber has 18 of these workshops planned for 2013. The first six are structured around the financial part of your business. They will be every Wednesday morning for six weeks at Lower Columbia College’s Heritage Room. Then we will take about a month break and start again May 1 with the topic Human Resources for another six weeks of workshops and start the final six-week series, Marketing and Sales, Sept. 4.
The Chamber is now on better financial ground and will be able to provide more opportunities for you as a member and business owner to enhance your business through programs at the Chamber of Commerce. As I explained early in my hire as the President and CEO for the Chamber of Commerce, I felt the Chamber needed to be more than a social networking organization. We need to provide education for our member businesses. Our goal at the Chamber is to help your business be successful.
Chamber members get special pricing on these workshops, $100 for a six-week session. Non-members pay $160 for all six weeks. You can purchase individual workshops for $25 each for members and $35 each for non-members.
Trusted.
We’re also taking a new twist on the Business 2 Business Expo, renaming it Building Bridges – A Regional Business Showcase. It is scheduled for April 17 from 1 to 7 p.m.
Since 1982, Cowlitz County Title has been the company the community turns to when buying, selling or refinancing a property. Whether you need title, escrow or property search information, come in for our exceptional service. Leave with the confidence that your real estate investment is properly insured and protected.
The main reason for the name change is to attract more people to the event for the businesses showcasing what they do in Cowlitz County. A Business 2 Business Expo suggested the event was about only those businesses that have a booth set up at the event interacting with each other.
Bianca Lemmons Vice President/Manager
1159 14th Avenue, Longview, WA 98632 Phone: 360.423.5330 ■ www.cowlitztitle.com
Kelso Longview Chamber of Commerce Team Bill Marcum, President/CEO Amy Hallock, Bookkeeper Brooke Fisher, Project Manager
1330 Commerce Ave. Longview
360-353-3790
Kelso Longview Business Connection is published monthly by the Kelso Longview Chamber of Commerce 1563 Olympia Way • Longview, WA 98632 • 360-423-8400
just in: new bmx lines!
To advertise, call Brooke Fisher, 360-423-8400 ext. 16 or email bfisher@kelsolongviewchamber.org. Ad Deadline: 20th of each month.
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Kelso Longview Business Connection
February 2013
Kelso
View from Visitor’s Center will look different in the future By Mayor David Futcher
month. Before we built a new structure, the council wanted to ensure the visitor center model was still viable.
Remember when you called your travel agent whenever you needed to book a flight? Or if you had a road trip vacation, you’d stop at each state line to get a map?
At a recent meeting with local hoteliers, the input the Kelso council received was that while a visitor information center shouldn’t be the only use of our tourism dollars, it still is relevant to those who visit the area.
Things have changed in the travel world. Now we book our own flights online, pop up guides to unfamiliar places on our smartphones, and follow wherever the GPS tells us to go.
Because sports tournaments and events regularly attract large groups to the area, another idea is to pledge some resources toward developing a better system for handling those events, and improving related facilities. We also talked about the need for improving an online presence in order to reach the multitudes that plan and book their trips completely online.
Within that framework, it’s not unreasonable to consider whether the old ways of attracting and interacting with tourists are the best. Old ways, like Kelso’s visitor information center. Every year, Kelso collects about $135,000 from a tax on hotel visitors. The state requires us to use that money to promote tourism. It can’t be used for things like repairing our streets or adding police.
But the most visible tourism piece will be an all-new visitor center, in the same location, probably sharing space with the Kelso Longview Chamber of Commerce. It may be the last visitor center for the city, but it will be one that better reflects our area.
Because the old visitor center had reached the end of its useful life, it was in need of significant repairs. It didn’t make sense to spend money on what was originally a temporary facility, so the council authorized the closure of the facility last
Kelso Longview Chamber of Commerce Board of Directors Anne O’Connor onthemark associates
Bianca Lemmons Cowlitz County Title Co.
Micheal Julian Kelso Theater Pub
Chris Bailey Lower Columbia College
Clayton J. Bartness, DC Longview Chiropractic Clinic
Chet Makinster Longview City Council
Frank V. McShane, Past Chair Cascade Networks, Inc. Jerri Henry, Chair Futcher-Henry CPA Group
Dennis Weber Cowlitz County Commissioner Joel Hanson, Chair Elect KLOG KUKN The Wave
Michael Claxton Walstead Mertsching
Ted Sprague Cowlitz Economic Development Council
Sarah Cave PeaceHealth
Steve Taylor Kelso City Manager
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Diane Craft, Vice Chair Koelsch Senior Communities Ginny Whiffen Red Lion Hotel & Conference Center Julie Rinard Community Home Health & Hospice Neil Zick, Treasurer Twin City Bank
Kelso Longview Business Connection
February 2013
SW Workforce Development Council spreading the word about STEM Education STEM Education Facts to Know and Tell:
STEM Fest:
• In the 2011 Intel Science Talent Search – the “Junior Nobel Prize” – only two of the 300 semifinalists were from Washington, putting it in 8th place among 20 technology peer states1.
“A community event designed to help students explore their passion, pursue their vision and determine their own success.”
• Employment in Washington private sector technology industries quadrupled from 1974 to 2009, reaching almost 400,000 employees2.
In September 2013, the Southwest Washington Workforce Development Council (SWWDC) will host the area’s first annual science, technology, engineering and mathematical festival. STEM Fest connects K-12 youth directly to the local STEM industry through fun-filled, career exploration activities hosted by local businesses. Students, their parents, and teachers will be invited to travel to local companies to participate in one- to two-hour activities including tours, contests, experiments, excursions, and talks to raise their interest level in and knowledge of the local STEM industry. Businesses will be able to choose the age group of the students they’d like to attend (elementary school, middle school, and high school), the number of participants, the day of their activity (September 20, 21, and 22), the time slot, and type of activity.
• Washington produces 29.8 engineers for each 1,000 engineering employees, and 21 computer scientists for every 1,000 computer science employees, ranking 9th and 7th respectively among the 10 technology peer states (2005)3. • For every 100 Washington students that enter 9th grade, only 18 receive a bachelor’s degree within 150 percent of time. Washington ranks 10th, last among the technology peer states4. • Almost half of all Washington high school graduates enrolled in community and technical colleges take remedial math courses (2008-2009)5. • Societal stereotypes about STEM are absorbed in childhood and begin to sculpt interests and aspirations. As early as 2nd grade, Washington girls think that “math is for boys, not for girls”6.
If you are interested in hosting an activity or just participating in the event, please visit the STEM Fest website at http://stem-fest. com or contact Mary Brown at mbrown@swwdc.org.
• Out of every 100 9th graders, only six graduate from college with STEM degrees7.
http://www.societyforscience.org/document.doc?id=264
1
• Almost half of Washington’s 4th grade teachers report teaching science less than two hours per week. Only four states reported less science instruction8.
Technology Alliance: The Economic Impact of Technology Based Industries in Washington State, 2010 2
3 NCH National Center for Higher Education Management Systems/U.S. Census Bureau
• While most parents of K-12 students (93 percent) believe that STEM education should be a priority in the U.S., only half (49 percent) agree that it actually is a top priority for this country9.
4 NCH National Center for Higher Education Management Systems/U.S. Census Bureau 5 League of Education Voters http://www.educationvoters.org/2011-reportcard/focus-on-math-science-and-engineering/
• Nearly 4 in 5 STEM college students (78 percent) say that they decided to study STEM in high school or earlier10.
Cvencek, Meltzoff, & Greenwald, Child Development (2011)
6 7
• More than half (57 percent) of STEM college students say that, before going to college, a teacher or class got them interested in STEM11.
http://www.washingtonstem.org/Why-Stem/The-Challenge http://www.washingtonstem.org/Why-Stem/The-Challenge
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Student Perceptions: Student & Parent Study, Microsoft Corp.
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Student Perceptions: Student & Parent Study, Microsoft Corp.
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• Only 1 in 5 STEM college students feel that their K-12 education prepared them extremely well for their college courses in STEM12.
Student Perceptions: Student & Parent Study, Microsoft Corp.
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Student Perceptions: Student & Parent Study, Microsoft Corp.
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Kelso Longview Business Connection
February 2013
Chamber Board Spotlight Ginny Whiffen Director of Sales and Catering, Red Lion Hotel and Conference Center
Hotel director caters to community’s needs and desires to ‘make your day’ “How Can I Make Your Day?” That’s what Ginny Whiffen, Director of Sales and Catering and “Group Godmother” at the Red Lion Hotel and Conference Center in Kelso, wants to know.
tourism board will come in handy. Whiffen said the industries “Heads in Beds” mantra benefits the KelsoLongview area through lodging tax funding. Money, she noted, that directly funnels into festivals and tourism for the area.
Her eager willingness to serve and be of service extends beyond her work at Red Lion. As one of the most recent directors appointed to the Kelso Longview Chamber of Commerce, Whiffen is melding her past experiences with her latest to bring a refreshing viewpoint from one who has been on the inside and the outside.
Whiffen also would like to concentrate her focus on how to better serve Chamber members and keep them engaged and on board.
The inside vantage point comes from her past. Born and raised in the Tacoma area, Whiffen has moved up and down the I-5 corridor and the Pacific Northwest coast. She landed in Kelso six years ago and it’s her stops along the way that bring her special personal perspective to the board.
“I’m really interested in member retention,” Whiffen said. “I’m interested in understanding what is it that Chamber members are looking for and helping members understand what their return on investment is with the Chamber.”
She spent part of that time as the Director of Catering and General Manager at the Inn at Otter Crest and also spent eight years as the executive director for the Lincoln City Chamber of Commerce. The look from outside the glass comes from her position with Red Lion where many of the folks she encounters are coming from 50 miles or more beyond Kelso-Longview who are planning to be in the area for business – a conference or meeting, or pleasure – like celebrating a wedding or class reunion.
If all that isn’t enough, the Seattle Seahawks fanatic brings a notso-hidden talent to the board – event planning. Whether it’s helping with the annual Community Home Health and Hospice’s fundraising gala or planning a tie-dye party for a handful of her seven children and 16 grandchildren, Whiffen knows how to get things done.
Tie that in with her position on the Cowlitz County Tourism Board and position on the board of directors for KLTV and she brings a neatly wrapped package of knowledge and experience to the board.
She’s already been getting her feet wet helping with Chamber events.
It has been just six months since she joined the board, but she’s making the most of it.
“The majority of what the Chamber does is plan networking events and activities, and Ginny, with her background in tourism is able to grasp our needs and provide valuable input to make our events a success,” Chamber Project Manager Brooke Fisher said.
“If I’m going to be on a board; to me that’s a working position,” Whiffen said, starting with making connections in the local business community, meeting people and learning what the community’s business leaders want and expect from their Chamber.
According to Fisher, Whiffen recently helped the Chamber with its first Non-Profit Night, hosted by the Red Lion. The event featured 33 Chamber non-profit organizations.
Whiffen said she spends a great deal of time with her children and grandchildren and another chunk of time at work, the Chamber gives her a different perspective on what’s going on in the community outside those two areas.
“It was a great success and I couldn’t have done it without her hard work and attention to detail,” Fisher said. “She is a wonderful lady and is a great contributor to the Chamber and its members.”
She’s hoping her experience in the hotel industry and with the
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Kelso Longview Business Connection February 2013
2013 Business After Hours Schedule January 8 Non-Profit Night at The Red Lion Hotel and Conference Center
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February 12 Lower Columbia CAP/Family Health Center March 12 Lifeworks April 16 Cascade Networks May 14 Three Rivers Mall June 11 Columbia Bank July 9 Cowlitz County Title August 13 Mega Mixer (Location to be Determined) September 10 Life Mortgage October 8 Heritage Bank November 12 Ashtown Brewery December 10 Holiday Mixer at Red Lion Hotel and Conference Center
X 18
April 17, 2013
1:00 pm - 7:00 pm Cowlitz County Regional ConfeRenCe CenteR
Building Bridges
A RegionAl BuSineSS ShowcASe
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$250 before March 15 $300 after March 15
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Includes 2 lunch tickets • extra tickets $15
Non-Chamber Member $600 before March 15 $700 after March 15 For information on joining the Chamber visit: www.kelsolongviewchamber.org/members/become-member
Includes 2 lunch tickets • extra tickets $15 each
Non-Chamber Member $350 before March 15 $400 after March 15 For information on joining the Chamber visit: www.kelsolongviewchamber.org/members/become-member
Sponsorship Packages Available Includes booth space, logo on all printed material, logo on website, banner at event and all advertising.
Call today 360-423-8400 or register online www.kelsolongviewchamber.org
Kelso Longview Business Connection
February 2013
Ribbon Cutting
Workout Welcome Chamber Ambassadors welcomed Doug Hastings, Diana Skala and the team at 1826 Elite Fitness with a ribbon cutting ceremony Jan. 17. The state of the art facility is located at 1826 1st. Ave., Longview, or visit their website at www.1826eleitefitness.com.
Red HatteRs and Guests aRe CoRdially invited to
Hats and Caps Luncheon!
• Gentlemen Welcome • Festive Feb 21st at Noon Complimentary Canterbury Park Lunch 1335 3rd Avenue • Entertainment & Longview Door Prizes RSVP by 2/19 CANTERBURY (360) 501.5100
PARK
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www.koelschseniorcommunities.com
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Business Connection
February 2013
Non-Profit Night
Drawing Attention for a Good Cause Chamber Non-Profit Night drew a big crowd Jan. 8. Ivy Masters lit up the room to draw attention to the American Cancer Society’s Relay for Life, while Rick Johnson and his four-legged friend Dolly mingled with visitors at the Humane Society of Cowlitz County booth. Bob Johnson of the St. John’s Foundation, talks with Propel Insurance’s Wendi Bryant and Jake Oja.
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02/12/13 5:30-7:30 p.m. GFO CafĂŠ Grounds for Opportunity CafĂŠ (A Lower Columbia CAP entity)
& Family Health Center
Location: 413 South Pacific Ave., Kelso Cost: $15 advance/$20 at door Register at www.kelsolongviewchamber.org
Tours of the new Family Health Center Kelso Clinic will be given. Show some love and join us for great food, fun, prizes and a chance to network with fellow community business members!
Business Connection
February 2013
Welcome New Members
Chamber membership has its privileges Celebrate these new Chamber members with us Business Association with opportunities to promote trade through Chamber socials, special events and committee participation.
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• Annual Meeting and Banquet • Networking Events • Committee Participation • Business Contacts • Quarterly Membership Meetings • Civic Representation • Monthly Business After Hours Business Services include marketing for your business, referrals and access to Chamber publications and research data. • Mailing Labels • Membership Window Decals • Member Referrals • Ribbon Cutting • Web Site Links • Member to Member Discounts • Membership Directory • Tax Deduction
• Newsletter • Business Card Display • Use of Chamber Logo Representation through action committees, Candidate Forums and up-todate Action Alerts. • Legislative Representation • Issues Tracking and Information • Task Forces • Candidate Forums • Legislative Update Breakfast • Demographics Publication
Packages
Basic Membership Package - $275 or $26 per month. Bronze Membership Package - $500 or $46.66 per month. Silver Membership Package - $1,000 or $86.33 per month. Gold Membership Package - $2,500 or $211.33 per month. Platinum Membership Package $5,000 or $416.66 per month. Diamond Club Membership Package $10,000 or $834 per month.
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Business Connection
Lower Columbia Professionals
Making Friends Getting Fit The Lower Columbia Professionals met for a night of fitness Jan. 17 at 3RAC CrossFit. 3RAC CrossFit owner Tracee Hansen and employee Keri Verhei worked up a sweat just getting things ready for the big night.
Looking for staff? Express can help! Express can help you find, screen, test, hire, train & motivate your employees. 360.414.1200 • www.expresspros.com 24
February 2013
Business Connection
February 2013
Petrick, from page 7
Take A Class
Looking to expand your markets? Thinking about selling to the government? The next Best Business Practices Series event is for you. For more information and to register follow this link: http://wsbdc.org/class-detail?classid=474 &sday=07&smonth=02&syear=2013
you’d need to buy similar assets, so the business is worth at least the replacement cost of the assets. The balance sheet can give you a good indication of the value of a company’s assets. • Revenues: Revenue is probably the crudest approximation of the value of a business. Often, businesses are valued as a multiple of their annual revenue. The multiples depend on the industry. There are historic norms for valuation based on sales multiples for many industries. Keep in mind that revenue doesn’t mean profit. While revenues can sometimes give a buyer an indication of potential if the business is poorly managed now, it is not a reliable indicator of value. • Earnings or Discretionary Cash Flow: Using earnings or what we call “adjusted or discretionary cash flow” may be a better way to think about valuation than revenues. Basically, this technique determines how much cash a business will generate for a new owner to take for him or herself as compensation and for any debt acquired in buying the business. The more cash a business generates, the more valuable it is. Here are the steps in determining discretionary cash flow: 1. Take net profit for the most recent year. 2. Add to that figure any non-cash expenses, such as depreciation. 3. Add to that any expenses that a new owner will not have or are discretionary. The most common might be charitable contributions, perhaps some travel or expenses for conferences, interest on any debt (a new owner will have their own debt and will have a different interest expense figure). 4. Add to that any wages that the owner has taken during the year. A new owner might have different income needs. 5. Subtract from that any known expense, other than new debt and new owner’s compensation. An example of this would be
if the seller is a couple, both working in the business and the buyer is an individual, the buyer will need to add another employee to replace one of the sellers. Another example would be if the seller owns the building where the business is located and will lease it to the new owner. A buyer then needs to subtract from the net profit figure what the new rent payment would be on an annual basis. 6. You now have how much cash this business currently generates for a new owner. If the financial statements you are using for this analysis are several months old and the most recent year is already proving to be different from last, you will want to adjust your analysis for that recent evaluation. 7. Have your SBDC Advisor help you with this analysis or review your figures. Applying a multiple to DCF: Multiples are usually applied to the discretionary cash flow figure to arrive at a valuation for the business. Factors that determine a multiple can be: • Type of business – service versus retail or manufacturing, for example. Also whether the business has significant assets • Whether special managerial skills or industry expertise is needed • Stability of historical profits • Business and industry growth • Location and facilities • Stability and skills of employees competition • Diversification of products, services and geographic markets
Facilitating Growth Through Leadership and Action
Feasibility Whatever the asking price of a business is, whether you are the seller and used one of the valuation techniques to arrive at a specific asking price and/or a range that seems acceptable to you, or you are a potential buyer trying to evaluate an opportunity to purchase a business, you should look at the feasibility of someone buying this business at this price. If you are the potential buyer, you can apply your specific situation to this feasibility analysis. If you are the seller, you might want to first look at feasibility for
We are a membership based not-for-profit organization. Join us today! Resources • Access • Partnerships
1452 Hudson St. • US Bank Building Suite 208 • Longview, WA 360.423.9921 www.cowlitzedc.com
Please see Petrick, page 27
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Kelso-Longview Chamber 2013 Schedule of Events
January 2013 1 – Chamber Office closed – New Year’s Day 8 – Business After Hours at the Red Lion – Non-Profit Night, 5-7pm 10 – Chamber Executive Board Meeting, 7am 15 – Chamber Board Meeting, Noon at Longview Country Club 21 – Chamber office closed MLK Holiday February 2013 12 – Business After Hours – Lower Columbia CAP, 5-7pm 14 – Chamber Executive Board, 7am 18 – Chamber Office Closed – Presidents’ Day. 19 – Chamber Board Meeting, Noon at Longview Country Club 21 – LCP Night at Pie@Trio’s, 5:30-7pm March 2013 6 - Start of the Small Business Boot Camp, Session One 12 – Business After Hours – Lifeworks, 5-7pm 14 – Chamber Executive Board, 7am 19 – Chamber Board Meeting, Noon at Longview Country Club 21 – Quarterly Luncheon – State of Education April 2013 11 – Chamber Executive Board, 7am 16 – Chamber Board Meeting, Noon at Longview Country Club 16 – Business After Hours – Cascade Networks, 5-7pm 17 – Building Bridges – A Regional Business Showcase, Expo Center May 2013 1 – Start of Small Business Boot Camp, Session Two 4 – Goal to be in our new building on Minor Road 9 – Chamber Executive Board, 7am 14 – Business After Hours – Three Rivers Mall, 5-7pm 15 – Education and Business Awards Night – Expo Center 21 – Chamber Board Meeting, Noon at Longview Country Club 27 – Chamber office closed, Memorial Day June 2013 11 – Business After Hours – Columbia Bank, 5-7pm 13 – Chamber Executive Board, 7am 17 – Chamber Golf Classic – Longview Country Club 18 – Chamber Board Meeting, Noon at Longview Country Club 20 - Quarterly Luncheon – State of our County (County Commissioners)
July 2013 4 – Chamber Office closed – Independence Day 9 – Business After Hours – Cowlitz County Title, 5-7pm 11 – Chamber Executive Board, 7am 16 – Chamber Board Meeting, Noon at Longview Country Club August 2013 8 – Chamber Executive Board, 7am 13 – Business After Hours – Still to be determined, 5-7pm 20 – Chamber Board Meeting, Noon at Longview Country Club September 2013 2 – Chamber Office closed, Labor Day 4 – Start of Small Business Boot Camp, Session Three 10 – Business After Hours – Life Mortgage, 5-7pm 12 – Chamber Executive Board, 7am 17 – Chamber Board Meeting, Noon at Longview Country Club 19 – Quarterly Luncheon – (State of our Cities) October 2013 8 – Business After Hours – Heritage Bank, 5-7pm 10 – Chamber Executive Board, 7am 15 – Chamber Board Meeting, Noon at Longview Country Club 23 – Small Business Boot Camp Bonus Session November 2013 12 – Business After Hours –Ashtown Brewery, 5-7pm 14 – Chamber Executive Board, 7am 19 – Chamber Board Meeting, Noon at Longview Country Club 21 – Economic Summit – CEDC - Chamber 28-29 – Chamber Office closed – Thanksgiving and following Friday December 2013 10 – Business After Hours – Holiday Mixer, Red Lion, Hosted by Chamber 12 – Chamber Executive Board, 7am 13 – Jingle All the Way 17 – Chamber Board Meeting, Noon at Longview Country Club 19 – Quarterly Meeting – With CEDC (Economic Summit 2014) 25 – Chamber Office closed – Christmas
Business Connection
February 2013
Petrick, from page 25 yourself and then look at what the situation might be for a “typical” buyer. For feasibility for the seller, the question is “can you afford to sell the business for this price?” Do you have business debt that needs to be paid off out of the proceeds of the sale? The steps for feasibility for the buyer are: take a specific price for the business, whether it is the asking price or one of the values in a range of prices; to that add the working capital a buyer would need to start as well as any other initial costs (perhaps there are some needed renovations or equipment that needs replacing etc); this gives you the total amount a buyer will need to buy and begin to operate this business. With that figure: √ Subtract the amount a buyer will have of his or her own funds. That leaves you with the amount of debt the buyer will have to incur. √ Figure out what the annual loan payment would be on the debt. Subtract that from the discretionary cash flow figure you arrived at in Step 6 above. Subtract the minimum amount the buyer will need to take out of the business for his or her own compensation. If there is not enough for the buyer, or if you are at a negative figure, the sale as outlined above is not feasible. √ Look at the deal and see what, if anything can be changed to make it feasible. Can the seller finance all or part of it at a lower interest rate or longer term? Can the buyer come up with more cash? Is it feasible for the seller to reduce the price? Your SBDC Advisor can assist you in looking at the feasibility of various scenarios. Information the Seller Wants The seller will most likely want some information from you before they release their financial statements. Typical information includes: signing a nondisclosure or confidentiality agreement, a copy of your resume and a copy of your personal financial statement. The seller will want to know that you are a serious buyer and are in good financial shape to buy this business. Remember that you may be competing with other potential buyers. Get Your Advisory Team in Place Your advisory team includes your attorney, your accountant, your banker, and your SBDC Advisor. Financing Buying the Business First you will need to determine how much cash you have and how much you will need to borrow. Will the seller finance all or part of the deal? How is your credit? Can you get a bank loan? What will you use for collateral? Are the business assets sufficient
collateral or will you need additional collateral, such as equity in your home? Making the Offer The offer is usually made in the form of a purchase agreement or a letter of intent. A letter of intent is a nonbonding agreement that allows the buyer to take a closer look at a business and its records before committing to a formal contract. The letter of intent lets the seller know that you are serious and that the two parties are in agreement on the basic terms of the transaction, such as price, terms, conditions, and timing. An alternative to a letter of intent is a standard purchase agreement that states specific contingencies that must be released before the offer becomes binding, such as financing. Keep a written record of meetings, conversations, and agreements with the seller or seller’s agent. You may also want to get your attorney involved in the drafting of the offer. My Offer has Been Accepted! What’s Next? Congratulations! Next Steps: a list of things to do for buyer and seller This list includes some of the activities after the offer has been accepted and any contingencies have been removed, but prior to closing. We recommend that both the buyer and seller consult with both their accountant and their attorney in the transaction of buying/selling. These professionals should be different for each party. Your SBDC advisor can assist you in determining any additional steps. • The seller continues to run the business in a sound and responsible manner until closing. • The lease: if applicable, the buyer confirms the details of a new lease with the landlord. • Business License: The buyer needs to get a state business license (www.wa.gov/dol); and a city business license if necessary. • If the buyer is going to be a corporation, he or she will need to file incorporation papers as well (buyer’s attorney can do this). • Seller will indicate that the business has been sold on the last B&O report that is filed. • Buyer needs to get an EIN (employee identification number) from the IRS to be able to employee people or if the business will be a corporation (www.irs.gov). • Buyer needs to get insurance prior to taking over the business (liability, property, fire, theft, vehicle, business interruption and the lender may require life insurance on the new owner.)
Please see Petrick, page 28
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Business Connection
February 2013
Good Information As tax time quickly approaches, Chamber Board President Jerri Henry of Futcher-Henry CPA Group took to the airwaves to offer advice.
TUNE IN every Wednesday Your Chamber Connection
KEDO AM 1400 – 3 to 4 p.m. Contact the Chamber to schedule YOUR 10-minute business spotlight
Petrick, from page 27 • Buyer is to inspect and approve the equipment list. Prepare allocation of purchase price forms that are for equipment (your accountant will have this IRS form). • Inventory: determine who will take inventory and when. Estimate inventory level for closing documents. • Contact utility companies to have accounts transferred. Contact phone company and web hosting firm, if applicable, to have accounts transferred and web site changed to reflect new owner (if applicable). Examine all marketing materials for any needed changes (such as owner’s name). • Clarify training period and activities. • Contact all suppliers and transfer accounts. Buyer to find out if suppliers will give terms and what they will be. • Contact merchant’s credit card company and arrange for transfer or new account. • Buyer to set up business checking account. • Seller to close business checking account. • Prepare joint press release to be sent out after the closing. • Seller to turn over all records for the business to buyer at closing It really is doable…and you are not alone.
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This article was prepared by Jerry Petrick, MBA, SPHR, PMP and Certified Business Advisor with the Washington Small Business Development Center (SBDC) in Longview. Jerry provides no-cost, confidential business advisory services by appointment. He can be reached via email at jerry.petrick@wsbdc.org.
Joel Lengyel
1425 Maple St. Longview, WA 98632
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Apply Now! Deadline March 31st! The Kelso Longview Chamber of Commerce recognizes that the skills required of businesses today typically demand post secondary education, and has identified that many students in our area are in need of financial assistance in acquiring additional education after completion of high school. As a business organization, benefiting from the contributions the educational system has provided us; we need to assist students in their endeavor to improve their skills for the workforce of tomorrow. Students can apply for the Maria Harris Scholarship or the Lower Columbia Professionals Scholarship on the Kelso Longview Chamber website: www.kelsolongviewchamber.org/applications/scholarship-information AMOUNT It is the intent of this program to award scholarships in the amount of $500 or more. As the funds for these scholarships are based upon the voluntary contributions of our members, the actual amount is dependent upon the level of contributions to the scholarship fund. CRITERIA The scholarship is to be used at a post secondary institution for tuition. The student/applicant must be a resident of Cowlitz County. The student/applicant must demonstrate financial need. The student applicant must have a cumulative G.P.A. of 3.25 or better. The student applicant must submit 3 letters of Character Reference from a parent or family member, a friend or community member. Letter should address character, personality, and academic or community involvement. The student applicant must submit a letter, including future goals, statement of need, outlining why the applicant should receive the scholarship. The scholarship award must be used within one calendar year of the following term.