Communities share small business appreciation

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In 2006, owner Larry VanOstrand, along with manager Jeff Hopkins, took over the operation of Instant Replay Sports on Third Street in Ithaca, turning their love of sporting goods into a small business. Seven years later, in 2014, the business grew and moved to a new location in the Triphammer Mall in Lansing.

Fast-forward six years later, and Instant Replay Sports now has three operations, five full-time employees and four to six part-time employees, all serving Tompkins County with their expertise and a smile.

“We have developed a customer base that depends on us for their equipment and some of their sporting goods needs, and if it wasn’t for us, they may not be able to have their son or daughter or them be involved in a sport or activity,” VanOstrand said.

VanOstrand’s connection to the community through small business is just one of many similar stories in Tompkins County. As this year’s Economic Summit, hosted by the Tompkins County Chamber of Commerce, showed, small businesses are everywhere, and their impact on local culture and economy is profound.

Typically, business coverage in Tompkins Weekly is geared toward new businesses, but the Economic Summit’s findings call for a more holistic approach. For this investigation, Tompkins Weekly is honoring small businesses new and old while outlining some of the challenges of making them last.

Trends

In the 2020 Economic Summit, small businesses were cited as one of the largest sources of job growth in the county. In his keynote, economic geographer Russell Weaver, Ph.D., senior extension associate in the Cornell University ILR Buffalo Co-Lab, touched upon this phenomenon as well as a growing interest in entrepreneurialism in the county.

Weaver reported that just under half of all private sector jobs in the county were in small businesses (45%), defined by an enterprise with fewer than 500 employees. Most of those are at businesses with fewer than 20 employees.

Those numbers have grown in recent years. According to Buffalo Co-Lab data, Tompkins County small businesses established between 2012 and 2013 grew from around 100 jobs in 2013 to more than 700 jobs by 2017. That sizeable increase puts Tompkins County in the 92nd percentile for small business startup growth across the state during that time period.

Weaver said this Co-Lab data suggests that there has been a recent shift from a global mindset to a local one when it comes to businesses.

“It’s one of the reasons why small businesses are seeing and enjoying, in many cases, higher survival rates,” Weaver said. “They are seen as a valuable component of localized economies.”

Challenges

Despite the renewed interest in small business, it can be difficult for them to succeed. A common observation from sources was that many small businesses don’t make it past the first three years. A similar phenomenon can be found among tech startups, as Lou Walcer, director of the McGovern Center at Cornell University, said.

“Since the McGovern Center was started in 2011, … I’ve had a little over 400 contacts with wannabe entrepreneurs, and out of that, maybe about 70 companies have been formed,” Walcer said. “Of those 70 companies, … only one third of them have actually come into the center.”

Sources outlined several reasons why small businesses often struggle to succeed. Zach Wasmer, co-founder of The Bloomwell, opened his business in downtown Ithaca with his partner, Johanna Baena, less than a year ago, and he can attest to the slow start small businesses can face.

“We’ve had a steep learning curve learning the market and getting our face out there and becoming that recognizable brand or business in the community,” Wasmer said.

Chuck Schwerin, managing director of business services at Tompkins County Area Development, said one of the largest challenges facing the county’s small businesses is labor force.

“In our current environment where unemployment technically is so low, it’s really hard for folks to find adequate workforce to fill the needs that they currently have,” he said.

Scott Wiggins, managing director of La Tourelle in Ithaca, said that lack of workforce makes it all the more important to retain employees.

“When we find a good employee, we work really hard to keep him or her,” Wiggins said.

In addition, to stay relevant, small businesses have to meet the demands of tech-savvy customers, as Steve Franco, owner of Bailey Place Insurance, said.

“The challenge small businesses have is adapting to the customer of the future that wants to do business the way they want to business, which is more of a 24/7, 365-day-a-year proposition,” Franco said.

And unlike big box stores or larger brands that have additional funds to fall back on if times get rough, small businesses often struggle with expenses and have to keep diligent track of their finances.

“There’s always that big pail of money that belongs to corporate people, whereas small businesses don’t have that,” said Kash Iraggi-Wiggins, manager of August Moon Spa in La Tourelle.

A last challenge some referenced the workload. Gary Ferguson, executive director of the Downtown Ithaca Alliance, said most small businesses have a very limited staff, and that can make running the business taxing for the owners.

“Small business owners need to be experts in so many different and diverse fields – marketing, sales, human resources, government regulation,” Ferguson said. “Most small businesses cannot afford separate people to undertake each of these items.”

Strategies to succeed

Many sources interviewed for this story said that research and a clear plan are among the best ways to succeed in the small business world.

“Some of the most successful small businesses in the area know their goals very well, so they’re planning out their business,” said Dominick Recckio, director of strategic communications and partnerships at the Chamber. “They’re constantly thinking about what things they need to tweak to meet the needs of their customers.”

Another common successful strategy is adaptability. Samantha Abrams, co-founder of Emmy’s Organics, said one way she and co-founder Ian Gaffney adapt is to be prepared for anything.

“There’s no light at the end of the tunnel,” Abrams said. “No matter how many issues you figure out, there’s always going to be more.”

The biggest strategy for success, though, is a customer- and community-oriented mindset, sources agreed. Darlene Wilber, communications manager for the DIA, said that when small businesses focus on customers, success follows.

“We see that many of our successful businesses adapt to the changes in their customers’ demands, adapt to current marketing trends and provide a positive experience for their shoppers,” Wilber said.

While larger retailers can often provide cheaper prices, small businesses compete and succeed through customer relations and by creating an experience for customers. This makes the business worth the possible extra cost.

“Provide them with demonstrations, workshops, … whatever it is so that there’s more to what you do than just people coming in and looking at stuff and then buying it,” said Wendy Sue Skinner, founder of SewGreen and IthacaSews in downtown Ithaca.

Small business climate

Tompkins County’s small business climate was almost universally praised by sources interviewed for this story.

“Of the regions that I’ve studied, it’s among the strongest places where I’d say small business has a good opportunity to set up shop, to become rooted in the locality and then to be able to succeed in the long term,” Weaver said.

Franco said one of the biggest reasons for this is the value residents put into small businesses.

“There just is a loyalty that people want to do business with people that they like, and people want to do business with people that live and are part of the community,” Franco said.

The small business climate in the county is also supportive of growth, which many small businesses in the county have been celebrating in recent years.

“We see businesses that are looking to open up a second location, or we see businesses that are looking to consider new offerings, so we work with businesses every day that are looking to grow,” Recckio said.

Why this matters

Sources agreed that the reason residents value small businesses is because they see the benefit to having a thriving small business economy in the region. First, by buying local, that money stays local.

“People shopping locally and supporting small businesses are going to keep the dollars and tax dollars local, and so, you’re going to be providing jobs for locals,” Wasmer said. “Ultimately, those tax dollars stay back within the community.”

Second, as previously discussed, small businesses are a large source of job growth for the region.

“In most places, including Ithaca, small businesses are the cornerstones of the local economy,” Ferguson said. “In aggregate, they create most of the jobs and most of the growth.”

Third, a thriving small business community contributes to the overall health of the community.

“If we lose a small business or two, it’s easily filled by a new one,” Schwerin said. “If you lose a manufacturing entity that hires 25,000 people, that can be devastating to the region.”

Fourth, small businesses help other small businesses, helping to create a sustainable future.

“What’s really important to us in all our departments is local,” Iraggi-Wiggins said. “We buy from local. We trade with local. … We support them, and they, in turn, support other small businesses.”

Last, Weaver emphasized that having a variety of small businesses helps promote and maintain diversity in the region.

“Small businesses really do become this engine of culture and place-based identity that has the potential to spread and get others excited about a space,” Weaver said.

Current resources

Sources cited numerous county resources that help small businesses get off the ground and continue to grow, and among the most mentioned were the DIA, TCAD, Chamber and McGovern Center.

The DIA offers marketing and technical assistance to downtown small business owners and organizes many promotions and special events for businesses to promote and showcase their products and services, Wilber said.

The Tompkins Chamber has over 700 members across the county and provides those members with resources that help them engage with customers and clients, Recckio said. The Chamber hosts networking events like Business After Hours and others to help businesses meet and talk with other businesses and learn from each other.

“Organizations like the Chamber work to really increase the visibility of our small businesses and we work to encourage people to shop local,” Recckio said.

TCAD aids small businesses mainly with financial resources. The Industrial Development Agency, for which TCAD provides administrative support, typically provides incentives for larger projects, but Schwerin said small businesses also receive assistance through the agency. Emmy’s, for example, received a $150,000 loan through TCAD’s revolving loan fund to move to Dryden.

The McGovern Center, as Walcer explained, provides university resources to startups to help keep their initial momentum. Members have access to materials like lab equipment and experts who can provide advice and guidance along the startup’s journey.

“The university as a whole is at the disposal of a young company, and that’s a lot,” Walcer said.

Advice for new entrepreneurs

For any readers who are looking to start a small business or started very recently, Tompkins Weekly asked sources for this story to offer advice for how to get started and stay successful. The most common piece of advice – do your homework.

“We really stress that a starting small business does what’s called customer discovery and spends a lot of time validating their hypotheses that this problem or opportunity really exists,” Schwerin said. “The last thing you want to do is invest your own and other people’s money in a venture that nobody’s particularly interested in.”

Sources stressed starting with enough money to keep your business afloat as you attract new customers.

“When you’re just building a brand, establishing yourself, revenue may be slow to materialize, and you need a cushion to survive those early days, weeks and months,” Schwerin said.

As previously mentioned, starting out with a small staff size can be taxing to new business owners, so sources recommended preparing yourself for some extra work.

“You are your business,” Skinner said. “It’s yours 24 hours a day. You have to be the kind of person that’s willing to put in a whole lot of time to keep it going.”

And as you grow, take every opportunity to hire new staff and educate them so they can lessen the burden for you as a business owner.

“Try to look at your business as a machine where you develop systems and ways of doing things that you can teach to other people so as a business owner, you don’t have to do everything yourself,” VanOstrand said.

To handle the journey ahead, several sources said it’s crucial to have your heart behind your business.

“[If] they’re doing it for the right reasons, they’re doing it because they want to make their little corner of the world better, the money will follow,” Franco said.

Abrams added that small business owners should take advantage of the small business climate in the county by reaching out to other business owners and resources to learn from those who have more experience.

“It just takes knowing you’re not the expert and asking people for help and knowing that you’re not going to be right all the time and surrounding yourself with people that are better than you,” Abrams said.

Walcer echoed that sentiment, adding that asking for help ensures you’ll be prepared for anything.

“Everything needs to be questioned because everything ultimately will be questioned,” Walcer said. “And the more you’ve thought about it, and the more you’re prepared to answer these ultimate questions, the better you’re going to be able to do.”

Conclusion

This county values its small businesses, and sources agreed that’s not likely to change any time soon.

“We have more attention being paid to establishing an ecosystem here to provide services to small businesses to give them a better shot at being successful,” Schwerin said.

Ferguson said he and others are confident in the longevity of the small business community.

“In some sectors, there is a worry that national and international forces will do away with small businesses, but I believe the foundation of our economy is based on small businesses and there will be a constant and necessary demand for small business formation long into the future,” Ferguson said.

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