Business Assistance

Successful small business expansions and new formations lead the way in creating new markets, innovations and jobs that fuel economic growth.

Federal Resources for Business Assistance

Recognizing the importance of the small business for a strong economy, the US Small Business Administration (SBA) helps small business owners and entrepreneurs meet their information needs for starting a new business. The SBA is an independent government agency created by Congress to help small businesses prosper. The SBA has more then 100 offices that offer small firms financial assistance through guaranteed loans, management assistance, help in obtaining government contracts, counseling services and many low-cost publications. The SBA is an outstanding source for information.

Small Business Answer Desk: 1-800-ASK-SBA

This toll free hotline provides personalized attention to your business needs. The phoneline operates from 8:30 a.m. to 5:00 p.m. (Eastern Time), Monday through Friday. Their fax number is (202) 205-7333.

SBA Home Page: http://www.sba.gov/

SCORE, or The Service Corps of Retired Executives, is a 12,400-member volunteer association sponsored by the US Small Business Administration (SBA). It matches volunteer business-management counselors with present and prospective small business owners in need of expert advice. SCORE has experts in nearly every facet of business management and maintains a national skills bank, to help identify the best counselors for its clients. Many SCORE volunteers are retired business owners or managers, while other members are active business owners and managers. SCORE members offer assistance in almost 800 locations nationwide, including Alaska . They can meet with you at a local SCORE office, an SBA office or oftentimes, your place of business.

What type of business assistance is offered?

•  In-depth counseling and training volunteers help business owners identify problems, determine the causes and find solutions.

•  SCORE offers low-cost pre-business workshops that address topics such as assessing entrepreneurial potential, developing a start up checklist, selecting legal entity, creating a business plan and securing a resource of funding. SCORE workshops can also aid established firms survey expansion, modify products and meet other business challenges down the road.

•  And finally SCORE offers one on one free and confidential counseling either in one of several chapter offices, or online at www.score.org . Simply enter the specific expertise required and retrieve a list of e-mail counselors who represent the best match by industry and topic.

Whether you are considering starting your own business, have a business that is experiencing problems, are ready to expand, or need some other type of advice, SCORE can help. The counseling sessions are confidential and personal. You do not need to apply for or have an SBA loan to participate in the program. An idea is all that is necessary.

The location information for the Anchorage SCORE office is:
US Small Business Administration,
222 W. 8 th Avenue #67 (Room A35)
Anchorage , AK 99501-1952
PHONE: (907) 271-4022
FAX: (907) 271-4545

•  The SCORE homepage is http://www.score.org/

Local Resources for Business Assistance

•  SBDC: The Alaska Small Business Development Center (SBDC) offers a variety of services to individuals looking to start a business in Alaska . The SBDC provides free, confidential, one on one counseling designed to provide practical and useful information to small business entrepreneurs with the unique perspective regarding a local interest. The SBDC also offers classes and seminars for new and established businesses to help them survive and grow. Business training topics include marketing, loan proposals, business plans, record keeping, taxes, proposal development, how to start a small business and more. There is also a variety of business libraries in each center location for free access to information vital to success, such as books, software and periodicals for reference. For information regarding starting a business in Homer as well as information on the services provided by the SBDC, please call the Kenai Peninsula SBDC branch at

•  (907) 283-3335, or visit in person at
110 S. Willow St., Suite 106 , Kenai , Alaska , 99611-7744

•  Homer also has a small branch of the SBDC with a concise but comprehensive business library located at the Homer Chamber of Commerce on the Sterling Highway in Homer. The library includes sample business plans, a variety of books describing a number of business facets, CD-ROM software aiding small businesses and brochures describing all services available to you. Please call the Homer Chamber of Commerce at 235-7740 for appointments and available times for a business consultation with a member of the Kenai office of the SBDC, who come to Homer periodically when needed for consultations with clients. The Homer office also offers a variety of business seminars in Homer, please call the Homer Chamber of Commerce for a seminar schedule. Or call and make an appointment directly by calling (907) 262-7497 .

•  http://www.aksbdc.org/ Is the homepage for The Alaska Small Business Development Center with information on how to receive local counseling for business as well as class and seminar information.

Links :

http://www.dced.state.ak.us/cbd/edrg/EDRG.htm
The Alaska Economic Development Resource Guide is designed to bring together in one place an inventory of programs and services, which can provide economic development assistance to Alaska communities and businesses. Print the entire guide or search the database for programs that meet your specific needs.

http://www.dced.state.ak.us/cbd/pub/estab98.pdf
This is a great place to start for starting a business in the state of Alaska . It's a comprehensive publication put out by the state of Alaska about starting a business in the state. The publication covers labor laws, taxation, licensing and regulation requirements, financial assistance and more. The document is in PDF format. If you do not have Adobe Acrobat Reader, it can be obtained here: http://www.adobe.com/

http://www.kpedd.org/

The Kenai Peninsula Economic Development District (KPEDD) supports businesses by assisting with developing their business plans, preparing them for commercial loans, providing access to capital and providing technical support through their Business Incubator program. KPEDD assists communities with capacity building. Capacity building starts with community involvement. The Kenai Peninsula Economic Development District information is as follows:

• Telephone
  907-283-3335

• FAX
  907-283-3913

• Postal & Location Address
  14896 Kenai Spur Highway, Suite 103A
  Kenai AK 99611-7756

• Email
  info@kpedd.org

• Assistance:
  Please complete the Technical Assistance Form available here: http://www.kpedd.org/pdfs/taform.pdf and send it to their office for better assistance.

**The following information is from the Alaska Economic Information System Small Business Section http://www.dced.state.ak.us/cbd/

Introduction to starting a Business.

So you want to start a business, but you've heard the statistics: According to the U.S. Small Business Administration, less than half the businesses started between 1989 and 1992 were still in business four years later. The difference between success and failure is a sound business idea and experience or training in your chosen business. But, how much money will you need to get started and to grow? What laws and regulations apply to your business? How do you reach your target market? The following guide is intended to help you make your business a success. It can help you consider the issues involved in starting a business, and direct you to the resources that can make the difference between success and failure.

Is My Idea Any Good?

Having "the right stuff" isn't enough. Success also requires a sound business idea. How do you test your business concept? Develop a mission statement that communicates your concept to others. Conduct a market analysis so you know what you can expect for sales. Write a business plan to explain how you will achieve success. For help in testing your business concept, be sure to see the sections below on "Where can I get help" and "Where can I find information?" You may also find other business owners willing to serve as advisors, and friends and family members ready to offer suggestions.

What is a mission statement and why do I need one? A mission statement briefly describes what you do, how you do it, and why you do it. A mission statement - Helps you stay focused on pursuing your goals. Explains your values to your employees. Tells your customers the way in which you will serve their needs. Although some mission statements are as long as several paragraphs, a brief mission statement might look like - "Our mission is dedication to the highest quality of customer service delivered with a sense of warmth, friendliness, individual pride, and company spirit." Profitability - making money - should always be one part of the business' mission. Your mission statement explains your "unique selling proposition." It describes what success means to you. Draft a mission statement as a guide in developing your business plan. After you've completed a market analysis and business plan, go back to the mission statement and make sure it still clearly defines your business.

What is a market analysis and why do I need one? Marketing is not just advertising. It is all the things you do to let your customers know how you will serve their needs. Marketing starts with knowing your customer: How old is your customer? Where does your customer live? Does your customer want your product or service? How much is your customer willing to pay for your product or service? What feature of your product or service is most important to your customer? Knowing your customer will provide valuable information about Where to locate your business. What hours you should be open. What range of prices you should offer. There are many other things that will affect your finances and operations. Marketing is also knowing your competition and how your business can fill a need that they can't. Your competition is not just other businesses like yours. Your competition is all the other ways that your customers satisfy the need that you address. For example, if you plan to open a video rental store, your competition is not just other video rental stores. Your competition includes all the other sources of entertainment nearby – bowling alleys, video game arcades, movie theatres, basketball games – as well as sources outside your community. Marketing is about making your video rental store the first thing your customers think of when they want entertainment. A marketing analysis can be as simple as talking to your neighbors if you live in a small community, or as detailed as researching industry trends if you're doing business in an urban area.

Where can I find information? For finding information for your market analysis, consult the demographics page on this Website.

For more on this topic
For a detailed workbook on marketing plans, go to SBA's "Marketing Your Business for Success Workbook" http://www.sbaonline.sba.gov/gopher/Business-
Development/Business-Initiatives-Education-Training/Marketi n g-Plan/

What is a business plan and why do I need one? A business plan describes how you will put your mission into action. A business plan is not just to: apply for a bank loan. But also to: Find the weak spots in your idea. Identify staffing needs. Provide a tool to help you stay focused. Make sure you've identified all your "partners" such as suppliers and distributors. Create a plan to help ensure that your day-to-day actions will lead to success. And finally, to: Determine how much money you need to get started. A business plan explains how your proposed business will be successful, and identifies all the resources needed for success. While there are many sample business plans available, they all include the same basic components: Executive Summary – One page that includes your mission statement, a summary of the major points of the business plan, and a funding request, if appropriate. Description of the business – What goods or services you will offer, where the business will be located, etc. Market analysis or marketing plan – Who are your customers, how will you reach them, and how will you compare to your competition? Management – Will you be the sole owner or form a corporation? Which responsibilities will you hire staff to do? Financial – Projections of cash flow, profit and loss statements, and balance sheet. Also, an estimate of start up costs, and loan request, if any. The business plan will vary in size based on the complexity of your business, and may have a number of attachments.

How to Write a Business Plan

To start a new business you will most likely need a lone from the bank, which requires a presentation of a thorough business plan. Approval of your loan request depends on how well you present yourself, your business and your financial needs to a lender. Lenders want to make loans, but they want to make good loans, loans they know will be repaid. The best way to ensure your chances of obtaining a loan from the bank is to present a comprehensive business plan.
*source Nation's Business, August 1997.

If you have never explained your business on paper before, here is help to get you started.

•  Write a statement of purpose. If you cannot explain your venture in 25 words of less, it is probably not a good idea. Following your explanation, tell how your business will work, who will own it, and why it will succeed.

•  Describe the business in detail. Tell what products or services you will provide and to whom. Discuss the market for your business and the competition. Profile your customers and explain how your business can satisfy their needs. Then explain how your company will be managed and by whom. Explain the business ownership structure. List their credentials, social security numbers and business addresses. Tell where your company will be located and why. Also, tell how you will apply the loan from the bank and list its expected effects. Request the exact amount you need to achieve your purpose.

•  Supply financial data. You will need three years of projected financial statements. They include income, loss and cash flow projections-by month for the first year, and by quarter for the next two. If you are just starting up, provide a projected balance sheet and income statement. If you buy equipment, list the items, their costs and what you will use for collateral. Resist using your house and other personal property. Instead, list savings, bank accounts and vehicles. Include notes of explanation whenever figures seem contradictory or otherwise questionable. If you are asking for $50,000 or more from the bank, provide quick and current ratios comparing assets to liabilities, with and without inventory.

•  Attach supporting documents. Examples include resumes of principals; references from creditors, potential clients and suppliers; the names of your accountant and attorney; evidence of hazard insurance; a lease agreement if any; and articles of incorporation if applicable.

Take this plan to a banker. If he or she says no, try another one. A sound business plan will eventually find a lender.

How Your Loan Request Will Be Reviewed

The primary concern for a loan officer when reviewing a loan request is whether or not the loan will be repaid. To answer this question, many loan officers will order a copy of your business credit report from a business credit-reporting agency. Therefore, it is helpful if you work with these agencies to help them prepare an accurate picture of your business. Using your credit report, and the information you provided, the lending officer will consider the following issues:

•  Have you requested savings or personal equity in your business totaling at least 25%-50% of the loan you requested? A lender of investor will not finance 100% of your business.

For more on this topic:

•  For a business plan outline, go to Tanana Chiefs Conference's site for the Alaska Minority Business Development Center http://www.tananachiefs.org/mbdc/BUSINESS%20PLAN%20Outline.htm

•  For a detailed business plan outline and workbook, go to U.S. Small Business Administration http://www.sba.gov/starting_business/planning/basic.html

•  For a business plan outline and additional links, go to San Joaquin Delta College's "How to Start a Small Business" http://sbdc.deltacollege.org/startup/bizplan.html

Where can I get help? Free, confidential counseling is available from the Alaska Small Business Development Center (SBDC). The SBDC also provides workshops, a resource library, and other services for small businesses. The SBDC has offices in Anchorage , Wasilla, Fairbanks , Kenai, Ketchikan , and Juneau , and a rural outreach program. Call 274-7232 or 1-800-478-7232, or visit their Website at http://www.aksbdc.org The U.S. Small Business Administration provides counseling through its SCORE (Service Corps of Retired Executives) program. Call 271-4838, or 1-800-755-7034 outside Anchorage , or visit their Website at http://www.sba.gov/ak/scoreak.html

•  The Alaska Minority Business Development Center , located in Fairbanks , provides services to minority clients. Call 452-8251 ext. 3277 or 1-800-478-6822 ext. 3277 or visit their Website at http://www.tananachiefs.org/mbdc/default.htm

•  The ARDOR (Alaska Regional Development Organization) program supports 14 local economic development organizations around the state. For the ARDOR nearest you, call Midge Clouse at 269-4587 or see the Website http://www.dced.state.ak.us/cbd/ardor/ardor.htm

What form of Business Should I use?

The most common forms of business ownership are -

•  Sole Proprietorship

•  General Partnership

•  Corporation

•  Limited Liability Company (LLC)

Each business owner must consider his own needs and circumstances in choosing a form of business. The following descriptions point out some of the issues to take into account. These descriptions, however, do not take the place of legal advice. Attorneys and tax accountants can provide additional information.

•  Sole Proprietorship

A sole proprietorship is a business owned by one person. The business is not legally separate from the business owner.
Formation To form a sole proprietorship, all the business owner needs to do is obtain a business license and satisfy any necessary licensing requirements. There are no special fees or forms required for the formation of a sole proprietorship. A federal employer identification number (EIN) is only required if the business has employees.
Tax Liability The owner reports the business revenues and expenses on his own tax return, on Schedule C of the Form 1040. The business profits are taxable income to the owner in the year in which they are earned, and are taxed at the owner's tax rate. The sole proprietor may set up a tax-sheltered retirement program, such as a Keogh plan. The business' health insurance premiums may not be fully deductible.
Risk Management The business owner is personally responsible for the business' debts, court judgments, and other liabilities. Insurance policies are available to protect the business owner.

•  General Partnership

A general partnership is a business owned by two or more people who have not filed the paperwork to form a corporation or a limited liability company.
Formation A written partnership agreement is not required, but can be helpful. The agreement spells out the rights and responsibilities of each partner, and addresses such issues as adding partners in the future. Each partner must act in good faith and loyalty to the other partners. A partnership is automatically dissolved when one partner dies unless the partners have agreed otherwise in writing. A partnership must obtain a federal EIN.
Tax Liability The partnership does not pay income taxes, but files an information return with the Internal Revenue Service. Each partner's share of revenues and expenses is reported on his personal tax return. A partnership is treated the same as a sole proprietorship with respect to retirement and health plans.
Risk Management Each partner is personally responsible for all partnership debts and liabilities. Each partner can take actions that are legally binding on the other partners. Insurance policies are available to protect the partners.

•  Corporation

A Corporation is an independent legal entity, separate from the owners created upon filing Articles of Incorporation. It has legal status or existence that is separate both from the individual(s) who forms it and its owners.
Formation
Articles of Incorporation are written and filed with the State of Alaska . The State then issues a Certificate of Incorporation. A single owner can form a corporation. Investors can become owners of the business, and selling shares can raise capital. (Please consult the Alaska Division of Banking, Securities and Corporations and the U. S. Securities and Exchange Commission for appropriate guidelines). The corporation can designate different classes of stock that carry different rights, such as non-voting stock. The corporation continues to exist after the death of a shareholder. A C corporation must obtain a federal EIN, S Corporations do not.
Tax Liability For federal tax purposes, corporations may choose to be designated as S corporations or C corporations. S Corporations file information returns with the Internal Revenue Service, and individual shareholders pay taxes on their share of profits. C corporations file separate tax returns and pay their own taxes. Corporations also pay state income taxes.
Risk Management Generally, a shareholder or officer is not personally responsible for the debts and court judgments of the corporation. When a corporation borrows money, however, the bank may ask for personal guarantees from the corporate officers. Shareholders are not personally responsible for each other's actions on behalf of the corporation. Individuals are responsible for their own negligent acts.

•  Limited Liability Company

A limited liability company (LLC) is a business entity that limits the personal liability of owners. An LLC has some characteristics of partnerships and some characteristics of corporations.
Formation Articles of Organization are filed with the State of Alaska . The owners of an LLC are called members. LLCs are managed by members or by managers who may or may not be members. A single owner can form an LLC.
Tax Liability An LLC with two or more members is classified as a partnership for federal income tax purposes unless it elects to be taxed as a corporation or was formed before 1997 and was taxed as a corporation. An LLC with one member is not treated as a separate entity for income tax purposes unless it elects to be taxed as a corporation.
Risk Management Generally, a member of a LLC is only personally liable to the extent of the capital invested; their personal assets are protected.

•  If you are in need of assistance deciding what type of entity to form, please consult an attorney and a tax accountant.

Where can I find information? For finding information for your market analysis, consult the demographics page on this Website.

Other Legal Protections

Other Legal Protections Certain legal protections are available for such business assets as the name and logo, printed materials, and inventions.

Registration of Business Name http://www.dced.state.ak.us/bsc/register.html Protect your individuality! Research existing business names to make sure your business will not be confused with someone else's, then register your business name to prevent others from using it. This link takes you to business name registration.

Trademark http://www.dced.state.ak.us/bsc/tmark.htm A state trademark can be obtained for a name, logo, or design that identifies your product or service. This link takes you to instructions for a state trademark application. Federal trademark protection is also available, from the U.S. Patent and Trademark Office (see Patent, below).

Copyright http://www.copyright.gov/ A copyright is a federal protection against the unauthorized use of one's artwork, music, photography, written works, and other intellectual property. For an eligible work, copyright is secured by including a copyright notice in the format "Copyright © 2001 by John Doe." For more information, take this link to the U.S. Copyright Office.

Patent http://www.uspto.gov/ A patent is a federal protection against the unauthorized use of one's invention, provided the invention contains new ideas or unique applications. This link takes you to the U.S. Patent and Trademark Office.

Requirements for Employers

Requirements for Employers http://www.irs.gov/pub/irs-pdf/p15.pdf and http://www.labor.state.ak.us/employer/employer.htm

You are an employer if you have people who perform services for you, and you "can control what will be done and how it will be done." (IRS Publication 15) Obtain a Circular E from the Internal Revenue Service each year for complete information on federal employment tax requirements. Take the second link shown above for more information for employers from the Alaska Department of Labor.

Employer Identification Number http://www.irs.gov/pub/irs-fill/fss4.pdf

An Employer Identification Number (EIN) is required for reporting employment taxes. To apply for an EIN, take this link to Form SS-4 and submit the completed form to the Internal Revenue Service.

Federal Income Tax Withholding http://www.irs.gov/pub/irs-pdf/fw4_03.pdf

Have each employee fill out a Form W-4 each year, available at the link above, then follow the instructions in Circular E for withholding, depositing, and reporting income taxes.

Social Security and Medicare Taxes http://www.irs.gov/businesses/small/international/article/0,,id=104936,00.html

IRS Circular E also has instructions for withholding, depositing, and reporting Social Security and Medicare taxes. The Form 941, at this link, is used to report employee withholding, Social Security, and Medicare taxes.

Federal Unemployment Tax http://www.irs.gov/pub/irs-pdf/f940.pdf

Federal unemployment tax, also known as FUTA, is paid by employers and reported each year on Form 940. The form can be found at this link.

State Unemployment Tax http://www.labor.state.ak.us/estax/forms/toc_forms.htm

Employers and employees also pay state unemployment tax. Complete information is available from the Alaska Department of Labor and Workforce Development, Employment Security Division at this link.

Workers' Compensation Insurance http://www.labor.state.ak.us/wc/home.htm

Workers' compensation is a program that requires employers to pay medical costs and partial wages for employees with work-related injuries and illnesses. This link has more information. Workers' compensation insurance can be purchased from insurance companies.

Immigration Laws http://uscis.gov/graphics/formsfee/forms/i-9.htm

Employers are required to have employees complete a Form I-9 from the U.S. Immigration and Naturalization Service as proof of the employee's eligibility to work in the United States .

Workplace Posters http://www.labor.state.ak.us/lss/posters.htm

Employers are required to post certain information for employees. Posters are available at this link.

Business Taxes

State Taxes http://www.tax.state.ak.us Be aware of any state taxes that may apply to your business, such as the corporate net income tax. See this link for complete information.

Federal Taxes http://www.irs.gov/businesses/small/index.html

Federal taxes will vary depending on the legal form of your business and the type of business activity. This IRS Website offers complete information for small businesses.

Please note that this checklist covers the basic requirements common to most businesses. Be sure to check for additional requirements specific to your location or industry.

Do I Have Enough Money?

Your completed business plan will show how much money you need to get started. It also shows lenders and investors that you have the business skills needed for success, and that the business can repay the loan requested. Initial financing should be enough to cover the costs of setting up your business location, equipment and furnishings, and inventory. Also be sure to have enough money to cover the costs of operations until the business' cash flow meets your requirements. Once you know how much money you need to get started, where do you find it? Common sources of business financing are – personal savings family and friends bank financing But don't overlook – credit from vendors and suppliers equipment leasing venture capital Take stock of your personal assets – savings, investments, availability of credit, equity in your home – to see what can be used to start your business. While you may not have enough money in your pocket to cover all your start-up needs, be prepared to use your own money. Other sources of financing are going to expect you to put your own money or property at risk, along with theirs. Financing comes in two basic forms – debt and equity. Debt financing is money that will be paid back on specified terms. A bank loan represents debt financing. Equity financing is giving up a portion of the ownership of the business in exchange for financing. Venture capitalists - individuals or companies that invest money in private businesses - provide equity financing.

How do I apply for a loan? Every lending institution will have paperwork requirements, which generally include a copy of your business plan. In general, the lending institution will evaluate your request on the basis of the Five C's of Credit:

•  Capital the amount of your own money invested in the business.

•  Character your reputation in business matters, including your credit history.

•  Capacity your ability to repay the loan.

•  Collateral assets pledged as security for the loan. Guarantees – someone else's promise to repay the loan if you don't – can also serve as collateral.

•  Conditions the intended uses of the loan, and the business environment in which you will be operating.

For additional tips on applying for a loan, see the following websites:

•  SBA's "Finding Capital" http://www.sba.gov/financing/index.html

•  Silicon Valley Small Business Development Center 's "Obtaining Funds" www.siliconvalley-sbdc.org/funds.html

•  Idaho Small Business Development Center 's "How will you finance the business?" www.idahosbdc.org/biz_startu p _step4.html

Where do I apply for a loan? Commercial banks are the most common source of business loans. Other sources include revolving loan funds, and state or federal loan funds. For information on local revolving loan funds, contact the ARDOR for your area (see www.dced.state.ak.us/dca/ardor/ardor.htm for contact information).

The following links will take you to agencies that offer loans and loan guarantees to businesses.

•  Alaska Division of Investments: www.dced.state.ak.us/investments/index.html

•  Alaska Growth Capital: www.alaskagrowth.com

•  Alaska Industrial Development and Export Authority: www.aidea.org/programs.htm

•  Small Business Administration: www.sba.gov/financing/sbaloan/snapshot.html

•  U.S.D.A. Rural Development: www.rurdev.usda.gov/rbs/busp/bprogs.htm

What other forms of business financing are available? The following link takes you to the Guide to Financing & Technical Assistance in Alaska :

•  This is an interactive site to help you find sources of financing and assistance specific to your business: http://www.astf.org/astf/guide/

•  Alaska InvestNet offers venture capital: http://www.alaskainvestnet.org/

•  The Economic Development Resource Guide provides a comprehensive list of technical and financial resources: www.dced.state.ak.us/dca/edrg/EDRG.htm

*Source: Alaska Economic Information System Small Business Section http://www.dced.state.ak.us/dca/smallbus