September 2008  Issue No. 26                    REAP HOME PAGE         A publication of the Center for Rural Affairs

Rural Enterprise Reporter

Tough Economic Times for Small Businesses:
Importance of Core Business Development Services Heightened in Tough Economic Times

BY JEFF REYNOLDS, REAP PROGRAM DIRECTOR

This year has been a rough one on many fronts. A struggling economy negatively affects almost everything, including small businesses. We have seen mega increases in fuel costs, consumer goods, etc., and the cost of living continues to rise. For many, simply trying to survive is a major struggle. Add the current credit crisis, with out-of-control individual debt and home foreclosures at an all time high, and financial ruin looms.

Small businesses are struggling to make ends meet. Many rely on discretionary spending for profit. Markets continue to be squeezed by increased competition, a lack of loyalty in purchasing locally, and, in some cases, shrinking markets.

The bottom line is that many small businesses are barely keeping their heads above water. Owning and operating a small business isn’t easy in the best of times. In the worst of times, it’s even tougher.

Making a Difference – Achieving Results through Tough Economic Times
Programs like REAP are needed now more than ever. The demand for programs that assist microen¬terprise businesses (small businesses with 5 or fewer employees) far outweighs the capacity currently available to serve them.

Small businesses need various “tools” to increase their chances of being successful. The “core” services REAP offers – access to lending capital, training, and one-on-one counseling and business planning assistance – provide those tools. Small businesses always need these services. But in the challenging business conditions of today, they are indispensable to small business success.

REAP staff work extremely hard to reach as many rural entrepreneurs as possible. We are proud to be making a major difference through very tough times, and look to continue building our program’s scale to match the overwhelming need for services throughout rural Nebraska.

REAP Results for Fiscal Year 2008
From July 1, 2007, to June 30, 2008, REAP provided assistance to over 1200 entrepreneurs. REAP placed 47 loans totaling $474,691 and leveraged an additional $1,127,250 from other sources due to REAP assistance. REAP lending and assistance during this time frame helped to create or retain 353 jobs.

Since 1990, REAP has provided business development services to over 10,000 micro businesses. Historically, REAP has placed 586 loans totaling $4,287,846 while also leveraging an additional $9,491,405 from other sources due to REAP assistance.

Through good times and bad, the REAP program continues working towards achieving maximum scale in rural Nebraska. Past results show steady and consistent growth. REAP activities and initiatives planned for the future clearly show our commitment to reaching all entrepreneurs in need of microenterprise development services in rural Nebraska.

Support from Funders Makes it Possible
The work of REAP and other microenterprise development programs would not be possible without adequate funding. Funding of microenterprise work in Nebraska and all across the United States must be prioritized and increased to reach existing demand for services. Microenterprise development plays a vital role in the economic development framework and must be expanded to reach maximum capacity.

REAP is committed to strengthening rural communities through small, self-employed business development and looks forward to making a critical difference for all startup and existing small businesses in rural Nebraska.

REAP is funded through multiple sources, including: the Community Development Block Grant program through the Nebraska Department of Economic Development; Nebraska Enterprise Fund through the Nebraska Microenterprise Development Act; Small Business Administration Microloan & Women’s Business Center Programs; the United States Department of Agriculture; and many foundations and gracious donors.

The REAP program is striving to achieve maximum scale in rural Nebraska. REAP is committed to strengthening rural communities through small, self-employed business development and looks forward to making a critical difference for all startup and existing small businesses in rural Nebraska in need of core small business services.

Contact: Jeff Reynolds, REAP Program Director at 402.656.3091 or jefff@alltel.net for more information.

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