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Millennium Press Owners Named Small Business Persons of the Year

By
Jim and Kelly Sullivan
Features Special Coverage

News That’s Fit to Print

Jim and Kelly Sullivan

Jim and Kelly Sullivan
Photo by Paul Schnaittacher

At first, Jim and Kelly Sullivan thought the email was junk or a hoax.

“It was an invitation to us from the president to go to the White House to sit in the Rose Garden with him and the vice president for a remarks ceremony,” Kelly recalled, adding that the missive was followed shortly afterward by an email from the Small Business Administration (SBA), essentially letting them know that the email from the White House was real, and they should reply — soon.

They did, and when they gathered in the Rose Garden with the other 49 Small Business Persons of the Year for each state, as recognized by the SBA, they managed to get within a few feet of the president, but didn’t fight the crowd to get any closer.

This gathering, which came during National Small Business Week, has been part of a nearly month-long whirlwind for the Sullivans, owners of Millennium Press in Agawam, the Small Business Persons of the Year from Massachusetts.

There was an awards ceremony in Washington that came just after the White House visit, and, earlier this month, another small-business awards ceremony in Massachusetts, at which they were recognized for their accomplishments in business — and for their perseverance through a series of challenges over the past 34 years.

There was an appearance on a Bloomberg podcast — “I was terrifed; I’m a printer, and they’re firing questions at you left and right,” Jim said — and, just a week ago, U.S. Rep. Richard Neal, who directed the Sullivans to SBA funding, and other officials toured Millennium’s facilities to get a look at its cutting-edge technology and talk with its team of 18 employees.

“Never in a million years did I ever think we would ever win anything like this — I’m still in awe that we did get it.”

As they spoke with BusinessWest at their shop in Agawam, the Sullivans talked a little about their awards, meaning the physical awards (they each got one) they received from the SBA. They are glass, large, quite heavy … and, for now and probably for a long while, “safe at home, under lock and key,” as Jim put it.

“You don’t want to ever break something like this,” he said. “Never in a million years did I ever think we would ever win anything like this — I’m still in awe that we did get it.”

But mostly they talked about what’s behind the award and the wording on it, and how they were chosen over the 700,000 other small businesses in Massachusetts to receive it. Specifically, it would be more than 30 years of hard work, sacrifice, making those large investments in technology, coping with and overcoming adversity — from several downturns in the economy to the Great Recession to the pandemic — and, in short, doing what they had to do to keep the doors open and the dream alive.

“I feel that we did a lot of good things with these SBA programs,” said Jim, adding that, personally, the couple did everything they were asked to do to qualify for such programs, including reducing their income and even buying a smaller home.

the team at Millennium Press

Jim and Kelly Sullivan, center, with the team at
Millennium Press.
Photo by Paul Schnaittacher

SBA District Director Robert Nelson said essentially the same thing as he remarked on the Sullivans and their achievements.

“The Millennium Press story demonstrates how small businesses can persevere when faced with extraordinary challenges,” he said. “The Sullivans didn’t give up on their dreams and kept working toward sustainability with support from public/private resources, including the SBA and its lender network that help stand by your side through the toughest challenges.”

For this issue, BusinessWest talked with the Sullivans about the SBA award, what it means to them, and why it embodies their approach to doing business and managing a workforce.

 

Don’t Stop the Presses

To say the Sullivans started small with their venture would be a huge understatement.

Indeed, they launched their business in a garage — and it wasn’t even their own garage.

“Our house didn’t have one, so we used Kelly’s brother’s garage,” said Jim, a printer by trade who was working at a shop in Holyoke at the time, but started printing short runs of specialty forms for different customers at night and on weekends, a part-time job that quickly became full-time.

Indeed, the Sullivans, who quickly became partners in the venture, said they recognized a growing need for printed forms that could be produced inexpensively and quickly. With an Apple computer, a two-color press, and a collator that would put the forms together — Kelly would handle the desktop publishing, and Jim ran the printing press — they started adding customers and achieving a foothold in the competitive printing business.

Over the course of the next 30 years, they would continue to grow the company, establishing a full-service, one-stop printing and mailing business operating out of a 20,000-square-foot building in the Agawam Industrial Park that they would eventually purchase and expand.

From the beginning, Jim recalled, they understood the importance of investing in new equipment and staying on the cutting edge of improving technology, knowing that doing so would open new doors for them.

Small Business Persons of the Year for Massachusetts in 2023

Jim and Kelly Sullivan pose with an award they recently received at the recent SCORE Boston awards breakfast, where they were recognized as Small Business Persons of the Year for Massachusetts in 2023.

This was especially true with the installation, in 2007, of an automated, six-color Heidelberg press, the XL 75, a more than $2 million investment that included not only the press, but also Heidelberg software to automate all the company’s processes, from estimating to shipping.

This was the first such installation in the U.S., he told BusinessWest, and it came on top of a $1 million expansion of the building and a number of existing equipment loans.

The acquisition of the XL 75, and those other investments, were a well-thought-out business strategy, and the equipment was expected to enable Millennium to take a major step forward, he went on. However, the timing was unfortunate, to say the least.

Indeed, just a year later, the words ‘Great Recession’ were working their way into the local lexicon. The Dow was cratering, the economy was in freefall, and businesses large and small were hunkering down and simply trying to survive the onslaught. And, by and large, no one was printing anything.

“In 2008, we saw sales drop. People weren’t purchasing as much printing — annual reports, mailings … they just weren’t doing the volume of printing they were in the past. Yet, our expenses were at their highest point.

“In 2008, that was the first year we didn’t turn a profit,” he went on. “And the banks … they want to know who you are at that point.”

Elaborating, he said the couple had a great 19-year relationship with a bank (he chose not to name it) that was sold to a larger bank, an entity that saw Millennium’s declining debt-to-income ratio and essentially said, “you’re not for us.”

The Big Picture

The Sullivans said they knew they needed to create a plan to slash debt, both business and personal. They altered their lifestyle and borrowed a significant portion of their retirement money to retain employees and pay down debt to keep the business open. They also sought help from the SBA, working with the agency’s lending team to refinance their building and business debt and essentially save the business.

And for the next decade, until 2020, the company continued to be profitable, pay down debt, and even build a reserve fund, said Kelly, adding that, by the end of 2019, they approached a traditional bank about a loan to pay off all their existing SBA debt.

“Our numbers were good enough, our equity was good enough, our debt was right where it needed to be, and they approved us in March of 2020,” said Jim, adding emphasis when noting the month and year, and for obvious reasons. That was the start of the pandemic.

“The bank came back and said, ‘we’re going to have to put your financing plan on hold,’” he went on, adding that the company saw more than half of its customers shut down, a staggering loss that forced Millennium to lay off 75% of its workforce, although the Sullivans continued to pay for their health insurance after they were laid off.

Even with a skeleton crew — the Sullivans and a few others — the company was chewing up its reserve fund at a rate that was not sustainable, Kelly said, adding that PPP loans and EIDLs (Economic Injury Disaster Loans) from the SBA not only helped Millennium, but also enabled other businesses to regain their financial footing and buy services — like printing.

“Those two products from the SBA helped jump-start the economy,” she said, adding that, by the fall of that year, Millennium was able to bring back all of its employees. The winter of 2022 brought another slowdown and more “scary” times, she added, but a second round of PPP enabled the company to retain its workforce and make it through the whitewater.

The company was also able to take advantage of an SBA debt-relief program for its outstanding loans from the agency, Jim said, noting that the SBA made payments on those loans during the pandemic — payments that did not have to be repaid.

“In 2008, we saw sales drop. People weren’t purchasing as much printing — annual reports, mailings … they just weren’t doing the volume of printing they were in the past.”

All this support had the company back to “almost normal” by the end of 2021, he went on, adding that he and Kelly again approached the bank that had approved their financing plan but put it on hold because of the pandemic — and this time it was approved, just before interest rates started climbing at a precipitous rate.

Milennium’s involvement in many SBA programs had the effect of “putting us on the agency’s map,” said Kelly, referring to recognition programs such as Small Business Person of the Year.

But what won the Sullivans this honor, in her opinion — and Jim’s — has been its willingness to invest in cutting-edge technology, its commitment to supporting its employees through the many difficult times, and to do everything they had to do keep the company on the track they set in on back in 1989, even through extreme hardship.

“To do the amount of work we do, we would probably need more than 30 employees — if we didn’t invest in the technologies we have,” Jim said. “And we have technologies that no one in this area has, especially at the small scale that we are; we’re Heidelberg’s most advanced print shop with fewer than 20 employees in the United States.”

 

Bottom Line

Jim and Kelly’s email now comes with a signature, courtesy of the SBA, identifying the sender as a 2023 Small Business Person of the Year State Winner.

Behind those words, printed on a gold banner above storefronts depicting small businesses, is a compelling story, one that involves sacrifice, perseverance, determination, and, as Nelson noted, a firm commitment not to let go of a dream.

All that has earned the Sullivans those large, glass awards they are keeping safe at home. But it has earned them much more than that — the ability to keep writing new chapters to a remarkable and inspirational success story.

 

Outlook 2022/Small Business

By
Economic Outlook

Many Are Busy, But Challenges Linger as the New Year Dawns

 

Bart Raser says customers, contractors, and homeowners have all felt frustration

Bart Raser says customers, contractors, and homeowners have all felt frustration when their favorite brands aren’t available.

Bart Raser started by stating the obvious: 2021, like 2020, was “a great year to be in the hardware business.”

Indeed, many of those who found themselves working at home, or just spending more time at home because of COVID, found themselves wanting to work on their homes as well, and that certainly brought more customers — contractors and do-it-your-selfers alike — to the doors of the eight Carr Hardware locations, six in Western Mass. and two in Northern Conn., with the flagship store in Pittsfield.

But while business has certainly been good, there have been myriad challenges as well, from workforce shortages — which Raser, the company’s president, has largely been able to avoid, and he’s one of the few who can really say that — to inflation, production, and supply-chain issues, caused in large part by that soaring demand and a workforce crisis that no one in his sector has been able to avoid.

And that’s why large orders of grass seed, bird food, and other spring items will be arriving at those stores in a few days or a few weeks, rather than in mid-March, as is customary, because Raser’s team ordered well in advance to make sure the shelves would be stocked. And that’s also why he’s predicting it will be very difficult to buy a new lawnmower come April, and those forced to do so will pay a steep price for that item.

“Lawnmowers for spring look tricky — really, really tricky,” he told BusinessWest. “Some of the big manufacturers got out, and … there will be fewer choices and significantly higher prices.”

Raser’s story has its own specific nuances, but there are common threads for most all small-business owners in the region. For many, business has been good, although in most cases still not as good as before the pandemic. But there have been — and will continue to be — headwinds, like inflation, shortages of products that consumers want, lingering workforce issues, and the impact of all of the above on the bottom line.

Kris Houghton, a partner with the Holyoke-based accounting firm Meyers Brothers Kalicka, said 2021 was a time when her small-business clients were looking to put COVID behind them. That didn’t happen, obviously, and as they continued to battle the pandemic and many new challenges emerged or escalated, especially the workforce crisis and the rising cost of everything from labor to health insurance.

“There’s definitely an employee shortage, which is causing employers to have to pay more than they would otherwise have paid in the past,” she explained. “And, of course, paying more leads to two things: they either increase prices to their customers, or there is less profit for them in the end. It’s a compounding problem, and the biggest issue is employees.”

But there are others, including supply chain, she said, adding that businesses in many sectors could have done better in 2021, if they only had product to sell or produce. That’s true of auto dealers, obviously, but also hardware chains, restaurants, and manufacturers.

“Supply chain is also a big problem because, if businesses can’t get the product, they can’t sell it,” Houghton noted. “And if they want the product bad enough, they pay increased shipping costs to try to make product available; all this is leading to diminished bottom lines.”

And these dynamics become even more critical in the months ahead, she went on, because most federal support programs, from PPP to the employee-retention credit, have expired or soon will.

“Those were lifelines to try to restore a little bit to their bottom lines,” she said. “So there is concern about the future. In New England, we’re resilient, and some businesses were fortunate enough to have some reserves that can help them carry on. I don’t know about the other businesses. Are they going to be able to borrow? Are they going to run up costly debt? Are business owners going to be relying on credit cards, which come with 18% interest? These are some of the questions that will be answered in 2022.”

“Supply chain is also a big problem because, if businesses can’t get the product, they can’t sell it. And if they want the product bad enough, they pay increased shipping costs to try to make product available; all this is leading to diminished bottom lines.”

As noted, 2021 was a solid year for many small businesses, especially those in manufacturing and related services. Jeanne Bell, controller and co-owner of Westside Finishing Co. in Holyoke, spoke for many when she said her company struggled to keep up with demand from customers who saw a surge in orders themselves.

“We ended up having a really good year,” she said. “It started off rocky, of course — the first two quarters, we were eligible for the employee-retention credit, but the second half of the year has been really, really busy, and it looks like it’s going to continue into next year.”

She said Westside is a job shop that power-coats parts and ships them back out again. Clients, and there are many, include OEMs like East Longmeadow-based Excel Dryer.

“We work for a variety of industries, and all of them are busy right now,” she told BusinessWest. “We’re actually turning down work right now because we can’t do it all; we would have to start a second shift to have more capacity, and we probably wouldn’t mind doing that if we thought we could get the people, but that’s our biggest challenge — workforce.”

Elaborating, she said the company’s labor costs rose in 2021, and one of the big reasons why was the need to hire additional staff to fill in for those out with COVID. And those additional costs kept this past year from being as profitable as others in the past.

Looking back, and ahead, she said overall sales in 2021 were not quite at pre-COVID levels. But she believes the company can get there in 2022, if current trends involving customers continue, if the economy continues to grow, and if some of those issues impacting clients themselves, including production and supply chain, work themselves out.

That’s a good number of ‘ifs,’ but overall, she said there is ample reason to be optimistic about the year ahead.

“We’re actually turning down work right now because we can’t do it all; we would have to start a second shift to have more capacity, and we probably wouldn’t mind doing that if we thought we could get the people, but that’s our biggest challenge — workforce.”

Raser concurred, but noted that most of the issues that came to the surface in 2021, especially when it comes to production and supply-chain woes — due to everything from soaring demand to workforce shortages to that large number of container ships waiting in a queue to be unloaded — are expected to linger well into 2022. He said roughly 3,000 of the 38,000 products his company sells have been impacted by both production and supply-chain issues, with that list including everything from paint and batteries to plumbing supplies and those aforementioned lawnmowers and other types of power equipment.

Paint manufacturers have been especially hard hit, he noted, adding that resin plants in Texas were set back by a succession of natural disasters, including the snow and freezing temperatures last winter and, later, hurricanes, as well as workforce challenges.

“All the big manufacturers of paint — Sherwin Williams, PPG, and Benjamin Moore — are all really struggling,” he noted. “And our painting contractors are very frustrated, as are their customers and homeowners as well. We’re been around a long time and have a lot of brands, so we’re able to pull a lot of levers to keep items in stock, but people have to flexible — they may have to consider moving to a different brand or a different product to get their project done.”

That part about being flexible goes for small businesses as well. This past year was solid for many of them, but business wasn’t the ‘normal’ that people had been hoping for, and expecting, around this time last year.

As we turn the calendars again, there are similar hopes and large doses of optimism, but the reality is that normal, as we knew it 22 months ago, is still an elusive target.

 

— George O’Brien

PPP Second-draw Loans Come with Strict Eligibility Requirements

By Contributor
Accounting and Tax Planning

Round 2

By Jonathan Cohen-Gorczyca, CPA, and Amila Hadzic

On Dec. 27, 2020, the Economic Aid to Hard-Hit Small Businesses, Nonprofits, and Venues Act was signed into law to assist businesses who have been financially impacted by the COVID-19 pandemic. As a result of the Economic Aid Act, the Paycheck Protection Program’s second-draw loan program was created.

This program will allow the U.S. Small Business Administration to provide eligible businesses with additional loans, similar to those from the original Paycheck Protection Program (PPP). The last day to apply for the second-draw loan is March 31, 2021, and there are eligibility and documentation requirements that need to be met during the application process.

 

Eligibility

This loan can only be made to a business that has received a first-draw PPP loan and has used the full amount of the loan on eligible expenses before the disbursement of the second loan. A business that was ineligible for the first loan cannot receive the second-draw PPP loan.

In order to be eligible for this second-draw PPP loan, the business must have 300 or fewer employees. The business must have also experienced at least a 25% reduction in revenue in 2020 compared to 2019. The revenue reduction can be calculated by comparing one quarter in 2019 with the same quarter in 2020. However, if the business was not in operation for the full year in 2019, there are other periods that can be used for this calculation. If an entity was in operation for all four quarters in 2019, then the annual revenue can be compared with 2020.

 

Loan Amount

The maximum loan amount for the second loan is the lesser of $2 million or two and half months of the business’ average monthly payroll. For those who are assigned a NAICS code with 72 or are a seasonal employer, the loan amount can be greater than two and a half months. The borrower can use either total wages paid in 2019 or wages paid in a 12-month period before the loan was made to calculate average monthly payroll. There is also the option to use 2020 wages.

 

Application and Documentation

In order to apply for this loan, the SBA Form 2483-SD needs to be completed. Form 941, state quarterly wage unemployment forms for the applicable quarter used, and other payroll records may be needed depending on the payroll period used to calculate the loan amount. For ease of applying for a second-draw loan, it is recommended that you apply using the same lender, as much less payroll documentation will be needed because it should already be on file with the institution.

The documentation requirements are similar to the first PPP loan. If the loan is greater than $150,000, documentation will be needed to show the revenue reduction at the time of application. Bank statements, annual tax forms, and quarterly financial statements can be provided as documentation. For loans under $150,000, this information can be submitted during the loan-forgiveness process.

 

What If I Did Not Receive a First-draw PPP Loan?

The SBA is also accepting applications for first-time PPP borrowers. The loan is capped at $10 million for eligible businesses. If the loan is used to pay for payroll and other eligible expenses during the eight- or 24-week period, it is eligible for forgiveness. Eligible costs for both the second-draw loan and first-draw PPP loan include payroll costs, business mortgage interest, rent, lease payments, utility payments, worker-protection costs, property damage costs due to looting and vandalism not covered by insurance, and other supplier and operation costs. Payments made to an independent contractor do not qualify.

As with the first-draw PPP loan, it is best to reach out to both your accountant and loan provider to find out if a second-draw PPP loan is right for you. They will be able to help you determine what is right for your business and help walk you through the application process.

 

Jonathan Cohen-Gorczyca, CPA, is a manager, and Amila Hadzic is a staff accountant with the accounting firm Melanson, which has offices in Greenfield and Andover, as well as Merrimack, N.H. and Ellsworth, Maine.

State Announces $668 Million Small-business Relief Package

By
COVID-19 Daily News

BOSTON — The Baker-Polito administration launched a $668 million program on Wednesday to provide financial assistance to Massachusetts small businesses impacted by the COVID-19 pandemic. The program relies in part on the pending federal COVID-19 relief bill recently passed by the U.S. Congress. Regardless of the developments at the federal level, the Baker-Polito administration will start releasing millions in new funding to restaurants, retailers, and other small businesses throughout the Commonwealth as soon as next week.

Earlier this week, the administration announced nearly $49 million in grants through the Massachusetts Growth Capital Corp. (MGCC) COVID-19 Small Business Program to support more than 1,158 small businesses. More than 10,000 applicants had sought relief in this grant round.

Additional grants will be made available to eligible small businesses through MGCC. The Small Business Grant Program was established in the fall and currently has a pool of eligible applicants awaiting funding. This additional funding will allow the administration to award more of those pending applicants. Eligible businesses that already applied to the program, but were not funded due to limited funds available, will be prioritized for funding first and do not need to reapply.

The funds will also be used to stand up an additional grant program at MGCC. This program will target the industries most hard-hit during the pandemic. Eligible industries for the new program include restaurants, bars, and caterers; indoor recreation and entertainment establishments; gyms and fitness centers; event-support professionals (photographers, videographers, etc.); personal services; and retail.

The new business relief program would offer grants up to $75,000, but not more than three months’ operating expenses, to be used for employee wage and benefit costs, space-related costs, and debt-service obligations.

The online application portal for the new program will open on Thursday, Dec. 31, and will close on Friday, Jan. 15. Awards are expected to be announced in early February. More details on how to apply, as well as eligibility requirements, are available at www.empoweringsmallbusiness.org.

For This Dental Practice, COVID Has Brought Myriad Challenges

By
Dr. Ronald Goldsher
Coronavirus

Root Causes

Dr. Ronald Goldsher

Dr. Ronald Goldsher says COVID has brought a host of new challenges for his practice, but also some rewards in the form of being able to help patients in need.

In many ways, Dr. Ronald Goldsher says, dentists and periodontists were better-prepared for COVID-19 than many others in healthcare, and certainly most business owners not in that sector.

“In some respects, dentists are way ahead of the curve because of what happened years ago with the AIDS epidemic,” said Goldsher, owner of Pioneer Valley Periodontics, which operates offices in Northampton and Greenfield. “At that time, there were a lot of mandated changes in infection control, so we’re used to sterilizing everything, using barriers on equipment, wearing masks, and disinfecting surfaces between patients; we may have ramped things up a bit [since COVID], but we were used to doing all that.”

But being better prepared certainly didn’t mean Goldsher and others in this profession were fully prepared for all that COVID-19 would throw at them — from the trepidation of patients to seek needed care to the equipment that would have to be purchased (from PPE to special air filters) to keep staff and patients safe; from confusion regarding what procedures could be carried out (and when) to the sharp reduction in overall business volume.

Add it all up, and it’s been ultra-challenging and even unnerving, said Goldsher, before adding quickly that it has also been rewarding at times. Indeed, to be open and able to provide needed services to those in need, especially those with emergencies, has been gratifying, he told BusinessWest.

“Every day, I have patients thanking me for being open and doing what I’m doing,” he said. “Some people tell me stories about how they have food delivered outside their home, their mail goes into plastic bags and they wait several days until they open it, they don’t exchange any money and they don’t leave their house — but they come to their dental appointment because it’s been eight months, and they used to come every two or three months to get their teeth cleaned, and they haven’t had a cleaning in a year. They’re so happy we’re open and providing this service, and, in their words, we’re taking risks to see patients. That’s brings a lot of lot of joy to my practice and my staff.”

Playing back the tape from a trying 2020, Goldsher said he was skiing in Colorado in late February as the news about the virus started to intensify. By the time he returned in early March, things were still normal, but soon began to change in a profound way — for both his business ventures; he and his sons also operate the entertainment venue Hawks & Reed in downtown Greenfield.

“In some respects, dentists are way ahead of the curve because of what happened years ago with the AIDS epidemic.”

Hawks & Reed had to close down, as all indoor performance venues did, and the periodontal office did as well, starting March 13.

“We shut down for what we thought would be two weeks, and two weeks turned out to be almost three months,” he explained, adding that the green light to reopen came in late May, only to have that date come and then be moved back another week, forcing the practice to reschedule a number of appointments and inconvenience several patients — and staff as well.

“There was a lot of confusing information, even when were ready to reopen Pioneer Valley Periodontics; the timelines that were given us by the governor were convoluted and confusing,” he said, noting that these adjectives also describe the information coming out about which procedures fell into the category of ‘essential’ — those that could be undertaken at that time — and which ones didn’t.

But gaining clarification on such matters was just one of the struggles, he went on.

“We were available on an emergency basis, but that comes with a lot of other issues,” he explained. “Like having staff that can come in in an emergency — they can’t be there all the time — and preparing the office for those emergencies.”

As noted earlier, Goldsher said dental practices in general were in some ways better-prepared for this pandemic because of safety measures that have been in place for some time. And his practice was even better-prepared than that in some respects because of the way he had stockpiled PPE over the years.

“I had thousands of surgical gowns that I collected over the years from doing implants,” he explained. “They come in a pack — there would be four or five in a package; we’d use two, and there would be two or three left over. The staff would always say, ‘let’s just throw these away,’ and I would say, ‘put them in a bag.’ We had garbage bags filled with gowns, so we were able to donate several thousand of them to Baystate Franklin Medical Center.”

Still, the pandemic has tested this practice in myriad ways, he went on, speaking for all those in healthcare when he mentioned everything from maintaining adequate staffing to coping with sharply reduced patient volumes, to simply dealing with all the unknowns, not to mention the emotional trauma of seeing patients in the middle of a pandemic.

“Despite all those precautions we were taking, it was still a little unnerving, and it took a couple of weeks for people to settle down because the psychological impact of the virus was there; you can’t see it, but it’s there,” he noted, adding that the spouse of one patient treated by the staff developed COVID-19 and eventually died.

As the calendar turns to 2021, the practice is coping with patient volumes far below what would be considered normal, said Goldsher, mostly due to a fear factor that has always been prevalent, but has kicked into an even higher gear amid the recent spike in cases.

“Patients will cancel at the very last minute depending on the news of the day,” he told BusinessWest, adding that overall revenues are down probably 35% or more for the year, this on top of all those additional expenses. “And from the top levels on down, there has been a lot of confusing information that’s been disseminated.”

He’s not sure when something approaching normal will return, but he does know that challenges remain and it will be some time before there is significant improvement for those in the field.

As he said, being better-prepared certainly helped, but it didn’t fully prepare anyone for what this unforgettable year has brought.

 

George O’Brien can be reached at [email protected]

Greenfield Recorder Stays Locally Focused on Pandemic — and Everything Else

By
Joan Livingston
Coronavirus

Words to Live By

Joan Livingston

Joan Livingston says reporters are working hard remotely, but she’s looking forward to the unique energy of a full newsroom.

Late last winter, Joan Livingston and her team at the Greenfield Recorder were planning a comprehensive, multi-part series of articles marking the 100th anniversary of women gaining the right to vote in the U.S. But, as businesses of all kinds can attest, plans made in February had a way of shifting in March.

“We were planning a series on suffrage; it was going to run, and we stopped that immediately,” said Livingston, editor in chief of a daily publication that covers some 30 communities in Franklin County and the North Quabbin region. But while the editorial focus may have changed — we at BusinessWest also remember, quite clearly, those early days of all COVID stories, all the time — the Recorder’s philosophy of hyper-local coverage did not change.

“That has remained our focus, how those communities have been impacted,” she said. “We had to shift gears pretty fast. We weren’t expecting this; no one was expecting this.”

Michael Moses, publisher of the Recorder and several other community newspapers in Western Mass. and New Hampshire, remembers closing all the buildings on March 16 and setting up reporters, designers, salespeople, and others at home.

“At that point, everyone wanted to work remotely, so we took steps to make sure they were able to work from home,” Moses said. “Like everyone else, we didn’t have a lot of time for planning for that, but everything came together pretty well. From an IT perspective, we were already teed up with our front-end system for the news to operate from anywhere, and that flexibility certainly helped us. So it was an essentially seamless transition.”

Since then, the newspaper offices have been open to employees who need to use them, from customer-service staff to the business offices, as well as some reporters, but in general, much of the work of producing these daily and weekly publications has continued remotely.

“A few people work only from home, some are hybrid and come in half the week, and then there are people like myself, who work in the newsroom all the time,” Livingston said of the environment at the Recorder, which is headquartered in downtown Greenfield. “We wear masks when we talk to each other, and we practice safe-distancing rules, but I miss that camaraderie, reporters just sitting around and swapping stories. I look forward to getting that back when things turn around eventually.”

That said, “I’m impressed with our hardworking staff,” Livingston went on. “They continue to generate coverage — that’s one good thing the pandemic did not stop. They’ve been great.”

Like all community newspapers with a wide coverage area, the reporters tend to stick to specific geographic beats, getting to know their communities intimately. The pandemic has shuttered municipal offices to the public and canceled annual events, making a reporter’s traditional in-person contacts harder to come by.

“I miss that camaraderie, reporters just sitting around and swapping stories. I look forward to getting that back when things turn around eventually.”

However, “business hasn’t stopped in terms of what’s happening in town governments, which we cover pretty heavily,” she added. “Some of it’s done virtually, we’ve had annual town meetings in cars or a field, and people have been inventive about trying to be safe during this time. That has been nothing like being in person, but we’re doing the best we can with what we have right now.”

At the same time, readers’ reliance on locally generated news is more critical than ever, especially in a year when locals need to understand how COVID-19 affects them personally, yet messages from national media sources and (especially) the internet have ranged at times from sensationalized to misleading.

That reporters are delivering that news by communicating with team members remotely is all the more impressive, Livingston noted. “Our computer system allows us to work anywhere, and that’s really helpful.”

It’s a slightly smaller team these days, too, she added.

“We had some layoffs after a few months [of the pandemic], and the paper got smaller because businesses are struggling and advertising is not their priority. But I’m impressed by the work ethic of the staff because we are down a few people, and hopefully, when things change, we’ll be able to restock those positions. But they’ve picked up the slack, and I’m impressed.”

Moses sees a silver lining in this year’s shifts in the way people work, because the industry was already moving in some ways toward more remote work, or at least asking questions about the best use of physical space.

“This has allowed us to accelerate where we were going anyway, so there are some positives to all this,” he said. “Like everyone else, we’re always trying to find efficiencies, and I want to be able to draw on those efficiencies.”

That’s not to say publishing hasn’t been challenging this year; it certainly has. “No surprise there, but, thankfully, we’ve been able to manage through it, and as difficult as it’s been, everyone has stepped up pretty well, regardless of which part of the business they’re functioning in.”

The Recorder did eventually get to that series on suffrage over the summer, examining the issue over a period of weeks, not only from a national perspective, but also — and maybe more importantly — through the lens of local history, local organizations, and local viewpoints.

That’s how the newspaper has continued to handle COVID-19 as well.

“I’m reminded every day that, on a whole range of subjects, whether or not they’re health-related, we’re helping readers manage through this, giving them critical news they need, and trying to provide them the right local information they wouldn’t be able to get anywhere else,” Moses said. “That’s even more critical now.”

 

Joseph Bednar can be reached at [email protected]

 

Pandemic Has Forced This ‘Pet Resort’ to Consolidate and Pivot

By
Chris Pratt, right, and Tracy Faulstick
Coronavirus

COVID Tails

Chris Pratt, right, and Tracy Faulstick

Chris Pratt, right, and Tracy Faulstick have had to pivot and create new revenue streams, because COVID-19 has left fewer dogs home alone.

“Because no one wants to be left home alone.”

That’s the marketing tagline for a venture called Wagging Tails Pet Resort, and until the middle of last March, it effectively summed up what this company was all about and why it was so successful; dog owners wholeheartedly agreed with that sentiment.

That was true for the boarding side of this operation, obviously, but the day-care component as well, said owner Chris Pratt, who told BusinessWest that many professionals had come to understand the value of leaving a dog in a day-care facility — for companionship and also, in the case of larger, athletic breeds, to work off some off their considerable energy before their master gets home at the end of the day.

But starting in March, most dogs didn’t have to be left home alone. Their owners were working remotely for the most part, if they were still working at all. Meanwhile, very few people were traveling anywhere.

Almost overnight, business for the day care, boarding, and other components of the multi-faceted Wagging Tails operation plummeted, said Pratt, noting that the COVID-19 pandemic could not have come at a worse time for her — not that it’s come at a good time for anyone.

“Going into March, we were overbooked in Hadley … by March 15, we had one dog left, who actually went home with me at night. I called the owner and said, ‘your dog is the only one here; do you mind if I take him home?’ They said, ‘no, please do.’”

That’s because business had been so good at her resort on Russell Street in Hadley that she moved aggressively and opened a second location on Florence Road in Easthampton — the Heritage Farm — last February to handle what had become an overflow.

Just a few weeks later, though, there was no overflow. She said she kept operating both locations as long as she could, but when Thanksgiving came and the numbers of boarding and day-care dogs were just a fraction of what they were a year ago — and not able to generate enough revenue to pay the staff — Pratt was forced to shut down the Hadley operation, with the intent of reopening when things get better.

“We’re combining our resources to get through the winter,” she explained. “And we’ve been very fortunate that a number of customers have decided to make the 15-minute journey across the bridge to bring their dogs here to the farm.”

That farm, all 30 acres of it, like the Hadley setting, is described by Pratt as a one-stop shop for dogs and their owners, offering everything from boarding to grooming; from day care to retail sales of food and other pet supplies; from walking to training. But because there’s less of all that, there’s now even more that people could do during one stop — or a few.

Indeed, Pratt is making the most of the indoor and outdoor spaces at the farm, and now offering new services ranging from horse boarding to riding lessons, to animals (such as several goats that arrived recently) that children and families can visit with.

“There’s a lot of things going on here that families can take part in,” said Tracey Faulstick, a business consultant working with Pratt to revise the Wagging Tails business plan. “There’s farm animals … there’s a lot that families can participate in in terms of training, horse lessons, and more. There’s an entire community here that’s dedicated to taking care of animals and people in a very safe environment.”

Creation of this community is a classic case of pivoting, making do, and trying to earn a living and keep people employed until things get better — a business survival plan, if you will. It’s also another case — among a great many in this region — of a company doing very well and expanding its operations … until the word COVID became part of our lives.

Indeed, as dogs barked parked consistently — and loudly — in the boarding area, Pratt recounted how and why she amended her business plan more than a year ago and put some ambitious expansion plans on the table.

“Hadley was full at the time … we had a waiting list,” she noted, adding that, essentially, all aspects of the business were booming, from the grooming to the training to the boarding and day care. But COVID-19 changed things in a hurry.

“Going into March, we were overbooked in Hadley … by March 15, we had one dog left, who actually went home with me at night,” she recalled. “I called the owner and said, ‘your dog is the only one here; do you mind if I take him home?’ They said, ‘no, please do.’”

But that was just the start. Indeed, restrictions imposed by the governor essentially shut down the grooming and training operations, two reliable revenue sources, for two months. Meanwhile, as noted, few people were traveling anywhere, for work or pleasure, putting a deep dent in the boarding side of the venture.

Some aspects of this business have returned to one extent or another — grooming and training, for example — and the day-care side has bounced back somewhat, as some dog owners realize the value of that service, even if they are home working all day. Pratt is hoping more people get that message.

“Dogs still need to socialize,” she explained. “Even if people are home working and with their dogs, they should still bring them to day care occasionally, to keep them socialized and keep them from getting separation anxiety; it’s better for the dogs. We were seeing, with people who hadn’t been here for weeks, that when they brought the dog back to day care, the dog was so happy, so excited, and so energetic that they lost most of their socialization skills — so we had to reteach them.”

This reteaching is just part of the COVID story at Wagging Tails, an intriguing saga that, like many in this region, involves imagination, perseverance, and entrepreneurial spirit, all of which are needed to get to other side of this pandemic.

 

George O’Brien can be reached at [email protected]

Hot Oven Cookies Seizes Growth Opportunities During Pandemic

By
For Sheila Coon and her husband, Dan, the pandemic has been a time to expand
Coronavirus

Things Are Heating Up

For Sheila Coon and her husband, Dan, the pandemic has been a time to expand

For Sheila Coon and her husband, Dan, the pandemic has been a time to expand, not retrench, and set new and ambitious goals for the future.

For many small-business owners, 2020 has been a year to hunker down. To focus on survival. To put plans for expansion on hold and devote time and energy to simply getting to next month, or even next week.

Not so for Sheila and Dan Coon, owners of Hot Oven Cookies.

For them, 2020 has been a year to take their brand to places, and a level, it had never been before, and to foster plans to take it further still in the years to come. It’s been a time to establish themselves downtown and uptown, as they like to say (we’ll explain later), and expand not only the footprint, but also the product lines, including cookie dough by the pint — ‘dough to go,’ as they call it.

There has been some good fortune, or serendipity, if you will, along the way, and some strong evidence that cookies have become a comfort food in the midst of this global pandemic — there’s even talk of a possible cookie shortage for the holidays. But mostly, this has been about entrepreneurial spirit and seizing opportunities when they have come about — traits that have defined this venture from the start.

About a year or so ago, none of what has transpired since seemed likely or even possible. In fact, as Sheila recalls, the husband-and-wife team were thinking about packing it in and turning the oven off for good.

Indeed, by late 2019, the company, then located at 1597 Main St. in Springfield, had endured several months of turmoil with its landlord over conditions that had made it increasingly difficult to do business — no heat in the winter, no air conditioning in the summer, for example. By mid-November, matters had come to a head, and the company had essentially ceased activity in that location, operating for a time out of its Cookie Cart (a food truck of sorts) until its pipes froze in the winter.

The two partners eventually went back to their storefront at the behest of customers, but when they did, it was late February, just before the pandemic arrived and a wave of restrictions on small businesses like this one went into effect.

“My husband and I were thinking, ‘we should probably close and collect unemployment, because this is going to be bad,’” she recalled, adding that, instead of shutting down, they decided to hang in — mostly due to the strong loyalty displayed by long-time customers.

That decision to persevere became just the first of many watershed moments over the past nine months or so. The company has since opened two new locations — one in Sixteen Acres at the Bicentennial Plaza (that’s the ‘uptown’ location) and then another (a replacement for the old site) further south on Main Street in Springfield, in a location formerly, and briefly, occupied by a Delaney’s Market. Both opened just last month.

Sheila knew about the downtown location and had her eye on it — sort of. She had long thought it out of her reach price-wise, but then, there was some of that serendipity.

“My husband and I were thinking, ‘we should probably close and collect unemployment, because this is going to be bad.’”

“I remember saying to someone, ‘if I could open up where Delaney’s was, I would do it in a heartbeat,’” she told BusinessWest. “It was wishful thinking, but two days later I got a phone call, and someone said, ‘hey, we have the keys, would you like to go see it?’

“We came to see it a few days after we opened Allen Street, and we thought, ‘this is beyond our reach,’” she continued. “But our brand reputation preceded us, and the landlord was extremely willing to work with us because he wanted us here. And here we are.”

In addition to those two locations, the company still operates the Cookie Cart, which has been parked at a number of area colleges, businesses, and even private residences for birthday parties and anniversaries, and also has a kiosk at Bradley International Airport, which has been idled by the pandemic — the one aspect of the venture to be slowed by COVID-19.

As BusinessWest talked with Sheila at the downtown location on a Thursday afternoon a few weeks before Christmas, customers steadily filed into the store. At one point, the line became long enough that she hit pause to go help her employee behind the counter.

It has been like this pretty much since the location opened, she said, adding that the Hot Oven brand — featuring more than 100 flavors, including staples like Dark Chocolate + Seal Salt Chip, Boozy Cake Batter Sugar, and Coquito Snookerdoodle — has always been popular and sought out by those in this market and others residing well outside it.

And the pandemic has made it even more popular, she believes, theorizing that the cookies provide a measure of comfort, a measure of normal, at a time when people are craving both.

Indeed, when asked how the downtown was doing since opening, she started with “wow,” paused for a second, and put it in perspective.

“My husband and I had a logistical meeting before we opened both the shops,” she recalled. “And the conversation went something like this: ‘we’re moving two blocks over to a new location and new customer base, and we’re moving uptown to another location; it’s going to take a while for people to catch on that we’re here.’

“Nope … that hasn’t been the case,” she went on. “Business down here for us has been double or triple what we’re doing two blocks over. And uptown is a beast of a shop — we sell out every day.”

Looking ahead, Sheila said the company is looking forward to the day when the kiosk at Bradley can open and become a strong source of revenue that can finance future expansion — perhaps into Worcester, Boston, and other cities. And there has long been talk of franchising this brand and taking it well beyond its Western Mass. roots.

For the immediate future, though, the two have their hands full with the two new locations and the brisk business they are witnessing.

There have not been too many business-expansion stories during this pandemic, but this is certainly one of them.

Call it a feel-good story if you like, but this is also, and especially, a taste-good story. And a very intriguing one at that.

 

George O’Brien can be reached at [email protected]

Baker’s Reopening Plan Is Anything But

By
Opinion

Editorial

If you watched Gov. Charlie Baker at his highly anticipated press conference to announce the state’s reopening plan last week, you may have been very disappointed.

The governor said he is trying to create a balance between keeping people safe and attempting to resurrect an economy that was seen by many as being one of the strongest in the country — although not anymore, thanks in part to the governor.

If balance is the goal, this plan — if we can really call it a plan — falls way short. It doesn’t move quickly or profoundly enough, and it leaves far too many of the small businesses that form the backbone of the state’s economy without any real chance to weather this storm.

In short, Gov. Baker’s plan creates winners and losers, haves and have-nots —  a situation where Walmart or Home Depot can open their doors to the public, but small, locally owned retailers are forced to keep theirs closed or operate curbside (if they can); a situation where a yoga school with eight students is put in the same category as a Planet Fitness with thousands of members.

As most everyone knows by now, the Baker administration’s reopening plan has four phases — named ‘start,’ ‘cautious,’ ‘vigilant,’ and ‘new normal.’ On May 18, a day every business owner had circled on his or her calendar, the governor gave some details on phase 1. Manufacturing and construction could restart immediately, with restrictions, as could places of worship, while hospitals and community health centers can now provide high-priority preventive care, pediatric care, and treatment for high-risk patients and conditions. On May 25, laboratory and life-sciences facilities can open; offices can reopen, except in Boston; and recreational-marijuana shops can reopen, as can salons, barber shops, and pet groomers. Retail facilities can open for remote fulfillment and curbside pickup.

Gov. Baker’s plan creates winners and losers, haves and have-nots —  a situation where Walmart or Home Depot can open their doors to the public, but small, locally owned retailers are forced to keep theirs closed or operate curbside.

But there are no details on phase 2, which includes restaurants and lodging, some healthcare facilities, and playgrounds and pools, or phase 3, which includes bars, casinos, gyms, and museums. All that’s known is that each phase will last at least three weeks and could be extended before moving on to the next stage, depending on factors like COVID rates, testing, and healthcare-system readiness.

For small businesses, this slow, plodding pace and lack of details makes it difficult, if not impossible, to plan and — more importantly — stay alive. The governor’s plan is anything but a plan, and it will spell the demise of many small businesses.

Rick Sullivan, president of the Economic Development Council of Western Massachusetts, put things in perspective when he told BusinessWest, “I think there needs to be an appreciation for restaurants and small Main Street businesses that are not going to be able to just comply with those protocols. They’ll need to plan, order equipment, and spend some time reorganizing their business, because it’s going to be different than it was pre-COVID. And it’s not something they can do overnight.”

The reopening panel could have recognized the needs of small businesses and implemented common-sense protocols to allow them to open. Instead, it chose not to. Clearly, there doesn’t seem to be an appreciation for just how endangered our state’s small businesses are, or what will become of our cities and towns if they are allowed to die on the vine.

These businesses need more than a belated plan with cleverly (or not-so-cleverly) named stages. They need a common-sense blueprint for effectively reopening an economy that’s been shut down for two tortuously long months.

The governor’s ‘plan’ is anything but that.

Stimulus Money Goes to Wrong Places

By
Opinion

Editorial

“Free money.”

That’s the phrase one of the region’s bank presidents used in a recent interview with BusinessWest to describe funds contained within the Paycheck Protection Program (PPP) being administered by the U.S. Small Business Administration.

He’s not entirely accurate with that choice of words — these loans are forgivable only if the companies receiving them keep everyone on the payroll for the prescribed period. But ‘free money’ is essentially what this is, if those requirements are met.

And the lure of free money is obviously quite strong, because interest in this program is off the charts. And as news starts to leak out about some of the large, national companies that are receiving this free money, it’s clear to us, and most everyone else, that some of it — and, unfortunately, a large portion of it — is not going to the desperate small businesses that need it most.

Hedge funds, national restaurant chains like Ruth’s Chris Steak House and J. Alexander’s, and a host of other large, public companies have all received several million dollars from the $369 billion fund, which was totally depleted less than two weeks after the program was officially launched. Meanwhile, Harvard University, with its $40 billion endowment, received nearly $9 million in aid from the federal government through the CARES Act — specifically, a $14 billion fund to support higher-education institutions during the pandemic. More ‘free money.’

Actually, Harvard received less than some other either Ivy League schools — Columbia and Cornell each got almost $13 million.

Whatever those numbers are, they represent poor allocation of money that is desperately needed to keep smaller businesses afloat during these ultra-challenging times. Harvard could certainly use $9 million, but it doesn’t need $9 million — not nearly as much as hundreds of struggling small colleges across the country do.

Ruth’s Chris Steak House could certainly use the $20 million it received, but it doesn’t need it to survive like the myriad small restaurants pushed to the brink of collapse need it.

Before we go any further, we’ll acknowledge that big companies have just as much right to apply for, and receive, stimulus money as the small ones do. They’re not breaking any laws by doing so. And we understand that a job saved is a job saved, whether that job was provided by a national taco chain or the corner pizza joint.

But the reality is, with a great many small businesses across this country, when it comes to the pandemic, we’re not talking about a bad quarter or a bad year — we’re talking about survival.

And while it wasn’t written into the legislation that created the Paycheck Protection Program and other forms of relief, enabling threatened companies to survive was, or should have been, the intent.

Moving forward, it should be. Many more relief measures will be passed in the months to come, and with these, Congress should be more diligent about who is eligible and who is actually awarded funds.

Meanwhile, we encourage those larger businesses to follow the lead of Shake Shack, the giant chain that was awarded PPP money and then gave it back amid the outcry from smaller businesses left high and dry.

“As we watched this opportunity play out over the weeks, it was very clear that the program was underfunded and wasn’t set up for everyone to win,” Shake Shack CEO and Chairman Danny Meyer said of his decision. “By returning our $10 million, that $10 million can go back into the pot and go to the people that deserve it.”

He’s right about that, and by ‘deserve,’ he means the hardworking small-business owners who simply don’t have the resources to weather this storm.

These are the people who deserve this ‘free money,’ and we’re hoping that, from this point forward, more of them wind up getting it.

The Impact of the Small Business Reorganization Act

By
Law

A New Type of Relief

By Rebecca Mercieri Rivaux, Esq.

Rebecca Mercieri Rivaux

Small-business owners will soon have a more affordable option to reorganize their companies. In February 2020, the Small Business Reorganization Act (SBRA) will go into effect, providing a new type of relief to small-business debtors.

The SBRA creates a new subchapter within Chapter 11 of the U.S. Bankruptcy Code. While Chapter 11 bankruptcy generally provides for business reorganization (usually involving a corporation or partnership), it can be an unappealing option for many small-business debtors, due to complex procedural requirements and high legal and administrative costs. The SBRA will expedite reorganization for small-business debtors by streamlining the burdensome requirements of Chapter 11 bankruptcy.

The SBRA is, in fact, very comparable to a Chapter 13 bankruptcy, the kind used by individuals. Just as with Chapter 13 filings for individuals, an SBRA debtor can expect to have a trustee appointed by the bankruptcy court. The court-appointed trustee will aid the small business in developing a reorganization plan, but is not likely to be involved in any operational aspects of the business. This essentially allows the debtor to remain in possession and control of their own business during the bankruptcy process. The trustee is responsible for disbursing payments to creditors under the reorganization plan.

In order to take advantage of the new SBRA, a debtor must first qualify as a small business. To qualify, the debtor must be a person or entity engaged in a commercial or business activity. If such a business has secured and unsecured debt totaling less than $2,725,625, the business may propose a reorganization plan under the SBRA — so long as they use net income to repay creditors.

This is in keeping with the general practices of Chapter 11, where a debtor usually proposes a plan of reorganization to keep its business in existence and pay creditors over time.

SBRA debtors must produce a copy of the business’ most recent balance sheet, a statement of operations, a cash-flow statement, and a federal income — or file a sworn statement that such documents do not exist.

The SBRA allows the small-business debtor to repay its creditors within a payment plan of three to five years, as the bankruptcy court determines. The SBRA also allows small-business debtors a greater opportunity to retain their ownership interests in their business, even when claims have not been repaid in full (in contrast with a typical Chapter 11 bankruptcy, where a shareholder cannot retain equity in the business unless creditors are paid in full).

To qualify, the debtor must be a person or entity engaged in a commercial or business activity. If such a business has secured and unsecured debt totaling less than $2,725,625, the business may propose a reorganization plan under the SBRA — so long as they use net income to repay creditors.

Another significant benefit to the SBRA is a specialized restructuring strategy offered to individual debtors. An individual who qualifies as a small-business debtor can modify the mortgage on his or her principal residence, provided that the mortgage loan was not used to acquire the real property, but was used primarily in connection with the debtor’s business — such as an individual who is borrowing against the equity in their home for the purpose of supporting their business. This individual small-business debtor would then be able to reduce the loan to the value of the secured claim, propose a lower interest rate, or extend the maturity date of the loan. Once the small-business debtor has completed all payments to creditors, a discharge is granted.  

Under the SBRA, the only excluded activity for the small business debtor is operating “single-asset real estate,” a term that describes a debtor who receives substantially all of its gross income from the operation of a single real property.

Despite this restriction, for many small business debtors, the SBRA will offer relief and a realistic means to reorganize and restructure their businesses under the Bankruptcy Code.

Rebecca Mercieri Rivaux is an associate with Bacon Wilson, P.C., and a member of the firm’s bankruptcy and business/corporate practice groups; [email protected]

Business Legal Primer

By

Presented by Attorney Sarah K. Willey, Esq., Bulkley, Richardson and Gelinas, LLP. Sponsored by the MA Small Business Development Center.
This presentation will help you gain a better understanding of the core legal concepts impacting your business.
• Choice of Entity – What does it mean to be a sole proprietor, partnership, limited liability company or corporation; which type is right for your business?
• Employee vs. Independent Contractor – Avoiding the steep risks of misclassification — the basics of determining whether you are hiring an employee or engaging an independent contractor.
• Trademark, patent or copyright – What’s the difference, when and how you need to get one.
Sarah K. Willey is Counsel in the firm’s Business and Finance Department, and is also a member of the firm’s Intellectual Property Practice Group and Employment Law Practice Group.
She has experience advising clients in the areas of business formation, mergers and acquisitions, business succession planning, and corporate structuring of businesses in regulated industries. Sarah counsels’ clients in protecting and maximizing their intellectual property via trademarks, copyrights, and licensing agreements. She also assists businesses with designing, implementing and auditing corporate compliance programs under International Traffic in Arms Regulations (ITAR), Export Administration Regulations (EAR) and Foreign Corrupt Practices Act (FCPA).
FEE: Free
REGISTER: http://bit.ly/BusinessLegalPrimer

EforAll Helps a Challenged Constituency Share the Wealth

By
India Russell and Lamont Stuckey, makers of Everything Sauce
Cover Story

Pivotal Support

India Russell and Lamont Stuckey, makers of Everything Sauce

India Russell and Lamont Stuckey, makers of Everything Sauce

The agency is called SPARK EforAll Holyoke. It represents a merger of SPARK Holyoke, an entity created to inspire and mentor entrepreneurs, and EforAll, the Lowell-based organization that has created an effective model that does essentially the same thing. By whatever name it goes, the agency is helping to spur business ownership among minorities, women, and other constituencies, and it is already changing the landscape in the Paper City.

They call it ‘Everything Sauce.’

That’s the name India Russell and Lamont Stuckey gave to a product that is now the main focus of a business they call Veganish Foodies.

This is a company, but also a mindset and what the partners call a “lifestyle brand for anyone making the change to ‘healthy living.’” Elaborating, they told BusinessWest that veganish foodies are individuals who love food and are ready to explore the more-healthy vegan lifestyle one meal at a time by substituting their favorite foods with healthier alternatives or ingredients.

The Everything Sauce? That’s part of it. It’s something they concocted themselves as a spicy alternative to other things people put on their food and something that may make the healthier foods in a vegetarian or vegan diet more, well, palatable.

“It has an alternative to soy … it has different spices to give you flavor … it has an alternative to sugar in there,” said Stuckey, trying hard not to identify any secret ingredients. “It’s all blended together to give you a sweet heat that makes all kinds of foods taste better.”

As noted, this sauce has become the main focus of this business venture since the partners became involved with a program called SPARK EforAll Holyoke, the latest branch office (if that’s the proper term) of an agency that started in the Lowell-Lawrence area of the state in 2011 and has expanded to a number of small and mid-sized cities, including Holyoke, that share common challenges and demographic profiles (more on that in a bit).

Overall, EforAll, short for Entrepreneurship for All, is an agency that essentially promotes its chosen name, specifically in cities that have large ethnic populations but few resources for individuals with entrepreneurial energy and drive.

Holyoke certainly fits that description, and EforAll became part of the landscape in the city when those managing the agency known as SPARK decided last year to merge with EforAll and fully embrace its model, said David Parker, CEO of the organization.

Tessa Murphy-Romboletti, executive director EforAll, Alex Morse, was encouraged by the progress being made in her hometown, and wanted to play a bigger role in those efforts.

Tessa Murphy-Romboletti, executive director EforAll, Alex Morse, was encouraged by the progress being made in her hometown, and wanted to play a bigger role in those efforts.

Like the better-known Valley Venture Mentors, SPARK EforAll Holyoke features mentoring, accelerator programs, pitch contests, and other forms of programming to help participants take an idea and eventually transform it into a business — while also helping them avoid many of the mistakes that turn businesses into casualties, said Tessa Murphy-Romboletti, the agency’s executive director. But its work generally involves a different constituency.

“The people we’re working with … they’re not necessarily making the next big mobile app or finding a cure for cancer — although they might be,” she explained. “They may just be running a cleaning business, but that’s feeding their families. Being able to work with people who may have never considered themselves entrepreneurs, and being able to show them that they’re able to do that, I think that’s what makes us unique.”

As for Russell and Stuckey, they became part of the accelerator class at SPARK EforAll Holyoke that graduated late last month during ceremonies at Wistariahust Museum, a fitting location because it was the home of William Skinner, one of Holyoke’s most noted and inspirational entrepreneurs.

“The people we’re working with … they’re not necessarily making the next big mobile app or finding a cure for cancer — although they might be. They may just be running a cleaning business, but that’s feeding their families. Being able to work with people who may have never considered themselves entrepreneurs, and being able to show them that they’re able to do that, I think that’s what makes us unique.”

Their mentors helped persuade them that making Everything Sauce shouldn’t be one small aspect of their venture — it should be the main focus. And they followed that advice, securing space in a commercial kitchen (Cornucopia Foods in Northampton) to scale up production, a process that is ongoing; you can now buy a bottle (price tag: $12) at Cornucopia or Crispy’s Wings-N-Fish in Springfield.

“When we came to SPARK EforAll, they really helped us organize ourselves and focus more on our sauce,” Russell explained, adding that the partners had several products and services, ranging from a 40-day cleanse to a seven-day challenge, but their mentors narrowed the company’s focus to something scalable and something it could sell.

In entrepreneurship circles, they call this a pivot, said Murphy-Romboletti, adding that such moves are usually vital to shaping a developing concept into a growing business.

And there was a lot of pivoting going on with the latest accelerator class, she noted, adding that it included eight companies, four of which split $5,000 in prize money to help take their ventures to the next step.

For this issue, BusinessWest talked with the entrepreneurs behind those prize-winning ventures to gain some perspective on SPARK Efor All and its growing impact within the region’s entrepreneurial infrastructure. Those companies came away from the ceremonies with one of those large ceremonial checks, but the reality is that they won much more than that — specifically a better road map for taking their business on the path to success.

Positive Steps

Alex Sandana told BusinessWest that he had aspirations to be a professional dancer while growing up. But his family was sternly tested by the expensive classes and training it would take to make that dream reality.

So he can certainly relate to the young people he’s now giving lessons to in a studio on High Street in Holyoke he calls Star Dancers Unity.

He opened it in 2013, and, like most people in business for any length of time, said his experience has been a roller-coaster ride — meaning both ups and downs.

Alex Sandana with some of his students at Star Dancers Unity.

Alex Sandana with some of his students at Star Dancers Unity.

Things have become somewhat less turbulent since he became involved with SPARK EforAll Holyoke, a step he wishes he had taken much sooner.

“I got into this knowing … zero,” he recalled. “I had an idea of what I was getting myself into, and I knew that Holyoke needed a place where kids could be themselves and not be burdened by the high tuition that other dance studios charge. But I never had any experience in business; I was learning as I was going.

EforAll has helped him expand the portfolio, if you will, serving not just young people, but also providing lessons, and choreography, for weddings and quinceañeras, the fiestas staged for girls turning 15 — that Latin equivalent of the sweet-16 party.

“I was able, with the help of my mentors, to identify other ways to generate revenue,” said Saldana, adding that this more-diversified business has much greater growth potential.

Helping business owners execute such changes and key pivots is essentially the mission statement at SPARK EforAll Holyoke, said Murphy-Romboletti, 29, who worked for several years as the executive assistant, scheduler, and press secretary for Holyoke Mayor Alex Morse, who coaxed her into returning to her hometown after she relocated to Brooklyn, feeling, as many young people did and still do, that she had to leave this area to find what she was looking for.

As she explained how she took the reins at the small agency, she said she watched as many of Morse’s initiatives in the broad realm of economic development — from promotion of the arts to development of an innovation district to programs to inspire and support entrepreneurship — began to change the landscape.

And she decided she wanted to be part of it.

“A position opened up in planning and economic development,” she recalled. “I loved working with the business owners in our community, and there were so many cool projects happening, especially in the downtown, so it seemed like a natural next step.”

One that led to another step when the directorship of SPARK came open. That provided an opportunity to work on a project she helped get off the ground while working in the mayor’s office.

“I loved working with the business owners in our community, and there were so many cool projects happening, especially in the downtown, so it seemed like a natural next step.”

“I was able, through my job at City Hall, to be there for the early planning stages for SPARK,” she recalled, noting that the initiative was funded through a Working Cities Challenge grant. “I loved it; I thought, ‘what an awesome opportunity to create an entrepreneurship program that’s inclusive and empowering and not your typical accelerator.’”

Those sentiments help explain why and how SPARK came to merge with EforAll. Holyoke’s demographics are similar to those in other cities it serves — 51% of its residents are Hispanic, and 9% of its businesses are owned by Latinos — and there is a need for services to help that latter number rise. Meanwhile, EforAll had an established model generating measurable results in other communities.

Getting Down to Business

Thus, she now leads what amounts to the latest in a series of expansion efforts for EforAll, which, after being launched in Lowell-Lawrence, has subsequently added offices in New Bedford, Fall River, Lynn, and Hyannis (an office that serves the entire Cape), as well as Holyoke.

The business model for the agency — launched under UMass Lowell with initial funding from the Deshpande Foundation and known originally as the Merrimack Valley Sandbox — involves working in communities, and with individuals, who are generally underserved, at least when it comes to initiatives within the broad realm of entrepreneurship.

“Generally speaking, this means immigrants, people of color, women, those who are unemployed, veterans, people returning from incarceration … those are the kinds of communities we look for,” Parker explained. “And we want to encourage people with ideas for businesses — we don’t give them ideas — to come to our programs, share their ideas, and see if we can help them get those businesses started.”

There are a number of measures for success, he said, including the number of businesses launched (both for-profit and nonprofit in nature), jobs, sales, and the capital raised for those ventures, he went on, adding that there have been a number of success stories as well.

The one cited most often is that of Danaris Mazara, who came to this country from the Dominican Republic at age 22.

Parker, who has told the story often, said that, after her husband was laid off from his job and the family began to struggle, Mazara took food stamps her mother gave her to buy groceries and instead bought ingredients for flan, a popular Dominican dessert. She made enough to sell to her co-workers and friends and made $500 in a few weeks.

Fast-forwarding a little, Parker said EforAll helped her move the flan operation out of her home and into a commercial bakery that she now owns by helping her secure a loan. It also assisted with product lines, pricing, and other aspects of the business. Today, she has 13 employees and is already looking for a larger bakery.

The EforAll model itself is scalable, said Parker, adding that the agency is certainly in an expansion mode. Indeed, now that it has shown that its formula for bolstering a community’s entrepreneurial ecosystem works in several Bay State cities, EforAll is ready to embark on expansion into other areas of the country.

“We hope to announce new EforAll programs in other states within this year,” he told BusinessWest, adding that the goal is to have another four sites by the end of this year, another six by the end of 2020, and perhaps as many as 50 in the years to come.

Julie Molianny and Rashad Ali, who launched Cantina Curbside Grill, a food truck featuring Latin fusion items, aspire to open a brick-and-mortar restaurant in the future.

Julie Molianny and Rashad Ali, who launched Cantina Curbside Grill, a food truck featuring Latin fusion items, aspire to open a brick-and-mortar restaurant in the future.

Meanwhile, in Holyoke, SPARK EforAll is getting set to open co-working space in a building on High Street — the doors will likely open in May — and thus take its mission to a still-higher level. Funded by a MassDevelopment Collaborative Workspace grant, the 1,500-square-foot facility has a large room that can accommodate perhaps 20 desks and several smaller cubicle-like areas, said Murphy-Romboletti, adding that there is obvious need for such space in Holyoke, and she expects that it will be well-received.

At the same time, the agency’s mentoring and accelerator programs are helping a number of entrepreneurs and aspiring entrepreneurs move their concepts forward.

The 12 weeks of classes — two classes a week — are “intense,” Murphy-Romboletti, adding that each company is assigned a team of three mentors that act as an advisory panel.

“These entrepreneurs are deeply immersed in this process,” she explained. “We’re helping people navigate the challenges in front of them and do their business right.”

Spicing Things Up

People like Julie Molianny and Rashad Ali, who launched Cantina Curbside Grill, a food truck featuring Latin fusion items such as tacos, burritos, quesadillas, and more.

They started slowly in 2017, said Molianny, focusing on events on area college campuses and farmers’ markets. But the truck will soon shift into a higher gear, figuratively, she noted, adding that later this month it will be parked Monday through Friday at a still-to-be-determined location near Springfield’s riverfront.

Down the road, and probably not far down, the partners want to add a trailer to the lineup so they can handle bigger events, she said, adding that the ultimate goal is to have a brick-and-mortar restaurant.

EforAll has helped the two with the accounting and pricing sides of the ledger, said Ali, and also with focusing on not only the big picture — what’s in the business plan — but also myriad day-to-day issues involved with running a business.

“The hardest part is keeping tabs on everything, crossing all the T’s and doting all the I’s, staying on top of taxes and everything else,” he said, adding that the accelerator classes have helped the partners stay focused and organized.

Specifically, that means focused on the best options for stability and growth moving forward, which brings us back to Russell, Stuckey, and Everything Sauce, which is just one bullet point in their ever-changing business plan.

Indeed, the partners also have plans to put a food truck on the road, one that would offer what they called “plant-based alternatives,” and operate what might be considered non-typical hours.

“We want to specifically focus on food after 9 p.m., because after that hour, most eateries in this area are closed,” said Stuckey. “And what is open … let’s just say there aren’t many alternatives for healthy eating; we intend to change that.”

In the meantime, they intend to scale up their sauce. They’ve moved from a few gallons at a time in their home to four or five gallons at Cornucopia, which they found with the help of SPARK EforAll, and aspire to production runs of perhaps 200 gallons or more, perhaps at the Western Mass. Food Processing Center in Greenfield, which they also found with help from their mentors.

These mentors are entrepreneurs themselves, said Murphy-Romboletti, meaning they’ve been on the roller coaster themselves and have real-world experiences that translate into sage advice about if and how to take an idea from scratchings on a table napkin to Main Street, or High Street, as the case may be.

From left, Marcos Mateo, his mother, Madeline, and Abiel Alvarado, look to open their auto-service business in June.

From left, Marcos Mateo, his mother, Madeline, and Abiel Alvarado, look to open their auto-service business in June.

That was the case with Abiel Alvarado, his girlfriend, Madeline Mateo, and her son, Marcos Mateo. The three are going into business together, in a venture called Mateo Auto Sales, which has an interesting backstory.

Indeed, Alvarado was in the auto sales and service business in Puerto Rico, and essentially saw that business, and his life, turned upside down by Hurricane Maria. He relocated to Holyoke, where he met Madeline and expressed his desire to soon get back into business for himself. Looking for some help and direction, Madeline went to City Hall, and was soon redirected to the Chamber of Commerce and eventually SPARK EforAll Holyoke.

The three partners applied to, and eventually became part of, the latest accelerator class. Marcos Mateo told BusinessWest they’ve received many different kinds of support for their mentors.

“They provided a lot of guidance,” he said. “They lined everything up, they showed us exactly what we should be focusing on; our mentors helped us with identifying where to go and how to find information.

“We’re not just guessing and having to waste our time doing research,” he went on. “Every class was full of information we needed.”

In Good Company

Alvarado and the Mateos are currently in lease negotiations on a building, and hope to be open for business in June.

After that, they’ll begin what will likely be a roller-coaster ride, something all entrepreneurs endure. With the accelerator behind them and quarterly meetings with their mentors to continue for at least the next year, maybe the ride won’t be particularly wild or feature many significant dips.

Helping create a smoother ride is what SPARK EforAll Holyoke is all about. Its accelerator programs and other initiatives are unique when it comes to the constituency being served, but similar to others in that its mission is to open doors to business ownership and the opportunities it creates.

And that’s why these services are pivotal, in every sense of that word.

George O’Brien can be reached at [email protected]

Every Small Business Needs a Succession Plan

By
Estate Planning

Preparing for the Next Stage

By Barbara Trombley, MBA, CPA, CDFA

Life — and business — can shift in unexpected ways, and an ownership transition can sneak up on even someone who expected to be at the reins for a long time. That’s why it’s good to start preparing for that possibility well in advance.

A succession plan is a vital part of a small business.

Most small businesses were built from the ground up, with a dedicated founder and owner, and it may be very hard for the owner to consider a succession plan. But retirement — or worse, sudden illness or death — can creep up on an owner and create havoc. Without a solid plan, a family may suddenly lose their income or the inheritance that was counted on, or the business may cease to exist.

“Many succession plans are not carefully planned out or are devised as a result of health event. A good succession plan is made when the owner can think rationally and formally devise a sort of buy-sell agreement.”

My personal experience with a succession plan is based on our financial- planning business. My father-in-law did what quite a few financial planners do. He brought my husband (his son) and myself into his business a few years before he retired. My mother-in-law had a bad health scare, and he could see that his years in the business were numbered.

In our case, my husband and I were good candidates to take over the family financial-planning business. We were both graduates of Duke University; I was a CPA, and my husband had recently retired from a first career in major-league baseball. We had the backgrounds and were ready to assume the responsibility of maintaining and growing the business that he started.

The transition wasn’t easy; my father-in-law’s mind knew that it was the best course of actions for his clients, but his heart wasn’t ready to leave. In hindsight, it was a great decision, because his health deteriorated quickly after we took over, and he passed away three years ago.

Many succession plans are not carefully planned out or are devised as a result of a health event. A good succession plan is made when the owner can think rationally and formally devise a sort of buy-sell agreement.

The buy-sell agreement is a legally binding contract that says what will happen if the owner passes away, falls ill, or wants to retire. It will formalize information like the company sales price, the value of each share in the business, and how the sale of the company could be funded.

 

Barbara Trombley

Barbara Trombley

“Many buy-sell agreements are funded with life insurance; the company or the individual co-owners buy policies on the other co-owners that allow them to buy shares in the company using the proceeds from the insurance after the owner or shareholder’s death.”

 

Perhaps the simplest example of a buy-sell agreement is if there is more than one owner. The agreement will state that the co-owners can purchase each other’s shares in the event the buy-sell agreement is triggered.

Many buy-sell agreements are funded with life insurance; the company or the individual co-owners buy policies on the other co-owners that allow them to buy shares in the company using the proceeds from the insurance after the owner or shareholder’s death. A term policy is often more inexpensive, but a permanent policy may be more suitable for a longer period of time.

What if you are the only owner? What makes a good succession plan?

A good succession plan will consider the human-resources side of the transition as well as the financial aspects. Do you want to keep the business in the family? Are your family members qualified and knowledgeable about your business? Do they desire and have the heart to keep your business going? Will you choose certain family members over others?

Most businesses do better with a single overall successor as opposed to splitting ownership of the business. It may be possible to appoint different heirs to manage separate departments. Many small-business owners assume their children want to take over. We have heard many stories about family in-fighting or entitled heirs assuming roles that they are not prepared for. Many a business has suffered or failed after a leadership change; a good succession plan will look with an objective view at different family relationships.

Another option to a family succession plan would be to have a key employee buy the business.

The buy-sell agreement could be executed over time, giving the other employees and customers time to get used to the idea, or it can be triggered by an event such as an illness or death of the owner. Of course, not many employees have the funds to purchase a company.

One idea would be to provide seller financing. A loan from the owner to the buyer could provide a stream of income to the owner as he enters retirement. Another option would be outside financing. This would be the best course if the owner desires his funds up front.

In our financial-planning business, we are constantly urged to set up a succession plan. This is mainly to ensure that a properly licensed advisor can quickly service our clients in the event of the death or disability of myself and my husband. Our plan is to set up a buy-sell agreement with another financial advisor that would be triggered in an emergency but fully changeable in case one of our qualified children would like to take over the business for a third generation.

Taking the time to consider the human-resource angle as well as the financial angle can ensure an agreement that is beneficial to all parties involved and ensure the business you have built will last for a long time.

Barbara Trombley, MBA, CPA, CDFA is an LPL financial planner with Trombley Associates Investment and Retirement Planning in Wilbraham; securities offered through LPL Financial; member FINRA/SIPC. The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual. Trombley Associates and LPL Financial do not provide legal advice or services. Consult your legal advisor regarding your specific situation.

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