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According to the Small Business Administration's Office of Advocacy ( www.sba.gov ):

• Ohio has an estimated 920,500 small businesses.
• Small businesses employ 49.6% of Ohio 's non-farm private labor force.
• These small firms together employ an estimated 2,400,000 people.

Questions to Ask

Owning and managing a business is not for everyone. The SBA estimates that 50% of small businesses fail within the first five years and suggests that any prospective business owners should first ask themselves the following questions:

• Are you a self-starter? A small business owner must develop projects, organize their time, and follow through on details.
• How well do you get along with different personalities? Business owners must develop working relationships with many people, including customers, vendors, staff, bankers, lawyers, accountants, and/or consultants.
• How good are you at making decisions? Business owners make a lot of decisions – many of them very quickly and under a great deal of pressure.
• Do you have the physical and emotional stamina to run a business? Business owners often work twelve-hour days, six or seven days a week, especially in the formative stages of a new business.
• How well do you plan and organize? Successful business owners must organize financial information, product inventory, staffing, and production schedules.
• How will the business affect your family? Starting and running a business can cause emotional and financial hardships for the family of an owner. It may take several years for the business to become profitable and may initially require families to restrict their spending and live more frugally.

Planning

A written business plan is a necessity for everyone who thinks about starting a business. According to the SBA, a business plan “defines your business, identifies your goals, and serves as your firm's resume.” A business plan has four distinct sections:

• Description – The service or product the business provides and the need it fulfills.
• Marketing – Customer profile and a plan to reach those customers.
• Financial – Start-up money (loans, grants, investors, etc), income projections, and cost projections (equipment, fees, rent, employees).
• Management – Who will manage the business and how (sole ownership, partnership, incorporation), hiring procedures, insurance, and contracts.

Financing

According to the Small Business Development Centers ( www.odod.state.oh.us ), there are two main types of financing:

• Debt Financing – A loan is obtained from a bank, agency or credit cards.
• Equity Financing – An investor buys part of the business, giving money to the owner to start or expand the business.

For more information, see the Treasurer's Tip “ Small Business – Sources of Funding.”

GrowNOW

The Ohio Treasury offers a program for Small Business called GrowNOW, which provides a 3% interest rate reduction on loans to Ohio small businesses of all kinds for job creation. For more information, call the Ohio Treasurer's Office at 800-228-1102 or visit www.GrowNOW.ohio.gov .

Resources

• U.S. Small Business Administration – 800-U-ASK-SBA (800-827-5722) or www.sba.gov .
• Small Business Development Centers of Ohio – 800-848-1300 or www.odod.state.oh.us

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