Thirteen ways Washington State can help small businesses

To continue our conversation about how to grow small businesses and create jobs in the US, below are a list of topics that were important to the participants in our February 9th, 2010 Council for Small Business meeting. Many thanks to Karen Pemerl of the Washington State Department of Commerce for compiling these notes. I have edited them to elaborate on the content of the conversation.

Workforce development
Do more skills matching in jobs. Many states have resources for employees. In Washington, WorkSource uses keywords to help employers find candidates. The system uses a weighted approach and other creative methods will help employers link up with well qualified employees. Since WorkSource has a direct link to unemployed individuals in the state, it has one of the most comprehensive resources available to employees.

Recognition
Recognize new small businesses. Theresa Chambers of RecognitionWorks suggests that the state shows pride in small businesses by promoting them to increase name recognition. One option is a directory with new business name, the NAICS code plus a small amount of information that allows for self-directed search (more extensive than the current licensing database now available). 

Encourage match-making between small and large businesses. Enterprise businesses can be some of the best customers for small and emerging businesses. They often buy goods and services locally. Match-making would encourage more local purchases and help the small businesses stay afloat while helping large businesses find the sub-contractors they need to fill gaps left behind by downsizing, reorganizing, and rapid market changes.

Help small businesses tell their story. In addition to the directory, the state could highlight small businesses through existing communications channels so they get increased exposure to potential customers.


Regulation
Eliminate excessive regulations. Regulation is putting small businesses out of business. Reduce regulation at all levels of government (see my previous post.)

Streamline licensing and permitting process. I discussed this in my previous post. One of the attendees revealed that as a licensed home health care provider and business owner who recently relocated to Washington state, she was informed that it would take 3 to 6 months to obtain license. That's three to six months of not being able to generate income while waiting for a license for a small business owner.

Money Matters
Support economies of scale. Software costs can be crippling for small business owners. The state could help small businesses get lower costs on software, products and services through group purchasing programs. The Greater Seattle Chamber offers similar programs on services like health insurance and 401(k) programs.

SBA loan options are dwindling. Many SBA loans that were previously available are not available today.  Help small businesses by restoring loans similar to what was available in the past.

Be the bank. North Dakota has its own bank to increase lending to small businesses. Washington state is considering the option. It would allow for more fiscal flexibility in the long-run and provide a resource for small business lending programs.

Hold banks accountable. Many voiced that the state should make it easier to get funding through banks. Some even advocated that Washington should force banks to lend to qualified small business owners. We acknowledged that changing federal guidelines are making it difficult for some banks to loosen purse strings, though new federal funding will soon be available.

State Contracting
Make state contracts competitive. One recommendation is to create dollar limits on state contracts so small businesses can compete. It's easier for a small business to respond to a $5 million, five-year contract than it is to respond to a $50 million lump contract.

Respect the creative ideas of small businesses. In one state contracting example, a business owner had submitted innovative process for job skill matching. The state chose a different vendor, but used his idea to build a job skill matching process that wasn’t nearly as successful as it could have been with his additional knowledge and resources.

Establish a buy local priority. The state could create a model and incentives for state organizations and private enterprises to buy goods and services locally.