SBA Administrator Testifies Before Congress, Tells of Progress in Assisting Small Business Owners

On Thursday, Jan. 7, the House Committee on Small Business held a hearing on the status of the U.S. Small Business Administration (SBA), and heard testimony from SBA Administrator Maria Contreras-Sweet as the lone witness.  Although the hearing was convened to address a recent report by the Government Accountability Office (GAO) that criticized the SBA for its failure to implement management recommendations dating back several decades, the Administrator took the opportunity to highlight the areas where SBA has succeeded in serving America’s small business and helping them continue to grow the economy.

In her testimony, Administrator Contreras-Sweet emphasized that, despite the criticism from the GAO and the Committee, FY 2015 was one of the most successful years in the history of the agency.  SBA backed 22 percent more loans to American small businesses, with a 23 percent increase in the dollar value of those loans compared to FY 2014.  Although lending to small businesses has increased in the years since the recession, she said, it has only returned to 84 percent of its pre-recession level, making the SBA’s role in helping small businesses secure vital financing even more important.  In addition, Contreras-Sweet shared that loan approvals to women in the flagship 7(a) loan program increased 29 percent over 2014, while loan approvals to minorities increased 27 percent and those to veterans increased 47 percent.  All of this progress, the Administrator noted, occurred while the 7(a) program has operated at zero-subsidy, with no direct cost to taxpayers.

The well-established 7(a) program is paramount in ensuring that qualified small businesses, especially franchise businesses, are able to survive and increase their production in a fragile economy.  In 2014 alone, SBA lending programs were used in the financing of nearly 30,000 new franchised units and guaranteed an estimated $6 billion in loans to new and prospective franchisees.  That number is likely to increase since SBA lending for the 7(a) program increased by 23 percent in 2015.  In 2015, nearly a quarter of all new single-unit franchises were financed with the help of SBA loan guarantees, with 17 percent of medium-sized multi-unit franchisees and 19 percent of large multi-unit franchisees utilizing SBA-guaranteed loans to expand their operations.  According to IFA estimates, for every $1 million in lending to a franchise, 40 new direct and indirect jobs are created.  These figures show that SBA loan programs are a vital lifeline to franchises and other small businesses as the small business lending market continues its recovery.

Although the Administrator focused on many of the agency’s high points, the Committee members sought clarification on the Administrator’s plans to address management deficiencies in cybersecurity, staff retention, and disaster relief programs.  Committee Chairman Steve Chabot (R-OH) pressed the Administrator for a commitment to addressing the GAO report’s recommendations, explaining that 62 of the GAO’s 69 recommendations have not been implemented.

IFA submitted a statement for the hearing record praising the SBA for its essential loan programs, while stressing the need for continued recognition of the needs of small business owners in the U.S. Congress.  The Committee will continue with its series of hearings on the oversight of the SBA this week.  SBA Associate Administrator of Capital Access Ann Marie Mehlum and Linda Rusche, Director of the Office of Credit Risk Management will testify on the status and management of the SBA’s capital access programs tomorrow at 10:00am ET.  For more information on last week’s hearing, or for more information on this week’s activity, click here.

Webinar: Preparing Your Franchise To Go International

 

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The newest webinar in IFA’s International Toolkit Series is “Preparing Your Franchise To Go International” presented by Edwards Global Services, Inc. Today more than 75% of all IFA franchisors are either in other countries or are planning to market their franchise into other countries. International franchise development represents the opportunity for additional revenue and increased brand value.  But taking your franchise global is not easy or risk free. The best time to prepare for international success is up front – before you go. This webinar will highlight what successful franchises do to prepare to Go Global successfully.

This webinar will cover these key items:

  • The pros and cons of Going Global
  • The methods and steps of Going Global
  • What is different about Global franchising
  • The international licensee and you
  • Where to take your franchise and why
  • A proven Going Global strategy
  • Keys to successful global franchising

Thursday, December 17, 2015, 11 am ET (1 hour)

Click here to register now!

Presenters:

William Edwards, CEO, Edwards Global Services, Inc.

Michelle McClurg, Chief Operating Officer, Edwards Global Services, Inc.

William Gabbard, Senior Vice President, Edwards Global Services, Inc.

 

IFA CEO Speaks at United Arab Emirates Franchise Conference

International Franchise Association President & CEO Robert Cresanti represented the association at the third annual “International Franchise Conference & Exhibition” Nov. 18 and 19 in Abu Dhabi, United Arab Emirates.

Organized by IFA member the Abu Dhabi Chamber of Commerce and Industry, the event raised awareness of franchising among Emirati firms, introduced best practices and offered a range of franchise opportunities to help diversify the UAE economy.   275 franchise companies from 27 countries exhibited, including seven from the United States.  Cresanti made opening remarks and spoke on a question-and-answer panel.

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Robert Cresanti giving welcome remarks at the IFCE inauguration

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His Excellency Mr. Mohamed Thani Al Rumathi, Chairman of the Federation of UAE Chamber of Commerce & Industry and Chairman of Abu Dhabi Chamber of Commerce & Industry is welcomed by Robert Cresanti at the U.S. stand

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Display of U.S. companies participating at the U.S. Franchise Catalog Show

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Robert Cresanti chats with Fabio Scocimara, Director of International Development, Visiting Angels

SEIU Endorses Clinton Candidacy – What About America’s Small Businesses?

On Tuesday, the Service Employees International Union (SEIU), one of the largest private sector unions, endorsed Hillary Clinton in the 2016 Presidential race. This decision by the SEIU executive board came amidst objections from local SEIU chapters, some of whom say that the endorsement came too early in the election cycle. The controversy is heighted by Clinton’s failure to support SEIU’s keynote initiative, the ‘Fight for $15,’ aimed at raising the minimum wage to $15 per hour. Instead, Clinton has spoken out numerous times in support of a $12 per hour minimum wage.  The endorsement reflects an alarming trend that a Clinton Administration would feature more pro-union policies, following the lead of the Obama Administration.

However, while the SEIU’s approach to solving income inequality is centered on disruptive protests and PR stunts against businesses, IFA’s President & CEO Robert Cresanti argued against harming America’s small business owners: “There is no question we should be looking at solutions to address the growing economic divide in America. However, staging street theatre and shutting down restaurants owned by local families who have invested their life savings and created jobs in communities cannot be the answer.”

The franchise industry is responsible for creating nearly 9 million direct jobs for Americans, outpacing job growth relative to the rest of the economy year after year.  If drastic minimum wage increases take effect, many of these workers will be priced out of the labor market, thereby increasing unemployment and failing to provide millions of workers with the skills needed to excel in a competitive environment.  Regulatory burdens such as the National Labor Relations Board and the Occupational Health and Safety Administration attempts to redefine the “joint employer” standard – which the SEIU has advocated for – have put the country’s more than 780,000 franchise establishments at risk. Despite franchising outpacing the gross domestic product of the rest of the economy, America’s small business owners face a perilous environment if these anti-growth policies persist.

In the future, the inequality debate should focus on creating opportunities to enter the middle class, rather than disruptive political theatre that targets America’s entrepreneurs.

Fuel Your Growth at #EmergingFranchisors2015!

Imagine being given tools and then told to build something. Well, as many of us know, it’s definitely a challenge to start on your own! However, given the proper resources, it could end up being the best learning opportunity. Now take that approach and apply it to your business. If you are a growing franchisor and looking for the premier franchising networking event filled with resources, then look no further! IFA has teamed up with a taskforce to implement a program that could best serve the emerging franchisor’s needs.

The 2015 Emerging Franchisor Conference is an interactive platform for executives of brands that are just stepping into the market.  Join fellow professionals who have been in the business for quite a while to gain tips and apply proven strategies on how to make your brand shine. Hear David Long, Founder & CEO, Orangetheory Fitness talk about how he transformed a simple workout to a global franchise. You’ll also hear Shannon Wilburn, CEO & Co-Founder, Just Between Friends, discuss five critical pillars to support your company’s growth, and much more! After hearing their motivational stories, there is no doubt that you will be ready to fuel your growth.

Not only does this event advise you on the necessary steps to reach the top, but it helps guide you in the right direction, especially in connection with your franchisees. Building trust from the start is crucial in any relationship, so enhance the connection with your current franchisee while creating new relations. By the end of the conference, you will know who you want to play a key role in your business, what you want from them, and where to put them in action.

Don’t just sit in the present to wait for something to happen in the future, take a plunge in this unique educational opportunity offered by IFA and register for the 2015 Emerging Franchisor Conference in beautiful Miami, FL November 18-19 today! The program brochure is now available, so click here to see what’s in store!

#EmergingFranchisors2015

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