The first quarter of the year is a great time to think about starting a business or growing your business. As entrepreneurs think about their businesses, often the first task that needs to be addressed is funding — whether it’s for new office space, investment in equipment, operating cash, payroll, marketing, or any other aspect of running a business.

Here is some guidance on that topic.

1. Use Central New York’s great resources for entrepreneurs. We work closely with and refer many small-business customers to work with the Onondaga Small Business Development Center at Onondaga Community College, as well as SCORE. Even before an individual goes to a bank to discuss a request for startup financing, these offices can help entrepreneurs and current business owners to understand requirements, compile information and develop necessary documents, identify available resources, and even offer some of their own financing programs. 

2. Develop a thorough business plan. Because new businesses don’t have the benefit of actual financial performance to demonstrate the potential for future success, it is important to have a business plan to guide conversations with bankers. A three to five-year plan with information on the business owner’s experience, personal financial information, anticipated business expenses, and rationale to explain expectations for earning revenue is recommended. This plan should also demonstrate the business owner’s understanding of both the proposed product and the market, as well as how he or she plans to take advantage of any trends or untapped opportunities.

3. Be prepared to spend time with the bank’s people, so that they can really understand your business. This allows them to provide the best recommendations and products to help the business be successful in the long-term.

4. Ask about Small Business Administration (SBA) resources, and even USDA (U.S. Department of Agriculture) resources. 

5. You typically need to contribute some of your own money (project equity) in order to secure bank financing. Banks generally do not finance the entire operations of a business, so startup companies should plan to raise capital or invest their own money for at least 20 percent of startup costs such as equipment purchases, fit up of the facility, and the projected cash flow needed to cover operations until the business becomes cash-flow positive. This capital infusion may be used to cover operating expenses, but is often used as the down payment on physical asset purchases. The trick is to find the right balance between debt (the bank loan) and equity (the owner’s capital). The more capital that an entrepreneur can raise or contribute, the better it will look to the bank that is reviewing the application for financing.

6. One of the most important things that an individual can do when preparing to ask for financing is take time to build his or her credit profile by staying on top of any existing loan payments, while saving as much money as possible for the personal investment in the business.

These tips should help entrepreneurs get the most out of their discussions with their banker, but this is certainly not intended to replace that discussion. It is important that the entire banking team, from loan officers to financial planners, get to know the individual and their organization, including where the company is in the business life cycle and what its overall industry looks like now, as well as trends for the future. This allows the bank to not only support a company’s operations, but also the business leader’s aspirations.

This is similar to how a professional mentor might be identified for you and your business, and how that relationship forms. It’s not overnight, but rather it takes time to get to know each other. And you recognize that someone has your best interests in mind, as well as knowledgeable and relevant advice to offer you.

This relationship is equally important after a business has been operating for several years, especially when the business owner starts thinking about growth. The smoothest transactions occur when the customer and the bank have an existing relationship, because the bank is already aware of how the business has been performing and its cash-flow cycle. Financing requests for growth initiatives often have the benefit of citing the proven financial performance of the business, and sometimes have assets to leverage for the requested funding. If a longer-term relationship has not yet been established between the business owner and the bank, then the business owner should be prepared to proactively explain why a past year may have been unusually successful or unsuccessful.

One of the most noticeable ways that a bank is able to create this type of personal relationship is by employing experienced bankers who have years of living and working in the area of their customers. 

Proper planning now for a minimum of the first two years of operation of a new business is critical to best manage the financial success of a startup, from the loan-payment structure to being able to invest in growth. The same approach to long-term planning is important for existing businesses that are looking to invest in growth efforts. And whether you have been in business for several years or just completed your first quarter, it’s always important take some time to review your business’s financial needs and options.

Every organization’s situation is different. That’s why it is critical to work with a banking team that understands your business. By connecting with these types of commercial-banking specialists, business owners will benefit from an experienced and dedicated team that can help to identify the most useful bank products and services.           

Jonathan Spilka is VP and commercial relationship manager at NBT Bank, based at its Syracuse Financial Center at 120 Madison St., He has spent nearly two decades in the Central New York banking industry.

Author’s note: The opinions expressed in the article belong to the contributing author, and anyone considering any investments or financing should seek advice from an independent third party such as their financial planner or tax advisor.

When we start to think about starting a business, there are so many things to consider. What are the steps to become legal? What are the proper filings I have to complete when established? How will I ever leave my job to go off on my own? Do I have what it takes? 

There is so much to think about in order to be fully prepared to begin your venture. One thing you must evaluate is whether or not your business is part of a fad or a trend in the industry. This can be a difficult decision to make. That is why doing your research is so important to becoming a successful business operation. 

In order to really know if your business is going to be able to support you and your family for the long haul is to understand the definition of a fad and the definition of a trend. According to www.yourdictionary.com, a fad is “something that people are interested in for a short period of time.” At the time, it is desirable to have this product or service, and just as quickly as it comes in, it goes right out. Some examples of fads are drive-in movie theaters, telephone booths, video-game arcades, video stores, roller-skating rinks, and of course products like Cabbage Patch Kids, virtual pets, and the fanny pack. You have to take into consideration the industry that you want to break into. Technology changed the way we communicate, hence the telephone booth not being used anymore. The way in which we watch movies has changed also, rendering video stores out of date. And, virtual gaming is a huge deal so arcades are not as popular to hang out in anymore. 

You have to be willing to see the industry trends and growth to fully understand if you can maintain a sustainable business for the future. A trend is ongoing. Industry trends help to merge and develop new business concepts. Key questions include: How is the consumer looking to spend their money? What is important to the buyer? 

Chris Malta, CEO of WorldwideBrands.com says, “Based on buyer lifestyles, trends move with rhyme and reason, and tend to progress and morph over time, rather than abruptly disappear.” Trends set the tone for what is to come. In our society, much more has been focused on healthy living, eco-friendly products, and e-commerce. Businesses with a brick-and-mortar presence have to have a bigger draw for the customer to come in more than ever before. Online shopping has been a fast-growing trend that makes products and services a click of a button away. Convenience is the way of the future. Food delivery is not just about getting take-out any longer. The new trend is healthy, good-for-you meals. Hence the growth of Blue Apron, Plated, and other meal-preparation businesses that deliver to your doorstep. 

Now for the big question, how do you know if your business is a fad or a trend? Know your industry. Start reading about the predictions for your industry from the experts. Evaluate and keep evaluating every year. Know the track in which your business could be heading. You have to have a clear definition of what you will offer to your customer and how you will continue to meet the demands of that customer. Understanding your market is a huge factor for any small business. Who are your customers, where and how will they get your product and service? Having a good, solid business plan that is well developed will help to reduce your risks when starting a new business venture. A business plan will tell you if your business is sustainable for years to come. When you are developing a business plan, the market research will forecast your longevity for the business. A business plan is ever-changing and you have to be willing to think outside the box, evolve, come up with new solutions to new problems that arise throughout the path your business takes, and be ready for unpredictable things that might occur. That sounds daunting, but it is so important to your success to stay aware of the current trends in your industry, in society, and in the future marketplace. After all your research and development, you will be able to distinguish between a fad and a trend and if your business will take you through the long haul.                                 

Melissa Zomro Davis, a former small-business owner in the equine industry, is a New York State-certified business advisor at the Small Business Development Center at Onondaga Community College. Contact her at m.l.zomro@sunyocc.edu or call (315) 498-6066.

A company’s culture plays a significant role in how successful that company will be over the long haul.

But often, as the world and circumstances change, that long-ingrained culture also needs to change — and that’s no easy task.

The challenge is that most people live every day without much thought to the patterns and habits that are guiding their daily business life, or even their general life. In a corporate setting, leaders espouse values, beliefs, and expectations so people know what to do and how to get it done. Everything is fine until something begins to change and that culture must change, too.

Any business facing the need for a culture change should try these six steps:

• Step 1: Ask what your culture is today. Think about what you value in terms of six key areas: dominant characteristics, organizational leadership, management of employees, the glue that holds the organization together, strategic emphases, and criteria of success.

• Step 2: Ask what it should be tomorrow? Consider what you want your culture to become. Should it be less controlling and more empowering? More results-oriented or more collegial? Do rules “rule” or are you open to new ideas and empowered staff members?

• Step 3: Tell a story. With your staff, tell a story about what the culture is today. Let them all create a visualization of how you get things done now.

• Step 4: Visualize tomorrow. What will tomorrow’s culture feel like? How will you get things done? Will people be enabled to make decisions and risk making mistakes? Frame this with stories. They are how the brain takes data and makes sense out of it.

• Step 5: Create pilot experiments. Through these experiments, you can get people to see how the new culture is actually going to feel when they live it. Set up some small win situations for your folks to test it out. Think of this as if it is improvisation with good rehearsal time. You are asking people to change what they value, as well as their beliefs and behaviors. That’s not easy and it’s full of risk.

• Step 6: Celebrate. People need symbols and they need to celebrate and share experiences. You need to seriously think about which rituals you will no longer do and which new ones you will introduce. Be careful, though. Things that didn’t seem important can be very sacred to people when you are taking them away.

When all is said and done, make sure you keep moving it forward. People will typically tell you how they love something new and then quickly revert to their old habits even without knowing it.                   

Andi Simon, Ph.D., author of “On the Brink: A Fresh Lens to Take Your Business to New Heights,” is a corporate anthropologist, author, and trained practitioner in blue ocean strategy at Simon Associates (www.simonassociates.net).