Denise Cotter and Michelle Marino originally started their business together back in 2005, working from home and their vans. Eventually, as this business grew to greater levels of success, these energetic entrepreneurs felt the time was right to move into a brick and mortar location in order to take the next step.
With 2,000 square feet, Denise and Michelle quickly found themselves outgrowing their space. Despite having moved into their location just prior to the onset of the COVID pandemic, the business continued to see tremendous growth...growth that would push them to make an even greater commitment of space.
Within a block of their first location, the owners of Houndstooth House were able to purchase a 10,000 square foot building using the SBA 504 program and to renovate the older building in order for it to reflect their sense of style and design.
While the building has become a showpiece on its block, it also came with additional overhead...more operating expenses, inventory to stock and higher overhead.
Quickly realizing the need to be proactive and secure additional Working Capital, the owners reached out their lender and to the SBDC for assistance in putting a plan together that would reflect their future needs.
"Michelle and I have gotten to know our local SBA office and team well over the last 5 years...we have been able to buy two buildings and get financial business advice. Being named SBA's South Dakota Business Persons of 2023 has opened our eyes to several tools available to us. Recently we had a meeting with Jim at the SBDC that was very beneficial to our business ... moving forward we will definitely utilize all the different tools the SBA provides. Thank you!"
Jim Whitcomb, Business Consultant for the Sioux Falls office of the South Dakota SBDC, worked with Denise and Michelle to analyze their historical financial statements and to build out forward-looking financial projections. These projections were essential for the owners of Houndstooth to communicate their need for working capital to their lender.
The business was able to secure an SBA 7(a) loan for additional Working Capital. These funds will be essential for them as they settle into their new level of expenses as well as to offset any seasonality impacts on the business. With the increased visibility and success of the business, they have also seen larger customers which increases the need for inventory purchases through this Working Capital line.
Heather Wendlandt has two passions...serving people and enjoying her feline friends. Seeking a way to accomplish both led this aspiring entrepreneur to create her business...the Cattitude Cafe. Cattitude is a business unlike any other in the immediate area. While it is licensed as a restaurant, it also offers a separate area where customers can spend time with a number of cats that are available for adoption through the local Humane Society.
Heather's SBDC consultant worked with her to develop the Business Plan and Financial Projections necessary to demonstrate the viability of such a unique enterprise. As part of the business planning process, Heather visited similar businesses in Minneapolis and Omaha. The business also had to navigate specific requirements set forth by the Department of Health in order to comply with regulations while also having animals on the premises.
Along with Heather's down payment, she was able to use this Business Plan to obtain an SBA 7(a) loan through a local credit union. Blending her 8 years of experience within the service industry with a passion for animals has led to the launch of this new venture. And a partnership with the Humane Society as an avenue to find "forever homes" for the 300+ cats currently looking for families. Over a four month period from July to November 2023, 120 cats found permanent homes!
Lori Johnson has been a repeated user of SBDC services over her years as an entrepreneur. Having started another child care center two decades before, Lori was no stranger to the industry. This first center featured "drop-in services" with extended hours and was located in a rental property. Desirous of building a new, high-end center in a building that she could own, Lori first approached the SBDC in 2018 with her vision for Encore.
Business planning and budgeting was done throughout the remainder of 2018 and into 2019. Concerned about the impact of draining too much of her personal assets to simultaneously start a new business and build a new facility for it, the decision was made to lease the new building with an option to purchase. Encore was able to secure an SBA 7(a) loan to begin operations in a beautifully designed, custom childcare center. A few months later, Covid hit and the decision to lease instead of purchasing the building helped the client to survive the pandemic.
As the months and years passed and with financial statements demonstrating the success of this new business, the client again engaged the services of the SBDC in order to purchase the building that she had been leasing. This would enable her to realize her original goal of building equity through her own facility in addition to the business.
"Thanks for everything the Small Business Development Center has done to help me get to where I am!"
The South Dakota SBDC worked with Lori to review financials and to build out a financial model demonstrating the viability of purchasing the building. Plans were presented to her lender and the Certified Development Company and approvals were secured!
Lori, and her business Encore Learning Center are now proud owners of this facility. Being custom-built for childcare and located adjacent to an existing elementary school gives it great visibility. Encore also has a niche market, focused on rates slightly above market in order to be able to pay her staff a better wage and to limit the enrollments to less than the maximum ratios allowed under state law. This stability gives parents the peace of mind that their children are receiving excellent care and a head start towards their education and development.
