2021 N.C. Small Business Handbook by Business North Carolina

WHAT’S NEXT? FINANCE | MARKETING | RESILIENCE | WORKFORCE

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Mark Hagenbuch, Deputy Director Guilford Technical Community College Nussbaum Center for Entrepreneurship 336-334-4822 x62003 mthagenbuch@gtcc.edu

NORTH CENTRAL REGION

Jill Sparks, Regional Director Asheville-Buncombe Technical Community College 828-398-7949 jillmsparks@abtech.edu

Cherith Roberson, Regional Director Wake Technical Community College | West Campus 919-335-1007 roberson@waketech.edu

NORTHWEST REGION

SANDHILLS REGION

Jeff Neuville, Regional Director Catawba Valley Community College 828-327-7000 x4102 jneuville@cvcc.edu

Todd Lyden, Regional Director Bladen Community College 910-879-5572 tlyden@bladencc.edu

SOUTHWEST REGION

SOUTHEAST REGION

Renee Hode, Regional Director Central Piedmont Community College 704-330-6832 renee.hode@cpcc.edu

Jerry Coleman, Regional Director Cape Fear Community College 910-362-7469 jdcoleman338@mail.cfcc.edu

PIEDMONT/TRIAD REGION

NORTHEAST REGION

Ginger O’Neal, Regional Director College of the Albemarle 252-335-0821 x2370 ginger_oneal@albemarle.edu

Martha Larson, Regional Director Davidson County Community College 336-224-4557 mlarson@davidsonccc.edu

NCSBC.NET

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SBTDC at Appalachian State University 828-262-2492 (Boone) 828-345-1110 (Hickory)

SBTDC at Western Carolina University 828-227-3504 (Cullowhee) 828-251-6025 (Asheville)

704-687-0440 (Charlotte)

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SBTDC at Winston-Salem State University, N.C. A&T State University

336-750-2030 (Winston-Salem) 336-256-9300 (Greensboro)

SBTDC at UNC Chapel Hill, N.C. Central University 919-962-0389 (Chapel Hill) 919-530-7386 (Durham)

SBTDC at N.C. State University

919-513-1500 (Raleigh)

SBTDC at Fayetteville State University, UNC Pembroke 910-672-1727 (Fayetteville) 910-775-4000 (Pembroke)

SBTDC at UNC Charlotte

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WEST REGION

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N.C. Community Colleges 910-545-3679 shawa@nccommunitycolleges.edu

800-258-0862 | sbtdc.org

Wilson Johnston

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Anne Shaw, State Director

The Small Business and Technology Development Center is a business and technology extension program of the UNC System operated in partnership with the U.S. Small Business Administration. Since 1984, the SBTDC’s experienced counselors have helped more than 140,000 small and midsized business owners make better decisions, become more competitive and improve the economy of North Carolina. National studies show that SBTDC client companies increase revenue and create jobs at significantly greater rates than the average North Carolina business.

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The N.C. Small Business Center Network, operated through the N.C. Community College System, is the largest statesupported small business assistance program, serving more than 70,000 North Carolinians each year. The 61 centers located at community colleges throughout the state are aligned with the state’s eight Prosperity Zones. Potential or current business owners can take advantage of high-quality, readily accessible assistance that includes resource and referral information for a variety of business needs; free confidential one-on-one business counseling services; and high-impact seminars and classes available.

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SBTDC at UNC Wilmington 910-962-3744 (Wilmington)

SBTDC at East Carolina University 252-737-1385 (Greenville)

SBTDC at Elizabeth City State 10 University 252-335-3247 (Elizabeth City) 252-335-3334 (Nags Head)

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Theressa and her husband (center) with their family.

CASE STUDY: FINANCE

Church Childcare | Walkertown

BY THE NUMBERS

Theressa Stephens built her child care business by following her heart and employing ﬁnancial prudence. It has paid off for her family, students, staff and community.

heressa Stephens stepped into the corporate world a few decades ago, using her Winston-Salem State University business degree to land jobs in banking and health insurance. While they made sense financially, they never made her happy. “So, I told my husband this is what I want for me,” she says. “I quit my job and started a career in child care.” Stephens owns Church Childcare in the Winston-Salem suburb of Walkertown. She chose its name for specific reasons. “We’re believers of faith, and we wanted to be a representation of the church, and the church represents love,” she says. “We represent love to our community and to our staff and our students.” Starting more than 20 years ago in the family home’s garage, Stephens has grown Church Childcare to serve more than 1,000 children at two Poindexter Street locations, the second of which opened in 2018. Her success is grounded in her experience and abilities. In high school, she helped her grandmother babysit. “She kept all the children in our neighborhood and was wellknown in the community,” she says. She’s quick with numbers, too, calculating percentages in her head and visualizing charts and spreadsheets. She can turn loans into profits, and she doesn’t mind working long hours. Church Childcare began with four children. Its enrollment doubled when it became a licensed family home care provider. So, Stephens hired staff, and word spread further. “I couldn’t take these children fast enough,” she says. “My husband kind of managed the home, because there was such a demand and a wait list.” A loan from Durham-based Self-Help Credit Union, whose specialty is working with traditionally underserved communities,

allowed Stephens to expand her business at a different location, where enrollment increased to 12. She was ready for her own building by spring 2004. “The initial plan was to get a loan, get a business plan then start building,” she says. “But construction was delayed because of winter.” When the building was finally ready, she had a month-old baby. “I had my infant in the office with me while we were enrolling students,” she says. “We went from 12 to 45 [students] in less than a year.” Stephens needed to raise an initial investment of about $800,000 for her building. “We had to put down 10%, and the loan was a Small Business Loan for minorities,” she says. “And the bank put down 50% and the [U.S. Small Business Administration] 40%. Somehow, the community knew we were interested in building a child care center, and the loan officer found out about us, and there was a mutual connection.”

We don’t like bills. We pay things off and don’t purchase a lot of unnecessary things that make bills. Most of our money goes to salaries and materials. -Theressa Stephens

The loan is almost paid off. She has about 35 staff members — teachers, administrators, floaters and cooks. About 75% of the business’s revenue goes toward paying their salaries, she says. Then there are bills and utilities. It all goes back to what Stephens learned in banking. “I have an annual budget, and I use the basic Microsoft Excel,” she says. “I also have a monthly budget to look at what we need on a

2021 NORTH CAROLINA SMALL BUSINESS HANDBOOK

monthly basis. If we have leftover [money], I leave it in the bank for the next month. We have contracts with N.C. Pre-K and with Head Start, so when they aren’t in session, I can pull from that for summer months.” Revenue is tied to tuition — $85 per week for after-school care, $172 per week for pre-K and $201 per week for infants. Annual September “slight increases” to those amounts were slated to take place. The COVID-19 pandemic dried up most of the business’s cash flow. “Our enrollment dropped overnight to 30% [of what it was],” Stephens says. “So, what that meant for us, with people working from home, they wanted to save money and bring their kids back when it was safer. And that was the private-pay parents. We didn’t know if we were going to be able to stay in business.” Stephens received a $150,000 loan from the federal Paycheck Protection Program. It helped pay salaries, which retained teachers. “But some chose not to come back,” she says. “So, about a year and a half later, we’re building our staff back up to what we’re accustomed to. We do have some who have been with the organization 10 years, and they’re very dedicated. Some have been here 16 years, since we started this.” Stephens budgets perks for her staff. She offers them a hospital policy through Aflac and a retirement fund. “And we do pay higher salaries than most [childcare] facilities,” she says. “We also have other incentives. We wash their car twice a month. We have Christmas bonuses.” Stephens spent a day in Raleigh this past summer, when state lawmakers agreed to hear child care providers’ thoughts on increasing the rate for tuition reimbursement. The nonprofit North Carolina Justice Center says House Bill 574, which was re-referred to the Committee on Appropriations in May, would up that rate to child care providers that care for children who receive child care assistance. That money is intended to ensure working families have child care options as the pandemic continues and recovery begins. Margins are slim for child care businesses, says the North Carolina Justice Center. Reimbursements and payments from parents are their primary sources of revenue. It says the situation is only worsening because child care costs are increasing, putting it out of reach for more parents, and state reimbursement rates don’t truly reflect the current cost of high-quality early education. About 60% of Church Childcare’s students attend on scholarship. The balance is private pay. “And they all get quality services, whether it’s from [Department of Social Services] or N.C. Pre-K,” Stephens says. “So, in Raleigh, we said we are in a workforce crisis. We have been on the frontline the entire time and only closed our facility once, when they said COVID-19 was going to peak last year. And when we did, we sacrificed and paid our staff to work from home. So, they did training online, because they couldn’t do work.” Stephens wants all childcare teachers to be paid well and feel good about their job. “You have to have compassion for your staff,” she says. “We can’t work if we don’t have our personal things in order. I advocate quite a bit throughout the state.” She recently hosted a retreat for her staff. “They were fed and showered with gifts,” she says. They even met with a health and wellness coach. Stephens may expand her business again someday. But she’s in no rush. “I’m not bored,” she says. “No day is like any other. That’s what I love about it. I love that I have beautiful faces that greet me every morning. I love to watch them grow.” 2021 NORTH CAROLINA SMALL BUSINESS HANDBOOK

CASE STUDY: MARKETING

Ripe Revival Market | Rocky Mount

STEPPING UP TO THE PLATE

Rocky Mount’s Will Kornegay created a means to feed people in need, reducing food waste and supporting local farmers in the process. It’s helping many people live better. griculture is North Carolina’s No. 1 industry, contributing more than 16% of the state gross product in 2019, according to a N.C. State University report. N.C. Department of Agriculture and Consumer Services says the state’s more than 52,000 farms work 8.5 million acres. They grow a variety of field crops, including the most sweet potatoes in the nation, watermelons, tomatoes, corn, grapes, squash and blueberries. But farming doesn’t guarantee selling. Some North Carolina produce never leaves the field. It’s left there to rot, because it’s deemed too mishappen or blemished to be sold in stores or used by processors. The fact that it’s edible, nutritious and delicious is moot. It’s part of the 108 billion pounds of food that’s wasted in the U.S. annually, according to Feeding America, a nationwide network of foodbanks. The food-waste problem has grown worse during the COVID-19 pandemic. It also has tightened markets for farmers and cost processors customers, including restaurants that closed to meet restrictions intended to stop the virus’s spread. Some will never reopen. Rocky Mount’s Will Kornegay sees these issues and others at the local level. Kornegay knew that pandemic-induced supply problems would raise the retail cost of food. That along with unemployment forced many low- and middle-income households, which spend a disproportionate share of their income on food, to cut back on groceries. U.S. Department of Agriculture says more than 10% of U.S. households were food insecure at some point during 2020. The pandemic led Kornegay, who earned a business degree

with a concentration in marketing from N.C. State University in 2009, to put his food knowledge, farming connections and business sense to work in a new way — Ripe Revival Market. “It is committed to making access to healthy foods easy, while also making an impact for those in need,” he says. Kornegay has experience in the food industry. He and his sister Laura Hearn co-created Glean, a company that markets farmers’ unused crops to consumers, in 2017. They formed Ripe Revival to make “functional foods with the nutrient-density of agricultural products” two years later. Its gummies — blueberry, peach, grape and cinnamon swirl — contain vegetables such as sweet potatoes, beets, lemons and pumpkin. “It caught the eye of The Kroger Co. Foundation, and we still sell them on the website,” he says. With support from the N.C. Small Business and Technology Development Center and his other businesses, Kornegay launched Ripe Revival Market. He says it welcomed hundreds of members in its first week. Each receives a weekly delivery of farm-fresh food. “[They] have access to fruits and vegetables but also meats and dairy on a recurring basis, where they trust us to curate a box that is local products and deliver it to their door,” he says. “We have probably 20 local farms for our box supply specifically. People can sign up [at riperevivalmarket.com], get a tracking number and go into their account every week to change the products or skip a week. It’s a convenient way to support local business.” And for each member order, Ripe Revival Market delivers a box to someone in need. For every $24-to-$27 box of “ugly produce,” for example, a similar box is donated to a group such as

2021 NORTH CAROLINA SMALL BUSINESS HANDBOOK

Will Kornegay and family

a Boys and Girls Club or YMCA. “It’s perfectly edible,” Kornegay says. “It just might be misshaped.” Ripe Revival Market fights three problems. It reduces farm waste, specifically edible crops left in fields because of cosmetic defects that make them unmarketable. It finds markets for agricultural products, replacing those lost to COVID such as restaurants. And it works to mediate economic uncertainty — financial trouble, job loss, closed schools — and the rising rate of hunger. Ripe Revival Market’s solutions are varied. It supports family farmers by providing profitable solutions for their “perfectly imperfect” crops. It opens access to farm-fresh produce and locally produced food through delivery and with snacks made from locally grown ingredients. It supports neighbors in need; every box purchased equals a box donated. And it embraces unity, coming together to love and serve others. Ripe Revival Market has about 20 employees. “We had four [employees] when we started with COVID,” Kornegay says. “We’re such a new business that we couldn’t get any [federal Paycheck Protection Program] loan support, so we did this ourselves through communities that support us. And we continue to grow with that model.” Kornegay’s relationship with SBTDC goes back several years. “I knew the organization and reached out during the last year with Ripe Revival and told them we were looking to hire salaried employees,” he says. “They helped read through the resumes and job descriptions and were able to fine-tune those.

They offered opportunities for us to take in interns from N.C. State to do our social media presence and website and provide feedback on how to improve our marketing communications.

Ripe Revival Market’s roots are in Farmers to Families Food Box Program, a program Kornegay worked with last summer. Hundreds of volunteers packed and distributed more than 5,000 boxes per week. When it ended, he called on the community to help him replicate the process. “In the large scheme of things, [Farmers to Families] didn’t move the needle on food waste, but there were government-funded food programs that allowed farmers to be helped,” he says. “Through the Farmers to Families Food Box Program, we packed over 54,000 boxes and distributed them to more than 5,000 families over three months.” From July through September 2020, boxes of produce were delivered to Nash, Edgecombe, Halifax and Wilson counties. “We brought in produce every week and put it in 15-pound boxes and worked with 40-plus nonprofits to distribute to families on need.” Working with farmers nationwide, Kornegay pulled local goods along with apples from Washington state, produce from Florida, and eggplant and peppers from New York state. “We were fortunate to be a small piece of a program here in our area and earn the trust of partners in the community,” he says. “Now we’re lifelong partners working to tackle food insecurities in similar ways. The mission is to impact communities by bridging the gap between farm excess and food access. We also work directly with farmers to help them market to restaurants and retailers, and local outfits, to help them diversify how they grow, pack and distribute.” Kornegay says his businesses are profitable, and things are coming around. “The runway gets shorter every day,” he says. “We like to say we were put here on Earth to do good. And our role in why we decided to build a mission-driven business is to support people through a common currency everyone understands, which is food. We’ve had long stressful days and sleepless nights, but it’s a blessing, because we can take our experience and knowledge and our business and serve people.”

-Will Kornegay

2021 NORTH CAROLINA SMALL BUSINESS HANDBOOK

CASE STUDY: RESILIENCE

New South Kitchen & Bar | Charlotte

SURVIVAL COOKING

COVID-19 has been brutal to the restaurant industry. But Chris Edwards and his wife, Sue, have kept their Charlotte eatery open with a positive outlook and a side of determination. hris Edwards and his wife, Sue, opened 90-seat New South Kitchen & Bar at Charlotte’s The Arboretum Shopping Center in 2007. Since opening their previous restaurant — Dakotas — in 1997, when the southern end of Providence Road was the Queen City’s outskirts, the couple has navigated twists and turns in the restaurant industry. But those paled in comparison to the challenges brought by COVID-19 last year. The pandemic has decimated the restaurant industry. It closed indoor dining for a time, slashed staffs and severed supply chains. Washington, D.C.-based National Restaurant Association estimated that nearly one in six U.S. restaurants — about 100,000 — closed during the pandemic’s first six months. When vaccines became widely available and dining rooms began reopening, many restaurant owners welcomed back hungry customers but struggled to reassemble their staff. The Edwardses are restaurant veterans, proficient at adjusting, rebranding and surviving. But the past 18 months tested those skills. “I do realize I’m in a very fortunate position,” Chris says. “A lot of restaurants got the [federal Paycheck Protection Program] money and had to use it to stay open, to stay in business. I was able to use it to make up shortcomings and have a great customer base. I’m very blessed. We kept making decisions and kept moving forward … . It’s not anything unique to us. It’s what the whole restaurant industry has been through the past year.”

It’s nothing short of heroic what some people have done. We’re a huge part of the economy. -Chris Edwards

Dakotas was a high-end seafood and steak restaurant with tasting menus and formal ambience. “We had the fancy stuff, and it got fancier and fancier to where we were serving a $75 meal that took two-and-a-half hours to eat,” Chris says. “I don’t know that Dakotas would have survived the 2008 [Great Recession] with that price range and us not being downtown, at the downtown price point.” While New South occupies the same space as Dakotas, it’s something altogether different: a local gathering spot that serves Southern comfort food. “We were simply going to do a remodel, but when we got into the process, we realized we were changing more than we were keeping,” Chris says. “The beginning was not so well-received as far as taking our existing customers and adjusting to the challenge of a new basic clientele that was going to support us.” New South’s menu includes a few Dakotas dishes and plenty of new ones, including sandwiches, fried chicken and meatloaf. It has established a loyal customer base in a shopping center that grows busier by the day. “[It has] a huge amount of traffic but limited walkability,” Chris says. “People drive out there for a specific reason.”

2021 NORTH CAROLINA SMALL BUSINESS HANDBOOK

This photo was taken at Triple C Brewing while doing a tasting in preparation for an upcoming New South beer dinner. Pictured left to right: Scott Snead, Leah Limper, Kelsey Edwards, Sue Edwards, Chris Edwards, Walter Drozd, Kaity Garner, Spencer Ingram, and Chris Fletcher.

When the pandemic arrived in March 2020, New South’s customer volume was cut in half. But Gov. Cooper’s response, which included restrictions on inside dining, brought opportunity and renewed Chris’ determination. “We closed for the afternoon and had a meeting of the minds and put a plan together and said the next day we’d be open for business as to-go orders, and we’ll see how it goes,” he says. “We had no idea what we were dealing with and what was on the horizon and what kind of support we’d get from our regular customers.” The pandemic has rerouted the road to success for restaurants. But Chris knows what direction to go. “Back in the day, you opened a restaurant and said, ‘These are the seats, and this is the people we need.’ And now it’s flipped upside down to these are the people we have, so this is what we want to serve,” he says. “What products can we get, and how many people does it take to produce this? The labor shortage seems to be everywhere. We have supply chain issues as well, like who’s in the factory? Who’s going to drive the truck? As difficult as it is, it’s not just us. So, I said, ‘Guys, let’s focus on what we can within these four walls.’” The Edwardses had 28 employees in March 2020, some fulltime and some part-time, and initially laid off everyone. But after three weeks, they brought back three cooks and a dishwasher then a few servers to take orders and deliver them to customers’ cars. Instead of 28 paychecks, they were writing eight or nine. “That was the terrifying part, the first month,” Chris says. “Can you sell enough to-go food to support the business? We cut our

menu in half. We kept the salmon but didn’t have the other four or five seafood selections. We had to think, ‘What can we put in boxes and what will re-heat well?’ Those were things to deal with. I remember when the governor came on with his announcement. We just had our [delivery] trucks loaded with our groceries. Then we had to close. But because it was just me and my wife, we could come up with menus every day without going through a corporate office.” New South received two PPP loans — $85,000 and $115,000 — and almost $200,000 from the U.S. Small Business Administration’s Restaurant Revitalization Fund. “Basically, with all that, it made us whole,” Chris says. The $85,000 loan was forgiven. The rent was paid. With the second PPP loan and the Revitalization funds, he says, “I have money to survive. If the Delta variant turns things sideways again, we’ll be OK.” Chris spends time on chef duty now, and his back-of-house staff is in place. They’re each making about $900 weekly, and he’s offering a $1,000 sign-on bonus. Front-of-house staff numbers are down because of the labor shortage. And developing concerns about the virus’s Delta variant are hurting sales. “Some things are back to what I hope will be normal,” he says. “We’re closed Mondays, and we’re back to a five-day work week. The abbreviated menu thing, I kind of like that.” He also supports other local businesses, including buying produce from a nearby farmer’s market. “I’m blessed to be able to keep things moving,” he says. “I enjoy the business.” ■

2021 NORTH CAROLINA SMALL BUSINESS HANDBOOK

CASE STUDY: WORKFORCE

Mojotone | Burgaw

IN HARMONY

The right hires allowed Michael McWhorter and Andy Turner to grow a small repair shop into a global supplier of musical equipment. Its customers range from casual players to top-billed acts. ichael McWhorter’s Wake Forest University biology degree was supposed to be his ticket to medical school, where he could ditch his alter ego of guitarist and keyboard player with a travelling band. But the 1996 graduate stuck with music instead. And it led him to his current location — a dead-end road in Burgaw. It’s there you’ll find Mojotone, a supplier of vintage and reproduction musical electronics, parts and speaker cabinets that serves electric guitar and tube amplifier enthusiasts, technicians and builders around the world. Its 78 employees create, repair, market and sell gear to casual pickers and a long list of top-billed acts, including Cheap Trick, Green Day, Keith Urban, Kid Rock, Rush, Sheryl Crow, The Who and ZZ Top. Mojotone started on a much smaller stage in WinstonSalem, where McWhorter’s business partner, Andy Turner, had a repair shop for keyboards and guitar amplifiers. It expanded into surplus deals in the late 1990s, when auction and marketplace website eBay became popular. Turner befriended the owner of Mojo Musical Supply in California, a mail-order company that was facing bankruptcy. He worked a deal to buy its inventory. He asked McWhorter to help move it to a former RJ Reynolds warehouse, where they would catalogue it. That was the birth of Mojotone in 2000. The duo’s haul was a potpourri of parts. “There were vintage amplifier replacement parts, cabinet hardware, cabinet materials, speakers, all kinds of stuff,” McWhorter says. “And we found an 800 [phone] number for [the business], and it just kept ringing.

At the time, Mojo Music had been the only place to get replacement parts. We started taking orders during the day, would go eat dinner then go down to the warehouse and put the orders on a pallet for the UPS guy to get the next day.” Six months later, McWhorter and Turner hired a furniture builder to open a wood shop and build speaker cabinets and cabinet components. Then they hired a warehouse person to help pull orders and a sales person to answer the phone and take orders. “Then [musical instrument manufacturer] Gibson approached us and asked if we could help them build some amplifiers, and we said yes,” McWhorter says. “We had the parts, but we needed the labor. So, we expanded into that and had a contract for cabinets where we were doing between 25 and 50 cabinets at a time. Then we started with electronic assembly and manufacturing. Then we started putting complete amps together.” In 2002, the pair moved their business to a bigger warehouse in Winston-Salem, where it stayed until that lease expired in 2005. “We were both from Winston-Salem, we went to college together, we’d gotten married and it was time to go somewhere,” McWhorter says. “We chose Wilmington [to be near the beach] and ended up in Burgaw.” They started with a 25,000-square-foot building, bought a 5,000-square-foot place and built a 5,000-square-foot unit. They sold them in 2018 and moved to Mojotone’s current home, a 46,000-square-foot building with office space, woodshop, warehouse and factory floor in Pender Progress Industrial Park. “I’m blessed to have a partner who’s good at what I’m not, and

2021 NORTH CAROLINA SMALL BUSINESS HANDBOOK

The Mojotone crew loads a container with a shipment for Thomann Music, its distributor in Germany.

I’m good at what he’s not,” McWhorter says. “So, he handles the technical side, and I progressed to the management and [human resources] side of the business.” Mojotone’s growth wouldn’t have been possible without its employees, who speak instrumental terminology, pursue common goals and focus on the work at hand. “Over the years, I’ve learned to stay away from folks that bring really strong opinions not related to what we’re doing here, like religious or political,” McWhorter says.

If you get people who want to express opinions not related to our work, it doesn’t bode well. So, we’ve done a good job. We welcome ideas about products and business operations and possible solutions, and I think everyone knows there’s a lot of different people here, so we talk about guitar stuff and music and building amps … . -Michael McWhorter

McWhorter says finding, keeping and training staff hasn’t been an issue. Most applicants know Mojotone products and are enthusiastic about the music business. “The easiest hires are guitar players,” he says. “It’s not hard to get a guitar player excited about everything we have in our warehouse and everything

Michael McWhorter

we’re doing. With the exception of a few people, we have trained everyone who’s come through the door. If they come in with an excitement for guitars or music in general, it’s fairly easy to teach someone what we do. With guitar pickups and magnets and wires, it’s easy to train.” Mojotone never missed a beat when COVID-19 arrived in spring 2020, though its arrangement changed. “Our sales guys went home and could answer the phones remotely,” McWhorter says. “Andy and I came back and started pulling orders and processing orders, which we personally hadn’t done in a few years. We were able to spot problems we weren’t aware of, like with the warehouse layout. We got to pull up to 200 orders a day and work out some issues. But we were able to keep everyone employed then bring people back in. We never fully shut down, but it was about 30 days of not even half the staff in the building. The pandemic has been a boon for the company. “We were fortunate that, like with people forced to be at home, they were playing their guitars or fixing stuff or modifying their amps,” McWhorter says. “A lot of guys wanted to build amps while they were at home.” Mojotone’s future is bright. “I’m really excited right now about manufacturing and making things, so our plan is to figure out new products,” says McWhorter, who keeps Fender Stratocaster and Gibson Les Paul guitars in his office and plays with his college band a few times each year. “We have our own woodshop, and there’s nothing we can’t do. I’m proud of our electronics division. We have all the right people and all the right parts.” ■

2021 NORTH CAROLINA SMALL BUSINESS HANDBOOK

FINANCE CASH MANAGEMENT

COSTS & PRICING

Prepare regular cash ﬂow forecasts

Review personnel requirements Reduce unnecessary expenses that don’t contribute to revenue generation

Focus on receivables collection

Review pricing and value — don’t cut prices in panic mode

Prioritize who to pay first

Consider renting unused space to other businesses

Ask vendors for longer payment terms or partial payment

INVENTORY CONTROL

Talk to lenders about renegotiating existing loan terms

Review inventory levels regularly

Sell unproductive assets

Negotiate deals with suppliers when possible

Get rid of slow moving or obsolete inventory

MOST POPULAR BUSINESS FINANCING METHODS IN 2021

20% 10%

CASH

401(K) BUSINESS FINANCING (ROBS)

FAMILY & FRIENDS

SBA LOAN

LINE OF CREDIT

UNSECURED LOAN

BUSINESS LEASE

HOME EQUITY LINE

Source: Guidant Financial

39%

MARKETING CHANGES BY SMALL BUSINESSES IN CONTENT MARKETING STRATEGIES POST COVID About 70% revised their targeting and messaging strategies

Develop a post-pandemic marketing message Communicate regularly with customers

64% of marketers updated their editorial calendars

Identify key customers and consider a “niche focus”

53% of the surveyed marketers changed their promotion and content distribution strategy

Strengthen digital communications and online presence

40% of content marketers have allotted more resources toward creating content for social media and online communities

Focus on social media

31% of marketers have re-examined their customers’ journey

Make SEO improvements — improve rankings, traffic, click-throughs

20% adjusted their Key Performance Indicators (KPIs)

Use technology to expand services — e-commerce, video, payment apps, etc.

14% of marketers updated their content marketing metrics, including setting up new analytics and dashboards

MARKETING TIPS

Measure the success of each promotional campaign or activity

SOCIAL MEDIA MATTERS

RESOURCE: DIGITAL MARKETING GUIDE

An analysis conducted by Visa says that 1 out of 4 online purchases is now made via social media interaction. Marketers expect a 66% increase in social media content creation.

The SBTDC’s Digital Marketing Guide is designed to help businesses get started with digital marketing. Topics include branding and messaging, websites, email marketing, social media and crafting a digital marketing plan. It also includes worksheets and other tools to help businesses through the process. Available at: sbtdc.org/pdf/digitalmarketingguide.pdf

2021 NORTH CAROLINA SMALL BUSINESS HANDBOOK

RESILIENCE WHAT IS RESILIENCE? Business resilience is the ability to recover from setbacks, adapt well to change and keep going in the face of adversity while safeguarding people, assets and overall brand equity.

SEVEN LESSONS FROM THE PANDEMIC

STRATEGIES FOR MOVING FORWARD

1. A strong lender relationship can make a big difference, particularly during stressful times.

“Right size” your business to match current revenue

2. An effective website & social media presence are key.

Shift sector focus to diversity your customer base

3. Remote work is here to stay. 4. Having a diverse customer base makes it easier to weather tough times.

Develop new offerings (virtual, socially distanced)

5. Customers will go out of their way to “buy local” and support their communities.

Offer new payment terms

6. Businesses who are technologically savvy and have an electronic accounting system were more successful in accessing emergency funding. 7. The most successful businesses regularly solicit feedback from employees and customers.

Use your imagination What do your customers really need now?

WORKFORCE REMOTE WORK STATS

HOW MANAGERS CAN SUPPORT REMOTE EMPLOYEES

About 71% of Americans have worked from home at some point during the pandemic.

Establish structured and regular (daily, weekly) check-ins

Remote work helps improve company loyalty. 88% feel working from home allows them to spend more time with their families.

Provide clear goals and a path for career development

There was an 80% decrease in sick days for employees working from home. Remote workers can save $4,000 on average for expenses associated with travelling to the office. 75% of employees have improved or maintained their productivity especially as it related to writing analyzing data and interacting with clients. Source: BunnyStudio

Provide several different communication technology options Establish rules of engagement Provide opportunities for remote social interaction Offer encouragement and emotional support Source: Harvard Business Review

The average remote employee saves 40 minutes daily in commuting time.

TIPS TO NAVIGATING THE LABOR SHORTAGE Consider unconventional workers, such as retirees, student interns, independent contractors, or those with disabilities or in recovery Get creative about outreach — job fairs, family and friends, social media Consider how you sell the job — showcase company culture, perks (ﬂexible schedule, onsite childcare), and current staff Focus on employee retention by listening and responding to your team Consider limiting hours or simplifying product offerings Outsource tasks such as payroll, marketing, bookkeeping

2021 NORTH CAROLINA SMALL BUSINESS HANDBOOK

N.C. DEPARTMENT OF COMMERCE

The N.C. Department of Commerce is the state’s lead agency for economic, community and workforce development. NCDOC works with local, regional, national and international organizations to fulfill its mission to improve the economic well-being and quality of life for all North Carolinians. It provides local communities with grants and planning services to spur infrastructure development and economic growth and administers the state’s economic incentive programs.

N.C. SECRETARY OF STATE’S OFFICE BUSINESS REGISTRATION DIVISION

The Business Registration Division is responsible for the examination, custody and maintenance of the legal documents filed by more than 400,000 corporations, limited partnerships and limited liability companies. The office ensures uniform compliance with the statutes governing the creation of business entities, records the information required to be kept as a public record and provides that information to the public.

919-814-4600 | nccommerce.com

919-814-5400 | sosnc.gov/divisions/business-registration

N.C. STATE INDUSTRY EXPANSION SOLUTIONS

N.C. DEPARTMENT OF LABOR

Industry Expansion Solutions, an outreach and extension organization affiliated with the N.C. State College of Engineering, was established in 1955 to help North Carolina industries grow and prosper. IES’ tailored solutions, university and community connections, and engineering know-how help companies stay abreast of the latest technologies and best practices in engineering and business management.

800-227-0264 | ies.ncsu.edu N.C. DIVISION OF EMPLOYMENT SECURITY

The N.C. Department of Labor is charged with promoting the health, safety and general well-being of more than 4 million workers in the state. The department administers the state’s workplace safety program and enforces employment discrimination and wage legislation.

800-625-2267 | labor.nc.gov N.C. DEPARTMENT OF AGRICULTURE & CONSUMER SERVICES

The N.C. Division of Employment Security oversees state and federal unemployment tax collections and payment of unemployment insurance benefits. Business owners can use the Employment Security website to file their Quarterly Tax and Wage Reports, apply for an unemployment insurance tax account number and make tax payments.

The N.C. Department of Agriculture & Consumer Services can assist business owners in planning, expanding or financing new or existing agribusiness-related industries. The Marketing Division leads the Got To Be NC campaign, which promotes North Carolina-made products across the state. The department also oversees the issuance and regulation of licenses and permits for a wide variety of industries.

888-737-0259 | des.nc.gov

919-707-3000 | ncagr.gov NCWORKS ONLINE

NCWorks Online is a powerful online job seeker/workforce services system, designed specifically for job seekers, students, employers and job trainers. The system provides fast access to a complete set of employment tools in one website. Business owners can use the site to post jobs, recruit employees, research salaries and labor market information, and communicate with job trainers.

ncworks.gov N.C. DEPARTMENT OF ADMINISTRATION OFFICE FOR HISTORICALLY UNDERUTILIZED BUSINESSES

The HUB Office was established to promote economic opportunities and eliminate barriers for historically underutilized businesses in state government contracting and procurement. HUB’s primary mission is to educate HUB firms and certify them to do business with the state of North Carolina.

919-236-0130 ncadmin.nc.gov/businesses/hub N.C. DEPARTMENT OF REVENUE

The Department of Revenue oversees collection of state business taxes and provides information on changes to tax laws that concern business owners. DOR offers online filing and payment services, as well as an online business registration, which allows business owners to electronically register for an account ID number for income tax withholding, sales and use tax, and machinery and equipment tax.

877-252-3052 | nc.dor.gov 16

2021 NORTH CAROLINA SMALL BUSINESS HANDBOOK

NORTH CAROLINA BIOTECHNOLOGY CENTER

COUNCIL FOR ENTREPRENEURIAL DEVELOPMENT

The North Carolina Biotechnology Center is a private, nonprofit corporation established in 1981 as the United States’ first statewide initiative in biotechnology. The center’s primary focus is to strengthen the biotechnology research capabilities of the state’s universities; assist biotechnology business development; educate the public about the science, issues and application of biotechnology; encourage collaborations among the state’s universities, industry and government; and strengthen North Carolina’s national and international leadership in biotechnology.

The CED provides education, mentoring and capital formation resources to new and existing high-growth entrepreneurs through annual conferences, forums, workshops and programs on entrepreneurial management and finance.

919-541-9366 | ncbiotech.org N.C. RURAL ECONOMIC DEVELOPMENT CENTER The Rural Center’s mission is to develop, promote and implement economic development strategies that improve the quality of life of North Carolinians in the state’s 85 rural counties, with a special focus on individuals with low to moderate incomes and communities with limited resources. Key programs include capital access and microenterprise funding initiatives, entrepreneur and youth business counseling and a leadership development institute.

919-250-4314 | ncruralcenter.org VETERAN’S BUSINESS OUTREACH CENTER

919-549-7500 | cednc.org NORTH CAROLINA MILITARY BUSINESS CENTER NCMBC was was created to leverage military and other federal business opportunities to expand the economy, grow jobs and improve quality of life in North Carolina. NCMBC’s Business Development Team includes 12 experienced business development and procurement specialists operating from 10 community colleges across the state to identify lucrative federal contract opportunities, notify firms of specific opportunities and help businesses prepare winning proposals. NCMBC also administers the state’s official web portal for federal contracting — www.MatchForce.org.

877-245-5520 | ncmbc.us NORTH CAROLINA LAWYERS FOR ENTREPRENEURS ASSISTANCE PROGRAM

910-672-2683 | fsuvboc.com

NC LEAP provides pro bono legal services to low-wealth entrepreneurs who are starting or expanding their businesses in North Carolina. Through one-on-one representation, community education and self-help materials, NC LEAP empowers low-wealth business owners to build businesses in North Carolina that create jobs, improve communities and boost participants out of the poverty cycle. Services range from basic transactional legal needs as struggling entrepreneurs strive to establish their businesses and create jobs, to potential long-term client-counselor relations

NATIONAL INSTITUTE OF MINORITY ECONOMIC DEVELOPMENT

919-677-0561 ncbarfoundation.org/our-programs/nc-leap

The Veterans Business Outreach Center Program is designed to provide entrepreneurial development services, such as business training, counseling and resource partner referrals to transitioning service members, veterans, National Guard & Reserve members and military spouses interested in starting or growing a small business. Located at Fayetteville State University, it serves all of North Carolina.

Formerly known as North Carolina Institute of Minority Economic Development, the Institute has 35 years of experience helping clients harness the power of diversity to achieve business and economic objectives. It brings deep industry knowledge of how to help business owners turn barriers of race, gender and disability into opportunity; companies diversify their supply chains; and communities broaden their business base. NCIMED helps clients focus on three core elements — money, markets and management — to create diverse, globally competitive companies.

919-956-8889 | theinstitutenc.org SERVICE CORPS OF RETIRED EXECUTIVES SCORE is a national nonprofit dedicated to helping businesses get started and grow, supported by the U.S. Small Business Administration. Retired business executives provide mentoring, counseling, local workshops and online webinars to business owners.

800-634-0245 | score.org WOMEN’S BUSINESS CENTERS IN NORTH CAROLINA The U.S. Small Business Administration provides funding for four WBCs in North Carolina in conjunction with local partners including NCIMED, The Support Center and the N.C. Center for Economic Empowerment and Development. WBCs seek to level the playing field for women entrepreneurs, who still face unique obstacles in the business world. They provide entrepreneurs, especially women who are economically or socially disadvantaged, comprehensive training and counseling on a variety of topics.

sba.gov/offices/district/nc/charlotte/resources/ resources-women-business-owners

as their businesses grow.

ECONOMIC DEVELOPMENT PARTNERSHIP OF NORTH CAROLINA In October 2014, the N.C. Department of Commerce entered a contract with a new public-private organization, EDPNC, to take the lead in recruiting and marketing functions. EDPNC oversees the state’s efforts in business and job recruitment and retention, international trade, and tourism, film and sports development. The partnership fosters collaborations between business and government, and provides a robust analysis of facilities and sites available for relocation.

919-447-7777 | edpnc.com BUSINESS LINK NORTH CAROLINA BLNC is a division of the Economic Development Partnership of North Carolina and offers a central source for consultations, information and referrals. BLNC counselors provide customized license information, employer and business structure forms, referrals to state agencies and state occupational licensing boards, local governments and federal agencies, and contacts for local, state and federal business programs and resources. BLNC business counselors are available to answer questions during regular business hours.

800-228-8443 | edpnc.com/start-or-grow-a-business

2021 N.C. Small Business Handbook

Articles from 2021 N.C. Small Business Handbook