How the SBA Can Help Your Business - Capital, Counseling and Contracting
The Small Business Administration (SBA) is a U.S. government agency that provides a wide range of services to help small businesses thrive, especially in the areas of capital, counseling, and contracting.
1. Capital (Access to Funding)
The SBA plays a key role in helping small businesses secure financing through various loan programs and guarantees. These are designed to make it easier for small businesses to access funds when traditional lenders may be hesitant to lend. Here are the primary ways the SBA helps with capital:
• SBA-Guaranteed Loans: The SBA does not lend money directly to small businesses, but it guarantees a portion of the loan provided by a bank or financial institution. This reduces the risk for lenders and makes it easier for small businesses to get approved.
• 7(a) Loan Program: The most common SBA loan program, ideal for a variety of business needs, such as working capital, equipment, real estate, or debt refinancing.
• 504 Loan Program: Designed for businesses that need to purchase major assets like land, buildings, or equipment.
• Microloan Program: Offers smaller loans (up to $50,000) to new or growing businesses, often with more flexible terms.
• SBA Express Loans: A fast-track version of the 7(a) loan, offering quicker processing times for smaller loan amounts (up to $500,000).
• Disaster Loans: If your business is affected by a natural disaster, the SBA can provide low-interest disaster loans to help with recovery.
• Export Loans: For businesses looking to expand into international markets, the SBA provides loan programs to help with export-related needs.
2. Counseling (Business Development Assistance)
The SBA provides several resources to help entrepreneurs and small business owners improve their knowledge and skills in managing and growing their businesses. Through free or low-cost counseling, training, and mentoring, the SBA offers:
• SCORE (Service Corps of Retired Executives): A nationwide network of volunteer business experts who provide free mentoring to small business owners. SCORE helps with business plans, marketing, financial management, and other key aspects of business operations.
• Small Business Development Centers (SBDCs): Located throughout the U.S., SBDCs provide business counseling, training, and technical assistance. They help with feasibility studies, business plans, marketing, finance, and more. These centers work closely with local businesses, providing specialized advice.
• Women’s Business Centers (WBCs): Focused on supporting women entrepreneurs, WBCs offer counseling, workshops, and resources tailored to the unique challenges women may face in business.
• Veteran’s Business Outreach Centers (VBOCs): Aimed at helping veterans start and grow businesses, VBOCs provide free and low-cost counseling, training, and mentoring.
• Online Resources and Courses: The SBA also offers a wide variety of online learning tools, workshops, and courses through its SBA Learning Center to help entrepreneurs improve their skills.
3. Contracting (Federal Contracting Opportunities)
The SBA helps small businesses access government contracting opportunities, which can be a significant source of revenue. The U.S. federal government is one of the largest buyers of goods and services, and it is required by law to award a certain percentage of contracts to small businesses. The SBA supports small businesses in securing government contracts by:
• Small Business Set-Asides: The SBA ensures that certain federal contracts are reserved specifically for small businesses. These contracts can be for goods, services, construction, or other types of projects. There are different set-aside categories based on business size, industry, and the owner’s status (e.g., women-owned, minority-owned, veteran-owned).
• 8(a) Business Development Program: This is a special program for small businesses that are socially and economically disadvantaged. It helps them gain access to government contracts and provides business development assistance, including training and mentorship.
• HUBZone Program: Helps small businesses in historically underutilized business zones (HUBZones) access federal contracts. To qualify, businesses must be located in specific areas and employ workers who live in those areas.
• Women-Owned Small Business (WOSB) Program: Provides women-owned businesses with access to federal contracts in industries where women are underrepresented.
• Service-Disabled Veteran-Owned Small Business (SDVOSB) Program: Offers opportunities for businesses owned by service-disabled veterans to compete for federal contracts.
• Subcontracting Opportunities: The SBA helps small businesses find opportunities to subcontract with larger companies that have been awarded government contracts.