Showing the money: SWIF and others offer financial help for small businesses
WORTHINGTON -- Kimberly Schroeder wasn't sure how she was going to open a cosmetology school in Worthington, but she knew she would. "From the beginning I never thought it wouldn't open," Schroeder said. "I never gave up in the worst of times, an...
WORTHINGTON - Kimberly Schroeder wasn’t sure how she was going to open a cosmetology school in Worthington, but she knew she would.
“From the beginning I never thought it wouldn’t open,” Schroeder said. “I never gave up in the worst of times, and I always told myself that with God’s help we would get there.”
The stylist of 20 years had always been her “own boss” and wanted to teach people how to take care of hair.
Schroeder opened the school - Avalon School of Cosmetology in 2007 - and her business is one of the 367 enterprises that have received a microloan from the Southwest Initiative Foundation (SWIF) since the program was founded in 2001. In addition, she also received financial help from First State Bank Southwest.
Within five years, she paid back the entirety of the school’s SWIF loan. Within a few more years, her school was debt-free.
“Typically when a person wants to start a small business, it’s a lifelong dream of theirs,” said First State Bank Southwest President Greg Raymo.
Small-business owners are able to finance a portion of opening their business with loans from a bank, but may need other financial resources, he continued.
There are a plethora of options in Worthington and the region that include the Southwest Regional Development Commission, Worthington Regional Economic Development Corp. and SWIF.
On average, SWIF lends $12,583 per loan to small businesses in the 18-county area.
In addition, the organization gives loan recipients and their staff business management training.
“It would have been a harder road without their help,” Schroeder said, adding that as a hairstylist, she didn’t know some of the accounting and bookkeeping methods that are traditionally used in a business.
“We want them to focus working on the business, not just working in the business,” SWIF Program Officer Jackie Turner said. “They are busy working in the business, but they also need to stay on top of other things as well.”
SWIF employees helped teach Schroeder’s staff marketing strategies and visited the school every month until Schroeder was comfortable operating the business by herself.
“They wanted us to succeed,” Schroeder said. “It felt good knowing that someone was supporting you in that way ... it was reassuring.”
Business management classes are also available online so owners can take classes when they are able, Turner said.
Boosting the economy
Raymo estimates that he has worked with SWIF to lend money to 25 different businesses in Worthington.
“Kim has turned that (school) into such a successful business and it will have a long life here in Worthington,” he said.
The creation of businesses in Worthington helps the community economy, Raymo continued.
“(New business) creates jobs, and then more people will want to live in town and want to live in homes. Then they will buy their cars and groceries here. ... It spirals to create other great economic opportunities for the community.”
SWIF’s microenterprise loan program has created or retained 834 jobs in southwestern Minnesota and has a low loan loss rate of 3.71 percent.
“It was a dream of hers and she needed someone to believe in her dream so she turned to the foundation,” Raymo said. It’s a great model and gives people a unique opportunity,” Raymo said.
For more information, call Turner at (320) 587-4848.