By Kathleen Reynolds
“From corner shops to innovation hubs, American entrepreneurs create jobs, invent and provide crucial products and services to their communities, and help define the neighborhoods they serve,” says Administrator Isabel Casillas Guzman, head of the U.S. Small Business Administration (SBA).
There are over 4 million small businesses in the state of California. The SBA defines a small business as one with fewer than 500 employees (and a few other basic criteria). According to the SBA, small businesses are responsible for more than 40% of America’s economic output and two-thirds of net new jobs.
“In Napa, a significant number of businesses are under the 500-employee threshold,” says Jeri Hansen, president and CEO of the Napa Chamber of Commerce. “So small business, while technically defined, can mean something different depending on the size of the community and the business industries and sectors present there. One clear criterion is that they are independently owned and operated.”
According to the City of Napa’s Economic Development Division, in 2024 there were 568 applications for new business licenses, and 93 companies who closed out their business licenses within the city. These figures were for all business types.
Why are small businesses important?
“Small businesses are the foundation of economy, of most economies,” says Hansen, who indicates that a considerable percentage of Chamber member are what they consider small businesses. “They are the product of our neighbors investing in the community by offering a service and/or providing a product, and by creating jobs – which are very often filled by other neighbors and community members. When you purchase at a locally owned business, much of that money stays right here in our community. It helps create jobs, support families, and drive community development while giving our local economy a boost.”
If you you’ve thought about becoming an entrepreneur and have a great idea for a business, begin at the Solano-Napa Small Business Development Center.
Carolynne Gamble is a business advisor/marketing specialist with Solano-Napa SBDC. She says that using the local SBDC has no charge.
“Beside being a free service, it brings you one-one-one advising and guidance, free online classes, information about grants and loans plus lots of other resources,” says Gamble, who has worked there for 20 years. “The SBDC website also lists all the licenses and permits required for start-ups. SBDC has over 25 advisors that offer specialized advice in all aspects of a business; for example, start-ups, marketing, finance, HR, e-commerce, social media and more.”
Gamble offers advice for creating a successful small business. “It is crucial to work with an SBDC advisor to help you write a business plan. Within your business plan, you define your demographic, which helps you know who your audience is and who you are talking to on your website and/or your sales message on social media. Research the need in the market and list your competition so you know more about the need, plus understand what else is offered in your market niche. Take the time to write a comprehensive business plan.”
When in the planning stages, Gamble suggests allowing plenty of time to research markets and industries in the Napa Valley.
“Use ChatGPT or perplexity.ai to research market trends and needs. For example, right now, we know the wine industry is saturated. The younger generations are less interested in fine wine than boomers and thus are not willing to pay top dollar for fine wine. We know the hospitality industry is recessed and tourists are more interested in being entertained than in paying $50 for wine tasting.”
“Follow NapaValleyFeatures.com online for well researched information about the hospitality and wine industries and understand the expanding e-commerce industry for all services. Also, understand that a brick-and-mortar retail business is difficult because of rent, inventory, staff, advertising and other costs.”
Sometimes it does seem small businesses are shut out by corporate giants, the big box stores and the deep discounters. Why do small businesses fail?
“Businesses fail because they begin by focusing on their service and/or their product(s) and don’t address nor understand if there is a need for the service or product,” says Gamble.
“Many times, a new business is unaware of how saturated a market is when they enter it; thus, it makes it extra hard to compete in a flooded market when there is less demand.”
“If a business starts by understanding a need, and filling that need, the startup and growth process is much smoother,” she says. “In a marketing message, first talk about the solutions and secondly about your product or service features and benefits. In a marketing message, talk more about the customer’s issues and needs, and less about yourself, the provider.”
Gamble says, “Just realize the value of getting expert guidance from the Solano-Napa Small Business Development Center.”
It’s not difficult to support small businesses.
“Shopping local, buying local and working with local businesses, vendors, service providers, and so on is the first step,” says Napa Chamber’s Hansen. “Another thing would be to share with others about your good experiences with local business and encourage your family, friends and colleagues to shop locally. Consider a ‘shop local first’ policy if you can. Many local businesses offer discounts or special offers to locals, and they love our support.”
“Local businesses are more than just places to shop; they’re a cornerstone of our community,” Hansen says. “Think about how often you’ve met friends or colleagues at a local coffee shop or restaurant. These spaces don’t just serve coffee or food; they bring people together. Many of our local businesses also sponsor events, support charities, and provide gathering spots for neighbors to connect. Supporting small local businesses helps sustain this sense of community.”
“It’s not just about the social benefits, either. Local businesses often prioritize sustainable practices and source their goods and services from nearby, reducing transportation needs and lowering carbon footprints. Shopping local is a win for the environment, too. And let’s not forget how much innovation small businesses bring to the table. Local entrepreneurs are constantly introducing fresh ideas, unique products, and creative services. Supporting them helps keep our marketplace diverse and dynamic.”
Every year since 1963, the U.S. Small Business Administration (SBA) has celebrated National Small Business Week, to recognize the important contributions entrepreneurs and small business owners have made. This year, that week is May 4 through 10.
In 2010 an initiative started for Small Business Saturday and in 2011, the Senate passed a resolution in support of the day. Small Business Saturday encourages people to shop at small businesses the Saturday after Thanksgiving, which falls on November 29 this year.
The Season of Small Business is relatively new. It’s an initiative from the SBA to drive Americans to shop at small businesses throughout the holiday season.
Entrepreneurs and small business owners work hard daily to provide jobs, be innovative and increase the economy. Let’s support them in their important work.
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6 Questions to Consider Before Beginning a Small Business:
1. Does it meet market demand?
Good small business ideas solve problems for specific groups of people. Before moving forward with an idea, research your target market, customer needs, and competitors’ solutions. Study your industry’s market trends, customer surveys, and sales data to see what consumers and businesses are doing.
2. Does it convey a competitive advantage?
How you meet market demand also matters. Competitive businesses often have original approaches that set them apart. This could be a new product, a unique selling proposition, or a competitive pricing strategy. Analyze your competitors to understand their strengths and weaknesses and develop a business plan that capitalizes on any gaps.
3. Is it scalable?
Scalability is about the potential for growth and expansion. Can your business idea grow without hitting geographical, financial, or market limits? Many scalable businesses leverage ecommerce platforms to reach global audiences without physical investment.
4. Does it have a low barrier to entry?
Businesses are easier to start with lower initial costs, fewer regulatory requirements, less need for specialized training, and minimal technological needs. For example, business ideas like creating freelance content or opening a drop-shipping store require minimal setup and no upfront capital.
5. Does it demonstrate potential for profitability?
Ultimately, a small business idea needs to make money. Estimate potential profits and build a financial model based on predicted sales and operational costs.
6. Is it sustainable?
A sustainable business is one with the potential for long-term success. Will your small business be part of a growing industry or a trend that’s already peaked? Will your operations align with environmental, social, and regulatory expectations? Consider the future before launching a new business.
Courtesy of shopity.com
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