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This article was prepared for the January 2, 2002 edition of U.S.
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Building Your Business
Decide if you are an entrepreneur and how independent you want to
be. If you need hand holding, consider buying a franchise.
40-year business owner and corporate executive Martin Mosho, who
some of the SBDC’s "How to Start Your Own Successful Business"
courses (U.S. 1, May 30, 2001). He remembers one woman who was
to buy a Subway Sandwich Franchise. A month after she took a job
she returned. She hated the work, hated food handling, and nixed the
whole idea. Give yourself at least a few months on the front lines,
a business franchise may usher you into a very supportive club,
the initiation scrutiny," says Mosho, "will rival and exceed
any bank loan inquiry." Also consider the six percent fee, plus
two percent advertising cost franchises typically take from the top
of your profit each month. Do you really need the mother company’s
network and support? Is it worth eight percent of your profits?
To get the lowdown on franchising, attend the New Jersey Economic
Development Authority’s conference for aspiring franchisees and
on Wednesday, January 16, 8:30 a.m. to 1:30 p.m. in the Winfred Scott
Ballroom in Elizabeth. Cost: $35 at the door. Call Judy Wilkinson
Find out if you have a market for your idea. Just
you think it’s terrific doesn’t mean everyone does. Jim Lenskold of
the Morristown-based Lenskold Marketing Group, has five principles
for new companies with a critical need to win customers, but with
of time, people say `Conservatively, we’ll get 10 percent of market
share’," Lenskold says. Start-ups get these numbers from benchmark
studies, but forget, he says, that the benchmarks are for established
companies. Start-ups are up against much greater odds. "As a new
venture, you don’t have credibility."
To minimize a perception of risk, start-ups may need to offer their
product for a very low cost. "Practically give it away to get
sales," Lenskold says. Strategies for making customers comfortable
enough to take a chance include entering into partnerships with
convinced that all they have to do is open the door, wave the product,
and people will buy," Lenskold says. But it is not easy to cut
through the buzz. Think carefully about your prospects’ priorities.
"If it’s the top executive, he may look at profitability,"
Lenskold says. "If it’s someone lower down, he may worry about
what could go wrong." Tailor the pitch to customers’ concerns.
little pond, or at most in two or three ponds. Target customers by
age, geography, interests, or perhaps industry. An ideal target would
be a group that spends money, requires little customer service, and
where competition is weak.
Once a target is selected, Lenskold says entrepreneurs’ strategy needs
to be: "Let me make sure this group hears my message over and
over." Once the message does get through, there will be word of
mouth. Soon, there will be momentum, and the new company has a shot
at being a leader in its group.
the learning curve is steep. The more revolutionary the product, the
more customers have to be educated, the more trial and error will
have to go into marketing. "I’ve seen businesses run out of money
just as they’re moving up the learning curve," Lenskold says.
is for companies to go all out on one type of marketing, and then,
when that doesn’t work well, start all over in another direction.
This is not only expensive, but can be fatal to attempts to attract
further funding. If investors see a company is not getting results,
they hesitate to put more money into the venture.
Gather information, maybe by taking small business
"To overcome the fear of failure, potential entrepreneurs make
many milestones for themselves," says Al Spiewak, director of
the Trenton Business and Technology Center. Taking courses is one
way to decide if you are ready. "Once you are ready, it doesn’t
matter whether you have finished the courses or not," he advises.
"But education gives you a way that has worked. It is always a
less expensive way of learning than trial and error.
training program sponsored by the New Jersey Development Authority
for Small Businesses, Minorities, and Women’s Enterprises. The program
covers such topics as goal setting, financing, and marketing. Students
develop a business plan for their businesses, which is necessary for
them to obtain financing. Once ETI classroom sessions are completed,
program participants submit their business plans to a panel of
accounting, law, marketing, and economic development professionals
The program is offered in 10 locations throughout the state at a cost
of $295. Classes are held one evening a week at 6 p.m., and class
size is limited to 20 students. The next session starts in March.
Locations will be announced in January, but general inquiries are
being accepted now through the NJ EDA’s website (www.njeda.com) or
The textbook, "Business Planning Guide," is by David H. Bangs
Jr. and covers such topics as business planning, financing, and
To graduate, students must attend six of the eight classes and
all written work, including a business plan. These plans will be
to a "panel review" by lawyers, bankers, and accountants on
the last night. Graduates are prime candidates to qualify for monies
from a revolving loan fund established by the NJEDA. More than 400
people have graduated from the training program in the past eight
small business management, designed for small business owners as well
as for those planning to start a business. A series of four core
and four electives, it takes entrepreneurs through the steps required
to create a business plan and get a business up and running. Core
skills the program works on include business finance, marketing,
for growth, and using technology to advance the business.
Classes for this session begin on Thursday, January 24, at 6:30 p.m.
with Starting Your Own Business: A Business Plan ($90). This course
is held on two consecutive Thursdays, and will be held again on at
the same time on Wednesday, February 6 and Wednesday, February 13.
Choices in Legal Formation ($30) meets on Saturday, February 23, at
9:30 a.m.; the Marketing Plan ($30) meets on Wednesday, March 6, at
6:30 p.m.; Financial and Accounting Systems for Small Business ($30)
meets on Wednesday, March 13, at 6:30 p.m.; Creative Marketing and
Advertising Techniques ($30) meets on Thursday, April 4 at 6:30 p.m.;
Internet Marketing ($90) meets on Wednesday, April 24, and on
May 8, at 6:30 p.m.
Call 609-890-6338 or register online at www.mccc.edu.
by the Mercer chapter of the New Jersey Association of Women
Owners (NJAWBO). The next free workshop is on Tuesday, January
15, at 7 p.m. at Borders Books in Nassau Park, led by Freda Howard,
president of Howard Lane Gift Baskets.
The workshop will help attendees decide if business ownership is right
for them. Through a practical exercise attendees will discover if
they have the personality characteristics crucial to handling the
obstacles a new owner can face. The exercise is designed to produce
a down-to-earth look at personal strengths and weaknesses.
For any standard, non technical business, get free
services from Mercer/Middlesex SBDC, located in the New Jersey Chamber
of Commerce building at 216 West State Street in Trenton
fax, 609-989-7638. Home page: www.yourbizpartner.com).
Mari Galvez de Cerdas, the SBDC director, says that her network of
consultants "is in the knowledge business, tapping best practices
and business intelligence from the public and private sector to
train and educate established and aspiring small business owners so
that they can compete more effectively in the domestic and global
She points out that SBDC consultants are not supposed to do the actual
work of, say, the accountant or the lawyer, but instead can provide
advice an overall perspective. "We make the determination on
based on what the clients need and what our scope of services can
provide," she says.
In other words, the consulting attorney can advise you on the legal
format for your business but will not file your papers. For that,
you need to pay your own attorney. "Someone embarking on
has to plan for those reasonable costs of doing business," says
For help with your high-tech business, go to Randy Harmon,
of the Technology Commercialization Center, part of the New Jersey
Small Business Development Center (NJSBDC) of Rutgers Graduate School
service. Call 800-432-1TEC (432-1832) to get one-stop access to
development information, guidance in commercializing new technologies,
information on grants and financing, and referrals to a statewide
and national resource network. "We help clients identify and
the steps required to take a technology concept and develop it into
a sound business," says Harmon. "Help is available on an
basis, at each step of the development process."
finance their technology-based businesses and establish themselves
in the marketplace. Needed services might be with market entry
business plans and strategy, financing strategy and equity financing,
approaching equity investors, research and development grant
financial projections, and strategic business partnering.
Writing out a business plan is often a killer for
says Al Spiewak, director of the Trenton Business and Technology
Even if you write something informally, putting it on paper is an
exercise in self discipline. "A lot of business requires
he says, "And if you can’t do that, you may not be ready for
Almost every business applying to the Trenton Business and Technology
Incubator, Spiewak says, has an inadequate business plan. Consultants
at the SBDC can help. For starters, go to the Small Business
website. You will find a 50-page start-up kit with detailed
on the business plan.
Even better is "BizPlanner," a step by step fill-in-the blank
handbook for writing a business plan, available by sending a $20 check
to the Mercer Middlesex SBDC, 216 West State Street, Trenton 08608.
Then get an appointment with a consultant from the NJSBDC or SCORE
to review and critique your business plan, identify steps that you
can take to strengthen your plan, your strategies, and your business
model. A good plan helps make a strong first impression on prospective
James Smith, director of the Skylands Small Business Development
has strategy for writing business plans that will impress bankers
(March 28, 2001).
a new business has for survival, they are looking at more than the
prospects for pizza parlors in Princeton or hair salons in Hamilton.
They look at the woman behind the business. Be sure your credit report
and work history are in order, and try to get letters of
If personal finance is an issue, so is lifestyle. "If you’re a
single mom with two kids, that’s an immediate concern," Smith
says. In preparing a business plan, you have to state how much you
will have to draw out of the business to live.
Business owners with a working spouse whose job comes with benefits
have an edge. Small business owners without cushions like this need
to be prepared to explain to lenders how they will support themselves
while the business is getting started, and should put that information
into a business plan.
to fund. "Restaurants historically are very difficult," Smith
says. "A lot of people think a restaurant is an easy way to make
money. It isn’t. Margins are razor thin." Financing is also
for any business with environmental issues. Pool cleaners,
dry cleaners, photo processors, and anyone else who plans to work
with chemicals that are regulated under environmental protection laws
needs to be prepared for lenders’ concerns over liability.
Meet these concerns head on, Smith advises. Be prepared to show
how you plan to achieve above average margins in your restaurant or
how you will handle pesticides safely in your landscaping business.
Whatever the business, figure out the obstacles, then clearly state
how you will overcome them.
Who your customers are will determine where your space
The time-honored tradition is to start your business at your kitchen
table. Hiring the first employee often propels the young business
into commercial space, perhaps a shared office space or maybe an
In an effort to encourage technology businesses, New Jersey has
technology incubators around the state, and the closest one is in
Al Spiewak, the director of Trenton Business and Technology Center,
has 16 tenants in more than 12,000 square feet at 32 South Broad
Rent is $235 for the smallest space, 10 feet by 10 feet. One
tenant has taken six offices and created a mini-suite, including a
"Now we have a fairly solid selection of technology companies,
whereas before we had mortgage companies and government agencies such
as the SBDC and the Trenton Arts Connection," says Spiewak.
are looking for companies other than technology companies if they
are from Trenton. Economic development is much more likely to happen
if we have Trenton residents," says Spiewak. One Trenton-based
company that is finding this company helpful is Carol JeanPierre of
JeanPierre Computers, a consultant on Lotus Notes who wants to be
an Internet Service Provider.
Tenants have use of the conference rooms, fax, and copier. They get
100 free copies a month and beyond that, they pay five cents per
They do their own secretarial work, provide their own phones, and
pay $35 a month if they want to use the incubator’s T-1 line. The
incubator’s location in an Urban Enterprise Zone location means that
tenants get certain exemptions on sales tax for their capital
The board evaluates applications for admission. The main reason for
rejection is that the business does not promise growth. "If you
come in with two people and plan to grow to three, that is not good
business for the incubator," says Spiewak.
Tenants get business mentoring from the board, which includes Joe
Montemarano of Princeton University, Greg Olson of Sensors Unlimited,
Mark Feffer of Tramp Steamer Media, and representatives from Mercer
County Community College, New Jersey Commission on Science and
Capital City Redevelopment Corporation, and the City of Trenton.
also benefit from collaborative relationships with PPPL, Princeton
University, and Sarnoff.
For companies that don’t qualify for admission, virtual tenancy is
available. Virtual tenants get a mailing address plus access to the
conference rooms, copier, fax, and a resource room with an Internet
access computer. Radiant Technology, for instance, is operating out
of a home in Jackson and patenting a new audio amplifier device.
rely on us to help find their funding. If successful, they will create
a 10-person assembly plant here in Trenton," says Spiewak.
Tenants are invited to stay between a year and three years. "We
have a month-to-month lease if they need to leave sooner," says
Spiewak. "After three years we are wondering why they are here.
We are expecting them to find success by them."
Incubator space typically costs far below market rates. Tenants
provide their own phone and Internet service but can use the copy
machine, a computer with an Internet connection, and the conference
Incubator, 900 Briggs Road, Mount Laurel 08054. Frank S. Keith,
manager. 856-222-9311, extension 7906; fax, 856-439-0154. E-mail:
with 23 physical tenants and 28 virtual tenants. A second incubator
is planned, and there is a computer-equipped technology library.
Luther King Boulevard, Newark 07102. Stash Lisowski, director.
fax, 973-643-5839. E-mail: firstname.lastname@example.org. Home page:
www.njit-edc.org. Nonprofit technology oriented small business
incubator with 20 tenants, plus 10 tenants at a second location on
105 Lock Street, 973-643-4063; fax, 973-643-4502. E-mail:
Dover 07801. Patricia Milley, executive director. 973-442-6400; fax,
973-442-6492. E-mail: email@example.com. Incubator for technology firms
that can have access to federal laboratories, personnel, and critical
Castle Point on Hudson, Hoboken 07030. Gina M. Boesch, director.
fax, 201-420-9568. Home page: tvi.stevens-tech.edu. A
non-profit incubator with 11 tenants.
South Broad Street, Trenton 08608-2102. Al Spiewak, director.
fax, 609-396-8603. E-mail: TrentonBusiness@aol.com. Home page:
www.TrentonBusiness.org. Economic development program assisting
small businesses, providing office space and services, and free small
North Brunswick, c/o NJ EDA, CM 990, Trenton 08625. Michael B.
NJEDA. 609-292-0369; fax, 609-292-5722. Home page:
Laboratory and production facilities for emerging technology
Also, for start-ups, 800-square foot labs with benches and hoods.
Suite 206, Princeton 08540. 609-452-0160; fax, 609-520-8731.
08540. Diane Morrison, owner. 609-924-0905; fax, 609-683-9633. Shared
offices and support services.
Suite 208, Princeton 08540. 609-514-9494; fax, 609-243-0045. Office
space, conference space, copying facilities, and business ID,
by Community Options to employ those with disabilities.
Forrestal Village, Suite 200, Princeton 08540. Jim Longon, chief
officer. 609-520-2144; fax, 609-520-1702. E-mail:
Home page: www.hqglobal.com Shared office center and support
services, global coverage.
Two, Suite 200, Lawrenceville 08648. Stephen Sproviero, president.
609-895-2999; fax, 609-895-2666. Office space with support services.
300, Third Floor, Princeton 08540. Gloria Bayes, vice president.
fax, 609-452-8464. E-mail: firstname.lastname@example.org. Home
page: www.officegalleryinc.com Furnished offices and business
Princeton 08540. Christopher Perez, sales manager. 610-727-3992; fax,
610-727-4005. E-mail: email@example.com. Home page:
Global provider of flexible office space.
Small Start-Up Space
Here are some of the office parks and buildings in which start-up
companies often find small and economical spaces:
Plaza, Monmouth Junction 08852. Harold Kent AIA, owner, architect.
732-329-3655; fax, 732-329-9697. Space for young technology companies.
Pennington 08534. Winn Thompson, leasing agent. 609-737-3322; fax,
609-737-6829. E-mail: firstname.lastname@example.org. Home page:
Total business service center, for companies to design, develop,
market, service, and export products and services.
5, Unit 11, Box 957, Belle Mead 08502-0957. Larry Gardner, president.
908-874-8686; fax, 908-874-5438. Small office and warehouse spaces
with short-term leases at 129 Stryker Lane, Hillsborough.
07728. Charles P. Kaempffer, president. 732-625-1055; fax,
Avenue, New Brunswick 08901. Sandy Newman, owner. 732-246-0015; fax,
732-246-4942. E-mail: email@example.com.
Mark Hill, leasing agent. 609-924-6551; fax, 609-924-6559.
Building 14, Box 2242, Princeton 08543-2242. Dorothea S. Potts,
609-452-8008; fax, 609-452-8008.
Street, Suite 309, Princeton 08540. Fred Miller. 609-924-7027; fax,
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