Targeted BR&E Program a strategy for business growth Module 1: What is the New Approach, and Why?

New Approach to BR&E The agribusiness cluster, according to Wikipedia, is synonymous with food industry. It includes crop production, animal production, specialty crop, food production including animal feeds, biofuels, distribution, farm machinery and other retail sales, and tourism.

Regional Planning Approach Working Team Purdue U – Scott Hutchinson Iowa State U – Nora Ladjahasen Ohio State U – Nancy Bowen and David Civittolo Advisors North Dakota State U – Kathleen Tweeten U of Minnesota – Michael Darger

Building on the Traditional BR&E Program Traditional BR&E is the broad framework Targeted BR&E is focused Combined, the programs provide maximum benefits

Benefits of an Established BR&E program Establish an integrated approach to economic development Develop community economic decision-making capacity Improve quality of life Develop a pro-business orientation Improve community leaders’ response to residents’ concerns Create a factual basis for attraction and community marketing Engage community residents in a discussion of local economy

How the OSU BR&E Program Works Make community contact Determine scope of project OSUE conducts BR&E training workshops Module 2,3,4 Data entry & analysis software (surveygold.com) Pre-tested questions for multiple economic sectors “Build-your-own” Question Bank.

Program Objectives Gain knowledge about significance of agribusiness cluster in a community or region Engage BR&E team methodology and philosophy to accelerate growth in the agribusiness cluster Use new tools to simplify and implement a targeted BR&E approach

Drivers of the Targeted Program Client survey results Grant through the North Central Regional Center for Rural Development is seeding development of program. Agribusiness first targeted cluster but others to follow Growth (green flag) vs. retention (red flag) approach

The Targeted BR&E program is Focused Single industry cluster – agribusiness Identifies the value chain of businesses in the cluster Addresses growth businesses “green flags” not “red flags” Engages a technical “expert” team

What is new? The agribusiness cluster, according to Wikipedia, is synonymous with food industry. It includes crop production, animal production, specialty crop, food production including animal feeds, biofuels, distribution, farm machinery and other retail sales, and tourism.

Focus on growth Focus on growth-oriented firms Second-stage companies Not startup but not fully mature Under $1M in total receipts 10-100 employees Second-stage companies Growth-focused BR&E team Green check/flag vs. red Growth vs. retention No matter which business cluster is chosen in pursuing a growth oriented approach to BR&E, the components to the focus on growth will remain the same – targeting second stage companies that are prepped for next stage of growth. More on the growth focused team in the next slide.

Growth-focused BR&E team Small Business Development Center Entrepreneurship/Incubation University commercialization Intellectual property expert State/regional economic development Manufacturing extension partnership (MEP)

Characteristics of growth-oriented firms Usually second-stage companies Not startup but not fully mature Under $1M in total receipts 10-100 employees Strategic business plan Expanding sales force Opening new or expanding existing locations Diversification of products/markets (including international) Centered on second-stage businesses — those that have advanced beyond the startup phase with the intent to grow even larger — Economic Gardening has powerful and far-reaching payoffs. With typically 10-99 employees and revenue from $1M to $50M, second-stage companies are not only significant job creators, but often have national or global markets, which means they bring outside dollars into the community. Between 1995 and 2012, second-stage companies represented only 11.6 percent of U.S. establishments, but generated nearly 34.5 percent of jobs and about 34.5 percent of sales, according to YourEconomy.org.

Economic Gardening Helps establish strong entrepreneurial culture Focuses on second-stage businesses Provides benefits to help them grow Uses highly trained team approach Grow from within strategy Supporting growth entrepreneurs means positive payoffs when it comes to economic growth and prosperity. Economic Gardening also provides a key balance between company attraction and small business support, and growing from within and supporting existing second-stage businesses. The key benefits that develop from an Economic Gardening program, include becoming a trusted source for growth companies, developing partnerships with key stakeholders, and the opportunity to develop a host of follow-on programs, as well as the chance to refer Economic Gardening clients into other existing programs.

Targeted BR&E Program Components Curriculum modules Targeted survey Mobile application Team training/coaching Data report template and strategy report

Program Component #1: Modules Why something new/what is new? About the agribusiness and food processing cluster Methods for measuring the cluster in your community How growth can occur within the cluster – using the tools Developing your team Demonstrating a user-friendly mobile application What’s coming next…

Program Component #2: Mobile Application A new mobile application is being custom designed for this Targeted BR&E program. Functionality will include all Microsoft and apple platforms Survey data can be collected in the field and aggregated at a hub site. Data downloaded later for software analytics

Program Component #3: Team Training/Coaching

Program Component #4: Report Templates Sample case study analysis. A report template to include analytic methods and tools is provided as part of the curriculum package to clientele. Strategy reports can be developed for a fee to include specific recommendations, timetable and potential funding mechanisms.

Growth-focused BR&E team Small Business Development Center Entrepreneurship/Incubation University commercialization Intellectual property expert State/regional economic development Manufacturing extension partnership (MEP) Who else? Suggestions for a growth focused team included those listed on the slide, but others would make sense to include….lets discuss possibilities. Are there businesses or organizations you would include?

Building on Existing Tools The agribusiness cluster, according to Wikipedia, is synonymous with food industry. It includes crop production, animal production, specialty crop, food production including animal feeds, biofuels, distribution, farm machinery and other retail sales, and tourism.

BR&E Program Assumptions Existing businesses create a majority of jobs Existing businesses can be looking elsewhere Existing businesses can share Existing businesses can recruit Existing businesses are invested Other assumptions? Knowing why you want to conduct a BR&E program in your community is important. Every community has a different set of objectives. These overall objectives encompass most of

BR&E Objectives Improve of quality of life for residents and businesses Establish integrated approach to economic development Develop community economic decision-making capacity Develop a pro-business orientation Improve community leaders’ response to residents’/business concerns Create factual basis for attraction and community marketing Engage community residents in a discussion of their local economy Ultimately, create and retain jobs Knowling why you want to conduct a BR&E program in your community is important. Every community has a different set of objectives. These overall objectives encompass most of

Basic Program Components Plan the program and review resources (targeted BR&E?) Form Task Force and announce program Develop and disseminate the survey Conduct company visits Survey data analysis Followup with companies as needed Final report Communications Using BR&E to assist businesses is a process that includes a number of steps. These steps can be modified and customized for each community but the basics are the same.

BR&E Coordinator A combination coach and facilitator The conduit between the local community, businesses and task force Responsible for the overall organization and management of the local program Oftentimes the individual whose “job” it is to conduct the BR&E the program

BR&E Coordinator hats… Extension/university partner Chamber of Commerce Local government official Local EDO Utility reps Anyone else?

BR&E Coordinator Tasks Selection of cluster or sector in coordination with task force Coordinate data collection Collect the contact information for the targeted businesses, email/ print the questionnaires and cover letters Coordinate activities associated with business visits Collect and review questionnaires - The Coordinator is typically responsible for reviewing the completed questionnaires.

Task Force What about the Task Force – they are critical! Who should be included? What responsibilities? What not to do? A key function of the coordinator is selection of volunteers to serve on the task force. What ideas for membership on this force would you have? Why?

Conducting Business Visits First step…decide which businesses to visit Visit strategies How will you (coordinator and team) choose who you will visit? Who will go? Follow-up plan?

Typical Survey Categories Employment and workforce Business plans and financial Marketing and growth strategies Challenges and assistance Community climate

Purposeful Survey Questions Encourage business input Identify growth opportunities Address concerns and issues Identify resource gaps Inform specific, actionable strategies Include metrics for measuring change Respectfully targeted and short

Sample Key Question: Are you currently considering moving, closing down, or selling this business?

Barriers to Growth Example Questions Is access to financing a barrier to your business growth? In what ways could local government or Extension assist your business? Formulate a few of your own questions….

Analyzing and Communicating Survey Results Perform a “risk assessment”—Red Flag issues Analyze survey results to identify trends and competitive advantages Blend findings and draw conclusions Write report and develop presentation geared to “general audiences” Present and report findings So once you have the survey results, it’s time to analyze and determine next steps

Outcomes Vary Establishment of a new service. A need was identified for an LPN to RN training program which graduated its’ first class of 25 students in 2005. by 2014, the program had graduated over 500. Response to an emergency. A 2002 tornado destroyed an industrial park, displacing 7 small manufacturers and over 500 jobs. Disabled employers represent lost jobs, and payroll. Other outcomes? Local applied research can help communities better understand their regional economy.  To facilitate this educational process, OSU’s BR&E program has collaborated with 24 different neighborhood, village, suburban, county-level, and multi-county regional partners since 2005, generating more than $55,250 in BR&E program training contracts.  Aided by this research, these communities have helped existing businesses create at least 672 new jobs and retain another 920 during this time period. The creation and/or retention of these 1592 jobs yields an estimated $60 million return on investment (considering Ohio’s private sector average wage of $38,116*).

Outcomes are measureable Outcomes are measurable, telling the local story… How many businesses are planning to expand? What percentage of businesses say the community is an excellent, good or poor place to locate a business? What percentage of businesses say the workforce is excellent, good or fair? What type of training do businesses say is needed to upgrade the skills of the local workforce? How do businesses rank local infrastructure and services? Local applied research can help communities better understand their regional economy.  To facilitate this educational process, OSU’s BR&E program has collaborated with 24 different neighborhood, village, suburban, county-level, and multi-county regional partners since 2005, generating more than $55,250 in BR&E program training contracts.  Aided by this research, these communities have helped existing businesses create at least 672 new jobs and retain another 920 during this time period. The creation and/or retention of these 1592 jobs yields an estimated $60 million return on investment (considering Ohio’s private sector average wage of $38,116*).

Results…Example Statement “About a third of the agribusiness firms surveyed are considering renovation or expansion. Of those companies, only one does not have sufficient property. Financing is the most frequent constraint (cited by 40%).” Local applied research can help communities better understand their regional economy.  To facilitate this educational process, OSU’s BR&E program has collaborated with 24 different neighborhood, village, suburban, county-level, and multi-county regional partners since 2005, generating more than $55,250 in BR&E program training contracts.  Aided by this research, these communities have helped existing businesses create at least 672 new jobs and retain another 920 during this time period. The creation and/or retention of these 1592 jobs yields an estimated $60 million return on investment (considering Ohio’s private sector average wage of $38,116*).

Ongoing Communications Essential Annual Member/Investor Meeting and Reception Annual Chamber/ED Dinner/Report Website/blog Facebook/twitter Newsletter Presentations to civic groups Highlight new and expanding companies in media Local applied research can help communities better understand their regional economy.  To facilitate this educational process, OSU’s BR&E program has collaborated with 24 different neighborhood, village, suburban, county-level, and multi-county regional partners since 2005, generating more than $55,250 in BR&E program training contracts.  Aided by this research, these communities have helped existing businesses create at least 672 new jobs and retain another 920 during this time period. The creation and/or retention of these 1592 jobs yields an estimated $60 million return on investment (considering Ohio’s private sector average wage of $38,116*).

Successful BR&E in your community Coordinator/ local team Existing Businesses Implement/ communicate Successful BR&E in your community

Questions or Suggestions? Program design can be replicated in other states/other communities. Only “detractor” – capacity limits in many states

Program Contacts Nancy Bowen David Civittolo Bowen-ellzey.1@osu.edu civittolo.1@osu.edu Nora Ladjahasen Scott Hutcheson nading@mail.iastate.edu hutcheson@purdue.edu