Success Story:
BRK Electrical Contractors LLC
Electrical engineer realizes long-held dream with successful contracting business
Marion A. Hayes III exudes electricity. After all, electricity is his business.
Electrical engineer Marion Hayes III founded BRK Electrical Contractors LLC, in 2003 in St. Louis.
Enthusiasm and positive energy are the trademarks of this human dynamo who founded his own electrical contracting business — BRK Electrical Contractors LLC — in 2003, after years of dreaming and an entire year of solid planning.
The dreaming started even before he completed his education at Washington University with a bachelor's degree in electrical engineering in 1991 and a master's in construction management in 1994. The solid planning started in early 2002, with years of electrical construction experience under his belt.
It was then Hayes decided to take the steps to establish a business. He just wasn't sure what all those steps were. At that point he sought advice from the counselors with the St. Louis regional office of the Missouri Small Business and Technology Development Centers. The SBTDC business specialists jointly tackled the challenges Hayes presented to them, according to Kevin Wilson, director of the region's SBTDC office at the Empowerment Zone in downtown St. Louis.
"Over the years our SBTDC has taken a team approach to helping Marion Hayes achieve his small business goals," Wilson says. "With a combination of counseling in the areas of strategic planning, marketing, debt structuring and management the SBTDC has helped BRK Electrical experience tremendous well-managed growth."
That growth is reflected in solid revenues. BRK Electrical's first-year sales reached $1.2 million. In 2004 revenues jumped to $2 million. For its most recent fiscal year Hayes' firm topped the $5-million range in business. During that span the electrical contractor went from a three-person shop to its current workforce of 23.
Along the way Hayes and BRK have received accolades from the St. Louis business community. In 2003 the St. Louis Regional Commerce and Growth Association (RCGA), the St. Louis American Foundation, and the Urban League tapped BRK Electrical with the Emerging Business of the Year award. The following year Hayes was dubbed "Entrepreneur of the Year" by the local chapter of the National Society of Black Engineers. More recent honors include the 2007 St. Louis Minority Business Council's Construction Business of the Year.
Read the complete BRK Electrical Contractors success story with additional photos.
Making Lemonade in the Current Economy
As the old saying goes ... "When life hands you lemons, make lemonade."
A recession provides you, as a business owner, an opportunity to look at your company and truly evaluate what you have. Especially now when sales are decreasing, it is the time to look at your marketing plan and see if it is current.
Fear is not an option. Studies at Penn State and the University of Texas have shown companies that maintain their marketing budgets tend to increase market share and experience growth at the end of the recession. Consumers want reassurance in difficult times and the perception your company is doing well creates that consumer assurance and increases your market share.
So, how do you create or refine your marketing plan? The plan should follow some basic rules. Be SMART:
- Strategy
- Maintain marketing spending
- Allocate the budget
- Research the consumer
- Target the consumer
Have a strategic plan to acquire new customers, to entice existing customers to spend more and persuade more customers to shop more frequently. To accomplish these goals you must first have a product or service the public or a segment of the public needs or wants. Second, make sure your pricing strategy matches the targets audience's mind set by testing new discounts, having sales and promoting the events to your audience. Pricing is a touchy issue but a company can offer many incentives for a consumer to come in and buy.
Read the rest of this article on surviving the current economy.
Business Going Green
Missouri stands to benefit environmentally, economically at a green crossroads
When you think of cleaner air and water, renewable energy and sustainable development, how often do you also think of wages that sustain families and good job opportunities for the future?
Today America stands at a crossroads where environmental improvement meets economic potential. A recent paper from the Missouri Division of Workforce Development, How Green Jobs are Connected to Workforce Development, discusses the directions to which this intersection could lead.
There are four areas that require the expertise of green-collar workers, according to this research. These areas are currently being developed in many states, including Missouri, through legislation and capitalization. The first is renewable energy — a sector that will continue to grow, especially as oil, gas and coal costs rise. The development of solar, wind, hydropower, biofuels, and hydrogen fuel cells will require technical knowledge, post-secondary education and training.
The second sector includes processes that improve energy efficiency in the manufacturing, distribution, construction, installation, and maintenance of products and services. Demand for experts in efficiency will turn traditionally blue-collar jobs into green-collar jobs.
Read the complete going green story on green crossroads.
Kauffman Foundation Study Explores Traits of High-growth Company Founders
KANSAS CITY, Mo. — Although entrepreneurs provide the majority of jobs in the United States, little is known about what makes them tick. The Anatomy of an Entrepreneur, a newly released study from the Ewing Marion Kauffman Foundation, fills in some gaps by providing insights into high-growth founders' motivations and their socio-economic, educational and familial backgrounds.
A summary of the findings: Most founders came from middle-class or upper-lower-class backgrounds, are well-educated and married with children.
"This study helps to illuminate the backgrounds of U.S. entrepreneurs and the formative factors that influence them," said Robert E. Litan, vice president of research and policy at the Kauffman Foundation. "As we begin to understand the circumstances that foster or induce entrepreneurship, we also will gain insights into new methodologies that will help us support existing entrepreneurs and add to their ranks."
A team of researchers — led by Vivek Wadhwa of Duke University, Raj Aggarwal of the University of Akron, Krisztina Holly of the University of Southern California and Alex Salkever of Duke University — surveyed 549 company founders of successful businesses in high-growth industries, including aerospace, defense, computing, electronics and health care.
The survey found more than 90 percent of the entrepreneurs came from middle-class or upper-lower-class backgrounds and were well-educated: 95.1 percent of those surveyed had earned bachelor's degrees; 47 percent had more advanced degrees. Those from lower-upper-class backgrounds, however, were more likely to have been extremely interested in starting a business than the average entrepreneur surveyed (25 percent vs. 18.5 percent).
Seventy-five percent of the respondents ranked their academic performance among the top 30 percent of their high school classes, and 52 percent said they ranked among the top 10 percent. In college, 67 percent of the founders ranked among the top 30 percent of their undergraduate classes, and 37 percent ranked their performance among the top 10 percent.
More than half of the company founders surveyed (52 percent) had at least some interest in entrepreneurship while in college. Of those who described themselves as "extremely interested" during college, 47 percent went on to found more than two companies.
Founders tended to be middle-aged — 40 years old on average — when they started their first companies. Nearly 70 percent were married when they became entrepreneurs, and nearly 60 percent had at least one child, challenging the stereotype of the entrepreneurial workaholic with no time for a family.
"The commonly held belief that entrepreneurs are young college students working out of their dorms is simply wrong," says Wadhwa, the associate director of the Center for Entrepreneurship and Research Commercialization at Duke University and a senior research associate at Harvard Law School. "Rather, on average, they tend to be highly experienced, well-educated workers who have families. They have come to a stage in their lives when they are simply tired of working for others and want to build real wealth before they retire." Wadhwa's research team hopes to uncover not only entrepreneurs' backgrounds, but also "the deeper formative factors that influence this select and incredibly important class of individuals."
The survey also found that:
- Respondents cited "building wealth" as the primary motivation for starting their companies. Other popular motivators included capitalizing on a business idea; the appeal of a startup culture; a desire to own a company; and a lack of interest in working for someone else.
- Only 4 percent said that inability to find traditional employment was a factor in starting their own businesses.
- Entrepreneurship did not necessarily run in the family. More than half (51.9 percent) of those surveyed were the first in their families to launch a business.
Did you know ...
According to recently published information from the U.S. Small Business Administration, Missouri had an estimated total of 501,850 small businesses in 2006. Of that total, 121,350 (24.2 percent) were small employer firms, which represented 97.8 percent of the state's employers and 49.7 percent of its private sector employment.
Other business trends in Missouri pinpointed by the SBA:
- The health care and social assistance industry was the state's largest small-business and overall employer in 2006.
- Small businesses created 67.5 percent of the state's net new jobs from 2004 to 2005.
- Missouri's real gross state product increased by 1.3 percent in 2007. By comparison, growth in the Plains region was 2.0 percent and in the United States, 2.0 percent.
... Now you know.
IRS Roundup:
IRS pinpoints top seven tax tips for new business owners
Anyone starting or thinking of starting a new business should be aware of their federal tax responsibilities, says John Berger, communications analyst with the External Outreach Branch of the Internal Revenue Service. Here are the top seven things the IRS wants you to know if you plan on opening a new business this year.
- First, you must decide what type of business entity you are going to establish. The type your business will determine which tax form you have to file. The most common types of business are the sole proprietorship, partnership, corporation and S corporation.
- The type of business you operate determines what taxes you must pay and how you pay them. The four general types of business taxes are income tax, self-employment tax, employment tax and excise tax.
- An Employer Identification Number is used to identify a business entity. Generally, businesses need an EIN. Visit IRS.gov for more information about whether you will need an EIN. You can also apply for an EIN online at IRS.gov.
- Good records will help you ensure successful operation of your new business. You may choose any recordkeeping system suited to your business that clearly shows your income and expenses. Except in a few cases, the law does not require any special kind of records. However, the business you are in affects the type of records you need to keep for federal tax purposes.
- Every business taxpayer must figure taxable income on an annual accounting period called a tax year. The calendar year and the fiscal year are the most common tax years used.
- Each taxpayer must also use a consistent accounting method, which is a set of rules for determining when to report income and expenses. The most commonly used accounting methods are the cash method and an accrual method. Under the cash method, you generally report income in the tax year you receive it and deduct expenses in the tax year you pay them. Under an accrual method, you generally report income in the tax year you earn it and deduct expenses in the tax year you incur them.
- Visit the Business section of IRS.gov for resources to assist entrepreneurs with starting and operating a new business.
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