Keith Twitchell spent 16 years running his own business before becoming president of the Committee for a Better New Orleans. He has observed, supported and participated in entrepreneurial ventures at the street, neighborhood, nonprofit, micro- and macro-business levels.
For 2021 to be better than last year may be clearing the lowest bar ever, but there really are good reasons for optimism on many fronts. In the mind of Guy Williams, President and CEO of Gulf Coast Bank & Trust, entrepreneurs and small businesses shouldn’t be afraid to have hope.
Gulf Coast is one of the top SBA lenders in Louisiana, so Williams and his team monitor the entrepreneurial terrain closely. Even with the pandemic still gripping the country, he sees positive trends in our region.
One key tendency is in shopping patterns.
“Identify yourself as local,” he recommends to local businesses. “People are supporting local businesses, and anything that is distinctly local will benefit.”
With coronavirus vaccinations underway, Williams predicts that the region’s beleaguered tourism industry will rebound this year. “I think travel is going to come back in a big way,” he said. “There is huge, pent-up demand and everyone who likes to travel is going to travel.”
He noted travel pricing is low right now, yet airlines, hotels and resorts are offering greater flexibility than ever, so those looking to travel should consider booking trips now, and tourism-related businesses should prepare to meet travelers’ needs. Looking at the anticipated vaccine timing, he said that 2021 “might actually be a good summer for tourism.”
One 2020 development that Williams expects to continue, and expand this year is the shipping of local food products. As national food delivery companies emerged, several local restaurants plugged their products into the distribution chains successfully; Williams sees this as a definite growth sector going forward.
One surprising trend last year was that the number of business startups grew at a higher rate than usual. Williams attributed that in part to “people [who] were lacking the opportunity to get a job, so they decided to take an idea they had and start a business.” He sees this continuing in the year ahead.
For individuals launching new businesses, or seeking to scale up, Williams offered guidance on preparing to approach lenders.
“You must have a business plan that makes economic sense,” he said. “This includes data-driven market research to demonstrate that there is a demand for your product or service.”
On a related note, he added that entrepreneurs should “focus on meeting the expectations of your customers. It’s not what you want, it’s what they want.”
This can sometimes be counterintuitive; as one example, Williams cited the fact that steaks are a top-selling menu item at Commander’s Palace, even though the restaurant is widely renowned for its seafood and New Orleans specialty dishes.
When it comes to securing funding, Williams also stresses the importance of including key partners and/or staff.
“You have to have the right team,” Williams explained, “and you have to be able to demonstrate that team for potential lenders.”
Also vital is showing that the business has some financial reserves.
“You’ve got to have enough cash to get through the inevitable tough times,” he said.
A focus on containing expenses is also helpful.
“Save every penny you can,” he added. “Buy used furniture and equipment. Your customers don’t care if that big frying pan in your restaurant kitchen is used as long as the meal tastes good.”
As a general tip, Williams urges entrepreneurs to “get advice from people who want you to succeed. Ask your vendors and suppliers what they are seeing in the marketplace. Talk to your commercial insurance agent. These people have a stake in your success.”
He also noted that “people who are professionals in the business are a lot better at giving advice than your family and friends.”
The road to economic recovery may still be long and bumpy, but increasingly, the pace is picking up. With all the restrictions in place last year, many people put aside money for spending this year. Wise entrepreneurs will keep an eye on national and local spending trends and position themselves to earn consumers’ saved-up dollars — and euros, pesos and yen.
