Access to capital still leaves a gaping hole in success for many organizations large and small. But as I connect with more and more small businesses, the top barriers to adding staff members and growing market capacity include:
- Patents. For many organizations, the process of getting a patent on their secret sauce can take years (the current average is 22 months), whereas the window of opportunity for their launch might not be as long. For companies whose main clients are beyond our national borders, the lack of international trademark and patent regulations can put a damper on success and introduce a reluctance to launch in countries where proprietary information might not be protected. Our government should work harder to streamline the patent approval process here at home. In addition, our global leaders should work together to put into place standards to recognize patent filings in home countries and to enforce laws against infringement.
- Policies. Bureaucratic processes provide a slow and deliberate process for making changes in public policy and legislation. These processes are designed protect people from sudden changes in the opinions of new leadership and hotheaded activists. However, these processes were created in an era during which horses were more common than cars and the US Patent and Trademark Office claimed that nothing new could be invented. The pace of change has accelerated with the dawn of a new, information-based economy in our country. Our policies have to keep pace, or innovative new companies will face a lot of little hurdles that add up to big dollars when attempting to fill market demands. Economic and trade policy makers need mechanisms that will allow them to be responsive to worldwide market changes. The result will be policies that keep relative pace with the marketplace, instead of a five to ten year lag in policy updates.
- Permits. See Patents and Policies above. Many of the same challenges that stall patent approvals and policy changes also hold up the permitting process. In the recent economic downturn, one property developer saw its previously approved financing completely disappear just as a few of its buildings were completing construction. Not long after they put the construction process on hold in an effort to secure new financing, their permits expired. To renew the permits required starting from scratch -- new master use permits, construction permits, project filing fees - the works. In light of the economic circumstances and developer outcry, local building authorities created a permit extension, giving developers more time to secure financing. We need more responsiveness like this from our permitting institutions to keep business moving forward.
- Prospects. This is the same challenge that small businesses were having a year ago: where are the customers? Last year, customers were reluctant to buy. This year, however, that has changed: more customers are opening their purses, but hungry enterprise organizations are swooping in with extra-low-pricing and extras that small and medium businesses cannot afford due to smaller staffs and limited resources. The mantra of the 1990's that "there's plenty of business for everyone" has gone silent. To help our local small businesses, we have to realize that shopping local isn't just for grocery stores any more. The nation is picking up on supporting local small businesses by contracting and shopping for goods and services within their own regions. Big organizations should not be overlooked, but healthy local communities come from small and medium businesses in our local economies.
Addressing these four areas will help our small and medium businesses go to market more quickly with their offerings, create more jobs, and pump more tax dollars into our local communities.
How do you propose we increase demand and create more jobs for small and medium businesses?