After the bumpy economic ride of the past few quarters, small businesses are looking once again to expand.
Robert D. Hamlin, state director of the Rhode Island Small Business Development Center at Bryant College, said he has observed expansions in service-related sectors – such as printing, copying and consulting services – of late.
"I think there’s a pretty positive climate," he said. "People have found out that there are opportunities."
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John Cooper, director of community banking for Citizens Bank in Rhode Island and Connecticut, said he is starting to see companies looking into the possibilities of staff expansion once again.
"There has been a certain amount of fence-sitting, of course, due to economic issues and world issues, but we’re coming out of that," he said. "I think we’ve gone through what I would term as a mild recession in the past 12 to 18 months. We’re coming out of it, slowly."
Cooper said he encourages small business owners hoping to increase staff or otherwise expand to run a cash flow scenario and look at the additional debt level such an addition would create.
Citizens often partners with other funding sources, Cooper said, such as the Small Business Administration and economic development agencies to fulfill loan requests.
"We do a fair amount of our business in the small business arena, actually growing customers," he said.
As an example of expanding companies in the state, East Greenwich’s American Biophysics Corporation, developer of the Mosquito Magnet, which attracts and kills mosquitoes and other pests, has increased its employee count by 65 to a total of 160 since last June. About 50 temporary employees are in the company’s manufacturing, administration and sales departments, with the balance being permanent positions: additional engineers and customer service representatives.
The company still projects sales for this fiscal year to reach $100 million despite a testy economy.
"It’s a consumer product, and with the influx of mosquitoes that are carrying diseases like West Nile Virus and malaria, it’s a big concern for people," Rebecca Green, human resources manager for American Biophysics, said. "It’s a product that people want. The demand is just as great this year as it was last year."
Green said that even though the company’s sales are on track, "we still use the same cost-conscious actions as we did before," carefully weighing work force needs, not just filling holes.
"It’s not cost-effective for companies to do that," she said.
Hamlin agreed that for companies looking to expand, doing a bit of homework is essential. When planning a staff increase, Hamlin said it is important to carefully consider a firm’s long-term needs, not just solutions for short-term busy periods.
"Just to hire somebody without knowing how that impacts their entire business model is a mistake," he said.
In addition to planning expansions to accommodate a firm’s work load, employers need to also weigh financial resources, the equipment costs of taking on additional employees and space considerations.
"How much are you willing to spend to get the expertise you need?" Hamlin said. "Companies that don’t plan it out can be disappointed."
