The history of Arkansas is replete with the names of great businessmen such as Sam Walton, J.B. Hunt and Witt Stephens. With a thriving atmosphere of startups and entrepreneurs in the state, there are plenty of aspiring business owners who hope to add their names to that list. Yet any entrepreneur would do well to remember that those business legends did not reach such heights alone. A successful company is a team effort, not only by its owners and workers, but often by a network of outside professionals who are dedicated to helping Arkansas businesses be the best they can be.
Banker
Few new business owners are going to have enough raw capital on hand to get a company up and running. Likewise, once the business is underway, the owner will probably not want to stuff their profits under their mattress or bury them on a deserted island. In either case, an entrepreneur needs the right bank and the right banker to get the most out of the services a financial institution can provide.
“I think a lot of people run their own personal household banking like it’s a business,” said Mark Wilson, director of small-business lending at Simmons Bank. “It’s all about having access to capital, whether that’s personal or business, but the difference is that when you get into business, it’s more complicated. The small-business owner has more worries, not only for themselves, but for the livelihood of their company and their employees, so things like payroll and retirement 401(k). They manage their vendors and their customers, so they need wire transfers and ACH services. Then small businesses have to weather the economic storms, the ups and downs, and it goes back to managing that capital in lean times and being able to tuck away savings and pay down debt in the good times.”
A good bank can help with all of those concerns and more besides. An entrepreneur could simply use the bank as a place to cash checks and make deposits, but a close relationship with a banker helps build a mutual understanding that makes it possible to find the best solution to a situation.
“I really think [finding the right banker] is matching up personalities and needs,” said Chris White, chief community banking officer at Simmons Bank. “What does your company need? What do you need personally? We do the same thing on our side. We really think it through when we’re bringing in relationships or calling on customers and businesses to find who would be the best. We have a very diverse group of bankers with different skill sets. We have people that have different experiences in life or may have owned a business and can really add a lot of value.”
Even once a relationship has been established with a business owner, Simmons performs regular relationship reviews, sitting down with clients to get an updated understanding of what they need and what they could do to benefit their current business cycle.
“We can mitigate some areas of concern,” White said. “Maybe they want to grow fast or they grew too fast. We deal with a lot of those projects and understand what a company’s shortfalls or successes might be. There’s a process that we go through to understand what their needs are, and more than likely, we’re probably ahead of them in thinking about some of those needs because we see it every day with so many clients. We can take one success that we had with one group and apply some of those understandings to other customers to help people manage their expectations.”
For those entrepreneurs still seeking the capital to get their business started, Wilson recommends making sure each prospective business owner has a solid plan in place before applying for a loan. They may be able to produce products or provide services, and they may be able to sell them, but it is important to demonstrate an ability to handle finances and operations. When obtaining a traditional bank loan might be difficult, there are alternatives. One particularly useful option for small businesses are SBA loans, which are guaranteed by the Small Business Administration to reduce risk for lenders and make capital available to those who would otherwise struggle to access it.
Accountant
Once an entrepreneur have secured the capital for a businesses, they has soon need accountants to help them make the most out of those funds and avoid wasting them.
“There’s a lot of what-ifs to running a business, and a good accountant earns his keep by keeping up with the financial aspects to a company — helps you deal with the banks, deal with federal and state taxes, should I do this, should I buy this, should I not buy it? Should I expand my business or not, and why?” said Richard Bell, owner of Bell & Co. “Usually if you find a successful entrepreneur, he’s probably got a strong chief financial officer right behind him.”
Most people have a vague idea of what accountants do but might not fully understand just how many important services they can provide, from filing tax returns and providing financial statements to third party lenders to business valuations and estate planning to debt and financing services, to name only a few. Yet their most important role may be as advisors and planners, helping clients do what they need to get big savings on their taxes or avoid overleveraging their businesses and falling too far into debt.
“If you’re an entrepreneur, you usually have some kind of specialized knowledge to start up a company in your industry, but you don’t know everything, and you have to realize that you don’t know everything,” Bell said. “One of the big things that I learned when I was a young man is that it’s OK if you don’t know something. You just need to ask somebody, so you’ve got to know where to go find people who know what you don’t. Being able to seek out other people to help you solve your problems, your questions and your legal matters is very important. I think successful entrepreneurs are really good at that. They’ve got great people skills and great soft skills.”
Business owners who fail to recognize that they do not know everything can miss a great many opportunities and be at risk of dangerous pitfalls. One of the most common mistakes Bell said he has seen new business owners make is taking too much money out of their companies. When the company is making a profit, it can be tempting to use that money for oneself, but to really get the company off the ground and keep it going into the future, it is important to live beneath one’s means and reinvest the majority of that money back into the company or save it for a rainy day.
“Most people find their accountant through a referral. It might come from the bank, the insurance agency, attorney or someone they go to church with,” Bell said. “It’s usually someone that you know who knows somebody. If someone doesn’t know anyone, they can call us, and we’ll help them find somebody. We have people tell us we give away our stuff all the time, but that’s part of it. I think most people are always willing to help others, and I just have really never seen many people that weren’t willing to help somebody. If they aren’t, they don’t need to be in business anyway.”
Attorney
Even once entrepreneurs have their finances effectively in order thanks to the support of good bankers and good accountants, their businesses could still be in serious danger of collapse if the people behind them do not get their legal ducks in a row. Law is rarely an area that a layman can navigate alone, so finding an attorney to keep the i’s dotted and the t’s crossed is essential.
“I think one of the most important things about building your team and collecting the right people around you, especially with a lawyer, is to make sure that you have people with the right specialties,” said Whitney Bower, a Little Rock-based licensed attorney. “Because law practices are so specific these days, you have to make sure that you have someone that’s practicing in the right area. I could generalize and say that I did a business practice, but I’m even more niche. I have a trademark practice.
“I work with a lot of people that are in the midst of developing or launching a brand or product. I work with doctors, bloggers, podcasters, estheticians — anything under the sun. I’ll use the example of a doctor that’s starting an online practice doing telehealth. They would want somebody that has a health care law practice speciality. When I’m dealing with someone on their trademarks, I’m going to refer out the health care part of that to a health care law specialty practice. Some attorneys are general practice, but really, everyone specializes.”
The relationship between a business owner and an attorney can vary greatly depending on that specialty. Some attorneys might be on retainer during the launch process as a sort of legal coach for the various legal necessities that come with establishing a business. Similarly, a trademark lawyer like Bower will mostly be involved when a business is either just getting started or launching a new product or service. In the case of a health care lawyer or some other heavily regulated industry, however, that relationship is much more likely to be long-term and characterized by regular meetings to make sure everything stays up to scratch. Whether one works with them for one year or 20, the right attorney can make all the difference.
“[I typically] see people during entity formation, which is a really simple process, but people get really intimidated by it because they want to make the right decisions,” Bower said. “That’s what I see people go to a lawyer for the most, but if you have a specialized industry, say it’s medical or alcohol related, there will be a special set of laws related to that industry, and you’re going to want expert advice because there will be nuanced laws that you aren’t going to know about, and your general practitioner attorney isn’t going to know those things either. The fortunate thing about Arkansas is that within the legal community, we know each other and we know what the other person does, so we’re really good about referring to the right person to handle those things. I refer people out all the time
because we only want to handle what we are really comfortable with in our practice.
Bower also noted that, especially during formation, there is a great deal of crossover between the work of an attorney and that of an accountant. For that reason, it can be helpful to set up a good degree of communication between the two so they can collaborate and set the business up for success.
As a business owner herself, Bower offered the following advice: “It is really important to identify your ideal customer and get to know your market really well. Without a clear direction on that, you may misdirect your marketing efforts and waste valuable capital resources. It’s also important to know what tasks are important to outsource. A lot of times with a business startup, people tend to DIY certain things, but some things are better left to the experts.”
Staffing Agency
At the same time that entrepreneurs are assembling their teams of experts to help with areas such as law and finances, they will also need to find teams of employees with the skills to make their businesses successful. Unfortunately, recruiting can be a slow and difficult process at the best of times, and when it comes to hiring, recent years are certainly not the best of times. Luckily, there are businesses that exist for the sole purpose of helping others overcome this very problem.
Arkansas Talent Group is a brand-new staffing agency launched by co-founders Chris Chunn and Stephanie Shine, both of whom have years of experience in the recruiting industry. The pair also hosts the Arkansas Talent Podcast, which showcases influential business professionals from a variety of industries.
Christopher Chunn, left, and Stephanie Shine, founders of Arkansas Talent Group
“Typically, staffing agencies can help you find talent, either temporary employment, consulting or permanent-placement solutions,” Chunn said. “There’s a lot of different firms out there that specialize in a lot of different areas. At this time, Arkansas Talent Group specializes in permanent-placement solutions in the professional services market, so for us, that’s accounting, finance and [human resources].
“We provide many services other than just the stereotype of submitting resumes to an open role. We like to take a really hands-on, what we call a consultative, approach. That starts with a discovery meeting. We’ll physically meet with the clients in person, get to know them and their business, assist them with the job description, the duties, the comp range and the culture fit. We just want to get to know the company pretty intimately so that we can make sure to identify the perfect candidate for them.”
From there, the agency taps into its pipeline of pre-interviewed candidates while also using a multi-source approach to attract and headhunt new candidates before presenting the client with their options. The agency then assists with the process through interviews, offer negotiations and counter offers, and then it conducts a post-placement follow-up a few weeks after hiring to ensure that both employee and employer are happy with the situation.
Many new business owners may be tempted to handle recruitment on their own in an attempt to save money. That can work, especially for positions that require less specialized skills and have a larger labor pool, but even if conducting one’s own recruitment is doable, it may not be optimal.
“I think business owners, especially if it’s a new business, need to be focused on running that business, not getting caught up in the lengthy process of trying to fill an open position,” Chunn said. “Hiring in today’s climate is extremely challenging, with record low unemployment rates and compensation packages on the rise. It can take days, weeks and months to write job descriptions, analyze compensation ranges and post positions on multiple job boards. Then you have to just sit there and wait for candidates to apply, then set up interviews. It’s much more efficient to work with an expert recruiter to take that weight off the shoulders of a business owner.”
A staffing agency can often skip a great deal of that waiting period by having a pool of pre-screened candidates available and ready while also having access to passive candidates that might not be actively seeking a new job and, therefore, might not see a typical job ad. Furthermore, an agency that specializes in the particular field an entrepreneur is searching for will be able to provide vital market intel on factors such as what the title for a position should be or the appropriate compensation package, including not just salary but bonuses, insurance and other benefits.
“I think working with a local recruiter is always the best because they’re going to have the best pulse on the market,” Chunn said. “A good recruiter who has tenure in their position and a strong reputation is going to know their market the best, and they’re going to have a great pipeline of talent.”
To find the right staffing agency for one’s needs, Chunn recommended reaching out to agencies in the local area, perhaps found through advertisements or online searches. If the agency does not deal with a particular niche, most will gladly refer business owners to another agency that would be a better fit for the business.
