Creating Jobs and Businesses Through a Central Business Development Center I. TOPIC Jobs and Business Development II. LOCATION Waushara County, Central Wisconsin III. SUBJECT Creating Jobs and Businesses Through a Central Business Development Center IV. SUMMARY Recognizing a deteriorating business/manufacturing base in the area because of factory closings, Community Action Program Services, Inc. (CAP Services), sought to bring business and employers back to the area by stimulating the economy and the business climate. In 1987, Speed Queen donated its abandoned manufacturing facility to CAP Services, which developed the facility into a commercial business incubator for new and expanding businesses. Tenants benefit from below-market rents and the use of shared services, e.g., copy and FAX machines, computers, and conference rooms. Entrepreneurs who do not require office space receive assistance from CAP Services' Jobs and Business Development Coordinator. This assistance includes developing business plans, conducting feasibility studies and market analyses, loan packaging, and direct loans. To date, 21 businesses have been created, which has resulted in more than 100 new jobs. Businesses include a computer store, ceramics classes and sales, a cleaning service, and an electronics repair shop. V. SUCCESSFUL PRACTICE Creation of a commercial business incubator that has brought 21 new businesses and more than 100 new jobs to an area in economic decline. VI. CONTACT Jan Tague, Project Director Karl Pnazek, Chief Executive Officer Community Action Program Services, Inc. (A Community Action Agency) 205 East Main Street Wautoma, Wisconsin 54982 414-787-3949 414-787-7614 (FAX) VII. CASE STUDY The Problem: The Speed Queen Corporation closed its manufacturing plant in Wautoma, Wisconsin, a town of 1,800 in Waushara County (population 22,000), in December 1980. When the 25,000 square foot facility closed, 50 people lost their jobs. This closing precipitated a period of economic decline in the central Wisconsin county. Many businesses closed, causing unemployment in the county to rise to 12.2 percent in 1983. The Approach Adopted: CAP Services, Inc., a community action agency in Waushara County, wanted to put its years of business development experience to work by establishing a business development center to help bring businesses and employment sources back to the area. The center would be a business incubator through which CAP Services would provide new or expanding businesses with inexpensive rental space and shared office services, e.g., copy and FAX machines, computers, and conference rooms. In addition, CAP Services would provide business development advice and services to both tenants and other new or expanding businesses that do not need rental space at the center. In 1987, CAP Services asked Speed Queen executives to donate their vacant manufacturing facility to CAP Services as a home for the incubator. How They Implemented The Approach: Speed Queen donated the building, and CAP received a $150,000 loan from the city to renovate the building and set up a revolving loan fund for new and expanding businesses. The U.S. Department of Health and Human Services' Office of Community Services provided an additional $80,000 for renovations. The Central Wisconsin Private Industry Council gave CAP Services $19,632 towards hiring a full-time staff person with expertise in business financing and site development to coordinate renovations and new business development. In October 1988, CAP Services opened its "CAPsell Center" with 11 tenants. First-time business owners often have product expertise or experience working for the particular type of business they are starting, but they lack market planning experience and business management skills. Therefore, the CAPsell Center's Jobs and Business Development Coordinator provides this vital business assistance to both tenants and other entrepreneurs who do not need office space at the CAPsell Center. CAP Services helps new and expanding businesses conduct feasibility studies and market analyses, develop business plans, and obtain financing. CAP Services recognized that the self-employment education and services available at the CAPsell Center might not be enough to get a business going. For some entrepreneurs, what they lack is capital. Therefore, CAP Services established a revolving loan fund to help promote opportunities for business development. CAP Services encourages new businesses to make use of the center, but it urges them to move on after they become viable so another new business can get a start. Results: Since 1988, 21 new businesses have opened at the CAPsell Center, thereby creating more than 100 new jobs in an area that had seen only economic decline for seven years. An additional 18 new businesses in Waushara County have used the center's business development consulting services to get started. The CAPsell Center is one of 16 business incubators in Wisconsin, but it is the only one in a rural area. The first tenant was CAP Services' recycling program. Other tenants have included a computer store, ceramics classes and sales, a cleaning service, and an electronics repair shop. Overall, 15 of the 21 enterprises to start at the incubator are still in business. "Wautoma Main Street," a town planning and development association, also has offices at the center. The building itself has become something of a community center. The CAPsell Center was named Social Entrepreneur of the Year in 1993 by the Social Entrepreneur Institute. The owner of a new aquatic nursery that received CAP Services' business development assistance was named Entrepreneur of the Year in 1995 by the Wisconsin Association of Community Action Agencies. VIII. KEY WORDS Business Development Business Development Center Business Incubator Community Action Agency Employment Entrepreneurs Jobs New Businesses Office of Community Services Private Industry Council Revolving Loan Fund Self-Employment Small Business Small Business Development