Implementing a New Business Model

A DoD contractor that produces precision engineered proto-type designs and mass production designs contacted the local SBDC for assistance in attaining a disaster relief loan in lieu of diminished business following September 11, 2002.

Initially, the SBDC counselor examined the business operations and finances and identified some weaknesses in the business model that appeared to be larger threats than cyclical weakness precipitated by the terrorist attacks. The client’s financials did not demonstrate a clear ability to repay the loan. The client was encouraged to transition from an “as needed” supplier to a contract supplier. The SBDC assisted the client with Dun and Bradstreet registration and Central Contractor Registration in the U.S. Small Business Administration’s Pro-Net system. Further, the SBDC guided the client through a marketing strategy in an effort to increase sales.

The process took four months to execute, but the client restored the company to solvency and produced a foundation for growth. The second half of 2003 resulted in a 1,736% increase in sales sequentially. One new job was created, four retained, and a new lathe was leased to increase production capacity.