2007 Semi-Annual Report

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					P E N N S Y L V A N I A   S M A L L   B U S I N E S S   D E V E L O P M E N T      C E N T E R S

                                                                                The Wharton School
                                                                                University of Pennsylvania
                                                                                               th
                                                                                Vance Hall, 4 Floor
                                                                                3733 Spruce Street
                                                                                Philadelphia, PA 19104-6374

                                                                                (215) 898-1219 phone
                                                                                (215) 573-2135 fax
                                                                                info@pasbdc.org email

                                                                                www.pasbdc.org




           2007 ANNUAL REPORT
   JANUARY 1, 2007 – DECEMBER 31, 2007




                                 Submitted by the

                          University of Pennsylvania

                                      3/28/2008
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                                       2007 ANNUAL REPORT
                                        TABLE OF CONTENTS

SECTION 1 - NARRATIVE
  Introduction & Highlights........................ 1             1600 Women’s Business
  100 Advocacy .................................... 7                  Development ......................... 24
  200 Capital Formation .......................... 8              1700 Economic Impact ................... 25
  300 Innovation & Technology Transfer .... 11                    1800 Veteran Business
  400 International Trade......................... 13                  Development ......................... 26
  500 Minority Small Business                                     1900 Manufacturing…………… ...... 27
       Development ................................. 14           2000 Online Activities………….… .. 28
  600 Resource Development ................... 15                 2100 Environmental Management
  700 Procurement .................................. 17                Assistance Program………… . 30
  800 Special Focus ................................ 18           2200 Keystone Innovation Zones ..... 31
  900 Economic Development .................. 19
  1000 Research..................................... 21    SECTION 2 – DELIVERABLES
  1100 Other Activities............................ 22
  1200 Success Stories ............................ 23     SECTION 3 – APPENDICES
  1300 Travel ……………………… .......... 23                            A—Marketing and PR
  1400 Problems………………….............. 23                          B—Success Stories
   1500 Finance...................................... 24         C—News Articles
                                                                 D—Letters of Support




                                                                   JANUARY – DECEMBER 2007 Annual Report
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INTRODUCTION

The Pennsylvania Small Business Development Centers (SBDC) is one of the longest running and
most highly regarded state small business assistance programs in the nation. Since 1980, the SBDCs have
worked extensively to grow the economy of Pennsylvania by providing entrepreneurs with the education,
information and tools necessary to build successful businesses. Our commitment to provide positive
impact—felt in local communities as well as the national economy—has helped small businesses achieve
significant growth and measurable success, extending greater quality of life for all Pennsylvanians.

Whether positioning a multi-generation manufacturing plant to compete despite increasing global
pressures, helping an entrepreneur prototype and find funding for a new transformative technology, or
enabling a motivated individual to achieve the dream of owning her own boutique, the Pennsylvania
SBDC program delivers results felt across the state. In 2007, the Pennsylvania SBDC demonstrated yet
another year of success:

      •   Demand for SBDC consulting services remains high. In the past year, a total of 9,073
          entrepreneurs representing a variety of industries and backgrounds received 144,162 hours of
          consulting in areas of financial management, market research, business planning, and
          recordkeeping assistance, among many other topics.
      •   At least 19,899 individuals attended one of the 1,202 educational workshops offered by the
          SBDCs during the year to brush up basic business skills or attend to more advanced business
          management topics such as OSHA compliance, government procurement, search engine
          optimization, or export assistance.
      •   SBDC clients opened 489 new businesses in the past year. A full 4,453 aspiring
          entrepreneurs explored the basics of starting and opening a business in the First Step
          workshop, offered statewide and an additional 452 individuals registered for the intensive 10-
          step Online Tutorial for Starting a Business, launched in July of 2007.
      •   This year, the Pennsylvania SDBC network opened two new centers hosted by Shippensburg
          and Widener Universities to respond to the growing demand for business services in these
          regions. These centers provided 357 small businesses with more than 5,417 hours of consulting
          services combined and educated a total of 882individuals in 72 educational workshops held
          throughout the year.
      •   SBDC clients opened 489 new businesses, thanks to SBDC assistance, rebuilding small towns
          and revitalizing Main Streets so distinctive to Pennsylvania.
      •   Sound management advice from SBDC consultants helped clients navigate new business
          regulations and retain 1,507 jobs in the face of mounting economic pressures.
      •   Financing in the amount of $185,099,808 positioned 774 businesses to expand operations
          needed for new growth.

The value of this assistance is apparent. SBDC clients continued to exhibit faster growth in sales and
employment, generating $306,739,746 in new sales and creating 1,504 jobs. In fact, SBDC clients
achieved national attention for their tremendous growth, including:
      • Mendocino International of Port Matilda was named 2007 ThinkGlobal/Commercial News
          USA Exporter of the Year. The company, which began in 2004, increased its export sales to
          $1 million, a 100 percent increase from the previous year, thanks in part to assistance from the
          Penn State SBDC in exporting its wood products to China.
      • Slowboy Racing of Indiana, PA was named to the Inc. 500 list of fastest growing companies.
          Since founding the rural-based business out of his basement in 2002, Huml has seen sales
          revenue fly up 863.5%. Owner Mike Huml credits long-term assistance from the Indiana
          University of Pennsylvania SBDC as instrumental to his success. He was one of just ten Inc.
          winners to share his story at the award ceremony in Chicago.
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National partners also recognized the Pennsylvania SBDC for its expertise:

      •   Earlier this year, U.S. Senator John Kerry praised the Pennsylvania SBDC’s Environmental
          Management Assistance Program (EMAP) as a national model when he introduced
          legislation to assist small businesses in becoming more energy efficient in his role as Chairman
          of the Senate Committee on Small Business and Entrepreneurship. In September, the program
          was recognized by both the U.S. Environmental Protection Agency as a 2007 ENERGY STAR
          Special Award winner and the Association of Small Business Development Centers as the 2007
          State Star for Pennsylvania. EMAP, launched in 1997, offers a step-by-step program to help
          small businesses recognize and realize energy and cost savings by analyzing current usage and
          recommending sound investments that lead to monthly savings in operating expenses.

Building on the assets of 18 host institutions and economic development partners, the SBDCs serve as
catalysts for economic growth by developing regional and statewide resources for small businesses,
increasing access to funding critical to growth, and fostering small firms’ continued growth and success.
This report offers more detail in how the collective efforts of SBA-funded SBDCs have added up in the
past year to help small businesses deliver real results.




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PENNSYLVANIA SBDC LOCATIONS




     •   SBDC location                 Non-SBA service area



     1. Bucknell University SBDC                          10. Saint Francis University SBDC
     2. Clarion University SBDC                           11. Saint Vincent College SBDC
     3. Duquesne University SBDC                          12. Shippensburg University SBDC *
     4. Gannon University SBDC                            13. Temple University SBDC
     5. Indiana University of Pennsylvania                14. University of Pittsburgh SBDC
         SBDC*                                            15. The University of Scranton SBDC
     6. Kutztown University SBDC                          16. Wharton SBDC
     7. Lehigh University SBDC                            17. Widener University SBDC*
     8. Lock Haven University SBDC*                       18. Wilkes University SBDC
     9. Penn State SBDC *


     *Do not receive SBA funding




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MISSION
The mission of the network of Pennsylvania Small Business Development Centers is to grow the
economy of Pennsylvania by providing entrepreneurs with the education, information and tools
necessary to build successful businesses.

PROGRAM HISTORY
Since its inception in 1980, the Pennsylvania Small Business Development Centers (SBDC) has evolved
into a network of 18 college- and university-based centers and more than 100 outreach locations
operating under the guidance of the State Director located at the University of Pennsylvania.

The Pennsylvania SBDC provides consulting services and educational programs to entrepreneurs
looking to start or grow a small business. SBDC consultants work with entrepreneurs in one-to-one
sessions to help test a new business proposition, shape a business plan, or investigate funding
opportunities. Addressing topics ranging from compliance issues to marketing tactics, SBDC programs
serve to inform and assist entrepreneurs with the many tasks a new business owner faces.

IMPACT
Since 1990 alone, the SBDCs have helped Pennsylvania entrepreneurs:

           Start more than 24,300 new businesses
           Obtain over $2.1 billion in start-up and expansion capital
           Expand sales by $8.7 billion, including over $2.1 billion in government contracts and $1.3
           billion in export sales
           Create over 104,800 new jobs at an average cost of $1,145 per job
           Generate more than $796 million in new tax revenues




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DEMOGRAPHICS

                           Client Industry Sectors


                               10%      3% 4%


                                                   16%
                                                                          Wholesale
                                                                          Construction
                                                                          Retail
                                                                          Manufacturing
                                                                          Service
                                                     16%
                                                                          Other/Unknown
                         51%




                                 Ownership Gender

          4,500
                  4,014
          4,000
          3,500                        3,235
          3,000
 Gender




          2,500
          2,000
                                                           1,596
          1,500
          1,000
           500
                                                                                   38
             0
                  Male                 Female               Both                   N/A
                                                Clients




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SERVICES

                    Consulting Hours by Center
                                                                                        Bucknell
                                                                                        Clarion
                                   None Identified,
                                       1,333 Bucknell, 6,158                            Duquesne
                          Wilkes, 5,275                                                 Gannon
                                                                                        Indiana
                    Widener, 3,241                 Clarion, 13,372                      Kutztown
             Wharton, 20,865                                                            Lehigh
                                                         Duquesne, 13,603               Lock Haven
                                                                                        Penn State
            Temple, 12,489                                                              Pitt
                                                          Gannon, 10,562
                                                                                        Scranton
         St. Vincent, 4,782                              Indiana, 6,022                 Shippensburg
                                                                                        St. Francis
    St. Francis, 4,377                               Kutztown, 9,147                    St. Vincent
           Shippensburg,                                                                Temple
               1,808                                      Lehigh, 12,472
                                                                                        Wharton
              Scranton, 3,426                     Lock Haven, 2,334                     Widener
                         Pitt, 9,550 Penn State, 3,338                                  Wilkes
                                                                                        None Identified




                Client Counts by Consulting Area
                                                                                Areas of Consulting
                            1%    2% 2%
                                                                                Business Accounting/Budget
                                                                                Business Plan
                                                    16%
              17%                                                               Buy/Sell Business
                                                                                Cash Flow Management
                                                                                Engineering/R&D

                                                              4%                Financing/Capital
                                                                                Government Contracting
                                                               1%               International Trade
                                                                                Legal Issues
                                                                                Managing a Business
                                                                                Marketing/Sales
                                                               10%              Start-Up Assistance
      14%
                                                                                Technology
                                                                                Other

                                                         10%
               8%
                           2%                6%
                                  7%



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100 ADVOCACY

Despite their importance to the economy, small businesses face a number of impediments to their success.
Burdensome regulations, complicated tax requirements, new legislation, increased competition from mass
merchandisers, and difficulty in accessing capital can all hinder a small firm’s progress. SBDC
consulting services and workshops prove valuable to small businesses needing help with translating
applicable codes and implementing new marketing tactics, and SBDC consultants have been called
“saviors” by clients who received help in processing reams of paperwork.

SBDC assistance extends beyond individual help for small firms, however. As part of ongoing efforts to
improve the business climate for small firms, the Pennsylvania SBDCs partner with various economic
development organizations, educate the public and small business owners through workshops and
seminars, and promote available services throughout the state via local media and community activities.
The resulting benefits are manifold. Through these relationships, the SBDCs are able to observe current
issues and trends for small businesses, poising centers to respond with the best and most relevant
resources available.

As a network, the SBDCs continued to work closely with the State Director’s Office to advocate for
additional resources to assist small businesses in 2007:

Addressing Small Business Issues

    •   The rising cost of energy is one of the top issues facing small businesses in Pennsylvania and
        nationally. In fact, some experts feel that Pennsylvania may be approaching an energy crisis.
        Rate caps enacted during the mid-1990s as part of deregulation of the supplier market, which
        allow consumers to choose an energy supplier, will be expiring within the next two years. With
        the energy forecast including rising energy prices, increased demand, and constrained supply,
        small business could soon experience overwhelming challenges such as higher operating costs,
        declining sales of energy-using products, and the loss of competitiveness in energy intensive
        businesses. The Pennsylvania statewide Environmental Management Assistance Program
        (EMAP) addresses this issue by providing prioritized recommendations for cost savings,
        assistance in locating local contractors, and sources of financing such as the Department of
        Environmental Protection Small Business Advantage grants. (More information about these
        activities appears in section 2100 – ENVIRONMENTAL MANAGEMENT).
    •   Effective July 1, 2007, Pennsylvania’s recent minimum wage increase to $6.25 per hour was
        further increased to $7.15 per hour as part of the amendments of the Pennsylvania Minimum
        Wage Act. Several SBDCs, including the Penn State SBDC, made efforts to educate small firms
        on the effect the wage laws may have on operations and offered options for responding to the new
        expenses.
    •   Several centers, including the University of Scranton SBDC, educated area businesses about the
        Earned Income Tax Credit and how information like this may be used to better employee
        management programs as a service to employees. The SBDCs service a number of lower-income
        areas, and workers eligible for the credit could use it to support their families.

During 2007, the SBDCs also worked with area partners throughout the state to promote available
services, as in the following cases:

    •   Regional tradeshows provide an excellent opportunity to promote services for the Saint Francis
        University SBDC. Congressman Murtha’s Showcase for Commerce held in Johnstown, allowed
        staff to present a broad range of services: one consultant led a seminar targeting entrepreneurial


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        opportunities for veterans, another outlined the specifics of SBIR/STTR opportunities for small
        firms, and the international trade specialist presented information on exporting.
    •   Participation in local nonprofit boards has enabled the Lehigh University SBDC to continue its
        strong relationships with local bankers in the community. The ongoing dialogue with banks
        generates new referrals of business clients to the center.
    •   Warren County consultants from the Gannon University SBDC rely on referrals from State
        Representative Kathy Rapp. All SBDCs meet regularly with state legislators to reinforce the
        SBDCs’ commitment in serving area constituents and offering general public support in the area
        of entrepreneurship.
    •   Attendance at various community functions increases networking with chambers of commerce,
        their staff and member organizations, along with other local and regional economic development
        professionals, as the University of Pittsburgh SBDC well understands. Dissemination of
        information about the SBDCs’ wide variety of programs and services helps to ensure that the
        community is fully aware of the advantages of working the SBDCs.
    •   The SBDCs also reach out to specific audiences and educate them about the availability of
        business services. The Shippensburg University SBDC, for instance, was active in the Hispanic
        Business Owners Group meetings co-sponsored by the Greater Chambersburg Chamber of
        Commerce, and the Saint Vincent College SBDC maintains active membership with the Laurel
        Highlands Chapter of the Women’s Business Network and Seton Hill University’s Women’s
        Economic Development Outreach Tour committee in order to reach out to female entrepreneurs.
    •   The Temple University SBDC developed a relationship with the University Of The Arts and the
        Coral Street Arts Center in Philadelphia. This enabled the center to educate the community about
        how to start an arts-based business and tax information relevant to artists.
    •   The SBDCs continue to keep open lines of communication with local media outlets and
        publications to highlight activities of the SBDC as well as client businesses. (Examples of the
        activities and press during 2007 are included in APPENDIX C of this report). Information about
        the SBDCs’ upcoming seminars is also included in local chamber of commerce guides, email
        alerts, and websites.

For other related advocacy efforts, refer to additional sections in this report.

200 CAPITAL FORMATION

Budding entrepreneurs need money to start businesses – renting space, purchasing equipment, acquiring
materials, and so forth all require an early outlay. Businesses looking to grow also need cash to expand
operations, boost inventory, and pay new hires. While local economies stand to benefit from the success
of these new and growing businesses, the capital required for their initial and sustained growth can be
difficult to acquire.

To help clients access the funds they need to proceed with their plans, the SBDCs have a process: they
provide information on available bank and government lending programs, assist clients in selecting
relevant sources, and help prepare smart loan packages. Services also include business plan preparation as
well as cash flow analysis.

As needed, SBDC consultants provide confidential one-on-one consulting services to address specific
needs, such as debt consolidation or credit repair. Consultants also provide group consulting or training
that involves other community economic development partners and lenders. Here the SBDCs’ strong
relationships with area lenders come into play: lenders are better educated about small business concerns,
and refer clients needing additional assistance to the SBDC, and consultants are better positioned to
respond to changes in the increasingly tenuous financial industry. In some cases, lenders may even adjust
services to better respond to the local small business market.
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Finally, SBDC workshops further educate the local community about available funding and how to get it.
From hosting bankers roundtables to exposing new borrowers to the lending process, to reviewing the
process for applying for Small Business Innovation Research (SBIR) funds, these workshops cover a
range of financial resources available as well the best way to secure them successfully.

During 2007, the SBDC helped 774 clients bring in $185,099,808. Examples of efforts to increase small
businesses’ access to capital include the following:

Relationships
   • The Penn State SBDC works closely with the banks in the area, the Ben Franklin Partnership,
       the CBICC, and the Local Development Districts for funding opportunities. Clients assisted by
       the Penn State SBDC invested $8,803,355 in capital into businesses from a variety of sources.
       Direct bank loans and lines of credit accounted for $5,692,665 in financing while SBA loans
       accounted for $1,256,000 in financing.
   • SBDC staff stay abreast of changes in SBA programs, meeting with SBA representatives that
       come to the center, and when possible, attending SBA-sponsored training. SBDCs in eastern
       Pennsylvania, including the Wilkes University SBDC, worked with the local SBA office to
       educate small business owners about the 504 Loan Program. The low 10 percent down payment
       is the big attraction of this program. It is possible to require even less from the business if a city,
       town or the state trying to attract businesses to their community is willing to provide a small
       piece of the financing.
   • Regular meetings with the Center for Economic Operations, an alliance of partners interested in
       economic development, has helped the Indiana University of Pennsylvania SBDC form
       strong relationships with members of the county’s department of planning and development,
       who staff the county’s loan programs and help package loan applications to state funding
       sources. The relationships built through this interaction have proven useful in assisting clients
       needing to obtain financing.
   • The Duquesne University SBDC, meanwhile, made sure loan information got out to key
       organizations reaching minority populations. SBDC consultants gave presentations on
       Community Express Loans for the Urban League of Greater Pittsburgh and the Hill House
       Association.
   • The Lock Haven University SBDC worked closely with the City of Lock Haven,
       Williamsport/Lycoming Chamber of Commerce, DCED, Seda-COG and the Clinton County
       Economic Partnership to facilitate the business plan development, application and loan packaging
       process for numerous financing requests by existing and potential small business owners in
       Clinton and Lycoming counties. In the past year, clients were successful in obtaining loan
       financing in the amount of $6,623,807. Seven clients received SBA guaranteed loans totaling
       $1,424,630.

    Small businesses not wanting to rely on commercial bank loans may also work with the SBDCs to
    uncover non-traditional financing:

    •   The University of Scranton SBDC is one of the primary resources for clients who seek Micro-
        Loan funding (up to $25,000) in Lackawanna County, helping clients secure $60,000 in Micro-
        Loans this past year. The Widener University SBDC also worked to establish these relationships
        in its first year of operations, working with organizations such as the Chester Microenterprise
        Partnership and the Chester Economic Development Authority (CEDA).
    •   The Pottsville Incubator in Schuylkill County has formed an advisory board to develop an angel
        network of equity investors for technology-related businesses. A representative from the Wilkes
        University SBDC serves on the advisory board for this project.
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    •   Technical assistance for the Community Loan Fund Growth Capital, designed for manufacturing
        firms and other existing small businesses, enabled clients of the University of Pittsburgh SBDC
        to borrow to $500,000. The fund offers flexible repayment options over varying terms.

Training
   • The Wharton SBDC hosted a “Meet the Lenders” educational and networking program that
       brought together representatives from SBA, several banks, the Delaware Valley Consumer Credit
       Counseling and several microfinance organizations.
   • The Duquesne University SBDC Entrepreneur’s Growth Conference offered several sessions
       exploring financial opportunities and resources used to grow businesses. Two of the workshops
       included” Shake Your Money Maker: What You Need to Know to Get Your Business Financed,”
       geared toward new ventures, and “Ask the Investors Panel: An Interactive Q & A with Venture
       Capitalists and Angel Investors.”
   • In September, representatives from the Lehigh University SBDC conducted a seminar “Building
       Relationships with Financing Partners and How it Impacts SBDC Clients” at the 2007 annual
       conference for the national Association of Small Business Development Centers. The session
       highlighted methods the SBDC has used to assist more than 350 clients in securing $150 million
       in financing.

Results
   • During 2007, the Clarion University SBDC helped 86 clients raise over $19 million in start up
        and expansion capital, including an Elk County firm looking to establish a large powder-coating
        plant in Cameron County. With the help of the extensive business plan and financial projections
        over two years, the firm was able to secure $1.6 million in financing to open the new
        manufacturing plant.
   • Economic development loans totaling $450,000 provided Erie Powder Coatings Inc. with the
        means to open a sister plant in Corry. The Canadian firm, helped by the Gannon University
        SBDC, will help add good paying manufacturing jobs in Erie County.
   • For young start-ups, finding venture capital or angel funding investment can be critical in that
        first phase. In particular, the University of Pittsburgh SBDC is skilled in helping clients connect
        with investors, and helped several individuals in the past year prepare investor pitches and tailor
        proposals for the most ideal match.
   • In ever more uncertain times, the Saint Francis University SBDC helped clients pull in a total of
        84 financial approvals during 2007, totaling $9,934,712. The approvals have resulted in the start-
        up of 19 new businesses, the purchase of 13 businesses and the expansion of several others. These
        loans have also enabled businesses to create 22 new jobs based on the information reported back
        to the center.
   • In 2007, the Environmental Management Assistance Program assisted 26 clients with
        obtaining grants from the PA Department of Environmental Protection. Through the Small
        Business Advantage Grant Program, matching funds are provided to pay for energy efficiency
        and pollution prevention upgrades. These clients were awarded $189,116 in grants.




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                                  Other County/ Community
                                           Loans                   All Others 9%
                         SBIR               3%
                          3%



    Other County/ Community
             Loan
              4%


                                                                                                Commercial (Bank) Loan
           State Loan Program
                                                                                                        43%
                   7%




                   Other Loan
                      8%




                                                            Owner Investment
                                                                  13%

                                SBA Loan
                                  11%
                                                                                               ES
                                                                                          SOURC OF FINANCING




300 INNOVATION & TECHNOLOGY TRANSFER

The Pennsylvania Small Business Development Centers’ technology commercialization services
continues to help equip entrepreneurs with the skills needed to develop a commercialization strategy and
help bring technologies to market. Specific services include:
    • Consulting services focused on planning, financing, market strategy development, intellectual
        property rights protection, trade marking and copyrighting, and patent search;
    • Identifying appropriate partnerships with state, federal, and local economic development
        organizations to ensure businesses have access to a full array of resources and services;
    • Identifying target markets and assisting firms in bringing new products to market;
    • Developing processes and design strategies for commercializing technologies; and
    • Identifying alternate sources of financing, including Small Business Innovation Research/Small
        Business Technology Transfer Research and other federally funded research opportunities, to
        help in the commercialization the process.

SBDC technology consultants are skilled at helping clients access Small Business Innovation Research
(SBIR) grants and other federal funds to assist with the R & D process prior to commercialization.
Workshops held across the state educate technology entrepreneurs on how to secure such funding, and
SBDC consultants work one-on-one with clients to prepare these applications.
   • The Temple University SBDC, in conjunction with the Ben Franklin Technology Partners,
       BioAdvance, the Science Center, and the Bucks County Keystone Innovation Zone co-sponsored
       an NIH SBIR workshop at the PA BioTech Center of Bucks County. Dr. Ohlsson-Wilheim, CEO
       of SciGro, Inc., provided an overview of the SBIR/STTR programs and gave tips on writing
       SBIR/STTR proposals for NIH. Company executives from Immunotope and Callisto

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        Pharmaceutical talked about their experiences and successes with the SBIR grant program. The
        workshop increased awareness of the SBDC’s services and a number of attendees became clients.
    •   Daedalus Innovations, which is working to develop high tech devices to enhance the capabilities
        of nuclear magnetic resonance spectroscopy used in drug development, successfully completed a
        Phase II SBIR proposal to the National Institute of Health thanks to help from the Temple
        University SBDC technology commercialization specialist. Following the submission, the
        partner continued working with the SBDC to pursue licensing negotiations with the university
        that owned the core technology for their inventions. Daedalus Innovations was approved for an
        award in the amount of $750,000 – usually the maximum amount awarded for a Phase II grant.
    •   A Gannon University SBDC client was awarded $4 million in federal R&D funding in
        November to further develop its technology for a positioning system. The client’s technology
        offers an alternative in environments such as mines, narrow valleys, and buildings where standard
        GPS cannot function.

This year, the Product Development Center at the Bucknell University SBDC returned to capacity,
renamed as Engineering Development Services to better communicate the broad range of sophisticated
technical consulting services available for clients. Services include intellectual property consultation,
patent and competitive product searches, technical feasibility assessments, preliminary technical design
and analysis, product development process consulting, prototyping fabrication and materials and product
pre-certification testing. In 2007, these services were obtained by 60 clients; 25 reported from the
Bucknell SBDC’s six-county region while 35 were referrals from other SBDCs, including:
    • The Duquesne University SBDC referred a client who is creating an alternative blood testing
         device for the diabetic population to the EDS center late in 2007. The client is looking to develop
         a low cost, low-tech tool that will minimize the pain of monitoring blood sugar levels. The case
         was discussed with EDS and the client is preparing a business plan in accordance with the
         feasibility policy.

SBDC clients were also assisted with basic preliminary research on patent, trademark and patent issues:
   • During the year, the Lehigh University SBDC conducted 28 preliminary patent searches in a
      wide variety of industries, including office supplies, toy, medical/cosmetics, food, child care,
      home goods, travel and garments. Three-quarters of these investigations resulted in the discovery
      of identical or very similar patents. Most of these clients decided it was not in their best interest
      to pursue their ideas. With regard to the seven remaining searches, some clients are now
      conducting competitor analyses or assessing the commercial potential of their idea.

When the need arises, the SBDCs lead efforts to develop other resources to meet this important client
base.
    • Many SBDCs partner with the Ben Franklin Technology Partners, a state resource offering a
       technical assistance and financing for tech start-ups. Hydro Enclosures, a Clarion University
       SBDC client, benefitted from this partnership, receiving $50,000 from the local program for help
       in marketing a patented hot water heating system.
    • The Shippensburg University SBDC has been participating in the Harrisburg Area KIZ and, in
       partnership with the Lancaster KIZ, provided input in the development of the Innovation Transfer
       Network “South Central Pennsylvania’s Technology Transfer Center.” The network is designed
       to support technology-focused economic development and the creation of high-tech jobs.

The SBDCs also partner with local incubators in an effort to service high-tech clients. More information
on these activities may be found in Section 900 – ECONOMIC DEVELOPMENT and Section 2200 –
KEYSTONE INNOVATION ZONES.



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400 INTERNATIONAL TRADE

Given the weak performance of the dollar relative to a number of foreign currencies, there may be
tremendous opportunities for small businesses to expand international sales in the coming year. The
SBDCs’ international trade services have already helped clients achieve success in the past year.
Specialists work closely with Pennsylvania and federal agencies to promote products in foreign markets,
and as such, have access to a large pool of knowledge, expertise and technical data. The SBDCs match
new trade inquiries with local companies as opportunities arise.

In 2007 500 entrepreneurs received 9,457 hours of international business consulting, reporting an
increase in international exports totaling $19, 492,818. For example:

    •   The Kutztown University SBDC uses a team consulting approach for high impact clients
        exploring the international arena. Clients receiving such assistance returned surveys reporting that
        these services helped retain 160 jobs and add another 14 in 2007. This assistance also generated
        nearly $2.27 million in new export and $6 million in domestic sales.
    •   The Global Business Program at the Duquesne University SBDC has continued to provide
        services to the exporting and importing business community, actively participating in the
        Regional Export Network (REN) - Southwest Region and cooperating with the other members to
        streamline the services provided to those interested in exporting their services or products.
        Professional networking has been ongoing to increase client referrals and establish linkages with
        the economic development community. In 2007, 122 clients received assistance from the export
        consulting staff throughout the year, accruing approximately 2,000 hours of work. The amount of
        export activity as a result of this is in the order of $6,000,000 for the year.
    •   In the latter half of 2007, the Gannon University SBDC assisted six local exporters in
        northwestern Pennsylvania in obtaining Market Access Grants offered by the Office of
        International Business Development (OIBD). Each of the companies received a matching grant
        from the OIBD in the amount of $5,000. The funds are used for cost recovery for international
        travel to expenses related to foreign language translation of marketing materials.
    •   The Lehigh University SBDC accomplished a total 48 research projects for clients seeking
        international assistance in 2007, including an industrial gas company looking to explore business
        opportunities in China.

To complement its consulting services, the SBDCs provide information on international trade
opportunities, issues and exporting mechanics through introductory, intermediate and advanced level
workshops. Programs include Export Planning, Financing and Documentation, Developing an
International Marketing Plan for Food/Agriculture Products, International Insurance for Business, Doing
Business Overseas, Cross Cultural Communications, and Licensing Technical Data and Software for
Export. The SBDCs also helped coordinate several successful trade missions to help companies establish
international contacts. Examples of these events include:

    •   The Saint Francis University SBDC helped 10 companies establish 240 leads through the Asia
        Pacific International Mining Exposition in Sydney, Australia in September. A Fayette County
        based pump manufacturer had an Australian pump distributor meet up with them in Pittsburgh as
        a follow up to the show. It is expected that there will be further positives reported from this event
        in 2008.
    •   Attendees at the Saint Vincent College SBDC workshop “Exploring Business Opportunities in
        Greece” focused on this growing market economy. Ms. Irene Ralli, Commercial Specialist from
        the US Commercial Services in Athens discussed current business opportunities in Greece,
        reviewing leading sectors that present major export prospects as well as opportunities to exhibit at
        commercial events.
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    •   In the fall of 2007, the Temple University SBDC offered a new version of its “Breaking into the
        Trade Game” series. The course was offered every Tuesday for six weeks from November
        through December.

Clients receiving international assistance from the SBDCs are better positioned to compete in global
markets:
    •   Mendocino International, a client of the Penn State SBDC, was awarded the 2007 Exporter of
        the Year Award in the Agriculture category from Think Global, Inc, publisher of Commercial
        News USA, the office export magazine of the US Department of Commerce. The SBDC was
        recognized by Rebecca McVicar, representing Mendocino International, at the awards ceremony
        hosted by Congressman John Peterson. Ms. McVicar said that the SBDC was instrumental in
        helping the company obtain the funding needed to expand their business.
    •   Sage Technologies, a veteran-owned business helped by the Temple University SBDC, is an
        engineering service company serving commercial markets and the Department of Defense. Their
        leading product is a hands free, thermal imaging device to serve the firefighting market. SBDC
        international business consultants assisted the company with international market expansion
        through export compliance issues and research, specifically in China and Saudi Arabia.

Other examples of international business successes are included in APPENDIX C – SUCCESS
STORIES.

500 MINORITY BUSINESS DEVELOPMENT

The SBDCs also work to build local resources to respond to the minority business population. During
2007, SBDCs continued outreach to minority communities, consulting with 1,550 clients counting
themselves as minorities (22% of all clients). The SBDCs place special emphasis on educating minority
clients about available certification programs, networking events, local purchase programs and funding
resources for minority-owned companies.

Generally, the more urban areas of the state service the bulk of minority clients. The Temple University
SBDC, located in Philadelphia, finds minority clients account for 48% of its total client base and 29% of
the total capital raised for clients.

    •   This year, the Temple University SBDC was able to officially launch the Philadelphia Business
        Builder Loan Program, a small business lending program aimed at increasing small business
        access to capital in low- to –moderate income and predominately minority areas of the city. The
        SBDC is designated as the technical service provider. The collaborative effort is supported by
        Beneficial, Citizens, Commerce, PNC, and United Bank, and the Consumer Credit Counseling
        Service of Delaware Valley among others. Two SBDC clients have been approved for loans
        through this program thus far.

Many other areas in the state do not see many minority clients as the population base simply does not
include this demographic. However, there are several examples of minority outreach and successes
resulting from the help of these SBDCs, such as the following examples:

    •   An Asian client who had become a client of the Penn State SBDC several years ago found that
        her retail women’s clothing business was suddenly growing so fast she was having a challenging
        time hiring and keeping staff. The client began work on an employee manual at the suggestion of
        the consultant to make sure all employees understand what is expected from them as well as what
        they can expect from her as an employer.

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    •   A Latino client came to the University of Scranton SBDC for assistance in opening a shop
        specializing in the sale of Confirmation clothing for children. The client did not have a good
        grasp of written or spoken English, and the SBDC consultant was able to walk the individual
        through completing Fictitious Name, Employer Identification Number and Enterprise
        Registration Forms.
    •   A minority-owned business approached the Gannon University SBDC for help in developing
        and commercializing a new patented product targeted to the trucking and RV industries. The
        SBDC offered assistance in developing the client’s manufacturing strategy and business plan, as
        well as identifying several marketing strategies. The client applied for the Ben Franklin
        Technology Partners’ Big Idea business plan contest and was selected as a finalist.
    •   This year, the Clarion University SBDC assisted a female minority business owner in opening
        her second funeral home and another minority client in expanding her restaurant located in Clear
        Creek State Park.
    •   A fine jewelry retailer secured $1.8 million for expansion into a new 30,000 sq. ft. warehouse to
        accommodate their inventory for increasing eBay sales thanks in part to efforts by the Lehigh
        University SBDC. Since their launch in 2005, the retailer has climbed to #1 in monthly
        transactions on eBay in one category and is setting their sights on similar achievements in other
        categories of gem/jewelry sales in the short-term future based on their expansion.

The SBDCs continue to advocate for and develop resources to respond to the increasingly diverse
demographics in Pennsylvania, and 2007 resulted in new measures to reach the ever-growing Hispanic
business population. A few examples from the past year include:

    •   The Kutztown University SBDC unveiled two new online tutorials to help Hispanic
        entrepreneurs start and grow businesses. Offered in both Spanish and English, the tutorials
        leveraged partnerships with Virtual Advisor Interactive and SmallBizU to develop the technology
        backing the content. With these additions, the SBDC has a substantial bilingual online library of
        entrepreneurial workshops.
    •   The Duquesne University SBDC participated in the Hispanic Job Fair at Carnegie Mellon
        University, resulting in five participants for the Spanish Business Plan Seminar, four new clients,
        and additional registrations for upcoming conferences.
    •   The Wilkes University SBDC continues to focus on meeting the needs of a dynamic Hispanic
        business community in the Hazleton area. The consultant serving the Hazleton outreach area has
        been participating in the newly formed Downtown Hazleton Hispanic Business Owners
        Association meetings. The SBDC will continue to offer the First Step: Steps to Starting Your
        Own Business and other relevant business training in Spanish in the Hazleton outreach office as
        needed.
    •   In an effort to improve its outreach to minority entrepreneurs, the Temple University SBDC
        formed relationships that led to co-sponsored events with both the Hispanic American Chamber
        of Commerce and the African American Chamber of Commerce. The SBDC also developed
        relationships with the Hispanic Association of Contractors and Enterprise in Philadelphia that led
        to a co-sponsored event titled “How to Access Capital for New and Existing Businesses.”


600 RESOURCE DEVELOPMENT

As the statewide network responsible for examining the issues and challenges facing small businesses and
responding to them, the Pennsylvania SBDCs are constantly looking for answers to small business
questions, and developing resources to better equip firms to handle new pressures. Access to SBDC
services is another consideration the network regularly reviews, and partnerships developed through the

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year have enabled centers to better respond to the growing needs in their communities. Examples to
develop additional small business resources in 2007 include the following:

Targeted Resources
   • When the state announced new regulations limiting how much manure farmers can keep on their
       land, the Pennsylvania State Conservation Commission tapped the Pennsylvania SBDC for a
       solution. The SBDC’s Environmental Management Assistance Program responded with The
       Manure Trader, launched in August (www.manuretrader.org), a free service to help farmers
       comply with the manure disposal regulations and explore nontraditional applications for manure
       such as alternative fuel.
   • The University of Scranton SBDC began monitoring legislation and activity geared to the food
       industry, specifically surrounding farm-related activity as it relates to production, packaging, and
       development of products. This enables the center to keep its agribusiness-related clients well
       informed of new developments.
   • To respond to the manufactured housing industry in northwestern Pennsylvania, the Clarion
       University SBDC has been involved in efforts to build a partnership created to address an
       unskilled workforce training program, the potential effects of tolling I-80, and the adoption of
       green technologies.
   • In October, a partnership with the Economic Develop Corporation of Erie County and the
       Gannon University SBDC was finalized with the hiring of another SBDC consultant and
       placement of this staff member in the manufacturing incubator. The SBDC’s on-site presence is
       intended to assist individuals in this sector needing to shift roles from technician to business
       owner.
   • A partnership with the PA Export regional network program gives the Lehigh University SBDC
       additional resources to provide to its client base, including access to a website resource, monthly
       newsletter, Market Access Grants, the PA Finance Program, and the PA overseas offices.
   • Meanwhile, the Penn State SBDC worked with the College Township IDA to create a loan fund
       to provide financing for businesses unable to obtain sufficient bank financing. The IDA received
       funds from the sale of their property and will use this money for the fund

Expanded Outreach
   • In ramping up its operations this year, the Widener University SBDC partnered with Citizens
      Bank, the Delaware County Commerce center and the Chester Microenterprise Partnership to
      open an outreach office in Upper Darby in July. The office is made possible by a $35,000 grant
      from Citizens Bank, a portion of which is used to support the SBDC.
   • The Wilkes University SBDC has been partnering with the recently rejuvenated SCORE chapter
      in the Wilkes-Barre area to assist in the delivery of consulting and training. In addition to
      participating in SCORE training for start up businesses, the SBDC has worked with new SCORE
      consultants to educate them about resources available at the SBDC. The SBDC has offered use of
      its library to all SCORE consultants.
   • Close relationships with area chambers, SEDA-COG, Ben Franklin Technology Partners, the
      Lewisburg Downtown Partnership, KIZ, the IRC network, and other economic development
      partners has helped the Bucknell University SBDC locate and obtain funding for several clients.
   • Small businesses in McKean and Potter counties now have better access to SBDC services thanks
      to a new outreach office set up by the Clarion University SBDC. In addition to regular
      consultant presence, the office is used to present First Step workshops monthly. The office has
      also enabled the SBDC to extend its relationships with local banks, economic development
      agencies and education councils in both counties.
   • Through a partnership with the local library, the Lock Haven University SBDC uses wireless
      laptops to offer QuickBooks workshops throughout the year in the Lycoming County Outreach

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        Center. The SBDC is able to train as many as 15 attendees per session on the use of the
        accounting software program as a result.

Additionally, reference materials and research resources are collected, reviewed and made available at
each center; many more of these are available on center websites or found on www.pasbdc.org. More
specific examples of the resources the SBDCs develop may be found in Section 200-CAPITAL
FORMATION and Section 1000-RESEARCH.

700 PROCUREMENT

The government marketplace is a profitable opportunity for many small businesses and here too the
Pennsylvania SBDCs may be of service. With the Kutztown, Lehigh, Temple and Widener University
SBDCs serving as southeastern Pennsylvania’s Procurement Technical Assistance Centers (PTAC),
this area represents the majority of our procurement efforts. These PTACs assist contractors with
marketing, pre-award, compliance and post-award issue. Specific services include developing government
marketing strategy, providing consulting on the procurement process, assisting in proposal preparation
and review, and serving as a liaison with government agencies and businesses. Additionally, the SBDCs
connect clients with the BID MATCH system, which helps clients identify federal, state, local and foreign
government leads with contractors and subcontractors. Clients in the government marketing arena also
benefit from general business assistance.

Elsewhere in the state, the SBDCs provide general business assistance to those looking to pursue the
government marketplace, offering assistance to firms that may benefit from a minority or woman’s
business certification to open opportunities to win contracts and referring clients to local PTACs when
additional assistance is needed.
    • The Duquesne University SBDC completed a 30-page guide entitled “Getting Started with
        Government and Private Contracting.” The guide includes Frequently Asked Questions on selling
        products and services to the government or to corporations. It provides an overview of purchasing
        requirements, contact information, and preparation tips for contract bidding.
    • A close linkage with the Private Industry Council of Westmoreland/Fayette, Inc. which has a
        formalized procurement assistance program has been beneficial for the Saint Vincent College
        SBDC. The SBDC in this region also worked with the State Office of Vocational Rehabilitation
        in assisting disabled clients in accessing funds earmarked for small business development.

The SBDCs also host training seminars to help small business owners gain a competitive edge in the
government arena. Workshops covering topics such as Understanding the Federal Acquisition
Regulations, Basics in Government Marketing, Doing Business with the Commonwealth, Marketing
your Goods & Services Using the Internet, Federal Government Cost Accounting were held in the past
year as well as:
    • The Widener University SBDC participated in the Pennsylvania Seventh Congressional
        District Business Procurement Summit, hosted by Congressman Joe Sestak (PA-7), on
        December 3, which drew over 400 attendees to Springfield. Featured speakers at the Summit
        included Congressman John Murtha (PA-12), Chairman of the House Defense Appropriations
        Subcommittee; Congressman Ike Skelton, Chairman of the House Armed Services Committee;
        and Vice Admiral David Architzel, Principal Deputy, Assistant Secretary of the Navy for
        Research, Development, and Acquisition.
    • On October 30, 2007 the Bucknell University SBDC held a "Doing Business with the
        Pennsylvania Government" seminar, conducted by a procurement specialist and co-sponsored by
        the Department of General Services. These seminars inform attendees on how to find contracts,
        become MBE/WBE certified and gain insight into how state purchasing personnel are doing
        business.

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At least 4,189 clients received consulting services to examine government markets. Of those choosing to
pursue government contracts, 89 clients were awarded 917 prime contracts totaling $94,087,316 and
434 subcontracts totaling $38,166,970.


800 SPECIAL FOCUS

When basic services aren’t enough, small business owners can find an abundance of specialized services
that respond to their unique needs thanks to the SBDCs. Centers develop programs and new capabilities
to specifically target entrepreneurial education, displaced workers, underserved communities and niche
markets in their respective areas. In doing so, the SBDCs ensure they properly serve the varied needs of
their regions.

From Unemployed to Self-Employed
   • From July-December 2007, 16 of the 18 Self Employment Assistance (SEA) participants have
      completed entrepreneurial training offered through the Gannon University SBDC. Of the 18, 14
      have officially started businesses in Venango, Warren, Crawford or Erie counties. The start ups
      range from a firm specializing in design consulting for the plastics industry to a kennel for pets.
   • The University of Pittsburgh SBDC regularly speaks at the Self-Employment Assessment
      training series held by the Washington & Greene County Job Training Agency. The SBDC
      representative discussed the mechanics of staring a small business and participated in financing
      roundtables.
   • The Lehigh University SBDC continues to participate in a program hosted by the local
      CareerLink that provides resource identification and information to unemployed persons who are
      considering entrepreneurship. In December of 2007, the local PBS station featured the SBDC
      during a story on how unemployment can lead to entrepreneurship.
   • Continuing its efforts with the Office of Vocational Rehabilitation, the Clarion University
      SBDC held a fourth and final training session in September. Previous training sessions have
      resulted in several business plans, one of which received financing to open a coffee shop/art
      gallery in Oil City.

Entrepreneurial Education
   • Several centers, including the Wharton and Indiana University of Pennsylvania SBDCs, utilize
       students in client cases. This experience enables students to have real-world business experience
       with each case and provides in-depth assistance to the client at no additional cost.
   • The Clarion University SBDC is actively involved with the Pennsylvania State System of
       Higher Education’s economic development committee, whose purpose is to determine
       appropriate economic development avenues that the 14 member universities might pursue. The
       committee adjudicated grant proposals for Entrepreneurial Learning Centers throughout
       Pennsylvania.
   • In December, the Bucknell University SBDC served as a team leader for Building Leaders of the
       Susquehanna Valley Program (BLSV) for both the Sunbury and Bloomsburg chapters. BLSV is
       a leadership group for juniors from numerous high schools in the region which enables students
       to take part in an exercise in which they propose development to help the economy of a
       hypothetical region. The exercise challenged the students to consider numerous factors including
       transportation, tax structure, demographics, public perception, environmental conditions, permits
       required, business planning and financial responsibilities with the SBDC providing oversight.




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Young Entrepreneurs
   • Working with the business schools within the university, SBDC staff contribute significant time
      to current students attempting to bring their business concepts to reality. The Lehigh University
      SBDC continues to develop ties within the University to connect the needs of early-stage and
      start-up entrepreneurs with appropriate resources. An ever-increasing number of students are
      experiencing more and more success growing their businesses to new levels. Two student owners
      of an indoor kart racing facility in Allentown rose over $1.4 million to start their business. Other
      student teams working with businesses in the salt water aquarium and personal computing
      industries raised over $1.1 million in 2007 from conventional, private investment and state-
      sanctioned economic development sources.
   • A consultant at the Duquesne University SBDC worked with two chiropractic students who will
      graduate in 2008. The consultant assisted the partners with the development of a business plan
      and financial statements in order to apply for a loan. In December, the students were approved for
      a $38,000 loan and $20,000 line of credit.

Agribusiness
     • Over the past year, the University of Scranton SBDC has developed new training programs
         geared toward the agribusiness sector, including the ServSafe program and the Food for Profit
         program, held in cooperation with the Penn Sate Agricultural Extension.
     • The Penn State SBDC worked with the owner of Center Hardwood, Inc., a wood products
         manufacturer, to expand his line of products to include wood pellets. The SBDC assisted in
         preparing a business plan for financing and the client obtained $252,000 for this project.
         During the second half of 2007, the client needed additional funding and the SBDC referred
         him to an AgChoice Farm Credit lender, who assisted with financing. The SBDC also advised
         the client on repurposing excess sawdust.
     • Thanks to dedicated space provided by the Pennsylvania Department of Agriculture, the
         Wilkes University SBDC held six First Step sessions in Sullivan County. As a result, the
         SBDC has seen significant increase in client activity in Sullivan County.
     • On November 15-16, the Wharton SBDC co-sponsored and hosted the Social Venture
         Institute, a 2-day education program for more than 125 entrepreneurs committed to the triple
         bottom line: people, planet and profits. Wharton SBDC client Farm to City offered testament to
         how these principles can reinforce a business model (see APPENDIX C – SUCCESS
         STORIES for detail).

900 ECONOMIC DEVELOPMENT

In 2007, the SBDCs continued to play an important role in fostering the revitalization of communities,
working with Main Street programs, local incubators, and other economic development partners to build
the stability and growth of the local economy. Some examples from the past year include:

Regional Initiatives
   • When a historical amusement park important to many other local businesses in Crawford County
       continued to experience financial failures and closed, a judge appointed a consultant from the
       Gannon University SBDC to a board to help get it back up and running. The consultant’s
       business planning expertise was used to develop a feasible business model to help it deal with its
       $3 million debt and a plan to shop around to investors.
   • Similarly, the Saint Francis University SBDC was approached by a group for advice on
       operations for the Ebensburg Airport. The center worked with representatives to assist them in
       preparing a five-year business plan for operations which addressed a number of the borough
       council’s concerns about the facility. The group was successful in securing a lease for the airport
       and the community will benefit.
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    •   Regional Small Business Forums such as the one hosted by the Lock Haven University SBDC
        in October enable economic development experts, including city, county and local government
        officials, local banks, and chamber representatives to discuss regional initiatives in support of the
        local Keystone Innovation Zone (KIZ) and Downtown/Main Street programs.
    •   The Clarion University SBDC supports the efforts of the Northwest Pennsylvania Regional
        Planning and Development Commission. The director of the SBDC led a tour of the Foxburg Inn,
        an SBDC client, for various northwest Pennsylvania county commissioners as part of a board
        meeting last year.

Developing Vibrant Downtown and Main Street Communities
   • In support of the Pennsylvania SBDC strategic plan, the Saint Vincent College SBDC
       participated in the economic restructuring committees of two local downtown districts, including
       the downtown Latrobe and Vandergrift communities.
   • Over the past year, the newly-established Shippensburg University SBDC worked to found the
       Shippensburg Area Chamber of Commerce Marketing Committee, a group of community and
       business members that work to enhance and promote businesses in Shippensburg.
   • The University of Pittsburgh SBDC has been an active participant in the Waynesburg
       Prosperous and Beautiful revitalization project since it was spearheaded in 2001. The SBDC
       continues its work in Greene County in conjunction with the Main Street Program and
       Pennsylvania Downtown Center.
   • The Lock Haven University SBDC worked closely with the Downtown Lock Haven Main Street
       Coordinator to conduct a needs assessment for a joint training effort specifically targeted at the
       downtown retail and services business in Lock Haven.
   • In support of New Bethlehem’s Economic Restructuring Committee, the Clarion University
       SBDC helped to develop a series of planning workshops for local leaders to assist them in
       designing programs and connect with Main Street grants.
   • The Gannon University SBDC’s Mercer County Outreach Consultant served on the Economic
       Restructuring Committee for the Olde Main Street Project in Grove City. The committee was
       organized to support the manager with issues related to revitalization.

Supporting Incubators
   • The Wilkes University SBDC, like other centers across the network, has been active in
      supporting local incubators in the past year. The SBDC supported the innovation center in
      Wilkes-Barre as well as incubator facilitates in downtown Bloomsburg and Hazelton with its
      consulting services.
   • The new Shippensburg University SBDC actively supported the Murata Business Center, a
      business incubator located in Cumberland County. SBDC staff members serve on the advisory
      board, co-facilitate educational programs, and meet with clients and prospective tenants on-site.
   • To be considered for the local incubator program, applicants must submit a feasible business plan
      evaluated by a team of business consultants from the Temple University SBDC. Upon
      acceptance into the program, business owners are required to establish reasonable short and long-
      term goals for their company. Progress towards these goals is evaluated each quarter. Tenants are
      required to attend bi-weekly meetings with their business consultant and any professional
      development opportunities as specified by their consultant. For more incubator activities, see
      Section 300-INNOVATION & TECHNOLOGY TRANSFER and 2200-KEYSTONE
      INNOVATION ZONES.




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1000 RESEARCH

SBDC research covering industries, products, technical specifications, patents, and demographics prove
immensely valuable for clients looking to stay ahead of the competition. In addition to market research,
SBDC consultants also conduct research for their clients regarding regulations, how to reduce waste, how
to improve air quality, alternative methods of operations to improve efficiency, and other environmental
issues.

SBDC consultants rely on the Internet, resources at university libraries both on site and via the Internet,
the Pennsylvania SBDC’s National Research Network, Hill Library, and many other sources of
information. Consultants may also post research requests to the PASBDC listserv for responses from
their peers.

Examples of research activities in latter half of 2007 include:

    •   The Gannon University SBDC assisted a client, Entech Plastics, in obtaining a database of
        potential and perspective customers by utilizing the network’s Business Research Specialist. The
        client was very pleased with the leads the list generated, and many prospects have become
        customers. The client reports these customers should add 20% to overall sales in the coming year.
    •   The Duquesne University SBDC conducts research for its clients using a staff of 5 part-time
        students. The students are trained in the use of the Effective Business Research tutorial, launched
        earlier this year, research information using other online resources, and visit the local Carnegie
        Business Library to gather hard copy research.
    •   The Pennsylvania SBDC network undertook a study to identify the major challenges facing small
        firms today. In compiling various surveys of small businesses in Pennsylvania, and nationally, a
        few issues immediately rose to the top, including access to affordable health insurance. Another
        major issue cited is the rising cost of energy, followed by challenges relating to taxes, lawsuits
        and liabilities, workers compensation, regulations. The SBDC network has used these findings to
        advocate for resources on behalf of clients.
    •   The Wilkes University SBDC maintains a list of loan and grant programs available in the service
        area and distributes the list in requests for information. A copy of that list is also available on the
        website and is included in the “First Step: Steps to Starting Your Own Business” manual. The
        SBDC has paid particular attention to the local microloan programs and has received briefings
        from the loan providers under this fund of the status and parameters of the financing.
    •   The new Shippensburg and Widener University SBDCs spent a good part of 2007 in building
        up their resource libraries. Hundreds of electronic resources can be printed or emailed to clients
        and the SBDCs have also amassed a number of books, pamphlets, and other print resources that
        may prove helpful to new business owners.
    •   The Lock Haven University SBDC business consultants all became members of HillSearch in
        November of 2007, to assist clients in making well informed decisions faster with access to the
        most current and credible business-critical information available anywhere. The SBDC staff
        understands the importance of research and recognizes that with the right information, it's easier
        for clients to make successful decisions.

SBDC staff members are well-versed in their fields and often looked to within their universities and
communities as research experts. In 2007 alone, the SBDCs contributed to the following research
requests:

    •   The paper “Innovation Factory – Startup Catch 22’s” by former engineering student and
        Bucknell University SBDC staff member, Tucker Marion—now Assistant Professor of the
        School of Technology Entrepreneurship at Northeastern University—was accepted by the
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        International Journal of Entrepreneurship Education. The paper focuses on the development of
        the IceDozer by the Innovation Factory, a previous client of Engineering Development Services
        and the SBDC.
    •   The Wharton SBDC collaborates with the Entrepreneurs Forum of Philadelphia and the
        Philadelphia Business Journal to compile a list of the 100 fastest-growing companies in the
        region. The SBDC’s role is to identify those companies based on sales and employment.
    •   Known for its capabilities in research relative to economic development, faculty at the Indiana
        University of Pennsylvania tapped the SBDC for help in obtaining a research grant from the
        Center for Rural Pennsylvania. The institution was awarded the funds to do the study, titled
        “Examination of Small Business Owners in Rural Pennsylvania.” The results of this study will
        aid the Center for Rural Pennsylvania in making policy recommendations that will assist the State
        in creating an environment that fosters rural small business.
    •   Clarion University’s long range planning includes locating the majority of student services in
        Becht Hall after renovations expected to be completed in 2011. Student input is necessary to help
        determine the best location of services and offices in Becht as well as the resource allocation
        plan. The Clarion University SBDC conducted a focus group consisting of students and
        completed a report on the results of the focus group.
    •   The Duquesne University SBDC participated with the University in a study to assess the
        feasibility of establishing a Duquesne University business incubator. The study found that
        business demand for an incubator definitely exists if the project costs and revenues can be
        reasonably structured.

1100 OTHER ACTIVITIES

Major activities separate of other SBDC initiatives in 2007 included the following:

    • In January, the Pennsylvania SBDC network announced the openings of two new centers at
       Shippensburg and Widener Universities to better service small businesses in southcentral
       Pennsylvania as well as Delaware County. This past year has evidenced a coordinated effort by
       the network to help these centers build operations, educate new staff, develop best practices, and
       integrate into their respective communities. The new centers provided businesses in these regions
       with more than 4,760 hours of consulting services and educated a total of 882 individuals in 72
       educational workshops throughout the year.
    • After nearly 20 years of leading the Pennsylvania Small Business Development Centers
       program to become one of the top SBDC programs in the nation, State Director Gregory L.
       Higgins, Jr. announced his retirement in the fall of 2007. Higgins, 63, offered more than 30
       years of experience in the formulation and implementation of economic development policy at
       the national, state and local levels. Prior to accepting an offer in 1988 to head Pennsylvania’s
       program, Higgins was State Director of the program’s counterpart in Florida, operated through
       its State University System. Development of a search committee to select his replacement is
       underway. In the meantime, Associate State Director Christian Conroy serves as the Interim
       State Director.
    • The Pennsylvania SBDC directors developed a strategic plan outlining the specific goals and
       objectives to guide its activities through 2012. A copy of the plan is available at
       http://www.pasbdc.org/news/strategic.asp.




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1200 SUCCESS STORIES

As part of its web 2.0 strategy, the Pennsylvania SBDC developed several short web videos of clients
offering testimony to the value of SBDC services. These clips may be viewed online at
www.pasbdc.org/impact/testimonial.asp.




For other success stories, see Section 3, Appendix B – SUCCESS STORIES.

1300 TRAVEL

    •   In November, the Penn State SBDC Director visited Virginia Tech’s Institute for Advanced
        Learning and Research, a catalyst for economic and community transformation in a distressed
        southern region of Virginia. The IALR showcased how partnering with various organizations can
        bring technology to a distressed area.
    •   During the first half of the year, an environmental consultant from the Penn State SBDC traveled
        to Chicago, Illinois, for Dust Explosion training sponsored by the American Society of
        Mechanical Engineers. Another environmental specialist traveled to Atlanta, Georgia for
        Registered Environmental Property Assessor Certification training.

1400 PROBLEMS

At many centers—as it has been for many years now—the demand for SBDC services continues to
outpace resources. In some areas of the state, population is growing, and economic development is
becoming a top priority for mayors and county executives. In particular, the past year presented the
following challenge:
    • State funding for the network of 18 Small Business Development Centers was cut from
        $8,000,000 in FY 2006-2007 to $7,376,000 in FY 2007-2008. This resulted in significant
        retrenchment in service delivery, and cuts in staffing, travel, marketing and staff professional
        development. Additionally, several other sources of funding used by the SBDCs to deliver
        services were either reduced or eliminated as well. These cuts included Self-Employment
        Assistance Program (a $329,257 loss) and Center for Global Competitiveness (a $480,000 loss).
        As a result, funding for SBDC services was reduced by $1,433,257 in FY 2007-2008.

The lack of secure funding contributes to many problems experienced by centers across the network,
including issues of hiring and retaining quality staff, and prevents the program from expanding services to
affect transformative change. The SBDCs are making adjustments to ensure clients are not negatively
impacted but remain uncertain as to how much the lack of resources may impact deliverables down the
line. Specific concerns cited in the past year include:

    •   The Lehigh University SBDC lost its Government Marketing Specialist. The position was filled
        by an existing staff member, and due to budget constraints, the position vacated was not filled.
        The SBDC also reported that the number of MBA students at its disposal is decreasing, and found
        that the limited resources are affecting clients. There is now a four-week wait for clients. To
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        attempt to alleviate this backlog, the SBDC modified its business model to assist pre-ventures via
        group consulting.
    •   Also because of funding concerns, the Saint Francis University SBDC was unable to replace an
        international business consultant who chose to make her maternity leave permanent. The SBDC
        has been active in seeking stopgap funding.


1500 INVOICES

All invoices for 2007 have been submitted for processing.


1600 WOMEN’S BUSINESS DEVELOPMENT

Once largely excluded from the business world, women now embrace entrepreneurship as heartily as
men. In fact, women-and jointly-owned businesses consistently represent over half of the SBDCs’ client
portfolio—more than 54% in 2007.The SBDCs make special efforts to reach members of socially and
economically disadvantaged groups, including women entrepreneurs. Services provided by the SBDC
are available to all citizens on a non-discriminatory basis, and are tailored to the local community and
the needs of individual clients:

    •   Experienced, professional staff help women uncover resources and loan programs available to
        help them start and grow successful businesses. Consultants recommend opportunities such as
        SBA’s pre-qualification program and other services to aid women in securing the capital needed
        to grow their businesses. Staff at the Saint Francis University SBDC, for example, helped
        women-owned businesses obtain loans totaling nearly $1.5 million and dually-owned businesses
        acquire nearly $3 million. Several of these businesses received financing through the SBA’s
        Community Express Loan.

    •   SBDC consultants help small business owners take advantage of opportunities that level the
        playing field within the private and public sector. With 8(a) or Minority/Women Business
        certification, for instance, women-owned firms capable of producing quality products and
        services at competitive prices have a more competitive position in procuring contracts. Based on
        current data, the percent of businesses served by the Lehigh University SBDC in which women
        are owners or partners increased from 48.8% in 2006 to 52.3% in 2007. Enterprises with
        majority woman ownership also showed an increase, going from 32.9% in 2006 to 40.8% in
        2007. Over $3.3 million in capital was secured to assist 7 start-ups, 7 existing business
        expansions, and 1 business acquisition. The majority of these clients are in the service sector
        (60%), followed by retailing (27%), and manufacturing (13%).

    •   The SBDCs serve women entrepreneurs by providing targeted training and technical assistance to
        help them compete. In the past year, a total of 7,018 women were educated through workshops
        held across the state. The SBDCs raise awareness of these programs by attending conferences and
        events. In October, the University of Pittsburgh SBDC offered an overview of its services for
        women at the Washington and Greene County’s Women’s Economic Development Outreach
        event held at Waynesburg University. In the east, the Wharton SBDC director spoke at
        Representative Lentz’s Forum for Women held at the Public Library in Wayne.

    •   Regionally, SBDC offices also coordinate roundtables, networking groups, and forums to enable
        women to know the range of programs and publications available to them throughout their
        business ownership. The SBDCs also recognize successes by female entrepreneurs. The
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        University of Scranton SBDC, for instance, again hosted the annual Award for Woman
        Entrepreneur. This year, Karen Russell of Keystone North Inc., a producer of organic fertilizer,
        claimed the top honor.

Some other examples of services provided to women in 2007 include:

    •   G & D Mechanical, a woman-owned HVAC firm assisted by the Saint Vincent College SBDC,
        was able to gain better financial management controls, reporting a 100% increase in revenues
        from 2006 to 2007 and a 125% profit increase. The firm continues to work with the SBDC to
        refine her 2008 budget.
    •   Another female entrepreneur assisted throughout the year by the Temple University SBDC was
        able to launch her own civil engineering consulting business in the final quarter. Working with
        her SBDC business consultant, the client identified various market segments and developed value
        propositions for each to address problems facing each segment. The SBDC also helped her
        develop financial projections and an operating plan, focusing on the use of independent
        contractors initially. The client then applied for and was granted, Women-owned Business
        Enterprise certification. The client has had a successful year of business, with several projects
        completed. The certifications as a WBE have opened several doors with prime contractor
        engineering firms for sub-contracts on public sector projects.
    •   Downtown Erie now includes a new retail store “Accents by the Bay,” thanks to a range of
        assistance provided by the Gannon University SBDC. The two women proprietors were
        displaced workers who entered and completed 21 hours of self-employment assistance training
        and worked with the SBDC for help in preparing their business plan and financial projections.
        The owners also received help in creating a logo, tagline, store signage, promotional cards,
        customer databases, and news releases to launch their business.
    •   Thanks to assistance from Penn State SBDC, two different women-owned businesses were
        launched in rural villages where women had perceived a need not being filled in their
        communities. One business was located in a remote rural village where the owner had purchased
        a turn-of-the-century building to renovate and open a small general store and take-out restaurant,
        while another was located in an area where many residents do not drive and now had easy access
        to a service many people take for granted. During the year, the SBDC had a total of 114 women
        as clients (35%) and 59 dually-owned businesses.
    •   At the new Shippensburg University SBDC, 64% of the business cases this year represented
        women- or jointly-owned businesses. SereneVisions, a women-owned business, credits SBDC
        workshops for providing the start to owning her own business. She was referred to the
        International Business Consultant for assistance in exporting her product to Belgium and also met
        with the Government Marketing Specialist with assistance in gaining contracts from the
        government.
    •   After attending an Introduction to QuickBooks workshop offered by the Lock Haven University
        SBDC, a massage therapist followed up with the trainer for assistance in setting up QuickBooks
        for her new business. In July, the consultant began teaching the client how to account for the
        business financial records utilizing the software. By September, her accounting system was fully
        implemented, and the client now effectively manages the entry of invoices, disbursements,
        payroll, tracking and payment of sales and payroll tax liabilities, and reconciliation of cash.


1700 ECONOMIC IMPACT

The array of programs provided and successes reported elsewhere in this report demonstrate that the
activities of the network undertaken are making an impact on the economy.


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In the most recent year studied, Pennsylvania SBDC clients reported that 2,147 new businesses were
opened, 7,033 new jobs were created, and more than $613,300,620 in new sales were generated from
their engagements. SBDC clients also exhibit faster growth in sales and employment than the average
Pennsylvania firm.




These numbers, combined with the current activities of the Pennsylvania SBDC network to date, suggest
yet another year of extraordinary returns for investors. Federal income taxes generated by SBDC clients
total $22,043,405 and state sales and income taxes brought in $35,458,209. 1

Since 1990 alone, the SBDCs have helped Pennsylvania entrepreneurs:

         •   Start more than 24,300 new businesses
         •   Obtain over $2.1 billion in start-up and expansion capital
         •   Expand sales by $8.7 billion, including over $2.1 billion in government contracts and $1.3
             billion in export sales
         •   Create over 104,800 new jobs at an average cost of $1,145 per job
         •   Generate more than $796 million in new tax revenues.

For examples of client stories which evidence this impact, see Section 3, Appendix B – SUCCESS
STORIES.


1800 VETERANS BUSINESS DEVELOPMENT

In an effort to increase veteran participation in educational programs and raise awareness of SBDC
services in 2007, the centers put forth the following efforts:

         Sent letters to area legislators informing them of veteran initiatives with an offer to conduct the
         First Step workshop for veterans at their location at no cost;
         Met personally with legislative staff to drop off materials and inform these offices of veteran
         services;


1
  All impact data and figures are from independent analysis of the SBDC program in Pennsylvania
in 2006 by Dr. James Chrisman of Mississippi State University.
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       Adjusted marketing materials to clearly convey resources and training opportunities designed
       especially for veterans;
       Distributed marketing materials outlining veteran services to area veteran organizations and
       resource partners such as CareerLink; and
       Offered the First Step workshop at no cost and mailed coupons to veterans to encourage
       attendance at training programs.

In total, the SBDCs consulted with 783 veterans and provided training to 856 veterans in 2007.
Specific examples of outreach to veterans throughout the year included:

   •    The State Director’s Office worked with Representative Altmire (D-4) to extend assistance to
        veteran small businesses through the HR 4253 bill. The bill was recently approved.
   •   The Gannon University SBDC assisted a veteran business owner in obtaining a contract with the
       local Veterans Affairs Medical Center in Erie. The hospital purchased an order for the client’s’
       patented biohazard waste receptacles. The SBDC assisted the client in preparing the bid for the
       contract and also introduced the client to the contracting officer.
   •   A veteran in McConnellstown received substantial help from the Saint Francis University SBDC
       in opening a sporting goods store conveniently located near the popular Raystown Lake and
       several state game areas. The SBDC helped him develop a comprehensive business plan, which
       included strategies for competing against Wal-Mart, as well as five-year financial statements. The
       client was approved for financing through the Progress Fund and immediately began construction.
   •   Veteran-owned businesses helped by Lehigh University SBDC received a combined total of
       50,000 sales opportunities through the center’s BidMatch program. These businesses also fared
       well with investments: $600,000 was raised by two companies from private investors and two
       companies were each awarded $15,000 technology transfer grants from the Southside Bethlehem
       Keystone Innovation Zone. Meanwhile, three female veteran-owned businesses successfully
       raised nearly $260,000 for their start-up and on-going business efforts.
   •   The Duquesne University SBDC educated 63 veterans and consulted with another 52 throughout
       the year. One such veteran completed the Self-Employment Assistance Program and started a
       financial consulting business. He worked with the SBDC to develop a business plan and marketing
       materials.
   •   To ensure widespread outreach to veterans, several centers attended events specific to this
       audience in the latter half of the year. The Kutztown University SBDC made a presentation to a
       group of 80 veteran entrepreneurs in Harrisburg at an event sponsored by Senator Piccola and the
       Veterans Corporation and the Widener University SBDC presented at a Veterans Conference in
       Chester.


1900 MANUFACTURING

The SBDCs supported 1,429 manufacturers with consulting services in 2007, providing fundamental
business management assistance along with an array of specialized programs in technology
commercialization, environmental management, product development, and government and international
sales. The SBDCs also maintain good working relationships with other economic development
organizations and regional service providers supporting the manufacturing industry, including local
Industrial Resource Centers and Manufacturers Associations. Activities undertaken in the past year to
support this important industry sector include the following:

   •   The Saint Vincent College SBDC worked with 109 small and mid-sized manufacturing
       enterprises in 2007—34% of the center’s client base. Support for this industry continues to be a
       top priority at the center.
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   •   With heavy representation of manufacturers in northwestern Pennsylvania, the Clarion
       University SBDC regularly responds to this important base. In 2007, the SBDC assisted 61
       manufacturers, including Jack Roser co-owner of Roser Technologies, Inc. (RTI), a specialty firm
       that services, repairs, and fabricates machinery used in the steel industry. Thanks to the SBDC,
       the Rosers are now owners of RTI for the second time. They started the business in 2001, then
       sold it to a German corporation in 2002. When the German parent company divested itself of its
       U.S. plants in 2006, jeopardizing 27 good paying jobs, the Rosers bought it back. Sales of $2.2
       million from RTI’s first quarter in business exceeded their expectations and the company now
       employs 34 people.
   •   The Gannon University SBDC, also servicing northwestern Pennsylvania, provides assistance to
       the industry as well. Typical requests include assistance in acquiring financing to purchase new
       equipment, help the SBDC provided to a tool and die shop located in Conneaut Lake. The
       consultant helped the owner prepare financial proformas to obtain loans in the amounts of
       $300,000 and $200,000 later used to purchase a Turning Center and Wire EDM. The purchases
       have increased operating efficiency and the company increased annual sales by $60,000.
   •   On an as-needed basis, the Saint Francis University SBDC works closely with the Bucknell
       University SBDC’s Engineering Development Services, the Ben Franklin Technology Partners,
       PennTap, Catalyst Connection and IMC when there are industry issues beyond the expertise of
       the consultant. The SBDC worked with a client formerly employed by International Trailers of
       Meyersdale. When the parent company announced it would eliminate the facility, an employee
       went to the SBDC for help in putting together a complicated loan package totaling $2 million to
       acquire the business.
   •   With 200 members, the Washington County Manufacturers Association offers a sizable audience
       the University of Pittsburgh SBDC can engage to discuss issues of concern in western
       Pennsylvania in the manufacturing industry on a monthly basis. Many of the Association’s
       members are not aware of the services offered by the SBDC, and through its membership, the
       SBDC is able to increase its visibility.
   •   The Lehigh University SBDC completed research reports for 20 manufacturing companies
       during the course of the year. International assistance ranged from referring one of the large
       manufacturers in the Lehigh Valley to one of the state Asian offices to assisting a start-up
       manufacturer of a unique product in acquiring a Market Access Grant and joining a trade mission
       to the Pacific Rim. The company has since seen sales and new business come from the mission
       and has since traveled to other markets around the globe.
   •   Audubon, Inc., another manufacturing client helped by the Temple University SBDC has seen
       substantial results from its SBDC engagement. Founded in 1884 as a chain-driven conveyer belt
       manufacturer, the company’s products are used in the food processing, snack food, ceramics,
       glass and automotive industries. Audubon had been receiving increasing international inquiries,
       but lacked in-house expertise, to comply with proper export procedures. The SBDC consultant,
       working jointly with the US Commercial Service, offered assistance and training in reviewing
       export guidelines, proper export paperwork procedures, and export quoting strategies. Since the
       initial consultation, the client has reported a 39% increase in global sales and this year alone, a
       23% increase.

2000 ONLINE ACTIVITIES

Since first offering web-based learning five years ago, the Pennsylvania Small Business Development
Centers has watched demand for online resources grow steadily as small business owners increasingly
discover the convenience of self-paced learning. Online tutorials and other small business resources
available through the SBDC network and on the statewide website, www.pasbdc.org, include access to a
range of resources, including the following added just this year:


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   •   Prospective entrepreneurs can test their entrepreneurial readiness with the Starting a Business
       Online Tutorial, which helps would-be business owners assess personality, skill level, and
       financial investment through scorecards before making any major decisions. The tutorial is
       divided by topic, with data input by users collected into a rough business plan outline which may
       be downloaded for further work with a consultant. From July through December, 452 individuals
       across the state registered for the tutorial.
   •   Other tutorials representing offerings from four virtual libraries: SmallBizU, Virtual Advisor, the
       US Small Business Administration, and the small business arm of the Internal Revenue Service.
       More than 40 online tutorials cover a range of topics, with targeted content responding to several
       critical areas for small businesses, including strategic planning, marketing, tax compliance, and
       business plan development. Through referrals from the SBA website, the Kutztown University
       SBDC reported 522 registrants for its Business Planning in Spanish tutorial and nearly 7,000
       registrants for the Accounting 101 tutorial.
   •   In August, the Pennsylvania SBDC launched The Manure Trader, (www.manuretrader.org), a
       free service to help farmers comply with the manure disposal regulations and explore
       nontraditional applications for manure such as alternative fuel. Dubbed the “eBay for manure” by
       Entrepreneur magazine, the site follows the model of the Material Trader, previously developed
       by the SBDC’s Environmental Management Assistance Program.
   •   The Clarion University SBDC developed a small business knowledgebase blog
       (http://clarionsbdckb.blogspot.com) designed for business owners, especially those thinking of
       starting a business. SBDC consultants also use the site to explore consulting tools and a variety of
       information pertaining to starting and expanding small businesses in western Pennsylvania. The
       blog is interactive, and individuals may request edits and updates on various topics as needed.
   •   The Pennsylvania SBDC network also updated its research training resource for consultants.
       More information about the Effective Business Research tutorial, formerly known as WISE, may
       be found in Section 1000-RESEARCH.

The centers also utilize online services to market SBDC programs, perform research, and help clients
better manage their businesses. Other examples of online activities in the past six months include:

   •   To help business owners, IT managers, and marketers make smart technology decisions, the
       Duquesne University SBDC developed the Pennsylvania Business Technology Conference. The
       event made its debut in November of 2006 and returned December 6, 2007, on the Duquesne
       University campus in Pittsburgh. Several hundred business owners from across western
       Pennsylvania convened to discuss topics including “Driving Online Business,” “Defending Your
       Network,” “New Media Weaponry,” and “Managing Your IT.”
   •   The Gannon University SBDC uses Profit Cents, a web-based financial analysis tool, to compile
       ratio and industry standards for manufacturing clients to help them define benchmarks and ways
       to make their business more profitable.
   •   The Wilkes University SBDC was invited to participate in a new internet based business
       program that features business tips and local business case studies. The video includes a one
       minute tip from the SBDC on developing a business plan.
   •   In August, the University of Pittsburgh SBDC was invited as a guest speaker for “Me, Market,
       & Money: Technologically Speaking” IT Seminar presented by the African-American Chamber
       of Commerce. The SBDC was able to promote the specifics of its IT consulting program.
   •   The Kutztown University SBDC debuted its newest vehicle for getting information out to small
       businesses, its “Success Connection.” The “TV Channel” includes a series of short interview with
       future and past business owners.




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2100 ENVIRONMENTAL MANAGEMENT ASSISTANCE PROGRAM

During 2007, the Pennsylvania SBDC’s Environmental Management Assistance Program (EMAP)
continued to help business owners achieve the results they need to stay prosperous. As the premier
environmental assistance provider for Pennsylvania small businesses, EMAP continued to build program
awareness through extensive marketing and outreach efforts to make sure all businesses, key partners and
stakeholders were aware of EMAP’s high-quality, no-fee confidential services.

In the last year, EMAP consultants responded to 400 requests for environmental information and provided
over 8,180 hours of in-depth consulting assistance to 478 small business clients. EMAP consultants were
invited to conduct 158 on-site visits at a wide range of businesses, from retail and commercial entities to
manufacturers, assessing over 3,735,584 square feet of office, commercial and manufacturing space.
Outreach efforts through presentations at conferences and other local partner meetings enabled EMAP to
educate another 2,837 people about EMAP services.

For the 2007 funding cycle, EMAP clients received 30 percent of the total grant funding available through
the Pennsylvania Department of Environmental Protection’s cost-share grant program, the Small Business
Advantage Grant program. In the commonwealth’s fourth round of grant offerings, EMAP helped 51
clients to receive $300,195 in grant awards to accomplish projects totaling $1,078,557. Once fully
implemented, these projects are expected to save EMAP clients a total of $223,226 per year in utility
costs and reduce greenhouse gas emissions by over 2,200 tons per year.

EMAP also won national recognition twice in 2007. US Environmental Protection Agency Administrator
Stephen L. Johnson named the Pennsylvania SBDC program a 2007 ENERGY STAR Small Business
Network Special Award winner. The award recognizes EMAP for its success in helping small businesses
across Pennsylvania to improve their energy efficiency and highlights the program’s commitment to
energy savings. Earlier in 2007, at a hearing at which Christopher Lynch, EMAP Director, was invited to
testify about small business issues, US Senator John Kerry praised EMAP as a national model and later
introduced legislation to expand the EMAP model nationally to assist small businesses in becoming more
energy efficient. In addition, the entire EMAP team was recognized for their outstanding performance at
the ASBDC conference in Denver, Colorado as the Pennsylvania SBDC’s 2007 State Star.

EMAP clients also won recognition in 2007. Central PA Settlement was one of just eight national
winners of the 2007 ENERGY STAR Small Business Awards and Resilite Sports Products, Inc. won a
Governor’s Award for Environmental Excellence for their significant energy efficiency upgrades.

Building on the success of Pennsylvania Material Trader, EMAP recently launched a new on-line
resource dedicated to finding alternative uses for excess manure in Pennsylvania. Responding to a
request from the Pennsylvania State Conservation Commission, EMAP developed the website as a way
for farmers to comply with Act 38 which imposes new restrictions on the amount of manure that can be
land applied to help protect the Chesapeake Bay watershed. It is expected that Manure Trader will also
help stimulate markets and connect sources of biomass sources for alternative energy with projects;
providing additional opportunities for businesses to operate off the grid.

During the last year, the program’s environmental consultants produced or co-sponsored 10
environmental, energy, and worker health and safety workshops offered to 144 attendees. Even more
significantly, by attending the “First Step: Starting and Growing a Successful Business” workshop series
offered throughout the Pennsylvania SBDC network, an additional 4,485 new and prospective business
owners were educated on important environmental issues to consider when starting a business – thus
continuing the SBDC’s unique role of being able to reach entrepreneurs with valuable information and
guidance before a business is started.

                                                                                2007 Network Annual Report
                                                                                                 Page 30
 P E N N S Y L V A N I A    S M A L L    B U S I N E S S    D E V E L O P M E N T     C E N T E R S



2200 KEYSTONE INNOVATION ZONES

By combining regional resources, including universities and economic development partners, the
Keystone Innovation Zones (KIZ) are a natural outgrowth of SBDC activities. The SBDCs have been
key players in the development of these state-defined hotbeds of innovation and entrepreneurial
opportunities from their inception. Some examples of ongoing developments to support the
Commonwealth's KIZ initiatives in 2007 include the following:

   •   The Northwest Pennsylvania KIZ was approved by the Department of Community and Economic
       Development in October 2007. The main functions of the KIZ are to develop the KIZ focus
       industries, transfer and commercialize technology and retain and create employment. The
       Northwest KIZ partnership includes Clarion University, Allegheny College, Thiel College, and
       the University of Pittsburgh-Titusville, with the Clarion University SBDC supporting businesses
       ranging from biotechnology and life sciences, healthcare, conservation and environmental
       sustainability, to information technology, business services, and advanced manufacturing,
       including nanotechnology and manufactured housing through this initiative.
   •   The University of Pittsburgh SBDC and the Saint Vincent College SBDC are working to
       establish KIZs in Waynesburg and Westmoreland County. Well-integrated in their service areas,
       the SBDCs will be key partners in these initiatives to foster regional economic development.
   •   The Duquesne University SBDC continued its involvement with the Pittsburgh Central KIZ,
       announced just this year. So far, the KIZ has referred several clients to the SBDC and the center
       is working with the new entity on planning a student idea contest for 2008. In southcentral
       Pennsylvania, the director of the Shippensburg University SBDC serves as the institutions’
       representative to the Harrisburg Market (Smart Market) KIZ and the York KIZ.
   •   The Bucknell University SBDC has continued to support regional efforts to start an Innovation
       Center. The project now stands with a coalition of four local IDCs who have joined together to
       develop a business plan for the project. The SBDC is also a named partner in the Williamsport
       area KIZ and a member of a regional KIZ that includes Geisinger Medical Center, Bloomsburg
       and Susquehanna Universities.
   •   At present, there are over 25 business establishments recognized as Erie County KIZ members,
       supported by the Gannon University SBDC and other economic development partners. The
       SBDC helped one such business, Immersimap, in developing a virtual mapping program for use
       in emergency response. The SBDC assisted the client with business planning and financial
       projections, as well as prototype development through the Engineering Development Services
       offered through the Bucknell University SBDC.
   •   The Indiana University of Pennsylvania SBDC engaged with key economic development
       players in the planning for the submission of a KIZ application in 2006, approved early in 2007.
       Over the past year, the SBDC participated in an awareness-building seminar on the tax credits
       available through the KIZ program, and staffers met with local companies to explain and clarify
       the intent of the KIZ and the functioning of the tax credits to area companies. This process has
       resulted in two new tenants for the Indiana County Incubator, new tenants at several other
       locations in the zone and several new product ideas in the development stage.
   •   The Saint Francis University SBDC supported the Greater Johnstown KIZ, acting as a reviewer
       for its microgrant program. The program provides up to $5,000 to technology businesses located
       in the territory for developing product lines.




                                                                             2007 Network Annual Report
                                                                                              Page 31

				
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