For the fifth consecutive year, area businesses will have a chance to vie for a $50,000 interest-free loan as part of the Prince Edward/Lennox & Addington Community Futures Development Corporation (PELA CFDC) Business Planning Competition. "Right from the beginning, there were two main thrusts to this. The first is that we have been given funds by the federal government to loan out at zero per cent, which is most unusual. We can't do this with any other loan that we do. So we have been given these specific funds to improve commercial property," said Gillian Chapman, business development manager for PELA CFDC.

"And with us being PELA, and not doing anything in the normal way, we try to zip things up a bit and make things more exciting, so rather than just approach businesses and say, 'we've got these funds available, are you interested?' we decided to do a business planning competition, because then it opens it up to everybody and will make everybody think, 'is this something I want to do? Do I want to improve my commercial premises? Do I want to start this business now?'"

She said since the competition began in 2006, the quality of the applications has improved each year, meaning the businesses that do apply are spending more time and effort putting together their business plans, which Chapman said is a good exercise, even if they don't win the competition.

"It may not be the best business plan as far as the competition goes, but it will still be a good business plan, and we can still work with that business and say, 'look, you may not have won the interest-free loan, but we've got this fantastic stimulus loan product for $25,000 at five per cent, and do that instead'," she said.

"Quite often, we have one winning business in Prince Edward County and one for Lennox & Addington and on top of that we also have three other applicants that have taken out small business loans of $25,000 each. So the impact of that business competition has multiplied for the amount of money that is sort of sloshing around in the business community."

Chapman said past winners have primarily used the loan to expand their current business to expand their current revenue streams, or create new ones.

She pointed to 2008 winner Raspberry Ridge Farms, which used the loan to help build a new equestrian arena, and Starlet Boutique the year before, which used the loan to help open Starlet Shoes.

"We had the Music Market Cafe, which was our first competition winner for L&A, and [owner Tim Sheffield] has built a whole self-sustaining business with the music school and the cafe, and he's got an amazing vision for the Market Square that we want to support. And of course, we've got McCormick's Country Store, and they expanded to include Square Boy Pizza," she said.

"We have found that the loans are being used to support a new concept or expand an existing business ... the whole point of what we are trying to do is generate a revenue stream. We want the businesses to be more successful, which means they might hire more people, and buy more from local suppliers, which is good for the local economy."

In addition to the $50,000 interest-free loan (which needs to be repaid in five years) the winner also receives a business-oriented prize package. It includes: a banking package with more than $125, a one-hour legal consultation, three hours of accounting support, a three-hour general business consultation, a one hour meeting with the municipal economic development manager, a one year membership in the local chamber of commerce, 200 business cards, free ads in local newspapers, $100 towards business insurance, a radio advertising package and, new this year, a discount package from Napanee Home Hardware.

Chapman said there are two panels of expert judges, one for Prince Edward County, one for L&A County, but these panels don't judge applications from their own region, rather the other one. So L&A judges will decide the winner from Prince Edward County and vice versa.

One winner from each region will be selected, with the winners announced during Small Business Week in October.

"We have a scoring Matrix. There are certain things that we look for in a business plan, the standard things. Really, what it boils down to, and I don't want to put anybody off from entering, is that it's not to do with how pretty the business plan is, it's the actual content, the ideas, the way that the business plan is expected to be managed to completion, how it's going to be marketed, and the cash flow forecast. You've got to have the numbers really tight. You've got to have some level of confidence of where you're going to be with your revenue streams, and you need to be able to communicate that to the judging panel," Chapman explained.

"So we're encouraging people. If you're sort of sitting on the fence with it, we are just giving you a little nudge and saying it's worth the effort. Let's see if we can make it happen."

For more information on the 2010 PELA CFDC business planning competition, visit www.pelacfdc.ca, or call the Napanee office at 613-354-0162.

Business plans must be dropped of in person, or mailed to PELA CFDC, Business Plan Competition, 47 Dundas St. E., Napanee, ON, K7R 1H7, by noon on Sept. 27.

From:  Business competition has helped local economy
By:  Jim Barber
The Napanee Guide
September 2, 2010