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Brandelyn Green, the entrepreneur behind Voice of Hair, knows a thing or two about building a community. Her thriving hair care business is exploding.

Gary Stockton: In November of last year, the federal reserve banks conducted the Small Business Credit Survey. In all, they surveyed nearly 11,000 small businesses to ask them about their financial condition, whether they had sought financing in the prior 12 months, and what the effect the pandemic had on their business. The results of that survey have just been published in the 2022 Report on Employer Firms. Emily Wavering Corcoran is the Program Manager of the Small Business Credit Survey (SBCS) in the Community Development Department of the Federal Reserve Bank of Cleveland. The SBCS is a national collaboration among the 12 reserve banks of the Federal Reserve System, to gather timely information on small business, economic conditions, financing needs and credit availability. And we're recording this interview on Friday, March 4th, 2022 ahead of the Federal Open Market Committee meeting. Emily, welcome to the Small Business Matters podcast. Emily Wavering Corcoran: Thank you so much, Gary. Glad to be here. Gary Stockton: Well, one of the most heavily impacted small business segments is leisure and hospitality. Could you tell us what you found out about the financial condition of businesses in this sector? Emily Wavering Corcoran: Absolutely. So as you've mentioned in sort of the background you gave about the survey, the SBCS is fielded every fall. The 2021 SBCS, of course, was fielded from September through November, 2021. And it gathered information from over 17,000 small business owners across the country, including nearly 11,000 small businesses with employees. So that's the segment of small businesses that this report in particular focuses on. As you mentioned, the survey provides detailed information on performance and financing conditions from the perspective of small business owners. In addition to the standard questions about business conditions, debt and credit, the 2021 survey included questions about the ongoing effects of the pandemic, including its impact on revenues and employment, operating challenges, including workforce challenges and applications for pandemic related financial assistance. We also, for the second year in a row, included a question asking small business owners about the financial condition of their business, which is what you just referenced. They were given five options to select from. They could say their business was in excellent financial condition, the financial condition was very good, good, fair, or poor. Out of all employer small businesses, 59% were in poor or fair financial condition at the time of the survey, so, fall 2021. Now, when we drill down more deeply, we see that firms owned by people of color, firms with fewer employees, and firms in particular industries, including leisure and hospitality, were most likely to be in fair or poor financial condition. So relative to small businesses in other industries, leisure and hospitality firms were more likely to be in fair or poor financial condition. So three out of four firms in leisure and hospitality. In many ways, this is not surprising, right? Leisure and hospitality includes restaurants, hotels, entertainment venues. So many of those small businesses that were particularly hard hit, especially early in the pandemic. And that shows the persistent impact of that initial hit and trying to weather the pandemic as a firm that really relies on face-to-face contact, on having people come into the business--All of those things really hold for firms in the leisure and hospitality sector. Gary Stockton: More than half of the firms were in fair or poor financial condition at the time of the survey. And nearly all firms faced at least one operation or financial challenge in the prior 12 months. With so much government assistance made available, why do you think so many small businesses are still struggling? Emily Wavering Corcoran: Yeah, I think for this question, it's important to think about the counterfactual. What might SBCS data look like had pandemic related financial assistance not been made available? I don't know the answer to that question, no one does, but the fact that business performance numbers are tempered, and that many small businesses continue to face operational and financial challenges, even with pandemic related financial assistance, suggests that in the absence of that support, aggregate outcomes for small businesses, and of course the resulting SBCS data to measure those outcomes, could have been much worse. Gary Stockton: Can you talk a little about which businesses applied for additional financing vs. those who did not, and some of the reasons why they did not apply? Emily Wavering Corcoran: The Small Business Credit Survey identifies applicants or small businesses that did apply for credit, and non-applicants, or small businesses that did not apply for credit. So we get both sides of the experiences, right? Apply for credit, don't apply for credit. And then we can drill down to more deeply understand both of those sets of firms: firms that did apply, firms that chose not to apply. So 36% of firms did apply for financing. And 64% did not apply for financing. When you look at just that set of non-applicants, firms that did not apply for financing, 46% of those businesses did not apply because they had sufficient financing. So they did not need to apply for a loan or a line of credit because they had ample financing through other streams. Then 14% of that non applicant pool were discouraged, meaning that they did not apply because they believed that they would be turned down. When you look again, one step further, more deeply at those discouraged firms, a majority of those firms, or just over half of those firms, believed they would be turned down because of weak business financials. And then other reasons that those folks cited in the survey were lender requirements, the belief that lenders would not extend financing based on some characteristic of their business; previous denials and bad experiences in the past that made them discouraged about applying again, and missing documentation was also a relatively big factor for folks. Gary Stockton: You mentioned them being concerned about weak financials as a leading reason. Would that be a major concern when seeking government help through the PPP program? Or was it just maybe a confidence issue with that business owner? Emily Wavering Corcoran: I think both. Financials are certainly an important part of the credit application process. And so as we saw, business fundamentals being hard hit through the pandemic, that certainly played out in both folks deciding to apply for credit or not. And then also it played out in some of the outcomes that we saw for folks who did choose to apply for credit. Gary Stockton: Yeah. The other thing that we noticed in the report was that 2021 PPP outcomes were worse than 2019, particularly in that leisure and hospitality sector. And particularly with black and brown businesses, do you know what's going on there? Emily Wavering Corcoran: Yeah. So again, I would point to some of the information in the report about financial condition, about annual revenues and employment. Certain segments of firms being really hard hit, and then that playing out in different ways in terms of credit access. We did, as you point out, we saw both a decline in firms seeking PPP and a decline in firms receiving PPP. The why is an incredibly complex question to answer, right? Definitely not fully answered by SBCS data, but it is at least partially explained by the relatively smaller size of the third round of PPP funding compared to the two prior rounds, as well as additional eligibility requirements for PPP. But again, not fully answered by SBCS data, certainly something that I'm sure additional research will look at in the years to come. Gary Stockton: What was the most surprising thing to you about the 2022 survey? Was there one thing that really stood out to you as, as important? Emily Wavering Corcoran: Good question, but to be honest, “surprised” doesn't quite capture what I felt about any of the survey results as we were digesting the data and really examining things. In many ways, I feel like the survey data add greater nuance and more robust evidence to ongoing narratives about small business hardship and resilience that we've been hearing about and talking about over the last two years at this point. instead of surprise, I would say that the results for me strengthened my resolve to continue collecting and producing this data so that we can continue to have structural information on small business credit experiences. Small business does matter, and of course, small businesses are on the road to recovery, but it appears to be a long and uneven road, but SBCS data will continue to be there as small businesses move forward. Gary Stockton: Well, Emily, I'd like to thank you for sharing your thoughts with our listeners. Where can they learn more about the great work going on at the Federal Reserve Banks? Emily Wavering Corcoran: I love that question. You can learn more about the Small Business Credit Survey in particular at www.fedsmallbusiness.org. I would also encourage your listeners to check out www.fedcommunities.org, which is a website that shares information across the Federal Reserve System on the great work that the Federal Reserve Banks are doing at the community level. Gary Stockton: Emily, thank you very much for your time. 2022 Small Business Credit Survey Note: We recorded this interview on Friday, March 4, 2022.

Barry Moltz joins us on Small Business Matters to talk about why change is so difficult for small business owners.

Farmers & Merchants (F&M) Bank of Long Beach, CA has awarded $60,000 to 22 local micro and small businesses since 2020. In the first year of the program, F&M Bank had 84 applicants. In the second year, more than 600. Recipients say these grants have come at the perfect time to help with challenges sometimes made even greater by the ongoing pandemic. (Farmers & Merchants Segment appears at 28:37) “There were a lot of small businesses in our community struggling, that were having to rethink how they do business and how to adapt to circumstances well beyond their control,” said Andrea Carlson, Vice President at F&M Bank. “We were able to help more than 6,000 businesses through the SBA's Paycheck Protection Program (PPP), but we still saw a gap in assistance for businesses that didn't meet the criteria [for that program]," she said. Applicants did not have to be members or clients of F&M Bank to be eligible to receive the grants. To qualify, a business had to have existed for at least two years, have fewer than 20 employees, be in the bank’s geographical service area, and have less than $1 million in revenue. Microbusinesses Fall Through the Cracks "F&M Bank is really a jewel for small businesses. People tend to forget about these microbusinesses, that make less than $2 million a year, have less than 20 employees. But there are a lot of us like that, we are a growing part of the greater economy, but we are so often overlooked," said Omar Hernandez, a disabled veteran and owner of Global Urban Strategies, a PR firm for municipalities. “Because of the pandemic, everything really just stopped. So our cash flow just stopped. So we worked off our cash reserves, and then our savings. For me, our employees are the most important component of my business. We have to invest in our people. This grant was so important to us, because we were able to keep getting everyone paid on time.” Hernandez says he plans to become a customer of F&M Bank now. “The way I see it is, they invested in me, so why not go and do the same thing and do business with them?” Tatiana Pacheco owns Andrea's Healthy Kitchen, a juice bar in Rosemeade, CA. Just as sales began slowing down at the beginning of the pandemic, her business location suffered a colossal fire. "It took us one year to reopen. Even though December is our slowest month, we were able to keep our employees paid for that month. This grant came at just the right time," Pacheco said.       Black-Owned Businesses Disproportionately Harmed by Pandemic A study1 from the early months of the pandemic showed 41% of Black-owned businesses closing their doors. Thirty-two percent of Latinx-owned businesses closed. Compared to about 17% of white-owned businesses. So F&M Bank gave priority to grant applicants whose businesses serve underprivileged neighborhoods, and/or are owned by people of color. Jala Eaton of On My Own Financial is an attorney and financial and estate planner on a mission to close the racial wealth gap. She started her business prior to the pandemic offering financial education and estate planning to business owners and families. “For me, these funds are going to build infrastructure and software to help me continue to serve my clients virtually. So online scheduling software, client management systems, even paying the annual fees to be an LLC,” Eaton said. “There is a big disparity—40% of Black businesses went out of business last year, because of COVID and lack of access to resources and money. That’s why I’m so passionate about talking to my community about money and being strategic with it.” Eaton said she's also planning on hiring her first employee this year.     F&M Bank was founded in 1907 on the principles of honesty, integrity, the home, the church, and service above self. Each year F&M Bank gives away more than $1 million to charities, non-profit organizations, and religious entities within the communities they serve. Find them on social media, and learn more about the other extraordinary entrepreneurs who received grants as part of this program. And thanks to Farmers and Merchant’s Bank for investing in the community.   Link to study: https://siepr.stanford.edu/sites/default/files/publications/20-022.pdf Got a story about Diversity, Equity, and Inclusion? Email us at smbmatters@experian.com. Listen to the full episode on any of these platforms:

In this episode of Small Business Matters we focus on generational entrepreneurship with our guest Keewa Nurullah. She is a fourth-generation small business owner.

There are two types of credit inquiry, hard and soft. How do hard and soft credit inquiries impact your business credit score? We explain the difference.

The legacy of Martin Luther King, Jr. is one that has spanned generations and continues to inspire people around the world. The hope he brought with his message of non-violence was a catalyst for change for millions of people, including many of us who work at Experian. We are honored to share what Dr. King's legacy means in our own lives and how we plan to carry his message of courage, strength, and determination into the future. "Love is the Greatest Force in the Universe" "What inspires me about Dr. Martin Luther King, Jr. is the way he was always able to show love, no matter what he was going through," says Chris, VP of Sales at Experian. "Despite threats, despite social injustices, despite assassination attempts on his life--he didn't grab a gun. He didn't teach hate. He taught love. Just like Dr. King, I teach and tell others that no matter what you're going through, or how hard it gets, just show love--genuine love--and it will always work out." His Message of Nonviolent Resistance Gary, Senior Manager, BIS, says the thing that inspires him the most about Dr. Martin Luther King, Jr. was his message about nonviolent resistance, and how it can bring about social change. "A simple but powerful act of boycotting public buses en masse brought about the November 1956 ruling by the Supreme Court that segregation on public buses was unconstitutional," he says. Today I celebrate the life, legacy and message of Dr. Martin Luther King, Jr." "I Can Do Small Things in a Great Way" "His work taught me never to give up hope in the face of despair," says Corliss, Senior Manager, Financial Inclusion, DEI Marketing. "As he said, 'We must accept finite disappointment, but never lose infinite hope.' Dr. King also taught me that we have a role to play to make a difference in this world, and that ordinary people can do extraordinary things. He said, 'If I cannot do great things, I can do small things in a great way.' So thank you, Dr. King, for your legacy of hope, love and reminding us again, that ordinary people can do extraordinary things." "I Have a Dream" Bryan, Social Media Specialist, says King's iconic "I have a Dream" speech has been a huge inspiration for him. "That speech…taught me that if you believe in something, stand up for it. It taught me to be the change that I want to see in the world," he says. "I'm proud and honored to continue his legacy. So, Dr. Martin Luther King, Jr.--you had the dream, and now it's my job to make sure your dream becomes reality." "Dangerous Unselfishness" "I believe it is MY responsibility every day, to use my privilege to ensure Martin Luther King Junior's dream is not buried," says Emily from Business Information Services. "To amplify the voices of people of color who are still not being heard because white people will not stop talking. Today, I will listen, I will learn, and I will practice 'dangerous unselfishness.'" Together, We Make the World a Better Place Taneishia, Account Executive, Software Sales, says that hearing Dr. King's "I Have a Dream" speech as a child encouraged her to dream, to hope, and to believe in something bigger than herself. "His work and his impact is evident in the fact that I, a woman of color, a Black woman, have the opportunity to work for a company like Experian alongside people of all types of ethnicities and backgrounds," she says. "Coming together, we are making Experian and the world a better place." Taking the First Step, Even When You Can’t See the Entire Staircase “When reflecting on the memory of the late, great Dr. Martin Luther King, Jr., there are so many things that I'm struck by,” says Jennifer, Senior Manager, Marketing. “His grace, his humility, and his ability to triumph in the face of adversity. One of the things that he said is that faith is taking the first step, even when you can't see the entire staircase. This resonates with me, because it shows that in times of difficulty and uncertainty, you just have to keep moving forward, taking the first step. Even though you don't know what the end result will be.” “We have an opportunity to make America a better nation.” We are grateful to Dr. King for his tireless efforts towards equality for all people, for his vision of the future that he would hold, but never see. Today we at Experian join people all over the world as we honor his memory, his work and his legacy. "Let us rise up tonight with a greater readiness. Let us stand with a greater determination. And let us move on in these powerful days, these days of challenge to make America what it ought to be. We have an opportunity to make America a better nation."1   Footnotes: 1.    From the "Mountaintop Speech," King's last speech on the eve of his assassination, April 3, 1968

You’ve heard it a thousand times: location, location, location. And sure, if you run a brick-and-mortar small business, details like great traffic and excellent parking certainly improve your possibilities. But regardless of your location, I thought maybe we could talk a moment about “place” and what it means to be a small business rolling into these next years. The Importance of Place for Small Businesses Ever since the COVID-19 Pandemic began in 2020, people everywhere have had to reconsider their relationships with local businesses. It used to just be a sign you’d see in the window: “shop local.” But with lockdowns, unemployment, shipping and logistics delays, and so much more to contend with, people everywhere found themselves having to think about who they wanted to spend their money with and what that meant to them. Before 2020, people might not have thought twice about placing their order with a large online retailer or a global big box store. But as the Pandemic continued, many communities rallied around supporting local businesses like never before. It suddenly became quite clear that without some direct and thoughtful local intervention, some of these small businesses might not make it for more than a few months, and some doors might be shutting forever. What could a small business do? Well, lots, as it turns out. Sean Hopkins opened “Hoppy’s Cantina” in a small northern Massachusetts town a few days before the entire state’s first big virus-related lockdown. He’d run restaurants before--this kind of delay might end up being a kiss of death before he’d even had a chance to fail in all the typical ways. He started posting little videos on Facebook about the kinds of burritos you could pick up via Take Out ONLY. Of course, just a few items were available, but Sean’s Facebook videos sold the heck out of them. His guacamole videos (often complete with singing) made your mouth water, not to mention the incredible pulled pork burritos. Sean’s efforts on his Facebook page drove sales that kept his restaurant alive during lockdown for sure. Local is More of a Badge Than Ever Before It’s a great time to promote your local roots, and people are showing interest in keeping their neighborhood businesses alive. It’s one thing to worry about who has the right price. It’s another to know that a company might vanish, thus leaving people with no local choice, if something isn’t done to keep it that way. All that glitters is not gold, after all. But one caution: there’s not a lot of forgiveness for poor customer service. You might not be able to compete on price, but if you don’t make the buying experience professional, friendly, and very efficient, you might not be able to count on that local support for long. One last detail: share the wealth. Just as you might run a local business, also remember to visit some local restaurants, buy from a few local shops, and refer as much business as possible to your neighbors. It’s most definitely a group effort, and the more people sharing the work, the easier it is to keep more local companies safe. What have you done to make “local” matter even more? About the Author In addition to being a best-selling author and influencer in the marketing space, Chris is a  sought-after keynote speaker and showrunner of “The Backpack Show.” Currently, Chris serves as Chief of Staff at AppFire, providing strategic advisory services to the senior and executive leadership of the company, with a mandate to drive the company’s major initiatives across the organization. He is also President of Chris Brogan Media, offering brand and digital content strategy and business strategy advisory services.       Related content Small Business Storytelling with Chris Brogan

Small business owners may have a small business credit card or even use their personal credit card when they’re just getting started. However, as a business grows, new types of financing that don’t depend on the owner’s personal finances—such as corporate credit cards—may become available. The Difference Between Corporate and Small Business Cards Corporate and small business credit cards can offer a variety of benefits. One of the main reasons companies sign up for a credit card is to empower employees to make purchases on the company’s behalf by using the company card. Using these cards, employees won’t have to pay out of pocket and wait to be reimbursed later. And employers may be able to limit where employees can use the card and how much they can spend, giving them greater control over their business finances. There are some similarities between corporate and small business cards, but they’re not created for the same types of companies. While small business credit cards may be available to any business, corporate cards are primarily intended for large and established businesses. What Is a Corporate Credit Card? Corporate credit cards—also known as commercial credit cards—are credit cards for medium- and large-sized businesses, although there are also some corporate card programs for startups. To qualify, a company must be either registered or incorporated—for example, as a limited liability company (LLC) or an S or C corporation. Card issuers may look at different factors when reviewing a card application, such as the business’s revenue, number of employees, history with the issuer and investors. In some cases, a business may need several hundred thousand (or several million) dollars in revenue to qualify. You may be subject to a credit check before getting a company card, but it won’t be reported to the credit bureaus under your name or impact your personal credit. Instead, the card’s usage and payment history is added to the company’s business credit report. Corporate cards also often don’t require a personal guarantee, meaning cardholders aren’t personally responsible for the debt. Unlike many small business cards, corporate cards are often charge cards rather than credit cards—meaning the company must pay the full balance at the end of each billing period. But similarly to personal and small business cards, some corporate cards offer rewards and have annual fees. Rewards aren’t the only—or even the most important—benefit, however. Companies can request employee cards to easily authorize and track employees’ expenses, eliminating the need for reimbursement requests. Corporate cards may also offer in-depth analytics and integrate with accounting platforms, which can help businesses save time, money and paperwork. What Is a Small Business Credit Card? Small business credit cards are typically more similar to consumer credit cards than corporate credit cards. Some consumer and small business cards even have similar names, fees and rewards programs. And, as with consumer cards, small business credit cards may let you revolve a balance and charge you interest on the unpaid amount. Unlike a corporate credit card, getting approved for a small business credit card can partially depend on the owner’s creditworthiness. If you apply for a small business card, the application might lead to a hard inquiry on your personal credit report. A card issuer may even report the card to the credit bureaus under your name, meaning it can impact your credit—although some only do this if the business misses payments. Small business cards also generally require a personal guarantee. As a result, if the business can’t afford the payments, you could be personally liable for the card’s unpaid balance. However, a small business card can help you keep your personal and business finances separate. The cards may also offer business-specific perks, such as free employee cards and bonus rewards on common business purchases. And, as the primary cardholder, you may be able to set limits on employee cards and determine how you want to use the rewards. Which Credit Card Is Best for Your Business? Most small business owners, entrepreneurs, solopreneurs and contractors will only be eligible for small business credit cards. However, if you work for or run a medium- to large-sized business or a venture-backed startup, a corporate credit card may be a better option. While you could open a small business credit card, a corporate card might give you a higher spending limit, more control over employees’ cards and better analytics and reporting. The ability to finance your business’s operations without being personally liable for the debt can also be a major benefit. Be Sure to Monitor Your Company’s Credit If you run a business and want to open a business or corporate credit card, your business credit score could be an important factor. Additionally, some small business lenders require a personal credit check before they’ll offer you a business loan, line of credit, invoice factoring or other types of financing. You can check and monitor your Experian business credit report, and get insights into how you can improve your company’s credit scores. About the author Louis DeNicola is freelance personal finance and credit writer who works with Fortune 500 financial services firms, FinTech startups, and non-profits to teach people about money and credit. His clients include BlueVine, Discover, LendingTree, Money Management International, U.S News and Wirecutter. Louis lives in beautiful Oakland, California, where he enjoys indoor rock climbing, yoga, and volunteers as a tax preparer.