Newsletter Archive Quad Cities Score Chapter

Scott County, Iowa; Rock Island, Henry, Mercer, Bureau, Whiteside, Lee and Henderson Counties, Illinois

The Chief Executive Officers of Merrill Lynch, Stan O’Neal and Citigroup, Charles Prince, recently either jumped or were pushed from the windows of the executive suites of their foundering corporations. Merrill Lynch and Citigroup lost billions of dollars connected with foolish subprime loans—and more unrevealed losses may still be lurking in the endless data in their Bloomberg machines. Other financial companies are burning midnight oil to assess their exposures to subprime loan risks. Estimates of losses of $40 billion and up are floating around. Financial markets are trembling--and tanking--as they wait for the next batch of bad news.

How could all of those super smart, ridiculously overpaid Wall Street bosses have allowed this to happen? It seems they lull themselves into the same mindsets as Las Vegas gamblers who go on winning streaks that block out the urgent voices yelling in their ears, “Hey there, cowboy, if you keep on betting like a greenhorn, your horse is going to buck you over a cliff at the first bend in the trail.”

Mr. O’Neal left Merrill Lynch like a pharaoh of old departing this world to a tomb stocked with hoards of gold. And Mr. Prince left without offering a cent of giveback of the princely pay granted to him while his company lost billions. This in ironic contrast to the U.S. Navy’s hoary tradition of court marshalling captains who run ships aground.

To make matters worse, we now discover that no one within Merrill Lynch or Citigroup was on the bench to fill the vacated top positions. Both firms appointed interim CEOs while their boards frantically searched for permanent replacements.

Citigroup has the additional burden of delivering on the rosy forecasts of several years ago when it bought Travelers and Smith Barney. The newly purchased businesses are still not integrated with Citigroup and many of the promised benefits are still not realized.

How should the public view all of this? Most of us do not understand the arcane world of investments or empathize with the atomic-fueled executives with elite educations who run the world’s largest financial companies. Should we just shrug and accept the mess they made because it is all too complicated and remote from our lives and experiences?

Let’s try to make some straight-forward observations about the perfect storm now brewing and growing on Wall Street. Let’s base our observations on the same common sense thinking we use in our every day lives.

Certainly we would not expose ourselves to the fantastic risks of subprime loans--loans to borrowers with shaky credit worthiness and no down payments for overpriced real estate. And we would not accumulate such investment dross in our own portfolios; we would promptly unload them onto others as soon as we had milked them of handling fees and commissions.

And we would have in place a system for filling management positions as they open up. Why were Merrill Lynch and Citigroup caught with their pants down? Did they think they were unaffected by retirements, dismissals, and resignations? Did they never read about companies such as GE where the CEO spends up to half of his time developing a deep bench of proven executives in reserve to fill high positions.

We all know it is easy to be a Monday morning quarterback. But when the most basic business fundamentals are ignored, it is hard to garner much sympathy. Maybe the elite institutions that educate next generation CEOs should offer courses entitled Common Sense 101 and How to Manage Greed.

And what other perfect storms does Pandora’s Box contain ready to pop out and saddle us with additional miseries? Is it a melt down of credit card debt as it approaches one trillion dollars? Is it strangulation from our sky-high and growing national debt? Or is it the out-of-control national trade deficit? Unfortunately, it’s a good bet that we will be just as hopelessly unprepared for the next perfect storm as we were for the current subprime meltdown.

So you want to start a business. There is always room for another Bill Gates; Sergie Brin and Larry Page (Google); and Larry Ellison (Oracle). There is also room for ordinary people who want to buy or start businesses with more modest potential such as coffee shops, professional service firms, or tree farms. On second thought, there is nothing modest about Starbucks Corporation that has rapidly grown from a single hometown coffee shop in Seattle to more than seven thousand shops in forty countries.

The taste of business success is savory. But did you know the failure rate of new start-up businesses is abysmal? Sixty percent of new small businesses fail during the first five years. However, those with comprehensive business plans are far more likely to succeed.

A business plan allows you to think through and test your ideas in detail on paper before you put a single dollar into the venture. The plan forces you to think through every aspect of your proposed business and see how much money it will put in your pocket. The projected bottom line will help prove or disprove the validity of the plan.

All businesses are risky, but a properly written business plan can help you reveal and assess the risks before your money is put into play.

But you may say, “Why should I go through all of that business planning folderol and play around with those pesky numbers? It’s all so tedious. And why, when I have such a nifty idea for a new business, should I not just say ‘giddy up’ and charge out of the corral to lasso prosperity before sunset? It can’t be that hard--even my featherweight brother-in-law runs a business and he drives a new Mercedes convertible.”

But hold your horses for a minute. There is a relatively painless way to write a business plan. Solicit the help of SCORE: In the Illinois Quad City Chamber of Commerce (622 19^th St., Moline, Il)—10:00 to 12:00 am, Tuesdays and Thursdays; or the Bettendorf Chamber of Commerce (2117 State St., Bettendorf, IA)—10:00 to 12:00 am, Wednesdays; or New Ventures (331 W. 3^rd St., Davenport, IA)—10:00 to 12:00 am, Tuesdays.

SCORE is a group of business and professional people who give free and confidential counseling and advice to small business owners. All SCORE members have many years of general business experience and expertise in fields such as accounting and finance, marketing, management, and engineering. Counseling can be provided in English, Spanish and several other languages.

SCORE strongly suggests that all who want to start a business should take enough time to make a comprehensive business plan. Benjamin Franklin’s advice is even more urgent, “By failing to prepare (plan), you are preparing to fail.”

SCORE offers an all day Business Planning Seminar that is just the ticket for anyone wanting to start a small business—or to revitalize an existing business. The seminar presentations are practical and straight forward with the idea that you can use the information to write your own business plan. Ample time is allowed for discussions. Then if you need further individual help you can return to SCORE for assistance at any time. When your plan is complete, SCORE will critique it to ensure that it is adequate for starting a small business and for presentation to a bank loan officer at the time you request a loan. There is a modest charge for the seminar to cover meals, handout material, and other expenses.

After you have taken the time to write a comprehensive business plan, you can confidently say “giddy up” and start your new business knowing you have a well-conceived road map in hand, the risks are acceptable, and the anticipated financial rewards are achievable.

In the early days, houses often were poorly lit because taxes were levied based on the number of windows. Did you ever think how different our writing and speaking would be if we paid taxes based on our word count? Let’s look at a few ways we can reduce word count—and probably increase our clarity.

We read in newspapers, “He is a lawyer (or it could be any profession) by training.” How else would a person become a lawyer than through training? And by the way, why say training instead of education? Training best describes what you do for your dog to make him stop wetting the rugs. Education is what schools provide for students to teach them to think and acquire knowledge. Wouldn’t it be enough to just say, “He is a lawyer?”

People often ask, “What’s your past experience?” Is it not highly likely that the questioner is only interested in your experience that occurred before he asked his question—so why not eliminate the word past? Although there could sometimes be exceptions--for instance a suitor might add to the clarity of his question by asking, “May I come up to your apartment for a repetition of our past experience?”

We often hear, “He’s a friend of mine.” Most of the time isn’t it clear that the friend of whom we speak is ours? Wouldn’t most people understand that when we bring a companion to a party and introduce him or her, the companion is our friend and not somebody else’s friend?

And that brings to mind our strange choice of prepositions. We all say we ride on airplanes—not in them. A person who is just learning English might think, “Is the person who rides on an airplane not going to have a bad hair day?” And while on the subject of hair, why do we say, “I am going to get a haircut.” A new English learner might more clearly say, “I am going to have my hairs cut—all of them.”

Luckily, we are not consistent with our logic reversal in the use of prepositions. If we were, an equestrian might say, “I am going to ride in my horse today?” Pity the poor new English learner who must ponder our use of prepositions—and pity the poor horse if he thinks too much about whether his rider will ride on him or in him.

Now that we have poked fun at some of the strange ways we commonly use certain English words, let’s look at a few other more arcane words that have recently crept into use by the bulls and bears who work in the trading and counting houses of Wall Street.

With a straight face the financial community speaks of tranches—in French it means slices. An investment firm acquires a bunch of mortgages and bundles them into packages called tranches. Standard and Poors rates the tranches from AAA to BBB-. If the tranches were chickens, the AAA ratings might apply to breasts and thighs and the BBB- to the beaks and claws. Apparently if the securities are called tranches, it gives them gravitas and reduces the likelihood that diffident investors will enquire into their real nature--especially those that contain beaks and claws. Since a bubonic plague is currently sweeping through the tranche market, many of the BBB- rated securities have been downgraded to toxic waste. French authorities go to extremes to maintain the purity of their language by disallowing foreign words. Maybe American investors should follow their lead and refuse to buy securities with fanciful French names that lull them into believing they are buying low-risk securities.

The financial community, for some time, has slipped us the term basis points as a metric for interest rates. One hundred basis points is the same as one percent. In about the third grade our teachers drilled the meaning of percent into our pointy heads and now we must switch to basis points for fractions of a percent. If our broker tells us the yield on a bond is up fifty basis points, wouldn’t it be a lot easier if he said a half of one percent so we might have a clue what he is talking about?

In his youth Jack Knepp intended to be a statistician, but after graduating from Drake with a degree in business his career veered in another direction. He found employment with Union Federal Savings and Loan Association of Kewanee as a teller where he stayed for sixteen years. He was Vice-president of branch lending when he left to take a position at Blackhawk State Bank in Milan. At Blackhawk his responsibilities as Vice-president and Loan Officer were primarily commercial lending oriented. The bank’s loan portfolio grew from under $50 million to over $300 million during his twenty years at the bank.

Along the way Jack earned an MBA from St. Ambrose College and later graduated from the Graduate School of Banking in Madison.

Apparently Jack Knepp has found a way to make his normal day stretch beyond twenty-four hours. He and his wife Mary, a professor of English as a Second Language at Blackhawk College, also took more than thirty foster children into their home for periods of time from overnight to one year. All of this while raising their own three children. Jack and Mary found the challenges of foster children were offset by the rewards they brought. In later years, their own children told them that being raised in a home with foster children showed them the value of their secure childhood as compared to the lives of the less fortunate.

Jack is especially interested in helping clients write business plans. He is also interested in expanding available SCORE consulting services to established businesses that want to grow or improve their operations.

Upon entering the wide-open, colorful spaces of It’s a Child’s World in Silvis, IL, visitors are met with the sight of children breakfasting on oatmeal and juice, small caged animals, enthusiastic voices, hatching eggs, toys, coloring books, reduced scale furniture and fixtures, smiling teachers, and childlike enthusiasm for living and learning. When the weather is good, the children play outside in a well equipped, grassy playground. For the last eight years, Naomi Lincoln and her staff of eighteen care for and teach two to twelve year old children. Naomi’s clients, the children, are usually there because their parents are at work. The younger children are there all day and the older ones come after school until their parents are through working.

The children’s needs always come first. As Naomi, who sits at a desk amid the clamor of the children’s activity room, was writing an important letter, a child interrupted for over a half hour to tell her of his compelling aspiration to become a scientist. When the child wound down from revealing his career plan, she resumed writing her urgent letter.

Before Naomi purchased It’s a Child’s World, she had a thorough knowledge of the child care business from having been the director for many years. She developed a keen recognition of business risks and the need for rapid adjustments when businesses go on strike or lay off personnel; parents instantly withdrew their children.

On the other hand, Naomi knows the tangential value to local businesses such as hers when new industries move into the community.

Over the years, increased dependence on state support programs has become normal for child care businesses due to the trend to lower paying jobs.

New business comes from word-of-mouth, ability to rapidly establish rapport with parents, telephone listing, and occasional newspaper ads.

Some of the reasons why Naomi Lincoln was able to quickly achieve success when she bought It’s a Child’s World were: (1) she had a Business Plan, (2) she was highly experienced in the child care business, (3) she had a passion for the business, (4) her business location was convenient to clients, (5) her services were high quality, and (6) she had good credit. When she presented her business plan to three banks for an initial loan, all offered her the requested funds.

Before Naomi Lincoln bought It’s a Child’s World, she used the assistance of SCORE to help her write a comprehensive business plan. Most of the objectives of the plan have materialized. She receives on-going counsel and advice from the previous owners as well as her exceptional staff.

It appears that our county’s future will be in good hands when the clients of It’s a Child’s World enter the adult world.

If you love the grandeur of nature—its canyons, its mountains and its mightiness, and love the thrill of their presence—then take the trip (Alaska) by all means; you will not be disappointed. But may God pity you, for you will lose one thing worth living, if you have the opportunity to make this trip and fail to do so. ----C.K. Snow

Ann recently crossed an item off her list when she visited her son Tom’s family in Alaska and witnessed the Iditarod dog-sled race, a re-enactment of the famous dash to deliver Diphtheria serum to the desperately sick, epidemic-plagued people of Nome, in 1925.

The race started in Willow, a few miles from Anchorage, and snaked through 1,100 miles of wintry wilderness. Dog-tired and hungry, thirty-six year old Lance Mackey barreled down Nome’s Front Street to win nine days and five hours later. (The last place entrant took over sixteen days.) Nine of the sixteen dogs he started with remained with him. His father and brother preceded him as winners of earlier Iditarods, all wearing their famous #13 bib. Mackey started mushing to his Iditarod win only eleven days after having won the Yukon Quest, a race that some say is even more arduous than the Iditarod.

Eighty one teams with men and women mushers started the race; fifty eight finished.

Ann snow-machined up the Yentna River for a three-night stay in a friend’s cabin. The cabin was directly on the Iditarod route two hours from the race starting point. When they were outside, they staved off some of the minus twenty degree morning cold by building a bonfire on the river bank. As the drivers raced by, Ann’s party shouted encouragement to the mushers. The mushers direct their dogs right or left by using the time-honored “gee” and ”haw” commands famil-iar to horse teamsters of old.

The dogs only need minimal shelter for their rest breaks. Straw on the snow and a bushy tail over their noses are enough for comfort even though farther on toward Nome the temperature can drop to seventy below zero.

Ann and her party enjoyed a more temperate climate in their wood-heated cabin even though it lacked indoor plumbing. When Ann asked her granddaughter, Mary Kate, why there were eight steps up to the outhouse, she explained, “There will likely be only one useable step later in the winter. The accumulat-ed snow will cover the rest.”

Ann said, “The thrill of the trip was seeing the dogs, mushers, and sleds in a grueling sports event in harsh arctic conditions; seeing Den-ali Park; and sharing a special experience with my family.”

Ann DeSalvo is a well-versed person. Perhaps as she lay under her blankets drifting off to sleep, words written at the time of the tumultuous 1890s gold-rush stampede intruded into her mind:

There are strange things done 'neath the midnight sun
By the men who moil for gold.
The arctic trails have their secret tales
That would make your blood run cold.
The northern lights have seen queer sights
But the queerest they ever did see,
Was that night on the marge of Lake LeBarge
When I cremated Sam McGee.

How many times have we heard executives in big comp-anies say, “’I’m quitting my job to start my own small business. It shouldn’t be that hard. Lots of acquaintances have told me they’ll be one of my first clients”? For many this makes as much sense as a five year old saying he is go-ing to run away from home and live on his own.

Because the executive’s previous career was success-ful he may believe it was entirely through his own efforts. He may have scarcely noticed that he was wrapped in a cocoon of lawyers, accountants, HR personnel, secretaries, marketing and sales personnel, and other support staffs.

He also may not have understood what he thought was a tiresome process of securing management approval for his actions was really a method of vetting projects to minimize risk and ensure success. In a fragile small business without checks and balances, fatal decisions can be made.

Reality often sets in when the new business owner tries to type a letter, set up and run his own computer equipment, and finds his “sure thing” customers do not return phone calls. And downright shock descends when sales do not materialize and cash flow is inadequate to cover bills.

Many small companies operated by ex-big company executives do not survive because they are not flexible enough to understand new cultures, can not work without extensive supporting infrastructures, and are not frugal enough with expenses. On the other hand some do survive the metamorphic shock when they switch from the sustaining embrace of a big company to the scary solitude of owning and operating a small business.

An ex-executive business owner said, “I underwent an epiphany that helped me out of a sales lump when I went to lunch with a professional salesman. I came away from lunch with advice that became my mantra, ‘A good salesman does not talk, he listens.’ When I did that, I found we were hitting the bulls-eye on understanding client needs and landing more orders.”

Another entrepreneur recognized the need for independent business reviews. He said, “I set up an advisory board for my small company that is valuable in preventing me from making too many ‘damn fool’ decisions. I now understand the value of all of those ‘pain in the rear’ sessions before we made key decisions in my old company. And surprisingly everyone who I asked to go on my board did. Several who worked for big companies said it was their only opportunity to look into the window of a small operation.”

An ex-big company executive said, “I can sum up my advise to others for success in operating a small business with these points: Discard un-transferable big company culture; bury ‘executive egos’; relentlessly focus on listening to and understanding clients and establishing trusting, long-term relationships; avoid all non-essential expenses; and set up an advisory board.”

For seventeen years Rosemary Phillips has owned Rosemary’s Potpourri Products. Her company produces and markets potpourri and fragrances in a converted commercial garage in Viola, IL.

Entering the building and seeing course burlap bags of dried leaves from India and containers of aromatic oils recalls the cargo of the ancient Argosies that plied their trade with the exotic Spice Islands of the South Pacific. In this building, Rosemary concocts her fragrant and colorful products in bottles and packets for her retail and wholesale customers. She customizes many of her products to the unique taste and needs of individuals.

Rosemary enthusiastically embraces all aspects of running her business with the exception of the never-ending requirement for paper work. Many small business owners do not relish selling, but with Rosemary’s room-filling personality, she finds it easy to relate to her clients as she solicits their business.

During the last year Rosemary improved her business by introducing additional products and landing twenty five new wholesale accounts. She hopes to continue to learn more about wholesaler business processes by meeting and networking with others, especially women, who also must deal with similar issues. Future sales growth is foreseen in the wholesale market.

For Rosemary, the most difficult part of running a business is finding the proper balance between working at the business and spending time with her family. In spite of the challenges of raising a family while running a business, Rosemary advises other entrepreneurs to never give up!

Many small businesses fail to prosper or declare bankruptcy soon after they open their doors. Most of the failures are related to inadequate sales. Even though the owners include logical sales forecasts in their business plans, sometimes they do not materialize. The owners see other comparable businesses prosper and yet they are confounded that their businesses languish.

It is possible that the business owners and customers perceive the offered goods and services differently. The owner may think he provides a quality product that is equal to or better than his competitors so that should be enough to attract business. But the customer may have another perspective.

One coffee shop owner may think his clients come for a good cup of coffee. Others may think their clients come to be greeted by name, receive a compliment, or hear the community gossip; the client may consider the coffee quality to be of secondary importance.

A business owner needs valid feedback from clients to ensure that he sees his business through his client’s eyes. One way is through evaluation forms. The owner should be aware, however, that a few clients will always give gushing, positive reviews and a few will only find mean-spirited, hypercritical fault. The owner should discount these evaluations.

An increasing number of small businesses are adding customer reviews to their Websites. Some business owners worry about the impact of negative reviews by clients. Experience shows that some negative evaluations enhance credibility and cause a favorable reaction from clients when the owner responds to the problems noted in the reviews.

If feedbacks on Websites are not practical, then business evaluations can be noted on bulletin boards and in newsletters.

Another way to receive a free business evaluation is to call SCORE to request a visit and evaluation. The invited SCORE members may also be able to provide useful observations on other aspects of the business in addition to marketing and sales.

George Kovacs received the Platinum Award from the Quad City SCORE Chapter for ten years of outstanding service. Since serving as the Chapter Chair in 1999 and 2001, George continues to work as an active counselor to SCORE clients and as chairman of the SCORE marketing committee.

The marketing committee objective is to make SCORE services more widely known to people in the community who want to start new businesses or improve existing businesses. After more than thirty years of presence in the Quad Cities, many still do not know that SCORE is a premier source for business counseling and consulting services provided by widely experienced professional men and women --and it’s all free.

George leads programs to advertise SCORE services on billboards, local TV channels, and radio stations; and seeks favorable newspaper coverage. Many of these media recognize the value of SCORE to the business community by providing their services free of charge. George also writes monthly columns on small business topics for local newspapers. The marketing programs have contributed to the increasing volume of business counseling services provided to SCORE clients at their Moline, Davenport, and Bettendorf sites.

George Kovacs began his marketing career as a thirteen year employee of the Massey Ferguson company. He then worked for John Deere for twenty five years while living in Belgium, France, Germany, Canada, and the U.S. He was the General Manager in Germany of the Deere Export Branch serving markets in much of Europe, the Middle East and part of Africa. He later worked in marketing positions in Canada and the U.S.

A CEO (Chief Executive Officer) is obligated to direct a corporation for the benefit of the stockholders; he or she can be thought of as the chief hired employee. And yet some CEOs, with or without the approval of their compensation committees and boards, treat company assets as Louis XIV regarded France’s resources. The king decreed, “L’etat, c’est moi” (I am the state.)

How much do CEOs of firms familiar to Quad City residents make? Robert Lane, CEO of Deere, received total compensation of $11 million in 2005, a combination of cash and other long range compensation; Alain Belda of Alcoa $3.5 million; and Stanley O’Neal of Merrill Lynch $22 million.

Larry Ellison, chief oracle of Oracle Corporation, was paid a more lofty total compensation of $75 million in 2005. Other corporate CEOs are paid even more. Ellison uses part of his wealth to bankroll his 450 foot long mother of all yachts.

Warren Buffet, head of Berkshire Hathaway, follows a path more tolerable to his down-home neighbors in Omaha. His total compensation is $100,000 per year. Of course he can fall back on his enormous, but seldom touched, $40 billion worth of company stock. He recently pledged most of his vast fortune to the Bill and Belinda Gates Foundation for disbursement to worthy charities.

Corporate directors often insist CEO compensation must be sky-high to be competitive. Are CEOs really so shallow that their job decisions are based on being paid enough to make a Maharajah envious? Shouldn’t their egos be sated by simply knowing they were singled out for the top job?

Why do they need more than enough to buy a fine house, several up-market cars, and a hideaway in a gated resort; educate their children; and fund their retirement? Maybe it’s so they can have bragging rights at their sanctum sanctorum weekend watering holes with their peers from other corporations.

The average person can better relate to a lordly $10 million annual CEO compensation by comparing it to his own pay. It would take the income of 200 people earning $50,000 per year to equal a CEO’s compensation of $10 million.

Richard Grasso, ex-head of the NY Stock Exchange, was recently forced by court order to pay back $100 million of his outlandish compensation. William McGuire, CEO of UnitedHealth Group, was ousted by his board for manipulating the dates on his stock options. Apparently his $125 million 2005 compensation was not adequate. (UnitedHealth Group recently bought John Deere Health Care.) But these instances of curbing gross CEO compensation are rare.

SCORE Business of the Year Winners

SCORE, a group devoted to providing free business counseling to small businesses, selected Back-to-Back Chiropractic of Moline, IL as its business of the year for 2006.

The award was made to the business owners, Pamela and Patricia Miller, by Dick Weeks, president of the local SCORE chapter, during the August Illinois Chamber of Commerce meeting.

SCORE evaluated ten companies while selecting Back-to-Back Chiropractic for their small business of the year. During the evaluation process SCORE gave honorable mention to Lavender Crest Winery of Colona, IL and Evans Manufacturing of Rock Island.

A large percentage of new businesses in the U.S. fail during the first five years. By careful planning, as was done by the above small businesses, the success rate is substantially improved.

I’m talking about counseling with clients on the Cyber Chapter, as it’s come to be known. The idea of doing SCORE counseling on the Internet moved into high gear at the turn of the century. The late Dick Stevenson of Quad Cities Chapter was one of the pioneers in getting it all put together, along with the late Bob Sousa of Hawaii. The group now consists of more than 1200 SCORE Cyber counselors nationwide.

Well over 100,000 persons took advantage of Internet counseling last year and that number continues to grow. Eight Quad Cities SCORE members participate in Cyber counseling and already have logged more than 300 Internet sessions this year, from clients all across the country.

While face-to-face contact is not part of the Cyber equation, challenging and interesting situations are a regular part of the mix. Yes, there are frustrating times, too, especially when clients fail to provide enough information so that counselors can offer insight or suggestions.

Many clients are generous in praise of the Cyber counseling they receive. There is a special feeling of accomplishment in knowing your words of wisdom and enlightenment have helped someone you’ve never met become successful in business.

Surveys conducted by the National SCORE Office indicate a high degree of customer satisfaction with the Internet counseling program. Nearly 90 percent said they would recommend SCORE to another entrepreneur. More than 80 percent rated the counseling experience either excellent or good, and three of four respondents felt SCORE was helpful in developing an effective business strategy.

Cyber counselors are asked to respond to all requests within 48 hours after receiving them. They can easily remove their name from the active counseling roster if they are vacationing, incapacitated or just want to take a break. Persons who seek Internet counseling can log on to www.SCORE.org and follow the simple instructions.

If any members would like to become SCORE email counselors they may contact Augie Zahatko of Chapter 432.

At Back-To-Back Chiropractic in Moline, the road to success is easy to follow--the proprietors, Pam and Pat Miller, just compare their actual business progress to their business plan.

The Miller twins’ chiropractic practice is ahead of the curve based on the comprehensive business plan they carefully prepared after they graduated from Palmer College but before they started their practice. A small business expansion is already completed even though the practice only started three years ago in 2003.

The philosophies learned by the Millers in their previous professions--elder and child care providers--also served well in their new chiropractic practice. They care about their patients; they listen and then find the best way to help them.

* Minimize expenses. Using second hand furniture and medical equipment did not detract from the attractive appearance of the waiting and medical rooms.

* Focus on the patients. Take time to hear what they think about their medical condition and how they feel; take a little extra time to listen to their personal interests. On return visits refer to incidents from earlier visits.

* Define what is effective in promoting business. For Back-to-Back Chiropractic, referrals and radio advertising brought in the most patients.

One of the initial hurdles for the Millers was the need to establish a banking relationship. Their persistence paid off when a bank loan officer finally extended them the necessary line of credit needed to start their business. When one banker observed that the Quad Cities might already be saturated with chiropractic practices, Pam Miller countered by telling him how many banks she had recently observed.

One of the remaining unresolved problems for the Miller sisters is the need to develop a better balance between work and private time. Serving patients on their terms leaves little time for their private lives. But they are now starting to plan for this problem as carefully as they did earlier for their initial business.

Leading business publications and the largest library association nationwide honor SCORE for counseling and Web site excellence.

Money Magazine names SCORE as “Best for One-on-One Counseling” in the June issue. The story is “Free Help for Launching a Business” and it lists SCORE’s phone number and Web site.

Inc. Magazine lists SCORE as one of “39 Great Business Bargains” in the June issue. SCORE is highlighted under “Free Consulting” with SCORE’s Web site.

A Choice Magazine review of the SCORE Web site says it is a “well-organized, easy-to-navigate resource” and that it is “highly recommended” for “all business collections.”

The American Library Association honors the SCORE Web site as one of the “Best of the Best Business Web Sites.” SCORE was selected for this award by the BRASS Education Committee, which consists of business reference librarians.

Ten U. S. Service veterans were provided the SCORE Chapter 432 Business Workshop free of charge in July. The free workshop was made available through the efforts of our chapter, The Community Foundation of the Great River Bend which provided the funding, and the Workforce Development Office of Iowa which did the publicity.

The seminar was a hit with those attending who gave comments such as: excellent wealth of material – very easy to listen to; presenters are very professional, they care and they know what they are talking about.

When Laurel Austin, an avid knitter, returned to the Quad Cities in 2002 after a career in Corporate Sales she was surprised to find there was no longer a shop devoted to yarn within the Quad Cities. She looked at that as an opportunity and decided to open The Yarn Shoppe in Davenport , IA.

However, Laurel quickly found out the road from an idea to making something happen is arduous and full of worry. She visited the SCORE office in Bettendorf and, with aid from counselors there, developed a business plan that helped her identify what she needed to open the store and keep it operating.

After receiving a bank loan she opened her store in Paul Revere Square last November. One of her biggest surprises was the passion people who knit have for quality yarn. Laurel put up a sign next to Kimberly Road stating The Yarn Shoppe would be open soon and people stopped to have their picture taken beside it because they were so excited about the shop opening. She had knitters coming in before the store officially opened so they could purchase her higher quality yarns.

Since she opened the store, sales have been above her projections and she expanded her space due to the increased business; something she had not planned on doing until next fall. One reason for the excellent business is her superior supply of yarns. Laurel stated that inventory in a yarn shop is everything. Picking the inventory to keep up with trends is difficult but her suppliers advise her and she also uses help from her employee and her 13-year-old daughter.

The month of May was much slower for her business, but that was predicted in her business plan and business is picking up again. However, during the slow month she was finally able to do some knitting herself, something she had not had a lot of time for until just recently. Thinking ahead, she knitted her Christmas displays since she knows she will not have time to do knitting as fall nears. The business is not yet profitable due to the high cost of the yarn inventory but it is providing a reasonable income for Laurel and she says that she is having fun.

When asked for advice for someone wanting to start a business, Laurel immediately said, “Go to SCORE.” Laurel was initially scared to death by the prospect of opening her own business but she said the SCORE counselors were very friendly and supportive.

So if you are a passionate knitter or just want to learn what knitting is about, stop in at The Yarn Shoppe and see Laurel ; she will be happy to give you whatever help you need.

Dick Weeks , Chairman of Quad Cities SCORE Chapter 432, will be taking over from Jim Thompson as District Director (DD) for SORE District 736 on 1 October 2006. Dick will drop his chairmanship of the Quad Cities SCORE Chapter so he can spend his time on the entire district made of eight chapters from Eastern Iowa , including the Quad Cities.

Jim Thompson, DD for the past two years, will be retiring only from the directorship and will remain active in the Cedar Rapids SCORE Chapter. Jim said he asked Dick to be his successor, after consulting with Ken Yancey, SCORE CEO, because “Dick has a heart for the work that SCORE does.” In addition Jim said that it was best to have someone with experience from a larger chapter that has implemented new and successful programs. That experience will allow Dick to spread new ideas in the SCORE chapters across the District.

District 736 is made up of 8 chapters ( Burlington , Muscatine , Quad Cities , Clinton, Cedar Rapids , Waterloo , Decorah and Iowa City ) and is one of 72 districts throughout the nation.

Dick is looking forward to this new challenge and plans initially to meet with all chapters, provide assistance where he can, and develop plans to increase chapter membership. In addition, he hopes to be able to reestablish a SCORE Chapter in Dubuque , since it is the largest Iowa city without a SCORE chapter.

Dick and Ken Yancey met at the Cedar Rapids annual meeting in June 2006 and discussed Dick’s new job. Dick will be attending a training session for District Directors sponsored by SCORE in Nashville in August to prepare him for all the requirements of his new position.

The Quad Cities SCORE Chapter is losing an excellent chairman but gaining a District Director with intimate knowledge of its strengths and weaknesses.

Dick Weeks met with Ken Yancey recently at Cedar Rapids to discuss his new role as District 736 Director.

Robert (Bob) Radkiewicz will be taking over as Chairman of Quad Cities Chapter 432 beginning Oct. 1, 2006. In elections completed in June other officers elected included: 1^st Vice Chairman - John Wetzel ; 2^nd Vice Chairman - Terry Kramer ; Recording Secretary – Merton Sachs; Assistant Recording Secretary – Tom DeSalvo ; Statistical Secretary – Wayne Patchin ; Assistant Statistical Secretary – George Rivard ; Treasurer – Bob Van De Voorde ; Assistant Treasurer – Linda Miller.

Bob joined SCORE in 2003 and was Vice Chairman this past year. Bob retired from the Rock Island Arsenal where he was Civilian Executive for the Munitions and Armament Command, responsible for 36 sites, including production and storage facilities across the nation.

In succeeding Dick Weeks Bob said “I hope to build on the momentum the Quad Cities Chapter has built in meeting clients’ needs and becoming a respected resource on both sides of the River.”

Following in his father’s footsteps, William R. Wandrey enjoyed a long career in banking—most of it in the Quad Cities. It culminated in 2005 when he retired as Community Bank President of MidAmerica National Bank’s Quad City office, a position he held for five years.

Bill’s banking career began at Northern Trust Company in Chicago , following graduation from Stanford University with a Bachelor of Arts degree in Economics. He also worked for various banks in Joliet and then held responsible positions at other banks, primarily in Moline .

Born in Chicago in 1941, Bill moved to Joliet at an early age and graduated from Joliet High School . While there, he was a member of the track team and set the school record in the high hurdles. He also participated in track while attending Stanford University .

Over the years, Bill has given generously of his time as a volunteer for United Way , the Boy Scouts of America, and the Quad City Arts Council. He currently is a member of Moline Rotary Club and serves on the Board of Niabi Zoological Society.

As a new member of SCORE, Bill Wandrey appreciates the opportunity to work with small businesses. “A significant part of my banking career was devoted to lending to small businesses,” he says. “SCORE lets me continue to be involved with the interesting people whose dreams help build

America

’s economic future.”

For 32 years Bill owned and rode horses, primarily thoroughbred hunters. While he no longer owns a horse, he continues to enjoy attending horse races. He likes to travel, hike, read, and socialize with friends and family.

He and his wife, JoAnn, live in Moline and spend winters in Naples , Florida . They have three children and four grandchildren.

Pinocchio’s Gourmet Pizza in Milan, IL has been growing steadily since it was founded in September 1996 by its owner John Hoffman. The main reason for the growth has been the wood fired ovens in which the pizzas are cooked, giving the pizzas a unique texture and taste. According to John he has regular customers for the pizza who come from as far as Galesberg, IL and Iowa City, IA.

Pizza is not the only thing on the menu which includes fresh salads, soups and a variety of hot and cold sandwiches. The pizza place is also unique with a pleasant ambience that makes for a relaxing lunch or dinner. John has pride in the appearance since his mother was the primary decorator.

Pinocchio’s has gone through several expansions since opening. The first addition was a banquet room that was added in August 1998 and expanded seating to almost 90. Another business had occupied the front of the building when Pinocchio’s opened but in May 2001 John expanded his operation to the front of the building opening J. Crickets which is a full service bar with an attached cigar lounge. The cigar lounge is a separate room so that cigar aficionados may enjoy their smokes in peace without offending others. John says that Pinocchio’s is a smoke free restaurant and there is a door to J. Cricket’s with a special air filter so smoke from the bar does not come into the restaurant.

Pinocchio’s relies on repeat business for its continued growth and keeps that business by maintaining a quality establishment including a pleasant atmosphere, good service and excellent food. John ensures the pizza maintains his high standards by doing the cooking himself very often. He knows the recipes for the pizzas well since he developed them himself by trial and error testing out new concepts on friends and family before using the recipe in the store.

Pinocchio’s has a staff of 18 with a large number of the staff having worked there from 4 to 8 years. John feels lucky to have those veterans who have been with him a while and says that their hard work is responsible for much of the repeat business. John is now looking for someone to manage Pinocchio’s for him because he is ready to expand the wood-fired baked pizza into franchising.

With the success of his recipes and with interest from various parties John hopes to begin franchising the business. He expects to open the first franchise store within 120 miles of the Quad Cities sometime within the next year.

John first came to SCORE before he opened his business just after graduating from college with a business degree. He says that SCORE gave him guidance on things to do, what banks would look for when he went to them for a loan and advice on general good business practices. Since that time his business has been one of steady growth. And soon you may be able to find that unique wood-fired pizza in more places than Milan.

SCORE Chapter 432 will begin counseling sessions at Davenport One starting May 16, 2006 every Tuesday from 10:00 a.m. to 12:00 p.m. No appointment is necessary. These sessions will be in addition to the regular counseling sessions held each week at the Moline and the Bettendorf Chambers of Commerce.

Our long awaited new SCORE Web Site update is up and running. You will find it easy to follow and it provides a lot of useful information and resources for those looking for small business development assistance. “The new Web site is user friendly and we encourage interested parties to go to the site and review the material prior to attending a counseling session,” according to Dick Weeks, SCORE Chairman.

Edward Zipper, the web master from Computer Tutor (563-650-2611), says an attractive and easy to use site produces the best possible results. Edward redesigned the SCORE web site with this in mind.

The new web site includes links to our Workshops and Schedule, Frequently Asked Questions, Free Counseling, Volunteer Opportunities, the SCORE Newsletter, a little SCORE history and much more.

Since we have a new Web master, you will find the information on our Web site more current and easily updated. Updates can be directed to the SCORE Moline Office, Phone 309-797-0082.

Ask John Wetzel what he likes best about SCORE, and Chapter 432’s newest member is quick to reply. “I appreciate the opportunity to continue contributing to the growth of small business,” he says, “and I really enjoy working with this great group of SCORE volunteers.” John’s life-long ties to the Quad Cities, his strong business background, and his willingness to serve the community in a myriad of ways, make him well qualified to be part of our organization.

John was born in Chicago and moved with his family to Rock Island at an early age. He graduated from Rock Island High School where he was manager of the football and basketball teams, and played on the baseball team. He obtained a Bachelor’s Degree in Geology from Augustana College where he played on the golf team four years and served as captain two years. He then enrolled at the University of Iowa and earned a Master’s Degree in Geography.

In 1968, John Wetzel joined the gas department at Iowa-Illinois Gas and Electric Company. Through the years, he held increasingly responsible positions in community, area and economic development at Iowa-Illinois and its successor company, MidAmerican Energy. He retired earlier this year as Vice President of Economic Development.

His list of volunteer activities reveals his commitment to the local community. He currently is chairman of the Moline Plan Commission and president of the Greater Davenport Development Corporation. He is a past president of the Professional Developer of Iowa and also a past president of Rock Island Rotary.

In 1992, John received the U.S. Small Business Administration’s regional Advocate of the Year Award for Financial Services. The Volunteer Action Center of the Quad Cities presented him a “Volunteer of the Year” award, and twice he has received the Iowa Governor’s Award for Outstanding Voluntary Service.

John and his wife, Marcia, live in Moline and are members of Trinity Lutheran Church. They are parents of a married daughter who lives and works in the Chicago suburbs. For relaxation, John likes to golf, travel (his favorite area is New England), collect baseball cards, and help his wife do genealogical research.

Platinum Award for Sachs

Mert Sachs was presented with the SCORE Platinum Award at the April monthly meeting by Chapter Chairman, Dick Weeks.

Merton I. Sachs, a member of SCORE Chapter 432 since February 1996, was presented the National SCORE Platinum Award at the April Chapter monthly meeting. Mert’s accomplishments with SCORE are many including being Chapter Chair for two years from October 2000 through September 2002 and Chapter Vice Chair from October 1998 through September 2000.

Dick Weeks, Chapter 432 Chairman, said that Mert has been a tireless worker for SCORE and due to his efforts many positive initiatives have been completed.

Mert was instrumental in setting up the Loan Coordinator Committee and its mission to develop a relationship with the financial and economic organizations in the community. It was through the leadership of Mert that this committee was able to get financial support from Wells Fargo and IH Mississippi Valley Credit Union in supporting our workshop books. It was also through this committee that a number of banks supported Chapter 432 when we held our small business workshops for Y2K.

Over the last two years Mert personally reviewed the records of clients for the last few years and distributed their names to our members who did an outstanding job of contacting them to follow-up on their business status. Another initiative of Mert was to establish the Business Plan Review process, which has been successful in assisting clients in the preparation of their Business Plan and obtaining bank financing.

Mert has been lead counselor with many clients who have gone on to have successful small businesses. He has also worked many times in a team of counselors to provide the most skilled advice to clients.

Mert is well respected by all members of the Chapter and is truly deserving of the Platinum Award.

Since buying her Colona Video and Games store two years ago, Sheila Lewis has seen the business grow and believes that growth can be tied to her emphasis on customer service. Her first action when she took over the business was to develop a list three pages long of things to do to make customer service better, which she shared with her two employees. These ideas included trying to know customers by name and checking all discs and cleaning them when they are returned so that customers do not wait for the discs to be cleaned when checking them out. “Just doing right by the public” has been her motto.

Sheila is an artist by training but after working at the video store as an employee for three years she thought she could run the business herself. So after some long talks with her husband, accountant, banker, lawyer and SCORE she decided to make an offer on the business. After some negotiations her offer was accepted and she took over the business on February 23, 2004.

Being her own boss is one of the things Sheila likes best about running the business, although she says she could not get by without the help of her two employees, who, like her, are mothers of children in school. She says the three of them are flexible about their work schedules so they can attend their children’s activities as much as possible. Sheila said she feels very lucky to have two great employees.

The video business is constantly changing both in movie content and in the format it is delivered. One major change Colona Video instituted this year is to not purchase VHS tapes anymore since people have moved onto the newer technology of DVDs.

Sheila has a manual tracking system for each video in stock and the VHS videos have recently turned unprofitable. Other changes to take place in the next few months are converting the manual tracking of videos to an on-line system and moving to bar coding of videos to speed customer checkout.

Sheila is aware of the potential changes coming to the video business which could hurt her bottom line so she is presently looking into branching into other retail areas. These changes can be made gradually and she can test various concepts before the video business begins to decline. Her concept is to sell items that make sense for the clientele in the Colona area.

Her plans to date have been on track so with the same meticulous planning she expects to move slowly to new retail items. In fact in the first month she took over the business she doubled the income and is moving pretty much on the line she thought sales would be.

Sheila came to SCORE in December 2003 before her business plan was done. She attended the SCORE seminar on starting a small business and used the SCORE outline for a business plan to finish her plan. In fact, she said, “Don’t waste your money on expensive software to do a business plan when it is so easy to use the SCORE outline.” After a business plan review by a SCORE panel she took her plan to the bank; she said they were very impressed with it and she had no trouble getting a loan.

When asked for advice for other people getting ready to start a business, Sheila said “Go to everybody for advice – your accountant, your banker, your lawyer and SCORE.” She feels the more advice you can get, the better. And that has made for a better video store in Colona.

For the past month if you have been watching CNN, Fox News or the Weather Channel on Quad Cities Mediacom Cable you may have seen ads run about SCORE and how to get in touch with the local chapter. During February and March the SCORE ad will be shown 100 times on any of the three stations. The ads are part of a new marketing initiative headed by George Kovacs who was looking for new ways to get our name in front of the public.

From April through December SCORE will get 100 commercials each month on CNN, The Weather Channel and MSNBC or CNBC. George said that Jim Stoos and Amy Thomas from OnMedia have been very enthusiastic about SCORE and in helping to get our capabilities to the public.

The public service announcement runs for 30 seconds and was provided by SCORE national headquarters. The local chapter was responsible for adding our local contact numbers on the screen with a voice over. So the next time you turn on Mediacom be on the lookout for SCORE.

Our local SCORE chapter opened office hours in the Bettendorf Chamber of Commerce on July 5 of last year and by all accounts this has been a successful endeavor. According to Scott Tunnicliff, CEO of the Bettendorf Chamber of Commerce, the SCORE commitment to Bettendorf has benefited both their Chamber and SCORE. One benefit to the Chamber is that they have a tangible asset to provide assistance to new and existing small businesses in Bettendorf. A benefit to SCORE is that it now has a physical presence on both sides of the Mississippi River which will help recruit new volunteers, according to Scott.

“The Quad Cities has always done a good job of training employees,” Scott said, “but we need to do a better job of developing employers and SCORE can help with that task.” The key to developing good employers is made up of three ingredients – experience, technical savvy and energy. With their wide variety of capabilities, SCORE counselors provide aid to small businesses in all these areas, according to Scott.

Dick Weeks, Chapter 432 Chairman, is equally excited by the Bettendorf office hours. “This has broadened our market,” said Dick, “and we are getting both Iowa and Illinois clients in Bettendorf.” For the first 6 months the office was in operation, SCORE handled over 50 clients and the number appears to be growing.

Further growth can be expected as downtown Bettendorf grows and traffic increases. In fact during some recent counseling sessions as many as 5 clients have shown up and Scott has had to borrow rooms from other companies in the building the Chamber is housed to handle the clients.

"None of this success would be possible,” according to Dick, “without the full support of the Bettendorf Chamber which has been very easy to deal with and responsive to our needs.” The bottom line according to both Dick and Scott is that this has been an excellent match for both sides and they hope to see it continue well into the future.

Counseling hours at the Bettendorf Chamber of Commerce, 2117 State Street, Bettendorf, are every Wednesday morning from 10:00 to 12:00. No appointments are necessary.

Tom DeSalvo (left), past chairman of SCORE Chapter 432, is presented a plaque for his service to the chapter by Dick Weeks, present Chairman.

Tom DeSalvo is enjoying a well earned vacation on the beaches of Akumal, Mexico, on the Yucatan peninsula which he and his wife, Ann, have visited 23 times. This year he will be a little more relaxed since he is no longer chairman of Chapter 432, a position he held for the past two years. Tom left office with mixed feelings – relief at having a responsibility lifted from his shoulders, but satisfaction in having made a difference in Chapter 432.

The counseling fit right in with Tom’s need to help other people. Tom feels he has been both lucky and successful in life and wants to return something back to others.

When he joined, Tom had no plans other than counseling but, as Tom says, “Then Mert Sachs coerced me into being Assistant Chairman. He made it sound so easy.” However, Tom held the position while still working full time as a salesman for Zimmerman Cadillac, Pontiac, and Honda.

Tom says he did not do anything exceptional while in office. But the accomplishments during his tenure included: opening a new office for counseling in the Bettendorf Chamber of Commerce; increasing Chapter 432’s client contacts through a variety of initiatives; installing a new wireless computer system so that the Chapter could better serve its customers; becoming one of the first chapters nationally to contribute $1000.00 to the SCORE Foundation; and developing new ways to make SCORE known to customers, including a new colorful brochure. Tom wanted to maintain the high regard for Chapter 432 both in the local community and at the national and state SCORE organizations and his initiatives went a long way to continuing that respect.

Tom was made aware of Chapter 432’s prestige nationally when he attended a national SCORE meeting. While Tom was signing in for the meeting, Ken Yancey, SCORE CEO, overheard the name Quad Cities and immediately came over and introduced himself and spoke about the great Quad Cities chapter. Tom was extremely impressed that Ken remembered our chapter out of the more than 325 SCORE chapters.

While no longer chairman, Tom says he will now have adequate time to take on specialty programs to further help the chapter. And he will have with him the feeling that as chairman he made a small difference somewhere. But most clients and SCORE members will tell you Tom DeSalvo made a big difference wherever he was involved.

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