So, in a time when the U.S. economy is trying to recover, major U.S. cities and states are cutting off the hand that feeds them. I am referencing the recent trouble Wells Fargo experienced and the retaliation of cities like Chicago and states like California who are stopping business with Wells Fargo for a year. This will cost Wells Fargo tens of millions of dollars in lost revenue. While many people, including myself, are not happy with the way large banks have been destroying the economy (think the housing crash, sub-prime lending, bank bailouts), I do not think the solution is to destroy the bank.
Small businesses like mine depend on large banks like Wells Fargo for lines of credit, loans, and banking services. So, my solution for Wells Fargo is to succeed and grow in spite of the treatment by these governments by forming a better relationship with Small Businesses like mine. Wells Fargo could take those funds it would have loaned to large cities and states for bonds and instead loan them to small businesses across the country. Aren’t the banks already doing that? Yes, they will lend $250k to a business that has already been in business for 3 years. But what about the countless people who want to start a small business but do not have the business training to start a business? What about those people who would love to leave the work force, start a business, and hire more people, but do not know where to start?
I suggest to Wells Fargo that the best way to respond to these government actions is to make even more money and help Small Businesses make more money along with them. By offering small business training in the local branches to people, they can help the economy recover and make money doing it. Train potential mom and pop store owners what they need in a business plan to succeed. Help people with ideas understand the fundamentals of a balance sheet, cash flow, and other business necessities to make a business thrive. Wells Fargo could train up those potential owners to take their ideas and turn them into a business that grows.
Right now, the federal entity, the Small Business Administration, offers free classes (well, paid for with our tax dollars) to those wanting to open a new business. I have been to many classes and learned a lot. And this is a great start, but image if the bank, the lender, was giving training to potential small business owners on how to craft their business plan and how to judge reasonable business expenses for a start up.
Keep your eyes open for Santee Shared Office, which brings the banks and other vital resources to small businesses for training sessions. They aim to be more than just a shared office space. They want to help small business profits explode and hire more people.
