2022-2023 Annual Report South Shore Opportunities
South Shore Opportunities is an independent, not for profit corporation governed by a Board of Directors comprised of volunteer business people from Queens and Lunenburg counties.
2022 marks more than 30 years of providing hands on help in the form of technical assistance and advice. A fairly unique role of South Shore Opportunities is providing practical and careful guidance to clients as they investigate the financial aspects of their new business idea. For 31 years there has been no charge for guiding people as they investigate new or expanding business ideas.
This fiscal year also marks 31 years of providing business loans to start-up businesses as well as existing businesses.
South Shore Opportunities originally received $2,396,890 for community investment from various Federal Government sources between startup 1992 and 1998. The organization has committed $24.7 million in small business start-up and expansion in Lunenburg and Queens counties to March 31, 2023.
A new Memorandum of Association and Articles of Association were prepared by Boyne Clarke and adopted by the Board of Directors in 2020, creating a fresh outlook on business operations.
During this fiscal year the Board of Directors engaged in strategic planning. From that the Board of Directors adopted a new Vision and a new Mission.
VISION: Lead by committed, engaged and diverse volunteers and staff, South Shore Opportunities is the go-to organization that stimulates and supports innovative and traditional businesses and entrepreneurs, through a range of programs, services and partnerships that will sustain and grow communities in Queens and Lunenburg Counties.
MISSION: To foster the creation, support, expansion, and modernization of existing and new businesses in Queens and Lunenburg Counties by providing financing, counseling, and technical services.
Also during the Strategic Planning session, the Board of Directors identified that the organization’s
Strengths include:
- Support and knowledge available to clients
- Ability to react to social issues as well as the financial
- An understanding of the local economy and business
- A commitment to the local community
- Providing accessible and timely resources and responses
$245,935 was received in operating income from ACOA.
Actual revenues achieved were ACOA contract $245,935 plus 30,701 deposit interest and other revenues of $66,000 which included reimbursements for training (CAS and ETF) as well as sub-lease revenue from ACOA and the province for Bridgewater office. Actual interest from investment earnings used was $62,913 less than budgeted. Revenues exclusive of use of investment earnings were $33,000 more than budgeted due mainly to increased Consulting Advisory Services revenue, $11,000 more than budgeted for interest on deposits and $5,000 of sub-lease revenue for the Bridgewater office location due to the organization changing to be main tenant for the lease.
Some expense line items were slightly over and some slightly under ending the year with total actual expenses of $485,927, $1,899 under budget, which is basically breakeven. General operating expenses were $5,463 over budget due to slightly increased Bridgewater rent and a new line item added for shared occupancy expenses for the Bridgewater location due to becoming the lead tenant. Board of Directors expenses were approimately $5,000 under budget mainly due to travel. Staff wages were approximately $30,000 underbudget due to some reduced paid working hours. Similarly, staff benefits were $3,500 underbudget. Training expenses were approx. $34,500 greater than budgeted due to strong use of Consulting Advisory Services program of which these expenses are 100% reimbursed by the NS Association of CBDC. As well, the Entrepreneurial Training Program was $3,700 over budget as a result of two pilot programs of offering Successful Business Basics and Business Plan basics group training, once in-person and once via live online learning.
The corporation did 2 other extra contracts during 2022-2023:
- Entrepreneurial Training Fund; partnered with Atlantic Association CBDC/ACOA
- Consulting Advisory Services Program; partnered with NS association CBDC
South Shore Opportunities invested $8,365 in Successful Business Basics and Business Plan basics in-person group training September to November 2022. There were 18 registrants and 17 received certificates of completion. The Atlantic Association CBDC reimbursed $7,528 of this cost via the Entrepreneurial Training Program. South Shore Opportunities then invested $2,000 in Successful Business Basics live, on-line, group training January to March 2023. There were 9 registrants and attendance was poor. The Atlantic Association CBDC reimbursed $1,800 of this cost via the Entrepreneurial Training Program. People did not interact as desired with this training method. The Entrepreneurial Training Program was also used to assist 2 individual business owners with training; one business received bookkeeping training and one received training in setting up and maintaining their own website.
South Shore Opportunities approved 10 Consulting Advisory Services contracts in the amount $42,775. This is twice the number of CAS approvals compared to the previous fiscal year. The Consulting Advisory Services (CAS) program helped businesses with strategic planning, human resource management issues, improved use of technology for business efficiency, operation processes, marketing and business valuation.
BUSINESS OPERATIONS
South Shore Opportunities had 120 new business client interviews, 31 from Queens Co and 89 from Lunenburg Co. This is an increase of 21 from 2021-2022. TEA noted 194 clients provided business counselling, 455 business counselling sessions , 267 other monitoring engagements, 24 site visits.
The year end March 31,2023 saw 25 formal requests for investment from the General Investment Fund, 4 for Queens Co. and 21 for Lunenburg Co. This is 9 more applications than 2021-2022, which comprised 2 less for Queens and 11 more for Lunenburg County compared to 2021-2022.
Counselling and technical assistance are a strong part of services provided by the organization. 120 new inquiries, 25 requests for investment from South Shore Opportunities community investment fund indicates that in this fiscal year, 20% of new inquiries applied for financing. This indicates that start-ups, expansions and business difficulties were supported through counselling, technical assistance (particularly cashflow planning) and guiding the client to be prepared to request financing from more traditional sources rather than financing through this organization.
The request for investment totaled $2,078,430 which is up dramatically, $576,430 from 2021-2022 $1,502,000, applications. Of note, 1997-98 had the highest loan dollar requests in the organization’s history with 71 applications for $2,574,640.04.
During this fiscal year South Shore Opportunities committed 100% of the requests, committing $2,078,430 net of refinancing, 25 loans (18 of which were used or remain committed), an increase of 4 loans used and an increase of $576,430 loans committed compared to 2021-2022.
2022-2023 was the highest loan dollars approved at $2,078,430 however $831,000 was uncommitted within the year for a net commitment of $1,247,430 so 2016-2017 remains the most loan dollars approved, $1,679,835, in the organization’s 31 year history.
The current year investment was partially used to create and maintain 41 FTE jobs.
South Shore Opportunities disbursed $1,092,500 regular investment funds in 2022-2023, $212,500 more than the amount disbursed in 2021-2022.
Write-Offs and Allowance for Doubtful Accounts
Write-offs to the general Investment Fund during this fiscal year totalled $37,915.25. Historical total write-offs with subsequent recoveries means the rate of write-offs net of recoveries, $2,761,668.29/ $24,785,208.95 net commitment to March 31, 2023 is 11.1 % of commitments, since inception, down from 11.6% in 2021-2022.
Following analysis of the loan portfolio and individual loans, the organization chose to make no increases to the Allowance for Doubtful Accounts, leaving the balance at year end at $568,989.31 which is a conservative 16.9% of the outstanding regular investment $3,372,638.99 loan portfolio, down from 21% in 2021-2022.
LOAN PORTFOLIO
The Investment Fund completed the year with $3,372,638.99 Million Loans Receivable, covering 53 loans.. This is the highest loan receivable balance in the organization history; the next highest year was 2012-2013 $3,322,004.60 which, of note, encompassed 78 loans. This is an indication of the much higher average loan. an increase in the portfolio of $484,886.16 and 0 loans from 2021-2022. As at March 31, 2023 there was $148,156.96 available for investment compared to $863,000 available at the end of March 2022. This is a strong indication that the organization will need to borrow from the central lending pool (Atlantic Canada Community Business Investment Fund) during 2023-2024.
GOVERNANCE
The Board of Directors continues to both advertise publicly and utilize networks to continually seek new members of the Board. The Board remains committed to seeking a broad range of business expertise to maintain the important access to capital for small business in the community of Queens and Lunenburg counties. The organization is currently seeking potential board members and invites interest.