The Body Electric

Shedding light on utility deregulation.

Magazine Contributor

May 1, 1997 5 min read

This story appears in the May 1997 issue of Entrepreneur. Subscribe »

No matter how you look at it, electric utility deregulation will not be simple. With California adopting a competitive system beginning in January 1998, at least two major congressional bills pending, and 49 states addressing the issue in some form (including Massachusetts, New Hampshire, Pennsylvania and Rhode Island, which have passed laws), small-business owners may soon face a decision about choosing an electricity provider that could profoundly impact their bottom lines.

But to make sure the decision doesn't put them between a rock and a hard place, entrepreneurs must make their views heard. "Major corporations have the wherewithal to attend hearings. Residential users have clout because they're a big voter block," explains Julie Scofield of the six-state Smaller Business Association of New England. If entrepreneurs don't offer input, Scofield worries, their concerns will be ignored.

According to Betty Jo Toccoli of the California Small Business Association (CSBA), small-business concerns include service reliability (will my lights go on when I hit the switch?), accountability (who will I call for repairs?) and price. The CSBA weighed in on these issues when it helped California lawmakers craft legislation small business can live with. Assembly Bill 1890 gives an immediate 10 percent rate reduction to all residential and small commercial customers of the state's three largest investor-owned utilities. By 2002, there should be a 20 percent rate reduction.

More entrepreneurs need to follow the CSBA's lead. While utility restructuring is in its infancy, the movement is gathering steam and will soon become a pressing small-business issue.

Jump-Start

By Holly Celeste Fick

American-Indian businesses get a boost from SBA centers.

American-Indian businesses have been reaping the benefits of Tribal Business Information Centers (TBICs) since their institution by the Small Business Administration (SBA) in 1995.

"The original TBIC site was able to [help] start over 100 businesses in just 18 months," says Quanah Crossland Stamps, assistant administrator of Native-American Affairs for the SBA. There are 22 TBICs now, and Stamps hopes there will be 50 by 1999.

The centers provide essentially the same services as the SBA's Small Business Development Centers (SBDCs): tax workshops, bookkeeping help, computer access, packaging and pricing assistance, and so on. The difference is, TBICs are located on reservations.

Another advantage is that TBICs help entrepreneurs start businesses on the reservations. "The [aid] money that comes into the reservation communities is [largely] spent off the reservations," explains Stamps, "so they've never been able to build an economy."

Now that resources have found their way onto the reservations, predicts Stamps, "Native Americans will be a major economic force in this country."

Fine Print

The TBIC on the Blackfeet Indian Reservation has been a boon to Bernadette Trombley, one of 13 employee co-owners of Blackfeet Writing Instruments Inc. in Browning, Montana.

Trombley, 42 (below, far right), purchased the pen and pencil manufacturing company from the Blackfeet Indian tribe in 1993. She worked at various jobs before taking over the company, from bartending to packaging at the very plant she now oversees.

The Montana TBIC helped grow Blackfeet Writing Instruments to $1 million in sales last year. "They've helped us with setting up our sales and marketing," she says. "They helped us with software." And the list goes on.

"We're in a real rural area," says Trombley, explaining that she'd have to drive 150 miles to find similar resources at the nearest SBDC.

Trombley has lived on the Blackfeet Reservation her whole life. Without Blackfeet Writing Instruments, she says, "I can't imagine what my life would be like."

With Relish

Opportunity didn't have to knock twice for Lisa Little Chief, who started a specialty food company at home in the heart of South Dakota's Rosebud Sioux Indian Reservation in the summer of 1993.

She knew she had a saleable product before she finished college at Black Hills State University in Spearfish, South Dakota. Little Chief's Indian tacos, made with her homemade fry-bread recipe, sold like hotcakes at campus Indian club fund-raisers.

"Students loved them," says Little Chief, 30, so she began doing research and subscribing to specialty food trade magazines before deciding to wholesale her Indian fry-bread mix to specialty stores.

Starting out was tough, but growing the company has been less difficult, thanks to the opening of a TBIC in Mission, South Dakota.

"I use [the TBIC] almost on a daily basis," says Little Chief. "I look up economic data, census data; I use Excel. [Without the TBIC,] I'd have to travel two-and-a-half hours to do my research."

And that research is beginning to pay off. With 1996 sales of nearly $100,000, Little Chief has begun exploring retailing as a way to sell her products: Her fry-bread mix is now carried on home-shopping channel QVC. She has also added a line of jellies and wojapi--Indian choke cherry pudding--to her specialty food line.

Little Chief's advice to other entrepreneurs: "Be prepared to take advantage of opportunities when they come along." That's certainly advice she's followed.