Business for Good: The Merchants Fund

Jul. 23, 2019

In the large forepart window of Dolly'southward Boutique and Consignment, on Germantown Artery in Mt. Airy, three mannequins in vibrantly printed dresses showcase a few summer pieces that Shani Newton––the boutique'south possessor and Mt. Blusterous native––has selected. Within, light fixtures that resemble bouquets of white daisies hang from the ceiling in a higher place dark hardwood floors and walls decorated with a black and white floral wallpaper. Amidst the racks of clothes for women of all ages and sizes, are tables with hats and jewelry, and a comfortable blackness chair for lounging.

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"It'due south a place where women tin come to not just store," says Newton, "but to network, socialize and connect."

Indeed, Dolly'south has become a gathering place for women in the neighborhood, hosting community events like volume signings and parties to support local designers and entrepreneurs. This year, Newton's ten th anniversary, she'll open a 2nd location as i of the few local shops at the new Fashion District of Philadelphia (the quondam Gallery), and will employ xi people, including seven on Market Street.

"We wanted to leverage the dollars we were giving away, not just to help individuals, but to help business communities grow," Hotaling says.

It'southward a far cry from where Newton was, about half dozen years ago, when she was fighting merely to keep her business alive. At that time, the wait of the former thrift shop that had become Dolly's Boutique "was old and drab," in dissimilarity to the new fashions she was trying to sell. People weren't coming through her door; she had non yet hired whatever employees. Newton had planned to do renovations by her fourth year, but was barely breaking even. She knew she needed assist.

In 2013, the Mt. Airy Business Association introduced Newton to The Merchants Fund, a 165-year-sometime clemency with a $15 million endowment that gives $10,000 grants to minor businesses in Philadelphia facing financial hardship. The grant allowed Newton to redecorate—including installing a brilliant new front window—and to implement a point of sale system to straighten out the boutique's finances, which had become overwhelming. It was, Newton says, equally though she'd opened a whole new store in place of her old business—and the customers started pouring in.

"The Merchants Fund changed my business," says Newton. "They gave me a new life."

Newton'due south story is all too familiar to pocket-size concern owners. According to the Bureau of Labor Statistics, well-nigh 20 percentage of small businesses fail in their starting time year; xxx per centum fail in their 2d yr; 50 percent fail after five years; and 70 percent fail in their get-go x years.

That's why, since 2007, The Merchants Bank has given over $four million to over 400 pocket-sized businesses all beyond the city. Last year, the organisation gave 37 grants; the highest was 57 in 2014. Those businesses used the coin for everything from cosmetic changes similar Dolly's, to unexpected moves, to new technology or changes to staff. Ofttimes, information technology was just the help needed to proceed going.

"I empathise what it means to take the plunge, to put everything on the line, to put your firm up as collateral. I understand what information technology means when things don't go as planned. But I also know what it's like to have an organisation like The Merchants Fund that you lot can get and inquire for aid from," Fink says.

The Merchants Fund dates back to the mid-1800s, when a group of businessmen in Philadelphia formed the Mercantile Beneficial Association, a self-insurance organisation that they  could pay into for $3 a year. Should annihilation happen to their businesses, the Association would support them financially. In November, 1842, the Mercantile Beneficial Association had its  starting time almanac member's meeting later on half-dozen months of functioning, with 92 members. The side by side year, at that place were 364 members.

Around 1854, The Mercantile Beneficial Clan created a fund to support merchants who wanted to retire––a challenge for pocket-sized business organization owners fifty-fifty today. The idea was to build a dwelling house in Philadelphia where retired merchants and their families could live after retirement. (It is unclear whether this always happened.) From this kernel, even so, The Merchants Fund emerged, no longer as a cocky-insurance organization, but as a charity for "indigent" merchants––as per the organization's original charter––who were retired or couldn't piece of work. For more than than a century and a half afterward its founding, The Merchants Fund wrote stipends for every bit much as $700 a month to over 150 merchants who were retired or couldn't work.

"In the old days, everybody who was involved in the Mercantile was from Philadelphia," says Bruce Hotaling, chair of The Merchants Fund'due south Lath, who became involved with the arrangement in the mid-90's. "They were looking to benefit people from Philadelphia." By the 1940s, still,  the leaders of The Merchants Fund began buying houses on the Main Line. "Suddenly all the people that were involved didn't live in the city whatever more than," says Hotaling. "They really became detached from everything that was happening in the metropolis, and who they could all-time serve. It became very transactional."

With the turn of the 21st  Century, Hotaling says The Merchants Fund began working to reaffirm the arrangement as one by Philadelphians, for Philadelphians. In 2007, they stopped giving stipends to new retirees––but they still give to 14 retirees who received them prior to 2007––and began instead giving $10,000 grants to agile pocket-size business concern owners, like Newton. "We wanted to leverage the dollars we were giving abroad, not just to help individuals, only to assist business communities grow," Hotaling says.

Each year, The Merchants Fund receives around 100 applications for grants; of those, thirty or so won't meet the eligibility criteria, which mandates that a business possessor relies on their business as a primary source of income and that a concern be in operation for at to the lowest degree iii years. The awarding takes anywhere from 30 minutes to an hour to complete, and includes questions like: "How volition you lot employ a grant?" "How will a grant stabilize your business?" "How is your business important to your community?" "What will you lot do if you do not receive a grant?" It is intentionally uncomplicated, and executive director Jill Fink says that TMF, being sensitive to technology admission issues, oftentimes invites small business owners to their office on Walnut Street (before long to be on the JFK Blvd.) to help fill information technology out.

After the applications are received, Fink and a 12-person board, comprised almost entirely of people who live in the metropolis of Philadelphia, decide which businesses will receive grants. (To avert recipients having to pay taxes on the grant, The Merchants Fund pays the contractor who is doing maintenance at a business buys the equipment directly.) This unabridged process happens annually, and is sometimes done twice a year, depending on the organization's endowment or if The Merchants Fund is focusing on a specific projection.

"For me, information technology's about building wealth in communities. Small businesses are the backbone of this state," Fink says.

Recipients are varied, and various: Mt. Blusterous Violins and Bows, which offers custom crafted bows and cord instruments simply a few blocks abroad from Newton's store, received a grant in 2016. Fond, a contemporary American restaurant in East Passyunk received a grant in 2012. Fink, before starting at TMF only a few months ago, was herself a grantee as the owner of Mugshots Coffeehouse, which had locations in both Fairmount and Manayunk. In 2008, Fink practical for a grant to expand the Fairmount location; shortly thereafter, she received another grant to build out an online platform for the Manayunk location's market place of local, farm-grown products. Then, TMF's executive director at the time asked if Fink would help mentor other businesses that were applying for grants. In 2013 she became the first grantee to join TMF's board (at that place are now several grantees on the lath).

"I think, having been a small business owner, allows me to piece of work with small businesses in a different way," says Fink. "I understand what it ways to accept the plunge, to put everything on the line, to put your business firm up as collateral. I understand what it means when things don't become as planned. Just I also know what information technology's similar to have an arrangement like The Merchants Fund that you lot can go and ask for help from." Now she's extending the paw that was one time extended to her. And she wants to reach into neighborhoods where small-scale businesses haven't e'er been supported.

A couple years ago, subsequently a group of students at Penn mapped where TMF had been giving grants, they noticed that there were clusters in neighborhoods, similar Manayunk, East Passyunk, Mt. Airy, where The Merchants Fund had previously given grants. Fink calls this the ripple effect: A business organization receives a grant and tells a neighboring business, who then applies. This helped business rows in those neighborhoods meliorate over the years. But the map showed that a shadow had been cast on the business communities in neighborhoods like North Philly.

In response, TMF launched "Identify-Based Initiative," every bit a project that commits a certain portion of The Merchants Fund's annual grant-giving budget of around $450,000 to a specific community. Fink says that TMF is working to place small commercial corridors in high demand areas, like North Philly, where says in that location aren't as many business associations or organizations that assist support the many small businesses in the community. Fink'south vision for "Place-Based Initiative" is so to work with that small business corridor over a menstruation of three to five years.

The goal, Fink says, is not to just assistance a few businesses—although that in itself is a way to help Philadelphia succeed. "For me, it's about building wealth in communities. Small businesses are the backbone of this land," she says. " How exercise we make sure that they aren't living in poverty? That they have an asset that they tin can pass onto the next generation? Or that they are making enough so that the next generation can do something else?"

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Source: https://thephiladelphiacitizen.org/business-for-good-the-merchants-fund/