Monday, September 01, 2008

Chrisman Revisited

Two years ago, I wrote a post that summarized a report written by Dr. James Chrisman, which provided data proving the economic impact of the New York State SBDC for clients seen during the year 2004.

It's time for a follow-up. If you recall, we mail surveys to all long-term clients (i.e., those who received five hours or more of consulting). Dr. Chrisman compiled the data, and released his report to us in late August.

Here's the details, taken directly from the report:

* "There were 620 responses to two mailings (post and email) of a questionnaire, a 7.2% response rate. The clients surveyed (8,647) represented the entire population of long-term clients (received five hours or more of consulting) of the New York SBDC in 2006. Of these, 3,168 were established businesses and 5,479 were pre-ventures (a/k/a, "startups").

* "In aggregate, we estimate that the long-term clients of the New York SBDC generated $861.9 million in incremental sales and 11,764 new jobs because of SBDC consulting assistance. We also estimate that $675.2 million in sales and 6,209 jobs were saved due to the consulting."

* "Compared to the total cost of operating the SBDC, the consulting provided to both established business and pre-venture clients generated $5.88 in tax revenues in one year for every $1 spent on the entire program."

* "Furthermore, an estimated $326.0 million in financing was obtained by clients as a result of the consulting received. This figure suggests that every dollar expended on the SBDC operation was leveraged by approximately $25.21 in new capital raised from external sources."

You'll notice that the important $5.88/$1.00 benefit-to-cost figure above is a bit lower than its counterpart from the 2004 survey. I think this is due mainly to the lower response rate (the 2004 survey had over twice as many people respond).

Regardless, it's a damn respectable figure, and worth publicizing here. Keep it up, folks.

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