BY GLENN PUIT firstname.lastname@example.org
Traverse City Record-Eagle
---- — TRAVERSE CITY — Herkner Foods has a catchy business pitch: three grandmas trying to improve the region’s economy, one batch of cherry topping at a time.
The northern Michigan manufacturer of toppings for ice cream and other foods is seeing success through orders from retailers like Meijer and other major grocers, but that success also brought with it a significant challenge.
The company this year received a large order for toppings from a major retailer, leaving business partners Judy Harmon, Sue Keegstra and Lynda Herkner scrambling to access capital needed to turn out more of their product in time for display at the Cherry Festival’s Farmers Market.
“They wanted two big orders, and we needed funds to get another batch out,” Harmon said. “To get another batch out, it’s usually a 30-day turnaround.”
The business found quick help through a new loan program offered through Fifth Third Bank and the Traverse City Area Chamber of Commerce. The Sub Micro Loan program is a $100,000 fund that targets small businesses in Grand Traverse, Benzie, Kalkaska, Antrim and Leelanau counties. The assistance encompasses short-term loans of up to $7,500 with a payback period of six to 18 months or less and interest rates from 8 to 12 percent.
The fund’s goal, said Fifth Third Northern Michigan President George Bailey III, is to help small businesses succeed.
“What can we do to help this market grow?” said Bailey. “(The chamber) identified what they saw as a gap for early-stage and start-up businesses and a lack of funding that was available for them. So this is really to help entrepreneurs and other early-stage companies and start-up companies obtain initial seed capital so they can start meeting their growth needs.”
Laura Galbraith, the chamber’s vice president of administration, said the grant from Fifth Third was matched with $50,000 from the chamber’s foundation.The fund is a revolving one and offers access to loans that traditionally fall outside the standard parameters of commercial financing.
“The whole intent of this particular fund is to reach small businesses,” Galbraith said.
Harmon said the loan helped Herkner Foods turn out a new batch of topping in time for the festival, allowing the business to reach new customers who otherwise would have been missed.
“They were just so accomodating and so kind and generous and very excited for us,” Harmon said. “A very pleasant experience.”