- First Heritage FCU is the presenting sponsor of Small Business Saturday; Fox Communities’ passport program encourages consumers to shop local.
- Verity connects consumers with underrepresented business owners, while Hope FCU offers consultative services and programs like the Power of Hope loan.
Small Business Saturday has reached the same level of prominence as Black Friday in the United States. What started as a way to help local businesses capture a piece of the holiday spending pie has turned into one of the busiest shopping days of the year. In fact, according to American Express, shoppers last year spent more than $20 billion during Small Business Saturday.
Credit unions across the country support local businesses 24/7/365, but these four cooperatives add a kick of holiday cheer this time of year. From festive events to local spending programs, retail partnerships to special loans, see how they help small businesses close out the year with a little more jingle in their pocket.
First Heritage Federal Credit Union ($672.3M, Corning, NY) is the presenting sponsor of the Gaffer District’s Small Business Saturday event, which is part of a broader series of holiday events dubbed “Crystal City Christmas.”
“Credit union staff has always walked in the parade of lights,” says Christine Francis, senior vice president of information technology and marketing. “And we set up a craft table for the kids to enjoy on Small Business Saturday.”
Last year, the credit union even won best float in the annual parade. Even though it was completely voluntary and unpaid, 50 employees showed up to kick off the holiday season. When the Gaffer District approached the credit union with a proposal to become the presenting sponsor this year, the decision to say “yes” was an easy one.
Small Business Saturday kicks off the holiday season in Corning’s Gaffer District — so named for the city’s glass-blowing artisans who work there — and is part of a series of events that encourages people to shop local. In addition to the permanent shops on Market Street, vendors set up shop in the middle of the square for daytime and evening shopping.
Other events that occur between Thanksgiving and Christmas include a tree lighting ceremony and the introduction of Santa Claus.
CU QUICK FACTS
FIRST HERITAGE FCU
DATA AS OF 06.30.22
HQ: CORNING, NY
NET WORTH: 10.13%
The credit union automatically enters members who use their First Heritage FCU debit card during the holiday season into the credit union’s Holiday Sweep promotion for a chance to win $1,000 with every swipe. The credit union also distributes complimentary gift bags, some of which contain gift cards for local merchants, during Small Business Saturday to encourage consumers to shop, eat, and stay local.
The credit union offers small business services, but its participation in these events extend beyond self-promotion and financial reward.
“There’s nothing more rewarding than walking in a parade and having people yell ‘Hey that’s my credit union!’” Francis says. “It’s a lot of fun for employees, and our members and local businesses appreciate our support.”
Passport To Holiday Spending
With 23 years of experience at Fox Communities Credit Union ($2.5B, Appleton, WI), and a background in business development, Heather Wessley borrowed an idea she saw in another state to create a Small Business Saturday event for the Wisconsin cooperative in 2016.
Participating businesses list their promotions on the passport, and consumers who shop on Small Business Saturday get a stamp for each local business at which they make a purchase.
For every five stamps, shoppers earn a chance to win prizes, including a $500 airline gift card grand prize and smaller prizes with an average value of $50 donated by participating businesses.
Fox Communities initially launched the passport in partnership with the Appleton Downtown Business Improvement District. It has since expanded to the Green Bay area.
CU QUICK FACTS
FOX COMMUNITIES CREDIT UNION
DATA AS OF 06.30.22
HQ: APPLETON, WI
NET WORTH: 10.6%
“We’ve had more than 200 businesses participate,” says Wessley, who is the credit union’s director of community engagement. “Just in the Appleton area, about 125 people end up winning a prize that day.”
In the past, the credit union distributed the printed passports as newspaper inserts wrapped around the widely popular local Black Friday ads included in the Thanksgiving paper. Now, Fox Communities prints and distributes the passports so participating businesses can hand them out personally to shoppers and promote the event via social media and posters.
Wessley tracks the number of passports and follows up with businesses to measure the initiative’s impact.
“The number of participating businesses and shoppers rises year after year,” she says. “Some businesses have even seen a 70% increase in sales that day alone.”
Businesses pay to participate, but the credit union uses those funds to advertise the event and pad the bottom line of local entrepreneurs. Local media also loves the story, Wessley says, and runs early morning live segments featuring business owners the week leading up to the event.
Engage With Purpose
Registration is now open for the January 2023 Sustainable Business Strategy cohort. Sustainable Business Strategy, which Callahan & Associates offers in collaboration with Harvard Business School Online, helps credit union leaders look inside their organizations and rethink their roles and responsibilities to members, employees, communities, and the environment.
Credit Rapport For Diverse Business Owners
According to John Benner, director of small business at Verity, the credit union focuses on connecting consumers with diverse entrepreneurs, including BIPOC, women, military connected, immigrant, and LGBTQ+. The Business Impact website even allows users to search by type of business and ownership structure.
Beyond encouraging its members to participate in Small Business Saturday, Verity helps small businesses avoid common mistakes and understand what will make them more attractive to financial institutions. The credit union offers discounts to non-profits making an impact in local communities and is continually evaluating its underwriting process, qualifications, and products to prevent exclusion.
“Our micro-loan program was created for startups,” Benner says. “Whether it’s a term loan, revolving line of credit, or short-term funding that’s needed, we want to find funding solutions.”
CU QUICK FACTS
VERITY CREDIT UNION
DATA AS OF 06.30.22
HQ: SEATTLE, WA
NET WORTH: 9.0%
These types of low-dollar loans can help build a member’s credit report and credit rapport with Verity. As their businesses grow, so, too, can the financial relationship.
The credit union has stripped down its policies and procedures to the bare bones to identify criteria that could have a disparate impact on minority-owned businesses. In doing so, Verity is improving its programs and eschewing a business-as-usual approach.
Verity measures the success of its small business initiatives by tracking the percentage and dollar amount of growth. It also considers how many enterprises turn to the credit union for financing and continue to operate in the long term.
“We’re evaluating how many are staying in business so we can create sustainability in our communities,” Benner says.
Better Infrastructure For Small Businesses
Hope Credit Union ($536.0, Jackson, MS) exists to close the racial wealth gap. In 2021, Hope made 2,630 commercial loans totaling more than $85 million. The credit union also encourages consumers to shop local on Small Business Saturday.
“As we celebrate Small Business Saturday, it’s important to look at the ways we can support the infrastructure needed to launch and grow a business,” says Ed Sivak, chief policy and communications officer at Hope.
According to Sivak, black-owned businesses are turned down for loans at twice the rate of white-owned businesses. That’s why the credit union’s work with small businesses centers around access to capital.
“We take a consultative approach to identify their real need and what they can afford,” says Mel Robertson, senior vice president of small business and consumer lending.
Sometimes that means pivoting away from immediate financing and developing an action plan to put a business owner in a better position to achieve their dream.
Hope partners with Small Business Development Centers throughout the states the CDFI serves so members can access resources to help them develop business plans, marketing plans, proformas, and more.
CU QUICK FACTS
DATA AS OF 06.30.22
HQ: JASCKSON, MI
NET WORTH: 28.1%
The credit union provides the financial education and lending expertise — explaining what lenders look for and offering special products like the Power of Hope loan, which provides loans up to $10,000 with 90 days no payments, six months of deferred interest, and below-market interest rates. For this product, the credit union does not hold student loan debt against the borrower, and the borrower’s credit score, by itself, is not the determining factor. This year alone, the credit union has provided morethan 70 small businesses with $750,000 in financing through the Power of Hope loan.
Although education is important, and a critical component of Hope’s approach, it’s only one part of the solution.
“Any time we’re talking about access to capital, we have to understand we can’t educate ourselves out of the barriers in the traditional banking structure,” says Robertson, a self-professed “recovering banker” who has seen firsthand how a numbers-only approach cuts out many borrowers.
Beyond being turned down twice as often for business loans, black entrepreneurs regularly receive less than requested at significantly higher rates than white entrepreneurs, the Federal Reserve has found.
“We can’t understate the role that small business ownership plays in closing the racial wealth gap,” Sivak says. “Across the general population, it’s a 10-to-1 ratio. For business owners, that shrinks to 3-to-1. It’s still not perfect, but it’s moving in the right direction.”
One entrepreneur in Louisiana, a black woman who wanted to start an organic coffee growing business, had been denied financing by a bank and was ready to give up.
“She said ‘the system wasn’t made for people who look like me,’” Sivak says.
Then she found Hope Credit Union.
Now, she sells her product in 13 stores and is looking to expand by building a manufacturing facility.
“The tragedy was, she only needed $10,000 to get started,” Sivak says. “There are thousands of people like her who need someone to believe in them.”
Robertson and Sivak advise other credit unions to remember their roots and structure their solutions in a way that’s free from bias to ensure capital is accessible to all, creating pathways of financial empowerment rather than exclusion.