Net Worth

Bill Shuffstall has been a driving force in creating “Access Pennsylvania Main Street.”

Extension is helping small businesses and local governments seize the promise of the Internet.
by Gary Abdullah

Everyone knows the conventional wisdom about business and the Internet: the bursting of the dot-com bubble exposed e-commerce as an unprofitable money pit. But don’t tell that to Scott Linnon. While Big Business may have cooled on e-commerce, Linnon is one of many small-town business owners who see the Internet as crucial for their survival.

He’s president of Keystone Mercantile Company, an 80-year-old Titusville company that has been in his family for two generations. Battered by competition from national “big box” stores, a troubled economy, and northwestern Pennsylvania’s dwindling rural population, he saw that using traditional retail techniques in his small store in a small town was a losing battle.

“In today’s economy, you can do everything right—but if you don’t have any people coming through the door, you’re going out of business,” Linnon says. “As depressed as our area has been for the last 20 years, it may take a generation before our local economy comes back.”

Nevertheless, Keystone Mercantile increased business by $50,000 in six months through Linnon’s Web site, bigandtallguys.com. “The Internet has probably allowed us to increase our gross margin by 15 percent, which is the difference between success and failure,” he says. “If you can find a niche and there are people out there who want your product or service, e-commerce makes it easier to go after their business. And small businesses can do this better than big businesses because we can change so easily and so quickly.”

Linnon notes that many people don’t understand how desperate small-town businesses are to take advantage of e-commerce opportunities. “If I hadn’t come upon this new medium, I don’t think we’d still be in business,” he says. “Thanks to the Internet, we’re doing more business than we ever have. But a little retailer like me can’t wait until the region implements new economic programs to rejuvenate the downtown—we need something now.”

Scott Linnon (with, from left, wife Debbie Linnon and sister Kathy Linnon) relies on a Web site, BigandTallGuys.com, to counter the falling traffic and dwindling sales at his family-run clothing store in Titusville. “I can’t say enough about e-commerce for small businesses,” he says.

Penn State Cooperative Extension is meeting that need with “Access Pennsylvania Main Street,” a four-part, 12-hour program that helps small business owners learn the basics of the World Wide Web and explore ways to use the Internet in their own business, including conducting business research, finding new markets and suppliers, and checking out the competition.

The curriculum, manual, and other resources for the program are on the Web at www.ebusiness.extension.psu.edu. The site also lists program instructors and their locations across the state.

“We try to help small businesses answer for themselves what many have found to be, literally, a million-dollar question: ‘Can I use the Internet to support or expand my business?’” says William Shuffstall, senior extension educator and driving force behind the program.

“We help small businesses understand how they can use the Internet to save or make money,” Shuffstall explains. “It’s not just about having your own Web site. It’s using the Web to evaluate your competition or identify suppliers who can save you money. We also examine how to use a Web site for product support, customer service, or just plain marketing.”

The program was developed by University of Minnesota researchers, who wanted to integrate Web technology into smaller communities. They saw that the e-business revolution sweeping through large corporations would need help to reach smaller rural businesses, so they designed a program to help small businesses apply the e-commerce strategies at their scale.

Shuffstall saw Minnesota’s program at a conference and immediately saw the need for it in Pennsylvania. “It’s critical that we help Pennsylvania’s small business owners to understand why they should be involved in e-business and how they can go about it,” he says. “For the five- to ten-person enterprise competing in a global economy, e-commerce can bring great efficiency and a broader customer base. And that means they can continue to do business and spend money in local communities, pay taxes, employ people, and grow.”

And, Shuffstall notes, not taking advantage of these tools can have negative consequences. “In our economy, businesses that don’t use digital technologies are becoming marginalized,” he says. “If your small business uses traditional merchandising, but the one next door, in the next town, or next county is using e-commerce tools, that business is likely to be more competitive because they can get access to more information and reach a wider audience.”

Access Pennsylvania Main Street focuses on strategies, not the nuts-and-bolts aspects of building and maintaining a Web site. “We try to help these businesses understand what e-commerce is and isn‘t,” Shuffstall explains. “We talk about who needs a Web site, how they would use it, and how they would create it. Equally important, we look at how it fits into their business. Will they sell through their site or use it to support their service or product? If they use the Web to market their business, how will it fit in with their other marketing activities?” The goal, Shuffstall says, is to give the average small businessperson enough training to ask intelligent questions without being overwhelmed.

As an office manager in Oil City, P. J. Wightman (above) was leery of the Internet. After taking Access Pennsylvania Main Street, she was able to propose innovations and improvements for her company, Kapp Alloy & Wire, Inc.

That approach was tailor-made for P. J. Wightman. As office manager for Kapp Alloy & Wire, Inc., in Oil City, she watched her boss integrate more and more e-business technologies into their operation—and she watched her computer literacy diminish. “I used to say that I was computer ‘e-literate,’ and I just wanted to understand the process better,” she says. “Through Access Pennsylvania Main Street, I learned not to be as leery of the Internet and increased my Internet usage about 200 percent within a week. The class also helped me develop a system for e-mailing our price quotes. I’d advise anyone who has any reservations about the Internet to take it. It was a great help to me.”

Shuffstall began training extension educators to teach the program in August 2001, and 14 staff across the state are now conducting e-commerce training for small businesses, chambers of commerce, and local economic development corporations. As trainers, these educators play a vital role in passing along the vision for e-commerce to participants.

“We want them to leave with an electronic business plan at the end of program,” says Dan Brockett, an extension educator who teaches the program in the state’s northwest region. “What strategy should they choose for their particular business with this specific technology, and what return on investment do they expect?

“One of the decisions we want to help people answer is whether they really need a Web site,” Brockett says. “The answer to that may be ‘No.’ For some companies, a Web site’s not worth the investment—but they can still use electronic commerce. They may put their product or service on another site, or they can use e-commerce to find new vendors and purchase supplies and services better and cheaper. Using e-commerce to buy products that they need can be a real eye-opener for some business owners. If you can reduce costs by 20 percent, that’s as good as making a sale. If you’re a plumber and you had a plumbing warehouse within 20 miles, that used to be where you went. Now you can shop online and increase your profits just by finding more economical suppliers.”

Building on the success of its e-commerce training, Penn State Cooperative Extension recently introduced the Access eGovernment program (www.egov.psu.edu), which aims to help county and municipal government agencies benefit from the Internet in much the same way Access Pennsylvania Main Street helps small businesses.

The “Access eGovernment” program brings e-commerce hardware and concepts to bear on the unique challenges of local governments. Tim Kelsey (left) trains officials and employees to find ways to make their specific organizations more efficient.

“We want to help governments plan and implement the migration of services available to constituents via the Internet,” says agricultural economist Tim Kelsey, trainer/coordinator of Access eGovernment. “These technologies really offer local government officials more powerful tools to serve their constituents.”

With more than 2,500 local government entities—the second-highest number in the nation—Pennsylvania is fertile ground for systems that can make government more efficient. “If you think of the purpose of government as providing services, e-government is a means to provide those services in another way,” Kelsey says. “The information is timelier and local governments can get more information out to a broader audience. E-government allows citizens to get forms, make payments, interact with local officials, register for services, and give input and feedback on issues without taking a couple of hours off from work to go down to the courthouse.”

In 2002, Kelsey and Shuffstall approached the County Commissioners Association of Pennsylvania (CCAP) with a presentation and explanation of the program and an evaluation of the potential opportunities, and since then they and other Access eGovernment instructors have presented the program in communities across the state.

“We start with a one-hour overview of what e-government is, what people want, and how to organize your site to provide that,” Kelsey says. “That gets local officials thinking and understanding how it fits together. Then, if they’re interested, we do a four-hour, hands-on session where they’re doing exercises, cruising other Web sites, and doing evaluations.”

A key point of the Access eGovernment training is that technology experts can write the programs that make a Web page run, but an e-government site should be designed by the people who know the government: the locally elected officials and the people who answer the telephone.

“The site has to allow information to get out more completely and correctly,” Kelsey says. “It should let people access information and forms when they have time, rather than just when the office is open. In the past, technology initiatives for local government have focused so much on the hardware: how to set up the server, how to make it secure. But the questions of what should go on a site, how it should be organized, and what people want from it weren’t covered. Those things are the main focus of e-government training, so our training meets a very obvious need for many agencies.”

In April 2002, CCAP had Kelsey and Shuffstall conduct four hands-on Access eGovernent sessions with department heads, municipal officials, and county government workers in Adams County. “We helped them think about what should go on their county Web site as they were putting it together,” Kelsey says. “It’s fun to watch people as the wheels start turning—they go from being skeptical to seeing how this technology can be really useful.”

Berks County extension director Rick Kauffman (right) interacts with other Access Pennsylvania Main Street class members at a recent session. Penn State Cooperative Extension hopes to help small business owners across the state to see the possibilities offered by e-commerce.

According to Shuffstall, research shows that civic participation actually increases in communities where the local government has an effective Web site. “People are finding more volunteer opportunities to help local government when they can find out how they can play a role that interests them. Something as simple as posting the agenda of a county commissioners’ or municipal meeting often will inspire people to attend and provide their input, because they know what’s happening. They
become more engaged.”

Because of limited finances, staff, and time, local government officials often don’t see how they’re going to create and maintain their Web sites. However, Kelsey says, the state is actively promoting Internet activities by local governments because it ultimately saves the state money, time, and effort.

“The state has a very large interest in e-government, they’re encouraging it, and they have several programs in place to help remove financial barriers,” he says. “Using these tools means local governments can communicate more effectively with each other and also can do better government-to-government commerce—including reports and those kinds of things,” he says. “That automatically helps everyone: when you send things by snail-mail, someone still has to enter it.”

The interplay of e-government and e-commerce is natural and almost unavoidable, since they both look to serve the same communities and businesses. And, as the services catch on, residents say they certainly appreciate it.

“To have a service like this from Penn State available in Oil City is vital,” says Scott Linnon. “There’s a big difference between taking a class in New York with big retailers versus in Oil City. Access Pennsylvania Main Street was
exciting because we got to know a lot of people from the area. Everybody was in the same boat and looking to find new customers. Since there weren’t any new people in town, we could only look outward, and that’s what the Internet provided.

“We’ve seen our business grow five times in three years, and Access Pennsylvania Main Street definitely contributed to that. We do 500 orders a month from all over the world. I watch orders come in from Kentucky or Germany or Japan, and think that not one of those people would have physically come into my store. Everything’s changed.”

______________________________________________________________________________

Faculty and staff referenced in this article are Daniel Brockett, community development extension educator in Venango County; Timothy Kelsey, professor of agricultural economics; and William Shuffstall, senior extension educator for community development.