Sprankle’s Neighborhood Market: An SBA 504 Loan Helps a Business Build Community

For more than two decades, the Sprankle family has proudly provided high-quality groceries and services to customers in their western Pennsylvania region through their business, Sprankle’s Neighborhood Market. When the family had the opportunity to purchase, renovate and revitalize an abandoned store in Saxonburg, PA, second-generation grocer Doug Sprankle turned to his commercial lender, Toni Conrad at NexTier Bank. Together with Vice President Ryan Lockhart of Pursuit, he secured an SBA 504 loan to bring his vision to fruition.

Today, the Saxonburg location is much more than a grocery store. It’s a neighborhood center that offers great experiences for customers – including Pennsylvania’s first in-store craft brewery – and innovative opportunities for local farmers, bakers and more.

Learn about why the SBA 504 loan was the right option for Sprankle’s – in fact, according to Doug, the only viable option – and what the loan helped Doug and his team achieve for the Saxonburg community.

From a single store to a regional leader

Sprankle’s Neighborhood Market got its start back in 1999 when Doug’s father worked in local retail-support operations. Doug’s parents learned about an opportunity to purchase a market in a nearby rural community and decided to go all in, making weekly payments to the owner until it was paid in full.

Doug grew up in the industry and purchased the family business from his parents. Today, Sprankle’s markets are found in two predominantly rural communities, Kittanning and Leechburg, as well as Saxonburg, a town just north of Pittsburgh.

“I wasn’t looking to expand when the Saxonburg store became available, but I realized pretty quickly that it could be a great opportunity to serve the community and really build our brand. We could do things with that store that would be unlike anything we’d done before,” explains Doug. “For example, we’d always focused on providing customers with high-quality food and great service and with this new location, we could take that even further. We could build new partnerships to support local producers while providing fun experiences for our customers.”

The SBA 504: The right loan to bring Sprankle’s vision to reality

For Doug, the decision to move forward with the Saxonburg opportunity was an easy one. But there was one catch.

“Even though Sprankle’s has a long business history and solid financials, we couldn’t quite meet conventional approval criteria for a business loan from our bank,” says Doug. “Commercial loans require 30% down in owner equity and that was out of my reach.”

Fortunately, his representative at NexTier Bank was familiar with SBA 504 loans, which only require 10% in owner equity. “For me, that made all the difference. If I didn’t have this option, I couldn’t have moved forward on this location. It’s that simple,” Doug says.

SBA 504 loans are a great option for business owner purchasing real estate and pursuing construction projects. As with traditional commercial mortgages, a 504 deal requires frequent communication between the lenders and the borrower, and Doug’s team helped to keep the project moving forward, even with bumps in the road. Doug says that just about everything took longer because of the pandemic, too.

“Even though I bought a former grocery store, it needed a full renovation,” he explains. Once the loan closed, his team worked day and night for eight weeks to meet their opening date.

The work his team completed through this investment was incredible. With the 504 loan, Doug’s team took on sealing the 100-car parking lot, a new store façade and doors, new signage inside and out, new lighting inside and out, new dairy cases and freezers, new meat cases, spaces for specialty offerings and, of course, all new inventory.

Doug also purchased a high-performing point-of-sale system to build efficiencies throughout the operation. The store has created dozens of jobs and provided essential support to smaller local producers.

On July 4, 2020, Doug and his team opened the doors to their entirely renovated, fully outfitted and gleaming new Sprankle’s – and the community’s response was remarkable.

“The check-out line was two hours long and we outperformed our opening projections by almost 100%,” says Doug. “And support from our community has been steady since, with people coming from as far as 45 minutes away to support us and the local producers that we have here.”

With the new space, Doug and his team are experimenting with new ideas to enhance their customers’ shopping experience. “We always look for ways to make Sprankle’s more than ‘just’ a trip to the grocery store and the Saxonburg store has become the test bed for all of our new ideas.”

He continues, saying, “We have a local bakery that bakes and sells out of our Saxonburg store and we have a sushi kitchen here. We have Pennsylvania’s first in-store craft brewery and that’s a draw, too.” One example of the store’s success? Last year’s Oktoberfest weekend. Though there are only 4,500 people in all of Saxonburg, the store hosted nearly 12,000 guests and people came from all over the region. “That’s what we want to do, providing experiences that are fun and memorable, as well as great groceries, of course,” adds Doug.

A continued commitment to innovation, authenticity and quality

“If you understand that as a small business owner, if you are your brand, then you’ll be motivated to engage with your community and always do the right thing,” Doug explains “Integrity is what people and communities want and when you give them that, they’ll be loyal.”

Looking ahead, he says, “We know that strong communities mean strong businesses and we’re fostering relationships and creating opportunities for other small businesses. We have 22 local food producers and promote their brands in our stores. We’re always looking for ways to have positive impact, whether by bringing on more local producers or through community engagement.”

Pursuit can help you achieve your vision for your business, too. We offer more than 15 small business loan options that can help you leverage opportunities to launch and grow your business. Contact us to learn more.

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