By Dwain Hebda | Photo By Jamison Mosley
Starting a business comes with challenges and more than likely obstacles. All business owners experience these hardships in launching and running their businesses. There is funding, contracts, marketing and so much more to consider. However, for minority entrepreneurs, there are so many extra struggles to overcome.
Arkansas is a great state for small businesses. It has the lowest cost of doing business in the United States, according to CNBC’s list of the Top States for Business in 2018, and it is always growing and changing. According to the Small Business Administration’s 2018 Arkansas Small Business Profile, more than 247,000 small businesses call Arkansas home. Of those, nearly 36,000 are owned by minority entrepreneurs. More than 99 percent of Arkansas businesses are small businesses, 15 percent of those are owned by minorities. While Arkansas’ business growth rate is slower than the national average of 3.4 percent, it has been steadily increasing for the past several years.
Industry experts, as well as business owners, see themselves in a good environment because of the “small business ecosystem” that dominates the Arkansas economy. Patricia Brown, director of the Arkansas Economic Development Commission’s Minority and Women-Owned Business Enterprise, says, “We are fortunate to have an economic community here in Arkansas that is supported by a foundation of interacting organizations and individuals – the organisms of the business world.”
Getting a business up and running is difficult for any entrepreneur. They must think about business plans, getting the training they need, the many confusing financing options, taxes, licensing and so much more. Luckily, there are several agencies right here in Arkansas to help. The Minority and Women-Owned Business Enterprise provides “real-world technical and professional assistance, certification, procurement, networking, capital and contracting opportunities,” she says.
Kenneth Freeman Jr., owner of Construction Development Team in Bryant, is seeing changes in the construction industry, specifically. He says doors that were once previously closed are opening for minority construction firms to reach into opportunities they never could before.
He says the Arkansas Procurement Assistance Center was a tremendous help in starting his business and guiding him through registering it legally.
“More owners, contractors, government entities, school districts, etc., are reaching out and seeking qualified and skilled minority firms to work on their projects,” Freeman says. “Although we may not be awarded the projects, we have been included and afforded the opportunity to bid on them.”
Even with all the positive changes in the environment and resources available, minority entrepreneurs still face many hardships and challenges on their way to running their business. Access to capital, financial matters and professional development obstacles, as well as access to the right advisers are the most common struggles of a minority business owner, according to Brown.
Freeman cited the stigma that minorities cannot compete with non-minority counterparts as the hardest hurdle to overcome.
“Many think that minorities are unqualified or won’t complete a project in the same manner of quality and skill as our larger counterparts,” he says. “That thinking couldn’t be further from the truth. In fact, in the construction industry, many of the skilled field workers are minorities.”
Getting Construction Development Team’s name out there as a reputable business was also a struggle.
“You may have the knowledge, but do you have the past performance on paper to show for it?” he asks.
People always want experience, so it is hard for a startup company to find projects willing to use someone new.
Even through all of the challenges, minority business owners find joy and rewards in all aspects of their business.
Technology has also allowed minority businesses to build bridges where walls once stood.
Carla Thomas, owner of Renaissance Healthcare in Pine Bluff, teaches a certified nursing assistant and phlebotomy training program and runs a laboratory that provides DNA, paternity and drug testing. She says social media has completely changed her marketing strategy.
“My marketing budget has been reduced by over 300 percent,” Thomas says. “I’ve found out how to market Renaissance Healthcare better with social media platforms, thus reducing cost plus increasing my client base.”
Thomas started her business with a loan from her father, but she uses the Arkansas Small Business Association (SBA) and the University of Arkansas at Monticello’s Small Business and Technology Development Center in southeast Arkansas.
Many minority-business owners say one of the greatest aspects of their company is being able to help others reach their goals.
Thomas loves celebrating the accomplishments of her students and often tells them they will surpass her. Many have gone on to medical school and doctoral programs. Some students stay at Renaissance Healthcare as instructors as well. Thomas always hires from within her company, making her students into the teachers.
Freeman says, “The most rewarding part to me as being a minority business owner is tearing down the stereotypes, being a man of integrity, and thriving in an economy when there aren’t many that look like me.”
To offer some advice from an expert, Brown advises new minority business owners to manage credit wisely, build a strong team and find a balance between professional career and small business ownership.
Thomas and Freeman both offered similar advice: do not give up when things get tough.
“The road will be tough starting out. Many doors will be slammed in your face,” Freeman says, “but you have to endure and keep pushing forward.”
Resources for Minority- Owned Business
For help starting their business, minority owners have options at the federal, state and local levels. Grants.gov is the easiest way to find grants that businesses may be eligible to receive. On the website, there are several pages of grants available to minority-business owners. Owners can search and apply through the site.
There are many more business loans out there for minority owners than you might think. Owners can get specific loans based on many different factors. The Department of the Interior offers a loan to those operating on Native American tribal lands, and the Business Center for New Americans exclusively grants loans to immigrants, refugees, women and other minorities.
The U.S. Department of Commerce Minority Business Development Agency (MBDA) offers information on loans, grants and contracts that minority owners can receive. MBDA’s goal is to help minority-owned businesses to create jobs, expand scale and capacity and increase revenue. In order to do this, MBDA works to match minority owners with the resources they need in order to grow. Their website houses research on minority businesses in every state in the United States, as well as information on what types of loans and grants are available and how to go about applying for those. They also work as advocates of minority-owned businesses to elected officials and policymakers.
The Small Business Administration (SBA) offers several programs tailored to the needs of minority owners. The 8(a) Business Development program allows businesses owned by minorities to register as a disadvantaged business. To help level the playing field, the government limits contract competition for 8(a) businesses. The disadvantaged business also works with a business opportunity specialist to help steer them through federal contracting and business training, counseling and marketing assistance.
Minority business owners may also qualify for an SBA Community Advantage Loan. The program works with nonprofit organizations to create loans for small businesses in underserved markets. It is designed to help those who may not qualify for traditional funding, making it a great option for minority owners.
The SBA Arkansas District Office is located in Little Rock and Fayetteville. Business owners can go to their local office to receive management training and consulting. Navigating the waters of federal contracts is difficult, but Small Business Administration offices are equipped to help business owners with them.
Arkansas minority business owners have access to the Minority and Women-Owned Business Enterprise (MWOB) as well. Their goal is to help minority businesses contribute to Arkansas’ economic growth. MWOB provides businesses with help in formulating business plans, government registrations and obtaining financing. They also provide workshops throughout the year on certification assistance and the Minority Business Loan Mobilization Guarantee Program.
SCORE is a nonprofit organization of business mentors that work locally with businesses to educate and mentor them to success. Businesses do not have to pay to receive a mentor, and the SCORE website features a free library of online courses and webinars. SCORE offices are located throughout the country, and business owners in Arkansas can find them in Rogers and Little Rock. Now, SCORE mentors are available at the Little Rock Regional Chamber of Commerce to meet with business owners on the first and third Tuesdays of every month. A local mentor will work with existing and aspiring businesses to get them the resources they need in order to succeed.