The Kutztown Unviersity Latino Business Resource Center

Minority Entrepreneurship Helps Boost Economic Development

Lenin Agudo, Director, Kutztown University Latino Business Resource Center

Jose Luis is one of the millions of Latino immigrants, who left everything in their country to pursue the American dream. Once he legalized all his immigration documents, Jose left his double-shift dishwashing job in Miami, FL and decided to move yet again, this time to Reading, PA in order to pursue his dream of being an entrepreneur. After several years working as an owner/operator, he decided to establish his own transportation company but he did not know how to do it. Although Jose speaks English well, as in the case of many other native Spanish speakers, he prefers to learn in his native tongue and he feels reassured to be able to create his business plan and strategies in Spanish and then transpose his ideas to English.

During a consulting engagement with the Kutztown University Latino Business Resource Center (KU LBRC), Jose Luis has been able to reduce his overall operating expenses by 55%. He is currently applying for a loan to purchase a new tractor-trailer and is working on refinancing his high interest loans. We are committed, through our ongoing consulting, to ensure his entrepreneurial venture is a rewarding one both financially and experientially.

As Jose continues to strive for the American dream he once envisioned, thousands of other Latinos are pursuing entrepreneurial endeavors. Hispanic entrepreneurship has increased dramatically in the United States and the Commonwealth of Pennsylvania. These people are determined to accomplish their entrepreneurial desires. It is in this spirit of responding to this increase in the Hispanic business community, as well as catering to an underserved market that Kutztown University President Dr. Javier Cevallos, and Ernie Post and Don Martin from the Kutztown University Small Business Development Center created the Latino Business Resource Center as a specialty program of the Small Business Development Center (KU SBDC).

The KU LBRC’s goal is to deliver business and entrepreneurial development skills and content in a recognizable format and bilingually bridge the gap between the demands of the fastest growing business and workforce segment in the Commonwealth with the supply of tools and resources available to both the entrepreneurs and economic development organizations.

A National Perspective

According to the U.S. Census Bureau, Hispanics account for about half of the growth in the U.S. population since 2000. Furthermore, the number of Hispanic-owned businesses has increased by 82% between 1997 and 2006. The number of Hispanic-owned businesses is growing faster than the Hispanic population itself. As of 2003, the U.S. Hispanic market became the largest minority group in the United States. The 40.5 million Hispanics represent 13.8% of the U.S. population and a $580 billion economy. The Latino population controlled $653 billion in spending power in 2003, and this number is expected to reach more than $1 trillion in 2008, according to the Selig Center for Economic Growth.

In the Commonwealth

According to the Census Bureau report Hispanic-owned businesses in Pennsylvania increased by 47% between 1997 and 2006. The growth rate of the Commonwealth’s Hispanic-owned firms was nine percent higher than the national average and more than ten times the state average for all businesses (4.4%) and is steadily becoming a significant and critical segment of the Commonwealth’s workforce.

In Reading and Berks County

The significant growth of the Latino population in Reading and Berks County is an undeniable trend that will continue into the coming decades. The 2006 Census Bureau estimates indicate that there are 42,204 Hispanics in Reading comprising 51% of the overall population. This represents a 28% Hispanic population growth since 2000. In 2006, there were 417 Latino businesses in Reading, PA. It is estimated today that there are more than 500 Hispanic-owned businesses in the City that may benefit from our services.

The U.S. Census Bureau's American Community Survey states that 31.5% of Reading's 18,829 households are below the poverty level (annual household income of $21,203 for a family of four in 2007). This makes Reading the most impoverished city in Pennsylvania with a population greater than 65,000. According to an article published on August 28, 2008 in the Reading Eagle “the large number of high school dropouts and impoverished Latinos in Reading seem to be two of the main reasons behind Reading having the highest rate of poverty of the seven largest cities in Pennsylvania.” The KU LBRC is ready to mitigate these negative trends by offering entrepreneurial education and business consulting. Historically, it has been noted that entrepreneurship is the answer to economic development and that it has a positive impact in creating jobs and in revitalizing cities.

In Lancaster County

The significant growth of the Latino population in the city and county of Lancaster is an undeniable trend that will continue into the coming decades. The 2005 Census Bureau estimates indicate that there were 44,151 Latinos in Lancaster County which comprised nine percent of the overall population. This represents a 264% increase in population growth since 1980. In 2002, there were 517 Latino businesses in Lancaster County; they had gross receipts of $106.3 million. This was double the gross receipt of the 455 Latino businesses in 1996. The national and local data indicates that there is a strong entrepreneurial spirit among Latinos.

Through analyzing the trends it becomes evident that the growing Hispanic business community in the Commonwealth is being under-served, and that a gap between demand and services offered to the Hispanic community exists. The KU LBRC is committed to bridging that gap and meeting the challenges that have specific bearing on the status of existing Hispanic entrepreneurs in our region.

Leadership Tips on Dealing with Tough Times

Leadership Tips on Dealing with Tough Times
Dan Goldberg Dan Goldberg Consulting, LLC

Effective leaders steer through the waters of commerce, leading their legions by example. The first thing leaders must do is take an inventory of their own strengths and weaknesses. Following those realizations they should then surround themselves with complementing individuals who will add to their strengths and help eliminate their weaknesses.

Leaders who build teams and give them the power to function on their own (within the framework of the organization) will see themselves happily on the road to success.

During tough economic times an organization that is run by a leader who has taken the initiative to add individuals who understand the values, mission, philosophy, and ethics of an entity will find that most of their folks will hunker down and be on board regardless of the situation. That’s the purpose of finding like-valued people. This does not mean that the leader should look for people who believe in the same methods of distribution, marketing techniques, and production systems, etc., because that can lead to stagnation and lack of creativity. What it does mean is that everyone is on board when it comes to the reason that the organization exists and what it strives to do.

One way to mitigate the possibility of having weak value links in the organization’s management chain is to ask open-ended situational questions during interviews. These questions can address the person’s reactions to downturns in the economy and what they might be willing to do for the company.

While most interviews entail situational questions, they rarely pose problems about the possibility of the corporation’s reversal of fortune during low or no economic growth periods. An effective leader can spot people who may have the fortitude to tough it out and/or come up with solutions to stave off deeper problems and perhaps even come up with ideas to turn revenues around.

Leadership is about having the ability to see the entire landscape and recognize who and what is necessary to keep the organization moving forward. Choosing the right people (not just individuals who have the skills to perform, but also the values to perform in the interests of the company) and getting them to do what the leader wants them to do because they want to do it, is a way to ensure that everyone is committed to the company even when times are tough.

Don’t forget that creating an atmosphere that incorporates some levity, especially during downturns, is a good way to relieve stress.

Upcoming Government Marketing Workshops

The KU SBDC is co-sponsoring a number of events with the Harrisburg Regional Chamber and CREDC. Subjects include: Supplier Diversity, Pitching your business, Exporting, Financial Statements and Buying a Business.

The 2009 Harrisburg Regional Chamber and CREDC/EDS Seminar Series returns with a new line-up of workshops starting February 20, 2009 and continuing through May 2009.

Click here to learn more and register for the workshops.